AFRICAN DEVELOPMENT FUND REF. N° : BEN/PAAP/99/02 LANGUAGE : ENGLISH ORIGINAL : FRENCH APPRAISAL REPORT

AGOUA, MONTS KOUFFE AND WARI-MARO FORESTRY MANAGEMENT PROJECT

REPUBLIC OF BENIN

NB: This document contains errata or corrigenda (see Annexes).

COUNTRY DEPARTMENT OCDW WEST REGION SEPTEMBER 1999

TABLE OF CONTENTS Page SUMMARY, CONCLUSIONS, RECOMMENDATIONS AND PROJECT MATRIX........................................................................................ i-vii 1. INTRODUCTION, CONTEXT AND BANK STRATEGY 1.1. Project Genesis and Background........................................................................ 1 1.2. Performance of Similar Projects in the Country ................................................ 1 2. THE RURAL SECTOR 2.1. Main Features..................................................................................................... 2 2.2. Plant, Animal and Fish Production .................................................................... 3 2.3. Land Tenure System and Soil Use ..................................................................... 3 2.4. Constraints of the Rural Sector .......................................................................... 3 2.5. Rural Development Policies............................................................................... 3 2.6. Forestry Potential and Resources ....................................................................... 4 2.7. Constraints of the Forestry Sub-Sector .............................................................. 4 2.8. Forest Resources Policy and Management......................................................... 4 2.9. Associated Institutions and Forestry Administration ......................................... 5 2.10. Legislation and Tax System ............................................................................... 6 2.11. Other Donors in the Forestry Sub-Sector........................................................... 6 3. THE PROJECT AREA 3.1. Location and Physical Setup .............................................................................. 7 3.2. Socio-Economic Framework.............................................................................. 7 4. THE PROJECT 4.1. Design and Formulation ..................................................................................... 8 4.2. Objectives........................................................................................................... 9 4.3. Description of Project Achievements............................................................... 10 4.4. Detailed Description of Project Components................................................... 11 4.5. Assumptions and Risks .................................................................................... 14 4.6. Project Costs..................................................................................................... 14 4.7. Sources of Finance ........................................................................................... 15 4.8. Impact on the Environment .............................................................................. 17 4.9. Impact on Women ............................................................................................ 18 5. PROJECT IMPLEMENTATION 5.1. Implementation Unit ....................................................................................... 18 5.2. Organization and Management ........................................................................ 19 5.3. Manpower, Training and Incentives................................................................. 21 5.4. Procurement of Goods and Services ................................................................ 21 5.5. Implementation Schedule................................................................................. 23

5.6. Monitoring and Evaluation............................................................................... 24 5.7. Recurrent Costs ................................................................................................ 25 5.8. Project Sustainability ....................................................................................... 25 5.9. Impact on Poverty Reduction........................................................................... 25 5.10. Coordination with Other Donors...................................................................... 26 6. TECHNICAL AND ECONOMIC JUSTIFICATIONS 6.1. Technical Justifications .................................................................................... 26 6.2. Project Benefits ................................................................................................ 26 6.3 Economic and Financial Justifications............................................................. 27 7. CONCLUSIONS AND RECOMMENDATIONS 7.1 Conclusions ...................................................................................................... 29 7.2 Recommendations and Loan Conditions.......................................................... 29 ___________________________________________________________________________ This report has been prepared following a mission to Benin from June 3 to 20, 1997 and reviewed in November 1998 by Messrs. E. DOTE, Agro-Economist, OCDW.4, Leader, G. TIBALDESCHI, Agronomist-Environmentalist, OCDW.4 and a Consultant in Forestry Management. Mr. M. SOUISSI, OCDW.2 Economist, contributed to the preparation of this report. Further information may be obtained from Mr. O. AW, Division Manager, OCDW.4 (Ext. 4110). __________________________________________________________________________

AFRICAN DEVELOPMENT FUND 01 BP 1387 ABIDJAN 01

Telephone: (+ 225) 20 44 44 Fax: (+ 225) 20 59 01

PROJECT BRIEF

Date: November 1998 The information given hereunder is intended to provide some guidance to prospective suppliers, contractors and consultants and other persons interested in the procurement of goods and services for projects approved by the Board of Directors of the Bank Group. More detailed information may be obtained from the Executing Agency of the Borrower. 1. COUNTRY : BENIN 2. NAME OF PROJECT : Agoua, Monts Kouffé and Wari-Maro Forestry Management Project 3. LOCATION : Borgou, Colline and Donga Departments 4. BORROWER : Government of the Republic of Benin 5. EXECUTING AGENCY : Project Management Unit created within the

Directorate of Forest and Natural Resources (DFRN) of the Ministry of Rural Development (MDR); B.P. 393 Cotonou (Benin); Tel.: (+ 229) 33 06 62 – 30 04 96; Fax: (+229) 33 21 92 – 30 03 26.

6. PROJECT DESCRIPTION : The project components are as follows: (A) Natural

Resource Management; (B) Accommodating Actions and (C) Project Management.

7. PROCUREMENT OF GOODS AND SERVICES

Procurement of goods and services financed by ADF will be in accordance with the ADF rules, as follows:

i. Competitive Bidding Based on a Shortlist: For the recruitment of technical

assistance and project audit services. Short-term experts will be provided by the technical assistance consulting firm. But the recruitment of the flora-fauna forester, agronomist, trainer, research assistant, and administrator and chief accountant will be by competition based on a short-list limited to national and regional consultants.

Other Procurement Methods

ii. Local Shopping: For materials, vehicles and various equipment (mopeds,

bicycles, canoes and outboard motors); this procurement method has been chosen because of the low values of the contracts (maximum of UA 85,000) and to the fact that competitiveness can be ensured in view of the adequate

number of local suppliers and qualified representatives of foreign suppliers to guarantee competitive prices;

iii. Force Account: For the nurseries, development and plantation works, construction of a small building to house the ecological centre and 15 small warehouses, the development of bottomlands; this procurement method has been chosen in view of the dispersed nature of the works and the fact that the latter cannot be defined or quantified in advance. Furthermore, this procedure makes it possible to guarantee the quality of seeds, seedlings, development, plantation, and construction works necessary to ensure an effective management of the forest;

iv. Direct Procurement: For training and research at the ecological centre. Regarding research and training, this contract will be awarded to NGOs and specialized institutions with the required skills.

v. Goods relating to the credit granted to CLCAM will be procured by commercial practices deemed acceptable by the Bank.

8. TOTAL COST : UA 17.56 million

− Foreign Exchange : UA 12.17 million − Local Currency : UA 5.39 million

9. ADF LOAN : UA 10.54 million 10. OTHER SOURCES OF FINANCE

− ABEDA : UA 5.55 million − Government : UA 1.40 million − Beneficiaries : UA 0.07 million

11. APPROVAL DATE : November 1999 12. PROBABLE START-UP DATE AND PROJECT DURATION : December 1999; 60 months 13. CONSULTANCY SERVICES REQUIRED :

− Technical assistance (CTA, forestry management expert, trainer, environmentalist, short-term experts);

− Accounts and financial audit.

CURRENCIES AND MEASUREMENTS

CFAF: African Financial Community Franc

CURRENCY EQUIVALENTS (November 1998)

UA 1 = CFA 780.113 UA 1 = US $1.40835

UNIT OF MEASURE

Metric System

FINANCIAL YEAR

1st January – 31 December

LIST OF TABLE Table 4.6.2a : Estimated Project Costs by Component Table 4.6.2.b : Expenditure Schedule by Category and Source of Finance Table 4.7.1.a : Expenditure Schedule by Source of Finance Table 4.7.1.b : Sources of Finance by Component Table 4.7.1.c : Expenditure Schedule by Component Table 5.5.1. : Implementation Schedule

LIST OF ANNEXES Description Number of Pages 1. Project Area Map 1 2. Organization Chart of the Project 1 3. Estimated Project Costs 1 4. Rate of Return 1

LIST OF ABBREVIATIONS

ABE : Benin Environmental Agency ABEDA : Arab Bank for Economic Development in Africa ADB : African Development Bank ADF : African Development Fund AGEF : Classified Forest Management Association CARDER : Regional Rural Development Action Centre CENAGREF : National Fauna Reserve Management Centre CENATEL : National Remote Sensing Centre CLCAM : Local Agricultural Mutual Fund CRCAM : Regional Mutual Agricultural Credit Fund CREP : Rural Savings and Loan Fund CRSP : Regional Project Monitoring Committee DANIDA : Danish International Development Agency DFRN : Directorate for Forests and Natural Resources DPP : Directorate for Programming and Planning EU : European Union FAO : Food and Agriculture Organization FDV : Village Development Fund FECECAM : Federation of Mutual Agricultural Savings and Credit Funds GDP : Gross Domestic Product GIS : Geographic Information System IBRD : International Bank for Reconstruction and Development (World Bank) INRAB : National Institute of Agronomic Research of Benin LPDR : Rural Development Policy Paper MDR : Ministry of Rural Development NGO : Non-Governmental Organization ONAB : National Wood Agency PAE : Environmental Action Programme PBF : South Benin Fuelwood Plantation Project PGRN : Natural Resource Management Project UA : Unit of Account UNDP : United Nations Development Programme

SUMMARY, CONCLUSIONS AND RECOMMENDATIONS 1. BORROWER : Government of Benin 2. EXECUTING AGENCY : Project Management Unit created at the

Directorate of Forest and Natural Resources (DFRN) of the Ministry of Rural Development (MDR).

3. LOAN

a) Amount : UA 10.54 million b) Terms :

− Duration : Fifty (50) years including a ten (10) year

grace period; − Service Commission : 0.75% yearly on the disbursed but non-

reimbursed amounts; − Commitment Charge : 0.50% on the undisbursed amount starting

one hundred and twenty (120) days following loan signature;

− Repayment : The principal will be repaid yearly at an annual rate of one percent (1%) from the 11th to the 20th year; and three percent (3%) subsequently.

4. PURPOSE : The loan will cover 65% of the foreign

exchange and 47% of the local currency costs, representing 60% of the total project costs excluding taxes and customs duties.

5. THE PROJECT

a. Sectoral Objective: The sectoral objective aims at the conservation and sustainable management of the country’s natural ecosystems; in particular, the conservation of the forestry ecosystem potential and the biodiversity at least in its present state.

b. Project Objective: The chief objective of the project is to undertake the integrated management of the Agoua, Monts Kouffé and Wari-Maro (370,000 ha) forests, by implementing management plans based on the sustainable management of ecosystems and with the participation of the local communities.

c. Project Description: The project will undertake major activities in natural resource management (fauna management), rural development activities (fish farming, bottomlands development, etc.), support to development efforts and accommodating activities (sensitization, self-managed group micro-credit, ecological centre, etc.), indispensable infrastructure (feeder roads and tracks, housing units, miscellaneous buildings, boreholes, etc.), vehicles, miscellaneous materials and equipment.

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The main components of the project are: (A) Natural Resource Management; (B) Accommodating Actions and (C) Project Management.

6. PROJECT COSTS The cost of the project, exclusive of taxes and customs duties and including 5%

physical contingency (excluding personnel) and 4% price escalation, is estimated at UA 17.56 million, representing CFAF 13.702 million. A breakdown of foreign exchange and local currency costs is presented in the table hereafter:

Estimated Project Costs by Component

(in CFA F and UA million) Component CFAF Million UA Million

L.C. F.E. Total L.C. F.E. Total Natural Resource Management 2 655.07 6 971.20 9 626.27 3.40 8.94 12.34Accommodating Actions 407.41 965.94 1 373.35 0.52 1.24 1.76Project Management 595.90 353.10 949.00 0.76 0.45 1.21Base Cost 3 658.38 8 290.24 11 948.62 4.68 10.63 15.31Contingencies (5%) 126.70 302.22 428.92 0.16 0.39 0.55Base Cost + Contingencies 3 785.08 8 592.46 12 377.55 4.84 11.02 15.86Price Escalation (4%) 420.55 903.90 1 324.44 0.54 1.16 1.70

Total 4 205.63 9 496.36 13 701.99 5.38 12.18 17.56

7. SOURCES OF FINANCE The project will be co-financed by the Government of Benin, the beneficiaries, ABEDA and ADF according to the details indicated in the table below.

Sources of Finance

(in CFA F and UA million) SOURCE CFAF Million UA Million %

L.C. F.E. Total L.C. F.E. Total ADF 2 238.92 6 136.60 8 375.52 2.67 7.87 10.54 60.02ABEDA 969.89 3 359.60 4 329.49 1.24 4.31 5.55 31.6Government 943.99 0.00 943.99 1.40 0.00 1.40 7.98Beneficiaries 52.99 0.00 52.99 0.07 0.00 0.07 0.4

Total 4 205.80 9 496.19 13 701.99 5.38 12.18 17.56 100.0

8. PROJECT IMPLEMENTATION The implementation period will be 60 months. 9. EXPENDITURE SCHEDULE The tables below give a summary of the project expenditure schedule:

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Expenditure Schedule by Component (UA million)

Component Year 1 Year 2 Year 3 Year 4 Year 5 Total % A. Natural Resource Management 5.05 2.08 2.46 2.56 1.97 14.12 80.5B. Accommodating Actions 0.38 0.66 0.56 0.33 0.10 2.03 11.6C. Project Management 0.26 0.27 0.29 0.29 0.30 1.41 7.9

Total 5.69 3.01 3.31 3.18 2.37 17.56 100.0

Expenditure Schedule by Source of Finance

(UA million) SOURCE Year 1 Year 2 Year 3 Year 4 Year 5 Total

ADF 1.73 2.01 2.41 2.31 2.08 10.54ABEDA 3.24 0.80 0.71 0.77 0.03 5.55Government 0.72 0.18 0.17 0.08 0.25 1.40Beneficiaries 0.00 0.02 0.02 0.02 0.01 0.07

Total 5.69 3.01 3.31 3.18 2.37 17.56

Expenditure by Category and Source of Finance

(UA million) CATEGORY ADF L.C. F.E. Total

ABEDA GOVT. BENEF. TOTAL %

1 SERVICES 1.48 3.78 5.26 0.33 0.38 5.97 34.00 Personnel 1.33 0.09 1.42 0.23 1.65 9.40 Training 0.18 0.18 0.33 0.14 0.65 3.70 Technical Assistance 2.74 2.74 2.74 15.60 Credit 0.14 0.14 0.14 0.80 Accommodating Research 0.09 0.25 0.34 0.34 1.94 Auditing 0.15 0.15 0.01 0.16 0.91 National Experts 0.06 0.23 0.29 0.29 1.65

2 GOODS 0.24 2.24 2.48 2.35 0.72 0.01 5.56 31.66 Materials 0.00 0.01 0.01 0.30 0.00 0.31 1.77 Vehicles 0.01 0.09 0.10 1.18 0.22 1.50 8.54 Equipment 0.00 0.32 0.32 0.40 0.27 0.00 0.99 5.64 Sundry Goods (photoint., cartogr.) 0.26 0.03 0.29 1.65 Operating Cost (inputs) 0.23 1.82 2.05 0.21 0.20 0.00 2.47 14.06

3 WORKS 0.95 1.85 2.80 2.87 0.30 0.06 6.03 34.34 Buildings 0.01 0.20 0.21 0.82 0.15 0.01 1.19 6.78 Feeder Roads and Pathways 1.80 1.80 10.25 Miscellaneous Constructions 0.02 0.18 0.20 0.25 0.09 0.05 0.59 3.36 Nursery 0.09 0.22 0.31 0.02 0.00 0.33 1.88 Plantations 0.83 1.25 2.08 0.04 2.12 12.07

Total 2.67 7.87 10.54 5.55 1.40 0.07 17.56 100.00

10. PROCUREMENT OF GOODS AND WORKS

Any procurement of goods, works and services financed by the Bank will be in accordance with the Bank’s rules of procedure for the procurement of goods and services or, where applicable, to the Bank’s rules of procedure for the use of consultants based on appropriate Bank tender documents.

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11. CONCLUSIONS AND RECOMMENDATIONS Conclusions The proposed Agoua, Monts Kouffé and Wari-Maro Forestry Management Project (PAMF) responds to several technical needs. It falls within Benin’s current rural and environmental policy. The sectoral goal pursued (conservation of natural resources through forest management and the fauna and the sustainable management of ecosystems and biodiversity) falls in line with the country’s overall economic and social development goals. The implementation of the project together with the participation of local communities will help ensure the conservation and sustainable exploitation of natural resources without disregarding the needs of the communities involved. Recommendations and Loan Conditions It is recommended that a loan not exceeding UA 10.54 million be granted to the Government of the Republic of Benin for the implementation of the project as described in the report subject to the following particular conditions: A. Conditions precedent to entering into force of the Loan Agreement:

Before entering into force of the Loan, the Borrower shall:

i provide ADF with proof that the loan agreement with ABEDA has been signed

or that the latter has committed itself in writing to providing its share of financing for the project in accordance with the financing plan;

ii show proof to the ADF of the creation of the Project Management Unit at the Directorate for Forestry and Natural Resources (DFRN);

iii show proof to the ADF of the appointment of the Project Manager with proven experience in forestry agronomy (natural resource management), with a view also to consolidating the achievements of the fuelwood project. The curriculum vitae of the said Manager should have received the prior approval of the ADF;

iv show proof to the ADF of the transfer to the project of part of the agro-forestry equipment, machinery and items procured for the South Benin Fuelwood Plantation Project, particularly: 2 bulldozers (D7 and D4), 1 grader, 1 loader, 1 compactor, 1 tipper truck, 1 generator (60 KVA), 1 tracing table, 1 digitalizing table, 7 GPSs, miscellaneous forestry inventory equipment and the main office in Cotonou.

B. Other Conditions

The Borrower shall also:

i submit to the ADF not later than 12 months following entry into force of the loan agreement, the Simple Management Plan outlining the basic principles for managing the three forests mentioned above.

AFRICAN DEVELOPMENT FUND

PROJECT MATRIX Country: BENIN Title: Agoua, Monts Kouffé and Wari-Maro Forestry Management Project Date of Summary: November 1998 Design Team: Messieurs E. DOTE and G. TIBALDESCHI in collaboration with the Directorate of the South Benin Fuelwood Plantation Project (PBF)

HIERARCHY OF OBJECTIVES OBJECTIVELY VERIFIABLE INDICATORS MEANS OF VERIFICATION MAJOR ASSUMPTIONS

SECTORAL OBJECTIVE 1. To conserve the natural ecosystems of Benin in particular

forestry ecosystem and biodiversity.

1.1. Forest ecosystem maintains at least its current potential. 1.2. Biodiversity remains at least in present state.

1. Project reports and inventories.

1.1. Political stability. 1.2. Financing available. 1.3. Monitoring of human migratory flows. 1.4. Vagaries of the weather in the Northern part of the country.

PROJECT OBJECTIVES 1. Undertake the integrated and sustainable management of

the classified forests of Agoua, Monts Kouffé and Wari-Maro and provide incomes to the local communities through related economic activities.

1.1. 79,000 persons participate in the application of measures

embodied in the management plans. 1.2. 79,000 persons apply measures stipulated in working plans. 1.3. The 5 main economic activities (forestry, agriculture, fishing,

hunting and apiculture) are stabilized. 1.4. New management structures created (associations, groupings,

committees, etc.). 1.6. Training programme in the 5 major economic activities

conducted. 1.7. Marketable outputs increased by 40%.

1. Management plans, project completion

report and ADF report. 2. Management report. 3. ADF supervision reports. 4. Economic statistics. 5. Training reports.

1. Compliance with environmental regulations. 2. Communities have understood the measures and are ready

to apply them. 3. Natural resources (soil, water, fauna, flora, etc.) are

rationally used. 4.1. Communities willing. 4.2. Candidates for training available and motivated. 5. Credit and inputs available.

ACHIEVEMENTS

1. Working plan. 1. Three (3) working plans executed on 370,000 ha in the forest.

1. Management records. 1.1. The project receives required technical resources. 1.2. Pace of works is maintained. 1.3. Intervention areas are accessible. 1.4. Administration and communities adhere to development plans.

2. Forest core. 2.1. One area (56,000 ha) completely brought under control. 2.2. 50 hunting brotherhoods organized/revitalized. 2.3. Partial control achieved with hunting of 5% of game in the first 2

years and 10% from year 5.

1. Management and ADF supervision reports. 2. Hunting permits. 3. Instruments governing brotherhoods.

2.1. Regulations established are complied with (hunters take estimated quantities).

2.2. Sites are accessible. 2.3. Hunters are available.

3. Natural forest. 3. 28,000 ha enriched with productive forest (timber). The number of trees per species and total volume increased.

3. Comparison of forestry inventories. 3. Forestry inventories conducted are accurate.

4. Artificial forest. 4.1. 1,000 ha of reforestation (timber). 80% of acreage planted successful. 4.2. 25 village nurseries and 10 State nurseries are established. 4.3. 500 ha planted through agro-forestry system.

4. Management and ADF supervision reports. 4. Seeds are available and bush fires under control.

5. Forest ecosystems and stabilized biodiversity. 5. Evaluation and monitoring of fauna and flora. 5. Management reports.

6. Increase in game stock. 6. The stock of wild hoofed animals has increased by 300%. 6. Inventories and management reports. 6. The 2-year control period is observed.

7. Increase in honey production. 7.1. 5,000 beehives have been established. 7.2. 15 kg of honey per beehive/year are produced, that is a total of 75

tonnes.

7. Management and ADF supervision reports. 7. Forestry management and biodiversity are observed.

8. Increase in fish farm output. 8.1. 15 400 m² fish farms constructed. 8.2. 12 tonnes of fish produced.

8. Management and ADF supervision reports. 8. Fry are available.

9. Developed eco-tourism. 9.1. Inventory of tourist sites established.

9.2. Five bungalows constructed. 9.3. Five observation posts established. 9.4. Five km of paths constructed.

9. Management reports. 9. Effective presence of tourists and visitors.

10. Increase in agricultural output. 10.1. 60 ha of cassava planted. 10.2. 80 ha of bottomland developed (rice fields and vegetable gardens). 10.3. 600 ha of cashew trees rehabilitated. 10.4. At least 1,300 pilot farmers have received support in improving

rural development methods.

10. Management and ADF supervision reports. 10.1. Farmers adhere to programme and are willing to participate in achieving this.

10.2. Methods can be mastered easily.

11. Increase in zoo-technical production (livestock). 11.1. 3 Fulani committees have been established and are operating. 11.2. 3 vaccination parks have been constructed. 11.3. 3 veterinary input depots have been constructed. 11.4. 30 apprentice livestock breeders have received initial equipment.

11. Management and ADF supervision reports. 11.1. Members of committees and apprentices are available and motivated.

11.2. Veterinary products are available.

12. Productive nurseries. 12. 50 village nurseries have been established and are in production. 12. Management and ADF supervision reports. 12. Seeds and inputs are available.

13. Functional women’s activities. 13.1. 500 women have received specific training in economic activities. 13.2. 15 warehouses and depots have been constructed for women’s

activities. 13.3. 30 women’s groupings have contributed to the purchasing of basic

implements and have received financing for purchasing products. 13.4. The 50 villages in the project area have developed productive,

processing and marketing activities for women.

13. Management and ADF supervision reports. 13.1. Women trainees are available. 13.2. Credit is available and accessible. 13.3. Methods can be mastered.

14. Trained and sensitized staff and target communities. 14.1. 100 persons have participated in inter-village exchanges. 14.2. 50 target villages have been formed and sensitized in specific

economic areas. 14.3. 25 workers have received training for each specific activity. 14.4. 20 middle-level workers have received further training. 14.5. 13 executives have received advanced-level training. 14.6. 10 executives have participated in international symposia. 14.7. Project management, field team and communities have received

various training in environmental issues. 14.8. 228 persons have been trained; all the communities concerned

have been sensitized.

14.1 Management and ADF supervision reports. 14.2 Training reports.

14.1. Sessions are organized at the right time. 14.2. Candidates are motivated and competent.

15. Functional credit. 15.1. Logging cooperatives have received credits for forestry exploitation. 15.2. 26 candidates for draught farming have been trained and encouraged. 15.3. 53 women have received credits for the cassava sub-sector and 60

for food crop farming. 15.4. 3 Fulani committees and 30 livestock breeders have received

livestock credit. 15.5. 220 bee keepers have received credit for the purchase of 5,000

honey hives, smoking apparatus, hoists and centrifugal machines. 15.6. 50 fishermen have received credits for fish farming. 15.7. 30 credit associations or groupings have been created. 15.8. 548 credits have been granted.

15.1 Management and ADF supervision reports. 15.2 Documents on the establishment of

groupings.

15.1. Credit is available and accessible. 15.2. The contribution by beneficiaries is real. 15.3. Candidates are motivated. 15.4. Credit agencies are in place.

16. Amenities provided. 16.1. 1,000 km of 1st class feeder roads, 171 km of 2nd class feeder

roads have been constructed. 16.2. 160 culverts and 13 culvert-type structures have been constructed. 16.3. 5 km of forest pathways have been constructed. 16.4. 9 130 m² offices/housing (forest posts), 4 160 m² administrative

buildings, 1 40 m² conference room, 4 housing units, 4 100 m² guest houses and 3 30 m² guest huts have been built.

16.5. 1 160 m² ecological centre has been constructed in Agbassa. 16.6. 6 dispensaries, 12 schools, 5 towers and 5 observation posts, 30

storerooms for local economic operators, 3 veterinary input depots and 4 honey houses have been constructed.

16.7 2 boreholes with water tower in Agbassa and Wari-Maro and 15 boreholes fitted with manual pumps have been built.

16.8 5 ponds and micro-dams have been constructed.

16.1 Management and ADF supervision reports. 16.2 Works reports. 16.3 Infrastructure acceptance reports.

16.1. The various contracts are signed on schedule. 16.2. Enterprises and workers are effective.

17. To promote research (Ecological Centre). 17.1. Various inventories (flora, fauna, etc.).

17.1. Inventory reports, management and ADF supervision reports.

17.1. Ecological Centre is constructed. 17.2. Personnel is available.

18. Project management. 18.1. National staff recruited. 18.2. National experts recruited. 18.3. Technical assistance recruited. 18.4. Operating expenses estimated. 18.5. Accounts audited.

18.1. Contracts and reports. 18.1. Adequate skills available. 18.2. Monitoring-evaluation study.

KEY ACTIVITIES 1. Natural resource management.

RESOURCES 1.1. ADF : UA 8.81 million 1.2. ABEDA : UA 4.72 million 1.3. Government : UA 0.53 million 1.4. Beneficiaries : UA 0.07 million

1.1. ADF/Govt. Loan agreement. 1.2. ABEDA/Govt. Loan agreement.

1.1. Loan agreement signed on schedule. 2.2. Loan agreement signed on schedule. 3.2. Beneficiaries participate effectively.

2. Accommodating actions. 2.1. ADF : UA 0.78 million 2.2. ABEDA : UA 0.83 million 2.3. Government : UA 0.44 million

3. Project management. 3.1. ADF : UA 0.95 million 3.2. Government : UA 0.64 million

1. INTRODUCTION, CONTEXT AND BANK STRATEGY 1.1. Project Genesis and Background 1.1.1. Aware of the rich forestry resources held by the Agoua, Monts Kouffé and Wari-Maro Forests located in the North-Central part of the country, the Government of Benin has always been keen to conserve and ensure the sustainable management of these forest stands. Indeed, a number of preliminary studies have been commissioned by the Government and financed by several donors namely UNDP, FAO, the German Development Service (GDS) and the Embassy of the Netherlands. 1.1.2. Regarding the 46 classified forest stands with a total area of 1,303,043 hectares, no concrete action was taken, until recently, for their protection, development and management. They have been subjected to a high anthropic and animal pressure resulting in an alarming rate of reduction in acreage. Despite this deplorable situation, these forests still possess considerable potential in ecological and economic terms. An assessment study of the sub-sector has revealed the need to envisage protection, conservation and exploitation of this wealth differently. Indeed, firstly, the reorganization of the Forestry Department, coupled with the effective empowerment of the local communities has become unavoidable in order to ensure a sustainable management of these forestry resources and, secondly, the need for urgent action has become a priority for the protection and conservation of these relics, hence the need for the urgent action by the ADF for these three forests. 1.1.3. Since 1992, the Government of Benin has embarked, with the assistance of the IRBD, ADF, GTZ and UNDP, on a Natural Resource Management Project (PGRN), focusing on the involvement of private initiative and comprising a Forestry Management Component (VAF) to test the global and participatory management methods with the village communities with a view to guaranteeing the sustainable use of the resources of classified forests on the Dogo-Kétou, Upper Ouémé, Tchaourou and Toui-Kilibo pilot projects. 1.1.4. In 1993, the Government sought the assistance of the African Development Fund (ADF) for a feasibility study leading to the management of the three forest stands of Agoua, Monts Kouffé and Wari-Maro. Thus, in 1995 the Embassy of the Netherlands in Benin which had expressed an interest in the study participated in the fuelwood project by sending a project pre-formulation mission to the area. Following the findings of the said mission, the ADF financed a feasibility study. It was on this basis that the appraisal mission was carried out in Benin in June 1997 and later in November 1998 resulting in the preparation of this appraisal report. Regarding co-financing, a joint ABEDA/ADF mission was conducted in Benin in March 1999 in order to establish the financing plan adopted in the report. 1.2. Performance of Similar Projects in the Country 1.2.1. The Bank has participated in various experiences in plant cover restoration through various agricultural projects which it has implemented in the sector since the 1980s. The Bank’s operations in the sector have entailed projects on integrated rural development, livestock rearing and reforestation. 1.2.2. However, it has acquired considerable experience in the area of reforestation and conservation of natural resources in Benin. Indeed, in 1992, the Bank initiated its first reforestation project by co-financing, with OPEC, an operation (South Benin Fuelwood Plantation Project), in the Southern part of the country (Atlantique, Mono and Ouémé Departments). Subsequently, it extended the experience to the Zou Department.

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Achievements as at 31 October 1998 comprised 9,801 hectares of plantations made up of 5,374 hectares of State-managed plantations in specific classified forests of South Benin and 4,427 hectares of privately-owned rural plantations which are provided with seedlings and technical supervision. 1.2.3. The project achievements exceed by far the initial objective of 5,900 hectares. This is also true of the other achievements in the area of service infrastructure and social amenities: housing, offices, shops, dispensaries, schools, access and service feeder roads, set up for the benefit of local communities participating in the project. Overall, it can be stated that this project has been effective at all levels: economic, financial, technical and environmental. At the economic level, (private) rural plantations contribute significantly to meeting the fuelwood and construction wood needs even though in financial terms these plantations have not as yet ensured a significant reduction in the price of wood. At the technical level, the project has made it possible to improve knowledge in the creation and management of nurseries, plantations and the sale of forestry products. Furthermore, the project has contributed considerably to soil conservation, erosion control, restoration of microclimates and the maintenance or increase in soil fertility. 1.2.4. Concerning integrated rural development and livestock projects, the Bank has financed four operations two of which have been completed. The Mono and Ouémé rural development projects have helped establish an effective extension service and promoted a shift towards more profitable crops made possible by the high yield seeds resulting from agronomical research. These projects have also contributed to enhancing social amenities and service infrastructure, institutional capacity-building through support to CARDERs and the establishment of credit funds in all the ADF intervention areas. With regard to livestock, a second phase of the Livestock II Project was needed to obtain tangible results to sustain livestock rearing. The current third phase of the project will help attain all the objectives fixed for livestock development. 1.2.5. To sum up, the achievement of the Bank Group operations in the Benin rural sector is characterized by relative success despite obstacles related to fulfilling conditions precedent to loans, administrative bottlenecks, cumbersome procurement procedures, manpower mobility and the suspension of disbursement over a period of about 18 months, resulting in additional delays in project implementation. 2. RURAL SECTOR 2.1. Main Features 2.1.1. In Benin, the rural sector accounts for 40% of the GDP and 60% of export earnings. Out of a total population of about 5 million inhabitants (1992 survey), the agricultural population amounts to 3.2 million of which over 51% are women. 2.1.2. Agriculture is dominated by small holdings. Indeed, the average size of a farm is about 1.7 hectares for an average family of seven members. Income from agriculture is still very low (US$100 to US$300 per year and by rural household). However, thanks to cotton and the use of draught farming, this can attain relatively high levels, particularly in the Northern region. Water resources are considerable but poorly used. Irrigated farming can be assessed at about 10,000 hectares of bottomlands and developed valleys for rice cultivation, market gardening, fruit cultivation, oil palm and sugar cane. The mixed results obtained for major schemes in the past compelled the Government to give priority to reduced schemes, particularly bottomlands.

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2.2. Plant, Animal and Fish Production The main food crops of Benin are: maize (380,000 to 480,000 ha/year), sorghum (133,000 ha), cassava (113,000 ha), yam (88,000 ha), cow peas (86,000 ha) and groundnuts (100,000 ha); millet and cow peas are also widely cultivated. Cotton currently represents the main industrial crop and is the leading agricultural export. Oil palm, coffee and tobacco are encountering market-related difficulties. Benin has about one million heads of cattle of which 85% are found in the Borgou and Atacora Departments, nearly 2,000,000 small ruminants, 400,000 pigs and 10,000,000 poultry. Seafish output is presently estimated at 10,000 tonnes, while inland fishing yields 30,000 tonnes a year. Overall, fish production still falls below demand. 2.3. Land Tenure System and Soil Use According to the present law, land belongs to the State. Land can be acquired through village chiefs who exercise traditional rights. Land ownership problems are particularly serious, especially in the Southern part of the country where fallow lands are becoming increasingly scarce. But, in the forest areas generally, access to land continues to be free for most natives. However, there is an increased use of fallow lands due essentially to the growing demographic pressure (internal growth and migrants) and to the fact that no regulation exists on the rational use of land for agricultural purposes. 2.4. Constraints of the Rural Sector The rural sector is faced with many constraints which have an overall negative impact on the growth of the sector. Indeed, these main constraints are the following: inappropriate policies and strategies; lack of organization of development institutions; inadequate communication, processing and storage facilities and insufficient technical and technological resources capable of improving the level of production; lastly, the degradation of the environment (deforestation, silting of lakes, erosion of hillsides, etc.) coupled with vagaries of the weather, constitute serious threats to some rural activities (fishing, agriculture, etc.). 2.5. Rural Development Policies 2.5.1. The priorities of rural development policies are: (i) redefining the role of the State, improving the effectiveness and reducing the cost of its intervention; (ii) improving services and infrastructure to which the rural populations have access; (iii) increasing export revenue by raising output and diversifying production; (iv) ensuring food security and (v) guaranteeing the sustainability of the national ecological heritage. 2.5.2. The basic thrusts of the rural strategy can be summarized as follows: (i) strengthening the administrative capacity to manage the so-called exclusive missions of the public sector; (ii) introduction or development of the private sector in the production, processing and marketing of agricultural produce as well as in the services provided to the sector; (iii) improving productivity in all areas of rural life and enhancing the competitiveness of produce on the domestic and external markets; (iv) development of rural infrastructure and services to ensure their sustainable functioning; (v) encouraging initiative and organizing producers in all areas of rural development; (vi) introduction of policies and methods of natural resource management to reconcile the short-term interest of producers and the long-term concerns of the communities.

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Forestry Sub-Sector 2.6. Forestry Potential and Resources Forest Stands 2.6.1. Forest stands are classified into three categories, namely: (i) natural forests, (ii) semi-natural forests and (iii) artificial forests which are in fact reforestated areas. Similarly, a distinction can be made between State-owned and private forests. Forests belonging to the State are either classified forests or protected forests. It is worth noting that the various forest stands cover about 97,000 km², that is 86% of the national territory. Classified Lands 2.6.2. Classified lands which comprise classified forests, national parks, cynegetic areas and reforestated schemes cover about 2.7 million hectares. They are subjected to a restrictive system of use by individuals or groups. Protected forests comprise all the other State-owned forests which have not been classified. Classified State forests cover nearly 24% of the country 90% of which are in the two least populated departments of the Northern part of the country. Protected areas, which include national parks and cynegetic areas cover an area of 13,576 km² divided into two national parks (Pendjari and W) and three cynegetic areas. Forest Exploitation 2.6.3. Forest exploitation is not significant in Benin. Wood production, notably timber, comes from a 6,500 hectare old teak plantation designed to produce 30,000 m² per year. Other timber comes from the three forest stands of Agoua, Monts Kouffé and Wari-Maro amounting to about 10,000 m² per year (lumber). 2.7. Constraints of the Forestry Sub-Sector Constraints which limit the development of the forestry sub-sector are many, but they essentially relate to: (i) unsuitable institutional framework for the development of the sub-sector; (ii) a lack of a development master plan for the regions and forest management plans; (iii) lack of planning and organization, insufficient human resources (number and quality) and inadequate resources and (iv) lack of consultation and involvement of communities in the management of natural resources. 2.8. Forest Resource Policy and Management Forestry Policy 2.8.1. As far back as July 1993, Benin formulated a forestry policy accompanied by priority action plans. The objective of this policy is to conserve and rationally manage forestry resources with a view to guaranteeing their sustainability while ensuring a sustained production of services and goods for the benefit of the population. 2.8.2. The main thrusts and priorities of the forestry policy are summarized as follows:

i. promotion of the adherence of communities to the management of forestry resources and the development of grassroots communities;

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ii. rational management of forestry resources in order to guarantee the sustainability of forestry estates;

iii. conservation of forestry estates and protection of fauna resources; iv. strengthening of the institutional framework and reorganization of the Forestry

Department. Forestry Resource Management 2.8.3. The management of classified forests has always been the responsibility of the Forestry Administration. It limited in fact to the surveillance, regulation and control of the exploitation of woody resources. Furthermore, the National Wood Agency (ONAB) is responsible for the exploitation of teak plantations. The role of the Forestry Department is limited to the a posterori monitoring of products from the forest and collection of forestry levies. 2.8.4. Logging is carried out on the basis of the payment of taxes and fees by authorized loggers with concession rights. These taxes and levies are fixed according to the unit volume “declared” and vary according to species and products obtained (timber, construction wood, fuelwood, charcoal and oil palm). Fauna 2.8.5. Game resources are not adequately known. Hunting activities provide a significant portion of meat consumed, both in the urban and rural areas. The organization of hunting and the strengthening of the Forestry Administration in terms of manpower and equipment would help restore fauna resources and limit the damage caused by traditional hunting practices entailing the use of fire. The setting up of the National Park Development Project to rehabilitate the Penjari Park has helped restore the fauna population of this park. 2.9. Associated Institutions and Forestry Administration 2.9.1. The Ministry of Rural Development (MDR) is the public institution responsible for the rural sector. Its mission is to create favourable conditions for the rural development of the country and improve the living standard of rural populations by formulating and implementing adequate policies and enhancing technical progress in the rural areas as well as facilitating the exploitation of natural resources at levels compatible with national needs and by ensuring the maintenance of ecological balances. 2.9.2. In the forestry sub-sector, the MDR operates through the Directorate for Forests and Natural Resources (DFRN). Its functions are as follows: (i) inventory of natural resources and evaluation of their potential; (ii) conditions for their exploitation and monitoring; (iii) management of State-owned plantations; (iv) contribution to promoting initiatives for the protection and regeneration of natural resources. 2.9.3. Other institutions also operate in the sub-sector, namely: (i) the National Remote Sensing Centre (CENATEL), (ii) the National Wood Agency (ONAB), (iii) the National Fauna Reserve Management Centre (CENAGREF), (iv) the Environmental Agency of Benin (ABE) whose mission is to ensure the establishment and monitoring of the “Environmental Monitoring and Information System” (SISE), (v) rural sector finance institutions (Local Mutual Agricultural Credit Funds (CLCAM) – Regional Mutual Agricultural Credit Funds (CRCAM) functioning under the wing of a Federation of Savings and Mutual Agricultural Credit Funds (FECECAM), Rural Savings and Loan Banks (CREP) and Commercial Banks.

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Major farmer organizations are expected to play an increasingly dominant role in rural development policy. Lastly, Non-Governmental Organizations (NGO) participate in the promotion of village associations and rural community development. 2.10. Legislation and Tax System related to the Forestry Sub-Sector 2.10.1. In a bid to formulate the joint-management of forests with local communities, the decree of 2 July 1996 stipulates under Article 44 that: “The implementation of management plans in classified forests may be carried out with local communities under a forestry management contract signed between them and the Forestry Administration”. The law therefore makes provision for the participation of local communities in the management of forests and it is in this context that the present project will be implemented. 2.10.2. From the point of view of the tax system, the Government levies various taxes through its specialized structures. These include annual licence for logging/marketing of forestry products, logging concessions and various taxes on the transportation of products (taxes on fuelwood, steres and charcoal, etc.) or on hunting. Revenues are collected by the Forestry Administration, but owing to lack of resources, the Administration cannot recover all the fees and levies which the Government could otherwise raise. 2.11. Other Donors in the Forestry Sub-Sector 2.11.1. The Forestry Sub-Sector of Benin currently receives assistance from a number of external donors. The Dutch Cooperation, operating in the country, has projected actions in two specific areas: (i) national parks programme (W Park), with the execution of two master plans for parks and (ii) programme for the management of forests and land use (Alibori, Ouémé-Benou and Trois Rivières classified forests) together with the financing of the implementation of development plans for Goungoun and Sota classified forests as well as the Gorobi borassus palm plantation. 2.11.2. The French Development Agency (AFD) and the GTZ envisage, as a follow-up to PGRN, the financing of a new project limited to catchment areas, and the management of rural land and natural resources (PGTRN) in the PGRN area, including the formulation of a rural land property scheme. The evaluation of the said project is planned to take place before June 1999. 2.11.3. The World Bank plans to pursue the forestry management component of the PGRN and include other forests such as the Atchérigbé, Dassa-Zoumé, Kouandé, Logozohé, Mékrou, Ouémé-Boukou and Savalou classified forests. The feasibility report is in preparation and the PGRN project has been extended to June 1999. 2.11.4. The Japanese Cooperation Agency is conducting studies and collecting data on the three forest stands with a view to formulating development plans together with the National Remote Sensing Centre (CENATEL). 2.11.5. DANIDA does not operate in the forest sector, although it pursues many activities in the agricultural sector (micro-credit, food security, income-generating activities) whereas the European Union is involved in the sub-regional management of the W Park. 2.11.6. The PAMF Project fits perfectly into all the actions and will serve to boost the PGRN experience.

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3. PROJECT AREA 3.1. Location and Physical Setup The project area consists of the three forest reserves of Agoua, Monts Kouffé and Wari-Maro, situated at about 350 km from the city of Cotonou, in the Central-Western part of Benin at the intersection of the Atacora, Borgou and Zou Departments (Annex I). The climate of the Monts Kouffé region is the Sudano-Guinean type with a rainy season from April to September and a dry season from October to March. The rainfall pattern varies from 1000 to 1200 mm rising to 1400 mm in the forest ecosystems. Five types of vegetation are found in the region: (i) dry closed forest; (ii) moist closed forest and semi-deciduous closed forest; (iii) gallery riparian forest, along watercourses; (iv) riparian forest represented by a narrow strip of vegetation a few meters wide along rivers and streams; (v) tree savannah which constitutes the commonest vegetation. 3.2. Socio-Economic Framework Population and Land Use 3.2.1. The project area has about 79,000 inhabitants. Geographic densities vary according to localities, but still remain low (15 to 20 inhabitants/km²). The ratio between useful farm space and the total population yields an agricultural density of 30 to 34 inhabitants/km². 3.2.2. The Agoua Forest is by far the most degraded through farming. On the other hand, the Monts Kouffé and Wari-Maro Forests are relatively unaffected by such problems of land use. The main economic sectors of the project area are agriculture, forestry exploitation, hunting, honey harvesting, livestock rearing and fishing. Communication Routes 3.2.3. The road network is represented by unpaved feeder roads. This network is hardly passable during the rainy season (May-October). The main routes are Bassila-Banté, Bassila-Bétérou via Wari-Maro, Banté-Savalou and Bétérou-Tchaourou. Health and Nutrition 3.2.4. The basic units of the health system are the Community Health Centre (CCS) and the Sub-Prefecture Health Centre (CSSP). These centres are able to provide primary care. They are operational in two of the three departments of the project area (Atacora and Zou), whereas in Borgou they are being rehabilitated. For more severe cases, there are Departmental Hospital Centres (CHD) located in the departmental capitals (Abomey, Natitingou and Parakou). It is worth noting that all the main cities near the project area have pharmacies. Agriculture and Livestock 3.2.5. In the project area, agriculture dominates the other economic activities, since over 80% of the population are involved in it. Agriculture is of the traditional type, that is, hardly mechanized and using shifting cultivation based on burning of bushes. Farmer organizations are very few thus limiting access to credit. Technical supervision is also weak in relation to the acreage needing it. The apparent availability of land contrasts with the numerous demands for the declassification of forests arising from the reduction in soil fertility caused by their disorderly use.

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3.2.6. Regarding livestock rearing, four types can be distinguished in the project area: (i) rearing of small domestic animals (poultry and small ruminants); (ii) sedentary cattle rearing with herds belonging to farmers, traders or public servants, driven by the Fulanis and (iii) transhuman cattle rearing driven by national and foreign herdsmen. Apiculture 3.2.7. Currently, some farmers or hunters harvest honey from wild bee colonies through traditional methods which are ineffective and destructive. They thus obtain poor quality honey, which is sold to average consumers at low prices (CFA F 300-500 per kilo). In recent years, there has been a scarcity of wild bee colonies on the outskirts compelling honey harvesters to go into deeper forests. Fish Farming 3.2.8. In the project area, fishing is conducted with basket type traps, fishing lines and occasionally unselective fishing gear (during floods mainly). Professional fishermen use large mesh-size nets, trawl lines and cast nets. The development of fisheries has been hampered by the following difficulties: (i) ecological problems with the drying up of streams and rivers, (ii) lack of financial resources, (iii) lack of centres for the supply of inputs and (iv) insufficient extension officers. The Monts Kouffé area is particularly suitable for the development of fisheries. Project Beneficiaries 3.2.9. The beneficiaries of the project, numbering about 79,000 persons, belong to several social categories and participate in all the economic activities of the project area. In particular, the project aims at the following beneficiaries: (i) women whose constraints are related to traditional taboos, work overload, illiteracy, lack of credit, lack of information, training and practices in sustainable development and low income levels; (ii) loggers whose industrial activity, which was formerly highly developed in the area, has now virtually disappeared; (iii) hunters whose difficulties are related to the non-recognition by forest wardens of their association as a privileged partner that could participate in the co-management of classified forests; (iv) farmers whose main constraints are related to the use of minimum capital and rudimentary implements; (v) livestock breeders whose type of breeding remains traditional and extensive; (vi) fishermen whose activity is carried out in a highly artisanal manner on water bodies; (vii) bee breeders composed of rural dwellers and hunters who harvest wild honey in the three forest stands. 4. THE PROJECT 4.1. Design and Formulation 4.1.1. The approach used for the project consists in considering the classified forest as an enterprise to be managed and to be conserved in a sustainable manner, by respecting the existing ecosystem without diminishing its stock. Forestry management falls under the responsibility of both local communities and the administration provided the former abide by the terms and conditions of a management plan which will be established at the end of the project. However, a “Simple Working Plan” will be prepared at the project start-up, and this will define the basic major principles for managing the three forest stands. The communities will participate in all the phases of formulating and implementing the development plan which

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will comprise the following three successive phases: (i) the preparatory phase for drawing up the plan, (ii) the actual formulation phase and (iii) the implementation and monitoring phase. 4.1.2. The procedures adopted in formulating and implementing the PAMF management plans are based on certain basic principles recognized by most of the international community developers for the success of a forest management programme. These principles are five in number but not exhaustive:

i. community participatory approach implying that they will be responsible for the exploitation and maintenance of the forest;

ii. ecosystem management entailing the observance of fundamental ecological management practices; the functioning of the ecological system should therefore be global and not by ecosystem;

iii. lasting output that guarantees sustainable forestry production and a stable biological equilibrium where the quantity of wood, fodder and other resources to be exploited does not exceed the long-term productivity of the forest;

iv. multiple usage highlighting the fact that the forest is a provider of all sorts of resources and not only wood and that non-wood products such as honey, shea butter, game, medicinal plants and fish are also important for the local communities;

v. coverage of recurrent costs: part of the income generated through forest exploitation should be reinvested to cover the recurrent cost of the development. A second part will be paid to the public treasury and a third part to local groups and villages.

4.1.3. These principles which combine a shared responsibility (population and administration), sustainable activities and effective and lasting outputs, coverage of recurrent costs and poverty reduction fall in line with the Government’s new policy and foster the sustainable development of the area. 4.1.4. The project design also takes into account women’s concerns. Indeed, the multiple use of forestry resources depends mainly on women and the project will provide them with assistance and highlight their role in conducting these activities centred on the gathering and processing of forestry products. 4.2. Objectives Sectoral Objective 4.2.1. The sectoral objective is to conserve and ensure the sustainable management of the country’s natural ecosystems; in particular, the conservation of the forest ecosystem potential and biodiversity, at least in its present state. Project Objective 4.2.2. The chief objective of the project is to undertake the integrated management of the Agoua, Monts Kouffé and Wari-Maro (370,000 ha) forests, by implementing management plans aimed at the sustainable management of ecosystems and with the participation of the local communities. The project will contribute to monitoring and stabilizing the economic activities of the communities by undertaking actions and accompanying measures particularly in the buffer zones. It will participate in the organization and strengthening of associations, local groups and administrative structures and in improving the incomes of the communities.

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Description 4.2.3. The project components consist of:

A) Management of natural resources; B) Accommodating actions; C) Project management.

4.3. Description of Project Achievements 4.3.1. In order to conserve forestry resources and economic activities conducive to the development of rural communities, the PAMF proposes to implement two key programmes in the three forests: (i) actual management programme comprising the formulation and implementation of management plans, rural development actions including accommodating research; (ii) accommodating actions covering the economic activities of women and young people, building of social infrastructure, training, sensitization and credit. 4.3.2. The main achievements of the project will be as follows:

i. management of three (3) forest stands (Agoua, Monts Kouffé and Wari-Maro), totalling 370,000 ha of classified forests, in a sustainable and profitable manner according to three (3) management plans adopted in order to obtain: − 1,000 ha of replanted forest stands (timber); − 500 ha developed through an agro-forestry system; − 28,000 ha enriched with production stands (timber);

ii. management of the fauna of three (3) forest stands through:

− a total controlled area of 56,000 ha of forests (Monts Kouffé and Wari-Maro) and the partial control of the rest of the forest;

− establishment and vitalization of fifty (50) hunting brotherhoods; − taking of 5% of game the first two years and 10% beginning of year 5;

iii. promotion of rural development actions (agriculture, livestock breeding, bee

keeping, fish farming, bottomland development, etc.) as an integral part of the forestry policy by supporting 1,300 pilot farmers and implementing accommodating research;

iv. implementation of sustained accommodating actions for:

− promoting income-generating activities for the women of 50 villages in the project area;

− sensitizing and training project officers and target communities, and conducting outreach activities and training in natural resource conservation for 79,000 beneficiaries;

− putting in place a self-managed group credit; − creating one (1) ecological centre for enhancing the scientific knowledge

of key species and the relationships with the physical and human environment of the area;

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v. provision of indispensable amenities:

− 1,176 km of forest feeder roads and pathways; − 1,650 m² of housing, various buildings, schools and health centres; − 17 positive boreholes for clean drinking water (human use) and 5 ponds

for grazing and fauna;

vi. procurement of vehicles, various materials and equipment;

vii. conducting project activities organized and managed by the project management and through technical assistance provided in support of the project staff; effective interventions by national support experts;

viii. auditing of technical (project implementation and environment) and financial (accounts) performance carried out each year; environmental monitoring of actions and measures taken.

4.3.3. The major components of the project are: A) Natural resource management; B) Accommodating actions; and C) Project management. 4.4. Detailed Description of Project Components Component A: Natural Resource Management 4.4.1. This component comprises three activities and consists of: forestry management, rural development actions, accommodating studies and research and technical assistance. This component may be subdivided into the following:

i. forestry management of 370,000 ha of the three forests based on three management plans and yielding 1,000 ha pure replanted forest stands (timber), 500 ha carried out through an agro-forestry system and 28,000 ha enriched with production stands (timber); the scheme will consist of inventories (species, diameter, number of trees/ha, volume, quality, etc.) making it possible to plan the exploitation, reforestation using local species and the setting up of controlled areas (biodiversity protection); similarly, they will make it possible to determine, and later implement, appropriate sylvi-cultural systems for forest stands, in accordance with their status and to define rules and annual forestry exploitation programmes which will accurately reflect the actual harvesting possibilities of these forests;

ii. management of the fauna comprising the setting up of a totally controlled core

of 56,000 ha in the Monts Kouffé and Wari-Maro Forests, the revitalization of 50 hunting brotherhoods, the setting up of a partial controlled area and the rational and controlled hunting of game beginning of year 5. The management of the fauna aims at multiple objectives including: (i) conserving the entire fauna and undertaking timely developments; (ii) reducing poaching pressure; (iii) involving local communities in the management of the resources;

iii. support to 1,300 pilot farmers in rural development activities, notably the

development of 80 ha of bottomlands (rice cultivation and vegetable crops), 60 ha of cassava (intensive cultivation), creation of three livestock breeders’ committees responsible for managing 3 vaccination parks and 3 veterinary

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product depots, support to 30 apprentice breeders, increase in honey production by establishing 5,000 honeycombs and producing 75 tonnes of forest honey, increasing fish production with the creation of 50 “fishing holes” (small-size ponds) and 12 tonnes of fish produce;

iv. conducting of accommodating studies and research for a better control over

actions conducted in conjunction with forestry management activities;

v. rational conservation of ecosystems by creating an “ecological centre” aimed at enhancing scientific knowledge of key species and relationships with physical and human environment. This centre will undertake studies in the following specific areas: (i) vegetation, (ii) terrestrial and aquatic fauna, (iii) history and impacts, and (iv) a biotic environment (studies on the soil science, geology and environmental climatology).

vi. basic infrastructure such as feeder roads and pathways (1,176 km); human (17

boreholes) and grazing (5 ponds) water sources; offices-housing (9) and administrative buildings (4); conference room (1); housing (4); guest buildings and huts (4 + 3); ecological centre (1); dispensaries (6); schools (12); storage warehouses (30); depots (3); honey houses (4); observation towers and posts (5 + 5) and procurement of vehicles and various materials and equipment indispensable for ensuing the monitoring and supervision of project works and for the sustainable management of the forest stands. The following items will be reallocated to the PAMF: 2 bulldozers (D7 and D4), 1 grader, 1 loader, 1 compactor, 1 tipper truck, 1 generator (60 KVA), 1 tracing table, 1 digitalizing table, 7 GPSs, various forestry inventory equipment and the main office in Cotonou;

vii. technical assistance comprising:

a. recruitment of a category of staff composed of national and international

experts to assist in the detailed studies on the topics dealt with during the preparatory phase and which will be identified throughout the life of the project; short-term national experts (106 m/m) in livestock breeding, agriculture, fisheries, apiculture, sociology, gender issues, credit, forestry, inventory (flora and fauna), eco-tourism and biodiversity; short-term international experts (24 m/m) in GIS, forestry, pastoralism, soil science and biodiversity;

b. recruitment of international experts (168 m/m) required to provide support to the national staff in the day-to-day implementation of the project; a long-term international expert such as the Chief Technical Advisor (CTA) will be appointed. The CTA should come from a consulting firm, be trained in forestry engineering and specializing in the participatory management of natural forest with sound knowledge in the environment. The recruitment of other executives and technicians will be based on degrees and experience in various areas in accordance with the procedures adopted;

c. recruitment of an engineering firm for the monitoring and supervision of works on feeder roads, buildings and rural water supply.

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Component B: Accommodating Actions 4.4.2. In order to sustain the economic activities of the target communities in a bid to move them away from the forest while at the same time improving their standard of living and incomes, this component will implement the following actions: the promotion of women’s activities, training, credit and social amenities. This component is subdivided into:

i. promotion of income-generating activities for women in 50 villages of the project area (cassava processing, marketing of food crops, etc.);

ii. training and sensitization of target populations and project staff: all the target

communities will be sensitized, 100 farmers will participate in inter-village interactions and 228 persons will receive specific training;

iii. promotion of a system of finance for self-managed group micro-credits for

economic activities such as: wood and its processing (10); cassava cultivation (55 women’s groups) and its processing (54 women’s groups); promotion of cooperatives (20); processing and marketing of various agricultural produce (50 women’s groups); equipment for agriculture (26), livestock breeding (30) and livestock cooperatives (3), apiculture (220) and fish farming (50) and credit associations (30);

iv. social actions in the context of the project: construction of 6 health centres; 12

schools; 17 positive boreholes 2 of which will have a water tower. Component C: Project Management 4.4.3. This component comprises five sub-divisions, namely: national staff, operation, auditing, environmental monitoring and mid-term review.

i. National Staff: this will comprise:

a. Project Management: 1 manager (permanent Government staff, APE), 3 unit chiefs (planning and implementation, project management and monitoring-evaluation), 4 coordinators (flora-fauna forester, agronomist, trainer and research assistant), 1 administrator, 1 chief accountant support staff comprising: 2 assistant accountants, 1 cashier and 41 other staff members (monitoring-evaluation, computer expert (programmer and GIS), cartographer, drivers, etc.);

b. 4 Stations: each station will comprise: 1 centre chief (Water and Forestry Engineer), 1 agro-sociologist, 1 agronomist, 1 pastoralist, 3 forest wardens, 1 accounting secretary, 2 drivers, chief hunters (360 m/m), 1 messenger and 2 watchmen;

c. Agbassa, Bantè, Manigri and Wari-Maro Stations: these stations comprise additionally, respectively: 1 agro-sociologist, 1 bee keeper and 1 fish farmer. Only the Project Manager (PM) will be a permanent Government staff member (APE), the rest of the staff will be on contract. The salary of the PM will be drawn from the national budget while extra expenses (bonus and allowances) will be covered by the project.

ii. Operating Cost: this comprises all the expenses relating to the implementation

of the project in the field (vehicles, motorcycles, mopeds, trucks, machinery, telecommunication equipment, maintenance of buildings and feeder roads).

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iii. Auditing: this comprises internal and external auditing. iv. Environmental Monitoring: environmental monitoring will be provided by

ABE. v. Mid-term Review: a mid-term review has been planned for year three of the

project. 4.5. Assumptions and Risks 4.5.1. One of the major assumptions of the forestry management approach is solid collaboration by the beneficiary communities. This collaboration should be based on a sound relationship between the beneficiary communities, the project staff and the administration in order that the effective and substantial benefits could be drawn from the sustainable management of natural resources in the short, medium and long-term. Key persons for the project should be carefully selected and special attention paid to training during the implementation of the project. 4.5.2. Economic risks are to be noted. Indeed, the various sub-sectors (hunting, timber, honey, etc.) are not fully known. Assistance among apiculturists for example can fail if fair prices for the produce are not guaranteed. Under the project, the installation of honey houses could guarantee the quality and marketing of the produce on the national market. Regarding timber, its marketing should not pose particular problems, since the quality of the produce is guaranteed by existing and newly-planted noble plant species and through credits set up for loggers (purchase of modern saws). The marketing of hunting produce should not encounter any special difficulties in view of the fact that the already existing hunter brotherhoods will be better organized and trained and that this type of organization should put an end to poaching. 4.5.3. Other risk factors for the success of the project will be come from: (i) the growth of the population of the area (3.5%), (ii) population migrations from the North and South to the Central part of the country, (iii) conflict between different ethnic groups, (iv) vagaries of the weather in the Northern part of the country, (v) exceptional animal pressure due to herd transhumance. With regard to social conflicts, the experience of the PGRN shows that they can generally be controlled in the short and medium terms through sustained dialogue within the associations. 4.6. Project Costs 4.6.1. Estimated project costs are based on recent unit costs of similar works carried out in the project area or in other parts of Benin. 4.6.2. The project cost excluding taxes and customs duties is estimated at UA 17.56 million. This cost is broken down by component as indicated in Table 4.6.2a and by category of expenditure as indicated in Table 4.6.2b hereafter. A physical contingency of 5% is provided for based on a sound determination of the project quantities and an adequate knowledge of the cost of the various procurement items estimated. The price escalation of 4% is based on an estimate of expected average rate of inflation in the country for the coming years. This provision should be sufficient to help cover any rise in cost during the project implementation.

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Table 4.6.2a Estimated Project Costs by Component

(in CFA F and UA million)

Component CFAF Million UA Million L.C. F.E. Total L.C. F.E. Total

Natural Resource Management 2 655.07 6 971.20 9 626.27 3.40 8.94 12.34Accommodating Actions 407.41 965.94 1 373.35 0.52 1.24 1.76Project Management 595.90 353.10 949.00 0.76 0.45 1.21Base Cost 3 658.38 8 290.24 11 948.62 4.68 10.63 15.31Contingencies (5%) 126.70 302.22 428.92 0.16 0.39 0.55Base Cost + Contingencies 3 785.08 8 592.46 12 377.55 4.84 11.02 15.86Price Escalation (4%) 420.55 903.90 1 324.44 0.54 1.16 1.70

Total 4 205.63 9 496.36 13 701.99 5.38 12.18 17.56

Table 4.6.2b Expenditure by Category and Source of Finance

(UA million)

CATEGORY ADF L.C. F.E. Total

ABEDA GOVT. BENEF. TOTAL %

1 SERVICES 1.48 5.26 5.26 0.33 0.38 5.97 34.00 Personnel 1.33 1.42 1.62 0.23 1.65 9.40 Training 0.18 0.18 0.33 0.14 0.65 3.70 Technical Assistance 2.74 2.74 2.74 15.60 Credit 0.14 0.14 0.14 0.80 Accommodating Research 0.09 0.25 0.34 0.34 1.94 Auditing 0.15 0.15 0.01 0.16 0.91 National Experts 0.06 0.23 0.29 0.29 1.65

2 GOODS 0.24 2.24 2.48 2.35 0.72 0.01 5.56 31.66 Materials 0.00 0.01 0.01 0.30 0.00 0.31 1.77 Vehicles 0.01 0.09 0.10 1.18 0.22 1.50 8.54 Equipment 0.00 0.32 0.32 0.40 0.27 0.00 0.99 5.64 Various goods (photoint., cartogr.) 0.26 0.03 0.29 1.65 Operating Cost (inputs) 0.23 1.82 2.05 0.21 0.20 0.00 2.47 14.06

3 WORKS 0.95 1.85 2.80 2.87 0.30 0.06 6.03 34.34 Buildings 0.01 0.20 0.21 0.82 0.15 0.01 1.19 6.78 Feeder Roads and Pathways 1.80 1.80 10.25 Miscellaneous Constructions 0.02 0.18 0.20 0.25 0.09 0.05 0.59 3.36 Nursery 0.09 0.22 0.31 0.02 0.00 0.33 1.88 Plantations 0.83 1.25 2.08 0.04 2.12 12.07

Total 2.67 7.87 10.54 5.55 1.40 0.07 17.56 100.00 4.7. Source of Finance 4.7.1. The project will be co-financed by the Government of Benin, the beneficiaries, ABEDA and ADF on the bases indicated in Tables 4.7.1a, 4.7.1b and 4.7.1c below.

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Table 4.7.1a Expenditure Schedule by Source of Finance

(UA million)

SOURCE Year 1 Year 2 Year 3 Year 4 Year 5 Total ADF 1.73 2.01 2.41 2.31 2.08 10.54ABEDA 3.24 0.80 0.71 0.77 0.03 5.55Government 0.72 0.18 0.17 0.08 0.25 1.40Beneficiaries 0.00 0.02 0.02 0.02 0.01 0.07

Total 5.69 3.01 3.31 3.18 2.37 17.56

Table 4.7.1b Sources of Finance by Component

(UA million)

COMPONENT ADF ABEDA Government Beneficiaries F.E. L.C. Total F.E. L.C. Total F.E. L.C. F.E. L.C.

Total

Natural Resource Management 6.57 2.24 8.81 3.65 1.07 4.72 0.00 0.53 0.00 0.07 14.13Accommodating Actions 0.78 0.00 0.78 0.66 0.17 0.83 0.00 0.43 0.00 0.00 2.04Project Management 0.52 0.43 0.95 0.00 0.00 0.00 0.00 0.44 0.00 0.00 1.39

TOTAL 7.87 2.67 10.54 4.30 1.24 5.55 0.00 1.40 0.00 0.07 17.56

Table 4.7.1c

Expenditure Schedule by Component (UA million)

Component Year 1 Year 2 Year 3 Year 4 Year 5 Total % A. Natural Resource Management 5.05 2.08 2.46 2.56 1.97 14.12 80.5B. Accommodating Actions 0.38 0.66 0.56 0.33 0.10 2.03 11.6C. Project Management 0.26 0.27 0.29 0.29 0.30 1.41 7.9

Total 5.69 3.01 3.31 3.18 2.37 17.56 100.0 4.7.2. The ADF loan will cover 60% of the total project cost, that is UA 10.54 million of which UA 7.87 million will be in foreign exchange and UA 2.67 million in local currency. The ADF contribution represents 65% of the foreign exchange cost and 47% of the local currency cost. The ABEDA which will contribute 32% of the total project cost has already approved its loan. The Government and beneficiaries will finance the remaining cost in local currency amounting to 6% of the total project cost, or 10% of the overall cost financed by the ADF and the Government. Costs by component and by category are given in Annex 3. Detailed costs appear in a document available for the implementation of the project. 4.7.3. The ADF participation in the local currency cost is justified by the following reasons:

i. in the early 1990s, Benin made commendable efforts in carrying out various reform programmes. The average real GDP growth rate was 5.2% over the 1996-1998 period and the rate of inflation stabilized around 3.7% in 1998. The accelerated growth partly resulted from a greater effectiveness of investments. Thus the country secured two IMF loans under the enhanced structural adjustment facility and IDA’s CAS III. This enabled the mobilization of additional resources from other donors for the financing of its development strategy centred on poverty reduction;

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ii. in view of its budgetary performance, the country has not been encountering

difficulties in allocating national counterpart funds for externally financed projects generally amounting to 10% of the investment costs; with the increase in the primary balance (excluding interest and extension of investments) which rose from 3.9% in 1996 to 4.4% of the GDP in 1998, external funds received were allocated to the financing of the foreign exchange costs of projects;

iii. nevertheless, gross domestic savings which averaged 8.7% in 1998 as against

10.1% in 1997 still remains inspite of decline in gross investment rates to 16.4% in 1998 compared to 18.5% in 1997. Despite remittances from Benin nationals living outside the country and improvement in domestic savings, the country will have to keep borrowing from external sources;

iv. in view of the financial discipline adopted and international commitments

made, the country can only have access to concessional resources that the local or regional financial markets cannot provide;

v. the PAMF project will consist of development works for the forest stands,

various construction activities, rural development activities (development of bottomlands, etc.) entailing the use of human resources and local materials, particularly considerable labour.

4.8. Impact on the Environment 4.8.1. The project is classified under environmental category II in line with the Bank Group guidelines. The project environmental impacts are diverse:

Impact of the Participatory Management of Classified Forests on the Natural Environment 4.8.2. Ultimately, the rehabilitation of the vegetation and enrichment of the forests are to be expected. These forests will play a key role in the conservation of forestry resources, reconstitution of the biodiversity of the area and, consequently, increase in rate of reforestation. The advantages of participatory development are many and important for the people (use of local labour, income distribution, etc.) for natural resources (use of local plant species and protection of the fauna) and for the environment in general (conservation of biodiversity). Impact on Vegetation 4.8.3. Through protection, natural regeneration, and the participatory enrichment of these forests the biodiversity will be protected. Valued species with prospects will be maintained and protected for a rational and sustainable economic exploitation. Indeed, one of the aims is to maintain and develop a climax forest made up of a wide variety of plants to meet the essential needs of humans. 4.8.4. Actions for controlling late bush fires and transhumance will have a beneficial effect on the restoration of fodder biomass and help increase as well as develop animal production. Similarly, participatory development will yield significant benefits in the areas of pharmacology and food production.

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Impact on Fauna 4.8.5. The project will have a positive impact on the fauna. Indeed, preliminary studies and limited surveys of the fauna in the three forest stands indicate a significant diversity of animal species. Scarce species (lycaon, leopard, sitatunga, etc.) have been put under rigourous protection and this will contribute significantly to the implementation of the conservation of biodiversity and help boost the development of eco-tourism for the socio-economic and cultural promotion of the country. Existing feeder roads which will be rehabilitated will not have any direct impact on the environment but rather will strengthen the monitoring of project activities and foster the development of eco-tourism. Impact on the Climate, Soils, Hydrography and Micro-Organisms 4.8.6. The impact of participatory development of the three forest stands on the climate, soils, water and soil micro-organisms will be considerable. Indeed, the major rivers of Benin draw their sources from these forest areas and the specific micro-organisms in this zone provide a conducive environment for the development of socio-economically valuable plants. During the implementation of the project and with the creation of the ecological centre, complementary studies will be conducted, inter alia, to measure the ecological benefits of the project actions better. 4.9. Impact on Women 4.9.1. The project provides for actions in favour of women whose support, in terms of provision of produce processing equipment, is of high importance. This action will have positive impacts by: (i) easing the difficult nature of work through the use of appropriate small technologies (mills, etc.); (ii) improving management capacities through training, sensitization and education of women in the field of nutrition, health and credit; (iii) enhancing economic power by promoting income-generating activities; (iv) increasing incomes and raising standard of living by marketing all the produce from the forests; (v) giving women priority of access to credit and savings through local financing systems and (vi) providing environmental training. 4.9.2. Furthermore, the forestry exploitation activity will highlight the possibility of intensifying the extraction, from the various wood vegetations, products such as shea butter, néré and many other non-wood products, wild fruits and vegetables which women can process and thereby improve their incomes and living conditions. 4.9.3. Other actions for women which will have significant impact are: (i) assistance in reducing traditional taboos (introduction of “gender” approach in work methods), (ii) functional literacy, (iii) information-communication training sessions; these are some of the activities that could contribute to the emancipation of rural women. 5. PROJECT IMPLEMENTATION 5.1. Implementation Unit 5.1.1. Project management unit will be created at the DFRN. The latter has already acquired experience in project implementation, supervision and management. Indeed, its experience with the Bank in the forestry area has enabled the implementation of the South Benin Fuelwood Project.

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5.1.2. In order to benefit from the experiences acquired, maintain a sustained support to the DFRN and ensure the continuity of services in place, the Project Manager must have proven experience in forestry agronomy (management of natural resources) in order to ensure the consolidation of the achievements of the fuelwood project. He will have administrative, financial and technical autonomy. He will be responsible for coordinating all the project activities. To this end, he will recruit the staff capable of conducting the following major tasks:

i. project coordination, monitoring-evaluation and inspection; ii. outreach, support to the promotion of activities and participatory management

of resources for various productive activities (apiculture, forestry, fish farming, credit, etc.);

iii. planning, programming and administrative and financial management of the project.

5.1.3. The project will be based in Cotonou, while four (4) stations will be created locally in three forest stands, in Agbassa, Banté, Manigri and Wari-Maro. These stations will be responsible for carrying out concrete actions in the field. 5.2. Organization and Management Orientation 5.2.1. In order to ensure a significant participation of all the stakeholders, it is important to establish an effective organizational structure. All the stakeholders must be informed of the distribution of tasks and contributions in order to be able to contribute effectively to the common concepts. To do this, the grassroots structures should be closely involved in the management of the various programmes. Horizontal relations will be established between the station chiefs and traditional chiefs. 5.2.2. The project, which is of a limited duration, cannot be substituted to the current organization in the field, but will reinforce existing structures and strive towards improving relationships between the latter and the beneficiary communities. It is in this perspective that the project will initiate actions that will be self-sustaining after the investment phase. 5.2.3. A key expected outcome of the project is an improvement in the functioning of the local Administration that would enable it to successfully pursue the development activities after the completion of the project. The building of the capacities of the local Administration should not in any way result in increasing the latter’s “enforcement” functions vis-à-vis the communities. On the contrary, the relationships between the Administration and the communities should improve. 5.2.4. In order to achieve integrated development, it is necessary that the Administration and the communities behave as partners. The newly-approved organization of hunting is an illustration of this form of collaboration: forest wardens and hunters will henceforth pursue the same objectives which are based on a rational management of the fauna. 5.2.5. This concept of the role of partners involved in the project requires that a special form of responsibility for the modes of intervention of each partner be defined. It is for this reason that apart from the supervising Ministry the project organization chart will include other structures and organs at the level of the communities.

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Structures and Organs Village Structures 5.2.6. The participation of local populations in the development of forest stands requires an internal organization capable of meeting the demands of the scheme. In this regard, the project plans to organize local populations into administrative and economic structures as presently observed in the ongoing participatory development projects in the country (Goungoun, Sota, Tchaourou and Toui-Kilibo). 5.2.7. Two types of structures will cater for the implementation and monitoring of the management plan for the three forest stands: the organizational structures of the local communities of the three forest areas and those of the forest administration representing the Government. The former will comprise: (i) associations for the management of each forest (AGEF Agoua, Monts Kouffé and Wari-Maro) and (ii) economically-oriented forestry groupings and enterprises which are conducting forestry exploitation activities or services as part of the management actions. The AGEFs will be linked to the Government through a forestry management contract in accordance with the application of the current law and the management plan. Micro-credit will be organized through the AGEFs which will also get assistance from the project. 5.2.8. The status of AGEFs and their role will be in accordance with the law. Their responsibility generally entails the following tasks: organizing basic structures of the association, planning activities to be carried out, coordinating works, awarding contracts, signing contracts, mobilizing and managing financial resources, ensuring the respect of technical specifications of the plan, and carrying out internal management control. In exercising their duties, the AGEFs can seek public support in enforcing the application of the rules prescribed. 5.2.9. The economic structures concern economic interest groups (GIE) responsible for the exploitation of forests under the supervision of administrative structures supported by the forest post foremen (CPF). Thus, the three forest stands in Agoua, Monts Kouffé and Wari-Maro will be managed by the local communities through their respective organizations together with the Administration (agriculture and forest) on the basis of the following three successive phases:

i. first phase: this will be the preparatory phase for formulating the plan. Several activities will be taken into account during this phase: information, sensitization, studies, inventories, cartography, training, exploitation control, research, trial actions, setting up of forest posts and farmer organization;

ii. second phase: this phase will entail the formulation of the development plan

and its adoption by the communities and the Government. The plan will be prepared in conjunction with the interested communities. It will be discussed, amended and adopted by the local communities and the Government. The communities will be responsible for its implementation;

iii. third phase: this will be the implementation and monitoring phase for the

development plan. Since the role of each stakeholder has been defined in the plan, emphasis will be on fulfilling the commitment embodied in the plan: the communities will implement the plan, the forestry administration will ensure that the provisions of the plan are complied with and followed correctly; it will

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also provide technical advice to users who work in the forest. The management plan therefore constitutes a “programme contract” between the communities and the Government.

Forestry Administration Structures 5.2.10. The Forestry Administration is represented by the DFRN at the national level and by nine forestry post foremen at the local level. The functions of the CPFs will consist in: (i) ensuring the application of procedures and rules contained in the development plan; (ii) training, in collaboration with relevant technical services, of local communities involved in the implementation of working plans; (iii) collecting forestry exploitation fees; (iv) assisting village structures in formulating and implementing annual workplans. Regional Project Monitoring Committee (CRSP) 5.2.11. In order to assist the village communities to understand the process and apply the procedures and rules of the development plan without resistance, a Regional Project Monitoring Committee will be set up. This Committee, made up of local representatives of the Administration (Sub-Prefects), technical officials (ABE, rural development technical representatives: RDR and DFPRN); development associations from communes, various partners (cooperatives, enterprises, NGOs, etc.), will also monitor the actions of the project as well as other development operations in the project area.

5.3. Manpower, Training and Incentives 5.3.1. The Agoua, Monts Kouffé and Wari-Maro Integrated Forestry Management Project (PAMF) will recruit its personnel among senior staff of the Administration and other local professionals. In particular, the PAMF Manager will be responsible for the administrative, accounting, financial and technical management of the project. He will also be responsible for planning, organizing and coordinating all the project activities. However, other senior staff and technicians to be appointed to the project will be recruited by the Project Manager. The Engineering Consulting Firm and the final list of other senior staff and technicians should be conveyed to the ADF at the latest three (3) months after the date of entry into force of the loan. 5.3.2. The project staff will follow the training programme envisaged by the PAMF. Training activities will be made available to this staff to help enhance their technical skills. Participation in international congresses relating to natural resource conservation has also been provided for. The construction of stations and forest posts and the payment of various allowances constitute some of the incentives designed to stimulate the staff. The training activity should help the staff double its work output. The project organization chart is given in Annex 2. 5.4. Procurement of Goods and Services 5.4.1. Provisions relating to procurement of goods and services are summarized in Table 5.4.1. hereafter. Any procurement of goods, works and services financed by the Bank will be in accordance with the Bank’s rules of procedure for the procurement of goods and services or, where applicable, to the Bank’s rules of procedure for the use of consultants based on appropriate Bank tender documents.

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Table 5.4.1. Provisions relative to the Procurement of Goods and Services

Project Component in UA millions

Other (1) Shortlist (2) ABEDA, Govt., Benef. Total

1. Works: 1.1. Roads, feeder roads, pathways 1.2. Buildings 1.3. Other Constructions and Bottomlands 1.4. Nurseries and Plantations

(0.183) (0.164) (1.977)

1.582 0.876 0.335 0.056

1.582 1.059 0.499 2.033

2. Goods: 2.1. Vehicles 2.2. Materials 2.3. Miscellaneous Equipment 2.4. Miscellaneous Goods (photos; cartography) 2.5. Consumables (supplies and spare parts)

(0.085) (0.007) (0.278)

(1.904)

1.260 0.276 0.592 0.266 0.182

1.345 0.283 0.870 0.266 2.086

3. Services: 3.1. National Personnel 3.2. Training 3.3. Technical Assistance 3.4. Credit 3.5. Accommodating Research 3.6. National Experts 3.7. Audit

(1.439) (0.151)

(0.124) (0.286)

(2.461)

(0.257) (0.132)

0.024 0.411

0.007

1.464 0.562 2.461 0.124 0.286 0.257 0.139

4. Unallocated (1.29) 2.248 Total (6.598) (2.850) 5.868 (10.74) 17.564

(1) Local shopping, direct procurement and construction by force account. (2) Shortlist. (..) ADF financing. Parallel financing by other donors. 5.4.2. The Project Manager will be responsible for awarding contracts for goods, works, services and training. The resources, capacity, expertise and experience already acquired will be adequate for the procurement. 5.4.3. Procurement of goods and services by ADF will be in accordance with the ADF rules, as follows:

i. Competitive Bidding Based on a Shortlist: for the procurement of technical assistance and project audit services. Short-term experts and other executives and technicians will be provided by the technical assistance consulting firm.

Other Procurement Methods

ii. Local Shopping: for materials, vehicles and various equipment (mopeds,

bicycles, canoes and outboard motors); this procurement method will be used because of the low amounts of the contracts (maximum of UA 85,000) and to the fact that competitiveness can be assured because of the sufficient number of the national suppliers and qualified foreign suppliers’ representatives to guarantee competitive prices;

iii. Force Account: for the nurseries, development and plantation works, the construction of a small building for the ecological centre and 15 warehouses, development of bottomlands; this procurement method will be used because of

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the dispersed nature of the works and the fact that these works cannot be defined or quantified in advance. Furthermore, this procedure makes it possible to guarantee the quality of seeds, seedlings, development, plantation and construction works needed to ensure an effective management of the forests;

iv. Direct Procurement: for training and research at the ecological centre, this contract will be awarded to NGOs and specialized institutions with the requisite skills.

v. Goods relating to the credit will be procured by commercial methods deemed acceptable by the Bank.

5.4.4. General Procurement Notice: The text of a General Procurement Notice (GPN) will be adopted in collaboration with the DFRN/MDR and will be issued for publication in “Development Business”, as soon as the loan proposal is approved by the Board of Directors. 5.4.5. Review Procedures: The following documents will be submitted for review and approval by the Bank before being published: (i) specific procurement notice, (ii) tender documents or letters of invitation to consultants, (iii) evaluation reports on bids by contractors or suppliers or proposals by consultants including recommendations on contract award, (iv) draft contracts, if those included in the tender documents have been amended. 5.5. Implementation Schedule 5.5.1. The duration of the project will be 60 months. The implementation schedule is provided in Table 5.5.1. below:

Table 5.5.1. Implementation Schedule

ACTIVITIES Responsible Start-up Duration A. ADMINISTRATION 1. Loan approval ADF November 1999 2. Signing of loan agreement Government/ADF January 2000 3. Appointment of Project Manager Government/ADF November 1999 1 month 4. Loan effectiveness ADF March 2000 5. Preparation of 1st annual budget Project Manager November 1999 1 month 6. Establishment and approval of shortlist of consultants Government/ADF November 1999 1 month 7. Competitive bidding Government January 2000 3 months 8. Reception and evaluation of bids

1 month Government February 2000

9. Approval of analysis report ADF February 2000 1 month 10. Signing of contracts Government March 2000 1 month 11. Start of consultant’s services Government April 2000 5 years 12. Completion of consultant services Government/ADF December 2005 5 years 13. Completion report by borrower Government December 2005 3 months 14. Completion report by ADF ADF December 2005 3 months B. PROCUREMENT, MATERIALS AND EQUIPMENT 15. Shopping, contract awards and contracts Government/ADF March 2000 3 months C. EXECUTION OF DEVELOPMENT WORKS 16. Commencement of works Government April 2000 5 years D. TRAINING 17. Start of on-the-job training Government April 2000 5 years 18. Training abroad Government October 2000 4 years

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5.6. Monitoring and Evaluation 5.6.1. Four types of monitoring-evaluation will be provided at project level: (i) permanent internal monitoring-evaluation conducted at all levels by the project specialized services; (ii) periodic monitoring-evaluation provided by DFRN and the Directorate for Programming and Planning (DPP) of the MDR; (iii) environmental monitoring and (iv) mid-term review. Internal Project Monitoring-Evaluation 5.6.2. The project should establish a simple system of monitoring-evaluation at each level. This system should be designed in a harmonious manner to enable comparisons between project areas or activities. The monitoring-evaluation activities should cover the technical aspects in terms of rate of execution of activities and the attainment of objectives, aspects relating to support to national institutions in terms of training and service performance provided and the budgetary aspects as well as use of human and material resources by comparing the activities formulated and the objectives attained. External Monitoring-Evaluation 5.6.3. This will be catered for by DFRN and DPP on the basis of information provided by the farmer’s annual missions. Relevant reports should be sent to the ADF. The project will also be supervised by the ADF, through periodic and regular supervision missions. Environmental Monitoring 5.6.4. Environmental monitoring by ABE will endeavour to verify and measure impacts due to the project implementation. Furthermore, it will put in place norms and measures for a sound management of forest and issue annual reports by focusing on the following essential points: (i) formulation of working plan; (ii) exploitation of areas (zonation, logging, hunting, food crop cultivation, bush fires, etc.) and (iii) information-education-communication (IEC) in schools and among various local actors. Mid-term Review 5.6.5. A mid-term review has been planned for year three of the project to examine achievements in relation to specific objectives and, where necessary, redirect or change certain actions. Accounting and Auditing 5.6.6. Project accounts will be kept in separate books where all the operations financed by the ADF will be clearly indicated. The keeping of the project accounts will be subjected to the usual inspection by public establishments. Moreover, an external auditing firm financed with ADF funds will be recruited to inspect the project accounts annually as well as corresponding bank accounts. The internal auditing of the Ministry responsible for this task will prepare an annual report which will be sent to the ADF.

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5.7. Recurrent Costs 5.7.1. The participatory approach adopted for implementing the project necessarily implies a joint-management of the State forest estate (Agoua, Monts Kouffé and Wari-Maro Forests) by the Administration and the local communities. In this context, the exploitation and maintenance of forests will be the sole responsibility of the communities in accordance with the programme contract adopted by the two parties. This new policy of the Government has made it possible to redefine the role of the State; improvement of the effectiveness of its intervention and the reduction of the cost of the intervention. This forestry policy has been pursued since 1994 with the adoption of a programme of priority actions ensuring the sustainable production of resources thanks to the adherence of the communities to the management system. 5.7.2. In conclusion, recurrent costs generated by the implementation of the project will be borne by the beneficiary communities which will pay fees for the maintenance and exploitation of productive capacities. Incomes obtained from the various project activities will help cover recurrent costs and ensure the project’s sustainability since all the project activities are highly profitable. 5.8. Project Sustainability 5.8.1. The Agoua, Monts Kouffé and Wari-Maro Forestry Management Project (PAMF) is a project set within a protracted time-frame: manage forests in order to draw constant income in a lasting and, above all sustainable fashion, is in essence a long-term endeavour. Indeed, it requires a minimum of 5 years effort to attain positive results for the fauna, and more for other activities. Thus, the sustainability of the economic actions of forests is an essential condition for achieving profitability, and thereby ensuring that the present project conforms to the generally accepted principle of sustainable development. Indeed, in its analytical approach, the project addresses problems of vast and international dimensions, notably ecological sustainability, social justice and economic development. 5.8.2. The project takes into account poverty alleviation by promoting activities for satisfying the essential needs of disadvantaged sections of the population, particularly women and the youth. The role given to women’s activities in the project area’s development actions will contribute to the project’s sustainability by guaranteeing access by women to resources and decision-making, bearing in mind that women constitute the nucleus of the family and the foundation of the society. The role of local authorities in planning actions and in decision-making as well as the project’s autonomy in working with other stakeholders in the area, will also favour the project’s sustainability in terms of social cohesion. 5.9. Impact on Poverty Reduction 5.9.1. The PAMF envisages many activities whose economic and financial results will have positive impact on alleviating poverty. Indeed, the sale of wood, taking of game, fish, various farm produces, honey, animal products and other forestry products, etc. will procure substantial revenue to the population of the area, notably women and children involved in marketing activities. 5.9.2. Furthermore, the financing of education-sensitization for women in the fields of health, environment, nutrition and the vocational training in various rural trades provided mainly to young people, will help improve communities’ living standards and village lifestyles with the improvement in skills and a better redistribution of incomes.

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5.10. Coordination with Other Donors 5.10.1. The basic principles of the design and formulation of the PAMF based on the objectives of the new forestry development policy in Benin were widely discussed with the authorities and other donors. Indeed, this policy implies the need to ensure the participation of the local communities in the formulation and implementation of forest working plans. 5.10.2. The PAMF is a development project based on a participatory approach in the three forest stands of Agoua, Monts Kouffé and Wari-Maro. These three forest stands are not financed by other donors and have been assigned to the ADF. During the appraisal mission, actions envisaged for the project were discussed with other donors whose operations remain complementary to those of ADF and are being conducted in specific forests. Operations in the forestry sub-sector (cf. Section 2.11) are coordinated between donors and the PAMF perfectly fits into the overall actions of other donors. 6. TECHNICAL AND ECONOMIC JUSTIFICATIONS 6.1. Technical Justifications 6.1.1. The Agoua, Monts Kouffé and Wari-Maro Forestry Management Project (PAMF) as presented in this report is the synthesis of the following three variants:

i. carry out a pure forest plantation project, that is destroy the existing natural forests and replace them with conventional industrial forest plantations;

ii. refrain from undertaking any action either in terms of reforestation or in terms of management and allow the natural forest to develop under pressure from neighbouring villagers;

iii. mount a project that would implement a management plan with the significant involvement of neighbouring villagers and by combining the management of natural forests with forest plantations in pockets or clearings.

6.1.2. In terms of costs and benefits, the third variant is by far the best option. Indeed, pure forest plantations can be highly advantageous, but they also have some drawbacks such as: (a) considerable investments, (b) production risks (fire, parasites, demand for new forest species, etc.), (c) often lower than estimated yields and (d) destruction of the biodiversity. 6.1.3. From the point of view of ecology, the management of natural forests is generally preferable to plantations; from the economic perspective, this requires lower financial outlays. A judicious combination of the two methods, plantation and management is by far the best solution. Furthermore, in view of the experience already acquired in participatory management of classified forests in Benin, the project does not present any major difficulties. 6.2. Project Benefits 6.2.1. The analysis of costs and benefits is limited by the lack of data on the state of degradation of natural resources and the impact of this on productivity, household economy and labour force allocation. However, the expected benefits of the project are multiple and cover the technical, ecological, cultural, socio-economic and financial aspects. 6.2.2. At the technical level, available results and information show that there is a sufficient number of effective and suitable technologies for improving the management of natural resources. Similarly, several existing technologies are economically interesting.

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6.2.3. In ecological terms, the project will foster the sustainable management of the three forests and the maintenance of biodiversity at acceptable levels. However, such benefits will only be visible in the medium- and long-terms. Also, the project will have a clear environmental impact. The environmental benefits are as follows:

i. awareness and empowerment of the communities for the rational management of natural resources;

ii. improvement in ecological surveillance and intervention capacities of forestry departments as well as the communities, making for a better monitoring of protected areas, conservation of biodiversity and reduction of poaching;

iii. the introduction of more intensive farming methods (sedentarization) would reduce the pressure on land and forest. A greater land security would promote an increased demand for appropriate technology and enhance protection of the environment in the face of abuses arising from the free access to natural resources.

6.2.4. From a cultural point of view, the project will enhance the technical skills of the personnel and target communities in the field of forest management. Indeed, the farmer voluntary training programme will help improve the skills of the latter in: seedling production and management of nurseries, plantation and protection methods, water and soil (composting), conservatory management techniques, vegetable gardening and animal husbandry methods, processing methods (shea butter into soap and pomade, cassava, etc.). At the institutional level, by introducing a participatory approach, the project will help initiate the communities in joint management methods based on a programme contract for which they will be partially responsible. The project will thus help envisage another form of empowerment of the communities based on mutual consent. The project will therefore be beneficial in terms of education, encouragement and empowerment. 6.2.5. In socio-economic terms, the project will affect about 79,000 persons in highly diversified rural areas and in equally different fields. The key benefits which will be visible in the short- and medium-terms are:

i. development of forestry products, stabilization of neighbouring communities, reduction of poverty in the intervention area through the creation of employment, access to credits, increase in farming, fish farming and forestry outputs, improvement of farming methods, processing of produce and the formation of various groupings;

ii. improvement in the health status and level of education of communities (safe drinking water, primary health care and schools);

iii. enhancement of women’s work (processing of produce); iv. improvement in the general living conditions of villages and a concomitant

slowdown in rural exodus; v. the results of the forestry inventory will serve as a basis for an effective space

development strategy and a better management of the wood sub-sector. 6.3. Economic and Financial Justifications 6.3.1. The Agoua, Monts Kouffé and Wari-Maro Forestry Management Project (PAMF) will significantly contribute to improving the standard of living of the communities mainly through income-generating activities and the rational, sustained and lasting exploitation of forest resources, notably timber, in the area. Indeed, at full production, about CFA F 1.05 billion will be distributed annually in the project area through the revenue generated from the

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various project activities: game, sale of beams, fish farming, agriculture, processed cassava and other agricultural products, honey, livestock rearing and marketing. 6.3.2. The project will thus enable the villagers to enjoy the benefits of a rational, sustained and lasting management of the fauna, clarify their rights, enhance their capacity for managing natural resources and make for a strengthened and acknowledged community organization. It will enable producers acquire techniques for environmental-friendly production and income enhancement. 6.3.3. On the financial level, projected revenue from the activities is expected to be very high and should even make it possible to pay for the various charges in the programme contract. Indeed, the net margin of a bee keeper amounts to CFA F 88,000, which is not negligible as income. By processing cassava, a farm run by 10 women in a village can yield CFA F 2,241,000, that is CFA F 224,100 per head. In livestock rearing, a farm comprising chickens, guinea fowls, small ruminants and cane rats can yield a net margin of CFA F 373,150. In agricultural production, a 3.76 ha or 6 ha farm (5th year) producing cassava, maize, rice, cow peas, groundnuts, sorghum, cotton, or agoussi, the net margins are CFA F 288,200 and CFA F 643,800 respectively. In fish farming, a 400 m2 fish pond would yield a net margin of CFA F 188,500. It is clear that the activities supported by the project will procure adequate incomes for their promoters. The operating account is given in a separate annex. 6.3.4. Most of the activities planned for the project are employment-generating. The creation of jobs also constitutes an important indicator of the reduction of pockets of poverty. The activities planned will create two types of employment: direct employment and indirect employment. Direct employment is made up of jobs for the project implementation executives and workers (about 121 regular jobs). Indirect jobs are related to all the project activities most of which require a significant amount of labour. 6.3.5. The PAMF will play a significant if not a highly essential role in the area of poverty alleviation. Indeed, the project is poised to be an important social operation in the project area. The social nature can be perceived in one of its objectives which is to improve the living conditions of the population concerned in an area where the poverty line is the highest. Measures such as the improvement of production methods, market development, the putting in place of a credit structure and functional literacy constitute some of the actions intended to reduce the poverty line in the short-, medium- or long-term. The building of institutional capacities for directing the communities in their development is based on the principle of equality and aimed at improving the living conditions of these communities. The improvement of the socio-economic status of vulnerable groups, particularly women, serves to enhance the fight against poverty. Indeed, under the project, the priority given to women and their activities, as well as their participation in the development actions of the project area while guaranteeing their access to resources and decision-making are also tangible factors of the determination to alleviate poverty. 6.3.6. Furthermore, this project will serve as an incentive and contribute to initiating a vast movement of rational management of forests through the establishment of forest plantations within these forests, planned exploitation of their resources and the adoption of agro-forestry as well as soil conservation techniques in the farming systems of the area. It could serve as an example for other forestry areas in the country.

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6.3.7. In the absence of a PAMF project in the coming 5 years:

i. fauna reserves will drop by at least half of their current potential due to poaching, bush fires and shifting cultivation in the forest areas. This represents an estimated loss in fauna of nearly CFAF 144 million in 5 years for 288 tonnes of game. Similarly, hunting revenue will also reduce considerably resulting in the increase in the prices of game meat and having as a direct consequence, an increased risk in decimating the last game populations; the commencement of the project in 5 years would lead to a total prohibition of hunting for about 10 years if the fauna reserves are to be restored to their current levels, and this would not be realistic;

ii. logging would be difficult because of the inaccessibility and lack of maintenance of access roads to the forest areas. This will put high pressure on accessible areas in the absence of a forest regeneration policy;

iii. flora reserves will also diminish considerably as a result of bush fires, shifting cultivation and poaching. On the whole, the environment will be highly degraded. The reconstitution of forest resources in 5 years will entail more rigourous and constraining measures for the communities.

6.3.8. However, the economic analysis of the project does not take into account the “without project” situation as described above. In the absence of statistical data that could help quantify the “without project” situation, the analysis only considered cost/benefit comparisons by taking into account only the quantifiable objectives. The economic rate of return attains 21% without considering other benefits of the project. 7. CONCLUSIONS AND RECOMMENDATIONS 7.1. Conclusions 7.1.1. The Agoua, Monts Kouffé and Wari-Maro Forestry Management Project does not involve sophisticated methods of implementation. It is based on the country’s current rural and environmental development policy. 7.1.2. The objectives pursued: conservation of natural resources through forestry and fauna management as well as the sustainable management of ecosystems and biodiversity, falls within the overall economic and social development objectives of the country. 7.1.3. The implementation of the project with the participation of the local communities will help resolve many problems of conservation and exploitation of natural resources by the communities involved. The project will thus help enhance incomes and improve the standard of living of the communities. The economic rate of return is expected to reach 21% excluding other benefits of the project which are difficult to quantify (proceeds from gathering, pharmacopeia, mushrooms, etc.). 7.2. Recommendations and Loan Conditions 7.2.1. It is recommended that a loan not exceeding UA 10.54 million be granted to the Government of the Republic of Benin for the implementation of the project as described in the report subject to the following particular conditions:

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A. Conditions precedent to entering into force of the Loan Agreement: Before entering into force of the Loan, the Borrower shall:

i provide ADF with proof that the loan agreement with ABEDA has been signed

or that the latter has committed itself in writing to providing its share of financing for the project in accordance with the financing plan (cf. 4.7.1.);

ii show proof to the ADF of the creation of the Project Management Unit at the Directorate for Forestry and Natural Resources (DFRN) (cf. 5.1.1.);

iii show proof to the ADF of the appointment of the Project Manager with proven experience in forestry agronomy (natural resource management), with a view also to consolidating the achievements of the fuelwood project. The curriculum vitae of the said Manager should have received the prior approval of the ADF (cf. 5.1.2.);

iv show proof to the ADF of the transfer to the project of part of the agro-forestry equipment, machinery and items procured for the South Benin Fuelwood Plantation Project, particularly: 2 bulldozers (D7 and D4), 1 grader, 1 loader, 1 compactor, 1 tipper truck, 1 generator (60 KVA), 1 tracing table, 1 digitalizing table, 7 GPSs, miscellaneous forestry inventory equipment and the main office in Cotonou (cf. 4.4.1.vi.).

B. Other Conditions

The Borrower shall also:

i submit to the ADF not later than 12 months following entry into force of the loan agreement, the Simple Management Plan outlining the basic principles for managing the three forests mentioned above.

ANNEX 1 Page 1 of 1

REPUBLIC OF BENIN AGOUA, MONTS KOUFFE AND WARI-MARO

FORESTRY MANAGEMENT PROJECT

This map has been prepared by the ADB Group’s Staff exclusively for the convenience of the readers of the report to which it is attached. The denominations used and boundaries shown on this map do no imply on the part of the Bank Group and its affiliates any judgement on the legal status of any territory or any entitlement or acceptance of such boundaries.

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ANNEX 2 Page 1 of 1

REPUBLIC OF BENIN AGOUA, MONTS KOUFFE AND WARI-MARO

FORESTRY MANAGEMENT PROJECT ORGANIZATION CHART OF THE PROJECT

MDR

MFRN

PROJECT MANAGER

Technical Assistance

Group of Coordinators (Forest, Fauna, Agronomy, Training)

Monitoring-EvaluationUnit Chief

Management Unit Chief - 1 Administrator - 1 Accountant

Planning & Construction Unit Chief

WARI-MARO CENTRE

Multi-discp. Team

Local Administration

AGBASSA CENTRE

Multi-discp. Team

Civil Societies Dev. Assoc.,

NGO, Private…

BASSILA CENTRE

Multi-discp. Team

Traditional Chiefs

HEALTH CENTRE

Multi-discp. Team

REPUBLIC OF BENIN AGOUA, MONTS KOUFFE AND WARI-MARO FORESTRY MANAGEMENT PROJECT (PAMF) ANNEX 3

ESTIMATED COSTS OF THE PROJECT BY COMPONENT

Year 1 Year 2 Year 3 Year 4 Year 5 Total L.C. F.E.

A Natural Resource Management A1 Forest Development 294.750.000 257.120.000 364.330.000 483.460.000 393.400.000 1.793.060.000 657.324.000 1.135.736.000 A2 Rural Development 7.600.000 55.172.000 57.500.000 57.500.000 40.000.000 217.772.000 66.092.000 151.680.000 A3 Accommodating Research 30.000.000 14.500.000 30.000.000 14.000.000 35.000.000 123.500.000 49.400.000 74.100.000 A4 Technical Assistance 530.000.000 380.000.000 390.000.000 300.000.000 320.000.000 1.920.000.000 0 1.920.000.000 A5 National Experts 41.250.000 39.750.000 39.750.000 39.750.000 39.750.000 200.250.000 40.050.000 160.200.000 A6 Ecological Centre 20.000.000 20.000.000 20.000.000 20.000.000 20.000.000 100.000.000 10.000.000 90.000.000 A7 Buildings 483.500.000 59.000.000 59.000.000 43.000.000 0 644.500.000 389.800.000 254.700.0A8 Feeder Roads and Tracks 636.300.000 207.800.000 195.300.000 195.000.000 0 1.234.400.000 370.270.000 864.130.000 A9 Hydraulique pastorale 45.000.000 15.000.000 0 0 0 60.000.000 60.000.000 0 A10 Vehicle, motos, etc. 818.250.000 0 111.850.000 120.000.000 0 1.050.100.000 204.980.000 845.120.000 A11 Materials 166.000.000 53.000.000 0 0 0 219.000.000 14.100.000 204.900.000 A12 Equipment 236.400.000 9.000.000 23.500.000 18.000.000 0 286.900.000 21.200.000 265.700.000 A13 Personnel 127.316.000 127.116.000 122.926.000 111.276.000 111.276.000 599.910.000 599.910.000 0 A14 Operating Costs 206.400.000 216.400.000 237.360.000 248.360.000 268.360.000 1.176.880.000 171.944.000 1.004.936.000

Base Cost 3.642.766.000 1.453.858.000 1.651.516.000 1.650.346.000 1.227.786.000 9.626.272.000 2.655.070.000 6.971.202.000 Physical Contingencies 147.210.000 45.349.600 54.942.000 59.966.000 37.838.000 345.305.600 100.755.500 244.550.100

Escalation 151.599.040 122.335.340 213.075.172 290.511.133 274.201.113 1.051.721.798 296.237.681 755.484.117 Total Cost 3.941.575.040 1.621.542.940 1.919.533.172 2.000.823.133 1.539.825.113 11.023.299.398 3.052.063.181 7.971.236.217

B Accommodating Actions B1 Women’s Promotion 86.600.000 141.000.000 141.000.000 46.000.000 25.000.000 439.600.000 131.480.000 308.120.000 B2 Training 124.450.000 165.050.000 84.750.000 26.750.000 37.500.000 438.500.000 91.450.000 347.050.000 B3 Credit 15.100.000 32.500.000 29.650.000 19.400.000 0 96.650.000 0 96.650.000 B4 Infrastructure 46.400.000 117.400.000 117.400.000 117.400.000 0 398.600.000 184.480.000 214.120.000

Base Cost 272.550.000 455.950.000 372.800.000 209.550.000 62.500.000 1.373.350.000 407.410.000 965.940.000 Physical Contingencies 13.627.500 22.797.500 18.640.000 10.477.500 3.125.000 68.667.500 20.370.500 48.297.000

Escalation 11.447.100 39.065.796 48.876.764 37.373.554 14.217.847 150.981.061 48.599.534 102.381.528 Total Cost 297.624.600 517.813.296 440.316.764 257.401.054 79.842.847 1.592.998.561 476.380.034 1.116.618.528

C Project Management C1 Personnel 108.400.000 108.400.000 108.400.000 108.400.000 108.400.000 542.000.000 479.000.000 63.000.000 C2 Operating Costs 61.000.000 61.000.000 59.000.000 59.000.000 59.000.000 299.000.000 111.500.000 187.500.000 C3 Audit 20.000.000 20.000.000 28.000.000 20.000.000 20.000.000 108.000.000 5.400.000 102.600.000

Base Cost 189.400.000 189.400.000 195.400.000 187.400.000 187.400.000 949.000.000 595.900.000 353.100.000 Physical Contingencies 3.050.000 3.050.000 2.950.000 2.950.000 2.950.000 14.950.000 5.575.000 9.375.000

Escalation 7.698.000 15.703.920 24.766.774 32.332.577 41.239.880 121.741.151 75.866.751 45.874.400 Total Cost 200.148.000 208.153.920 223.116.774 222.682.577 231.589.880 1.085.691.151 677.341.751 408.349.400 T O T A L Base Cost 4.104.716.000 2.099.208.000 2.219.716.000 2.047.296.000 1.477.686.000 11.948.622.000 3.658.380.000 8.290.242.000 Physical Contingencies 163.887.500 71.197.100 76.532.000 73.393.500 43.913.000 428.923.100 126.701.000 302.222.100 Escalation 170.744.140 177.105.056 286.718.710 360.217.265 329.658.840 1.324.444.011 420.703.966 903.740.045 Total Cost 4.439.347.640 2.347.510.156 2.582.966.710 2.480.906.765 1.851.257.840 13.701.989.111 4.205.784.966 9.496.204.145

REPUBLIC OF BENIN ANNEX 4

AGOUA, MONTS KOUFFE AND WARI-MARO FORESTRY MANAGEMENT PROJECT (PAMF)

RATE OF RETURN

(in thousands of CFAF)

YEAR REVENUES COST BALANCE Fish Farmi Apiculture Agric. Output Cassava Processing Animal Prod. Forestry Gains Game Marketing TOTAL

1 14800 272000 41900 272500 174500 517000 17770 231500 1541970 4268603 -2726633 2 15100 275500 42500 273000 174800 518000 17789 240000 1556689 2170405 -613716 3 15300 277500 45800 275000 175000 519500 17790 243000 1568890 2296248 -727358 4 15500 277500 45800 275000 175000 520000 17800 255000 1581600 2120689 -539089 5 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1521599 60027 6 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1581626 7 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1581626 8 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1581626 9 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1581626 10 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1581626 11 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1581626 12 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1581626 13 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1581626 14 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1581626 15 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1581626 16 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1581626 17 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1581626 18 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1581626 19 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1581626 20 15500 277500 45800 275000 175000 520000 17826 255000 1581626 1581626

TOTAL 308700 5542500 908800 5495500 3499300 10394500 356365 5049500 31555165 31555165 IRR: 21.01%

Annex

BENIN: AGUA, MONTS KOUFFE AND WARI-MARO FORESTRY MANAGEMENT PROJECT (PAMF)

EXPLANATORY NOTE

During the Board sessions held on 15 December 1999, clarifications were requested concerning the following aspects of the above-captioned project: The numerous components, the complexity of the project, the relatively large number of vehicles and buildings, the recurrent costs and project sustainability and, lastly, the lessons learnt from the German projects and the short period of implementation of the project. Below are the answers provided. 1. Project Components and Complexity 1.1 As indicated in section 4.2 and paragraphs 4.2.3 and 4.3.2, the Agoua, Monts Kouffe and Wari-Maro Forestry Management Project (PAMF) has three components: A. Natural Resource Management; B. Accommodating Actions; C. Project Management. It has eight main outputs: i) development of the three forest stands; ii) related fauna management; iii) promotion of rural development action; iv) implementation of sustained accommodating actions; v) provision of infrastructure; vi) procurement of vehicles and various materials and equipment; vii) conduct of project activities; viii) audit of technical performance. 1.2 All these outputs will be realized through economic activities already existing in the three forest stands. The populations in the area in fact regularly collect honey, shea butter, medicinal plants, etc, and in the present “without project” situation, forest exploitation activities are conducted in an anarchic manner and without control, especially those relating to hunting. Therefore under the “with project” scenario, these activities are already known and not complex, though greatly diversified and numerous. Moreover, the professionalization of economic agents (hunters’ groups and associations of stockbreeders, fish farmers, honey producers, farmers and loggers) allows for rationalization and full mastery of their activities, in addition to streamlining each occupation. 2. Vehicles and Buildings 2.1 It is planned to purchase 27 vehicles for the duration of the project (five years). These vehicles, acquired in two phases, will make it possible to cover the 370,000 ha of the project area. Their cost will be entirely covered by ABEDA financing. ADF will finance only motorcycles, for an amount of UA 100,000 as indicated in table 4.6 (2) b. The vehicle requirements have been calculated on the basis of the number of experts (national and foreign) involved in the project, the numerous activities required on the ground for the supervision of each profession within an area of 3,700km2, giving an overall periphery of approximately 260 km, not counting the distances to be covered within each stand. Lastly, it should be noted that these vehicles will not have to be replaced at the end of the project; the beneficiaries will no longer require close supervision when each profession has become autonomous. The vehicles will thus be returned to the Government on completion of the works.

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2.2. Regarding buildings, since the three forest stands are far from the inhabited areas, finding rented accommodation will be a problem. The building construction programme will enable the project staff to be suitably housed near their areas of activity. In Cotonou, provision is made only for renovation of the central office, which will house the project liaison office. A total of 9 offices/housing units, 4 administrative buildings and 4 accommodation units for the 4 heads of station (Agbassa, Banté, Manigri and Wari-Maro) will be constructed. ABEDA and the Government will finance the greater part of the cost, while ADF contributes only 18%. 3. Recurrent Costs and Project Sustainability 3.1 The recurrent expenditure will primarily concern reforestation, maintenance of feeder roads and socio-economic infrastructure. These recurrent costs will be met by the beneficiary populations, who will pay dues to be used in maintenance and exploitation of the stands (See 5.7.2). The fundamental principle of participatory development of the natural forests involves regular re-investment in the forest of part of the income derived from exploitation. Associations for management of each stand will thus sign with the Government forest management contracts indicating the exact sharing of the income from exploitation, in accordance with the relevant laws and the development plan (See 5.2.7). In that connection, a development fund will be set up to cover all the recurrent development costs. This fund, fed mainly with forest users’ contributions, will also be adopted for PAMF, based on contributions by the different occupational groups (4.1.2 iv). 3.2 In that regard, PAMF will be guided by the World Bank’s experience in the Tcaourou and Tou-Kilibo classified forests. In both these forests, the payment of contributions varies in accordance with the economic activity concerned (agriculture, forest exploitation, hunting, fisheries, etc.) For example, regarding forest exploitation (timber, charcoal and fuel wood production), the rule is that 95% of total contributions goes to the Development Fund and the rest to the National Forest Fund. In the case of hunting and fishing, 80% of the funds goes to the Development Fund, while 20% goes to the collectors. PAMF will abide by this principle as a means of sustaining this system adopted by the project, and improve on it by establishing the Village Development Fund 3.3 PAMF will thus use a portion of the income generated by the activities promoted through rationalized forest management (approximately CFAF 1.60 billion/yearly -- see Annex 4) in meeting the recurrent expenditure relating to the development, including reforestation. In fact, the average cost of participatory development of the forest is approximately CFAF 32,500/ha. The cost of renewal of the 2,500 ha/yr under the rotation system gives CFAF/81 million/yr and will thus be largely covered by this income. A second portion of the income will be paid into the Public Treasury to fund collective expenditure, while a third will be provided to the villages and groups in the project area (Village Development Fund) for their development activities. To meet the requirements for private production, all economic activity promoters will cover the cost of maintaining their own facilities. Income from the various project activities (see paragraph 6.3.3) will make it possible to cover the recurrent costs and promote related activities. Similarly, the problem of recurrent staffing costs is taken care of. As indicated in paragraph 4.4.3(c), the project staff will remain on contract and their tasks will end on the completion of the project, which will mark the end of their contracts. The project will thus bear no recurrent costs in this connection.

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3.4 ADF participation in the financing of recurrent expenses mainly concerns a portion of the staffing and operating costs for the “Natural resource management” component. These recurrent costs, which are renewable over the five year period of project implementation, will be financed at a decreasing cost by ADF and reflect the trend noted in the financing plan (See table 4.7.1c) of the appraisal report. The level of the ADF share of these costs will gradually fall from UA 0.54 million to UA 0.44 million in the last year. 4. Lessons Drawn from the German Projects and the Short Period of

Implementation of the Project 4.1 The project appraisal mission team visited these German projects. ADF itself implemented a reforestation project covering 2,400 ha in the Lama classified forest, drawing on the experience of the German forest economy project, which is adjacent to the ADF project. In addition, the visit to the Bassila forest resource restoration project and the discussions with the officer-in-charge of the project afforded lessons concerning restoration of a productive ecosystem and promotion of natural forest development. The mission team has thus taken into account the experiences of the two German projects, even though these old projects were not expressly referred to like PGRN, and the project will develop cooperation links with them. 4.2 As part of cooperation arrangements, there were exchanges of view making it possible to establish that the three forest stands entrusted to ADF (Agoua, Monts Kouffe and Wari-Maro) will not be taken over by other donors. In addition, the proposed project activities have been discussed and the ADF operations are in fact complementary to those of other donors to be carried out in specific forests. PAMF is therefore an integral part of the series of donor activities, and the Forest and Natural Resource Department (DFRN), which is responsible for coordination of all the sub-sector operations, is carrying out the monitoring in conjunction with all the other donors. 4.3 As regards the duration of the project, the five-year implementation period precisely takes account of the experience acquired in this domain. In the past, development projects were delayed in starting up, owing to the lengthy preparation of the development plan (3-4 years). Experience has made it possible to reduce this preparatory phase to a maximum of two years. In addition, the populations in the project areas have already been to a great extent mobilized, since they participated in the design. It is thus believed that the five-year schedule will be maintained. As is to be expected for the activities concerning wood resources, the period of full development of the project -- especially for the main activities-- will begin only after this implementation period. The other activities will however keep to the original schedule.