PROJECT EXECUTIVE SUMMARY
GEF COUNCIL SUBMISSION
FINANCING PLAN (US$)
AGENCY'S PROJECT ID: GF/RLA/07/XX
GEF PROJECT/COMPONENT
GEFSEC PROJECT ID: 1346
COUNTRY: Mexico
Project $4,502,500
PROJECT TITLE: Integrated Assessment and
PDF B
$473,000
Management of the Gulf of Mexico Large Marine
Sub-Total GEF
$4,975,500
Ecosystem
CO-FINANCING*
GEF AGENCY: UNIDO
GEF Agency

OTHER EXECUTING AGENCY(IES):SEMARNAT
Government $96,774,780
DURATION: Four years
Bilateral

GEF FOCAL AREA: International Waters
NGOs

GEF OPERATIONAL PROGRAM: OP 9 Integrated
Others

Land and Water Component
Sub-Total Co-
$96,774,780
GEF STRATEGIC PRIORITY: IW2
financing:
Pipeline Entry Date: July 2001
Total Project
$101,750,280
ESTIMATED STARTING DATE: January 2008
Financing:
IA FEE: $497,500
FINANCING FOR ASSOCIATED
ACTIVITIES IF ANY:

LEVERAGED RESOURCES IF ANY:

*Details provided under the Financial
Modality and Cost Effectiveness section
CONTRIBUTION TO KEY INDICATORS OF THE BUSINESS PLAN: In conformity with GEF4 IW
priorities, reforms, investments, mechanisms and a regional framework put in place through a TDA-SAP
process to address land-based sources of marine pollution that create anoxic "dead" zones in coastal waters,
depletion of fisheries, and degradation of coastal resources and processes. Contribute to increasing global
coverage of management programs for LMEs. Contribution to WSSD POI sustainable fisheries targets
RECORD OF ENDORSEMENT ON BEHALF OF THE GOVERNMENT(S):
México:
Date: June 25, 2007
Claudia Grayeb Bayata, Directora General
Secretaria de Hacienda y Crédito Público


Approved on behalf of the UNIDO. This proposal has been prepared in accordance with GEF
policies and procedures and meets the standards of the GEF Project Review Criteria for work
program inclusion


Dmitri Piskounov
Edward Clarence-Smith
IA Executive Coordinator
GEF Coordinator
Date: July 5, 2007
Tel.:+43-1-26026-5079
Email: E.Clarence-smith@unido.org

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LIST OF ACRONYMS

APR
Annual Project Report
AWP
Annual Work Plan
CAE
Country Assistance Evaluation
CARICOMP
Caribbean Coastal Marine Productivity
CBO Community
Based
Organizations
CCRF
Code of Conduct for Responsible Fisheries
CEC
Commission for Environmental Cooperation
CECADESU
Centro de Capacitación para el Desarrollo Sustentable (Human Resource Development
Center for Sustainable Development)
CENAPRED
Centro Nacional de Prevención de Desastres (National Center for Disasters
Prevention)
CEO
Chief Executive Officer
CCRF
Code of Conduct for Responsible Fishers
CIMIOC
Commission for the Integrated Management of Oceans and Coasts
CIMOIC
Comisión Intersecretarial para el Manejo Integrado de Océanos y Costas
(Inter-ministerial Commission for the Integrated Management of Oceans and Coasts)
CINVESTAV
Centro de Investigación y de Estudios Avanzados del IPN (Research and Advanced
Studies Center, National Polytechnic Institute)
CIP
Centro de Investigaciones Pesqueras (Fisheries Research Investigation Centerr)
CNA
Comisión Nacional del Agua (National Water Commission)
CNHP
National Commission for Priority Wetlands
CONABIO
Comisión Nacional para el Uso y Conocimiento de la Biodiversidad (National
Commission on the Use and Knowledge of Biodiversity)
CONAGUA
Comisión Nacional del Agua (National Water Commission)
CONANP
Comisión Nacional de Áreas Naturales Protegidas (National Commission of Natural
Protected Areas)
CONAPESCA
Comisión Nacional de Acuacultura y Pesca (National Commission of Aquaculture and
Fisheries)
CONAFOR
Comisión Nacional Forestal (National Forestry Commission)
CTA
Chief Technical Advisor
DGIRA
Dirección General de Impacto y Riesgo Ambiental (General Directorship for
Environmental Impact and Risks Assessment)
DGPAIRS
Dirección General de Política Ambiental Integración Regional y Sectorial (General
Directorship for Environmental Policy, Regional and Sectoral Integration)
DGVS
Dirección General de Vida Silvestre (General Directorship for Wildlife)
DGZFMTAC
Dirección General de Zona Federal y Ambientes Costeros (General Directorship of
Federal Coastal Zones)
DIM
Data and Information Management
ES Environmental
Studies
EBA
Ecosystem Based Approach
EBM
Ecosystem Based Management
EcoQOs
Ecosystem Quality Objectives
ENOETMC
Estrategia Nacional para el Ordenamiento Ecológico del Territorio en Mares y Costas
(National Strategy for the Ecological Land Use Planning of the Territorial Oceans and
Coasts)
EPA
Environmental Protection Agency
EPOMEX
Centro de Ecología, Pesquerías y Oceanógrafa del Golfo de México -Universidad
Autónoma de Campeche (Ecology, Fishery and Oceanographic Centre of the Gulf of
Mexico - University of Campeche)

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EEZ
Exclusive Economic Zone
ERP
Enterprise Resource Planning
FAO
Food and Agriculture Organization
FONDEN
Fondo de Desastres Naturales (National Fund for Natural Disasters)
FSP
Full Size Project
GEF
Global Environment Facility
GIS
Geographic Information System
GOM
Gulf of Mexico
GPA
Global Programme of Action
HAB
Harmful Algal Blooms
IGO Intergovernmental
Organizations
IGoMC
Interim Gulf of Mexico Commission
IMTA
Instituto Mexicano de Tecnología del Agua (Mexican Institute of Water Technology)
INE
Instituto Nacional de Ecología (National Institute of Ecology)
INEGI
Instituto Nacional de Estadística, Geografía e Informática (National Institute of
Statistics, Geography and Informatics)
INP
Instituto Nacional de la Pesca (National Fisheries Institute)
IOC
Comisión Oceanográfica Intergubernamental de la UNESCO (Intergovernmental
Oceanographic Commission of UNESCO)
IOCARIBE
Subcomisión para el Gran Caribe de la Comisión Oceanográfica Intergubernamental
de la UNESCO (Sub-Commission for the Greater Caribbean of the IOC
ISC Intersectoral
Committee
IW International
Waters
LBS
Land Based Sources of Pollution
LME
Large Marine Ecosystem
LOE
Letter of Endorsement
LUP
Land Use Planning
MAB
Man and Biosphere
MEXUS
United States-Mexico Fisheries Cooperation Program
MSAR
Magnuson-Stevens Fishery Conservation and Management Act Reauthorization
MOU
Memorandum of Understanding
MPA
Marine Protected Area
NASA
National Aeronautic and Space Administration
NAFTA
North American Free Trade Agreement
NAP
National Action Programme
NCDDC
National Coastal Data Development Center
NEPSDOC
National Environmental Policy for the Sustainable Development of Oceans and Coasts
NGO
Non Governmental Organization
NMFS
National Marine Fisheries Services
NOAA
National Oceanic and Atmospheric Administration
NPA
Natural Protected Areas
OP Operational
Programme
P Process
PAG
Project Advisory Group
PAH Polynuclear
Aromatic
Hydrocarbons
PANDSOC
Política Ambiental Nacional para el Desarrollo Sustentable de Océanos y Costas
(National Environmental Policy for the Sustainable Development of Oceans and
Coasts)
PCB Polychlorinated
Biphenyl
PCU
Project Coordination Unit
PDF
Project Development Facility

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PEMEX
Petróleos Mexicanos (Mexican Oil Company)
PIR
Project Implementation Review
PPCU
Pilot Project Coordination Unit
PROFEPA
Procuraduría Federal de Protección al Ambiente (General Federal Attorney Agency
for Environmental Protection)
QA Quality
Assurance
QC Quality
Control
RAMSAR
Ramsar Convention on Wetlands
RCU
Regional Coordinating Unit
ROAR
Results Oriented Annual Report
RPA
Regional Programme of Action
RPA-YUCATAN Regional Programme of Action for the Yucatan Peninsula
R-TAG
Regional Technical Advisor Committee
SAGARPA
Secretaría de Agricultura, Ganadería, Desarrollo Rural, Pesca y Alimentación

(Ministry of Agriculture, Livestock, Rural Development, Fisheries and Food)
SAP
Strategic Action Programme
SC Steering
Committee
SEAMAP
Southeast Area Monitoring and Assessment Program
SeaWiFS
Sea-viewing Wide Field of View Sensor
SECTUR
Secretaría de Turismo (Ministry of Tourism)
SEDESOL
Secretaría de Desarrollo Social (Ministry of Social Development)
SEFSC
Southeast Fisheries Science Centre
SEGOB
Secretaría de Gobernación (Ministry of the Interior)
SEMAR
Secretaría de Marina (Ministry of the Navy)
SEMARNAT
Secretaría de Medio Ambiente y Recursos Naturales (Ministry of Environment and
Natural Resources)
SEP
Secretaría de Educación Pública (Ministry of Public Education)
SCT
Secretaría de Comunicaciones y Transportes (Ministry of Transport and
Communications)
SGP Small
Grants
Programme
SNIB
Sistema Nacional de Información sobre Biodiversidad de México (Biodiversity
National System of Information)
SO Strategic
Objective
SPAW
Specially Protected Areas and Wildlife
SR Stress
Reduction
SSPyPA
Subsecretaría de Planeación y Política Ambiental (Undersecretariat of Planning and
Environmental Policy)
STAP
Scientific and Technical Advisory Panel
TDA
Transboundary Diagnostic Analysis
TOR
Terms of Reference
TPR Tripartite
Review
TTT
Technical Task Team
UN United
Nations
UNAM-ICMyL Universidad Nacional Autonoma de Mexico Instituto de Ciencias del Mar y
Limnología (National Autonomous University of Mexico Sea Science and Limnology
Institute)
UNCLOS
United Nations Convention of the Law of the Sea
UNEP
United Nations Development Programme
UNDP
United Nations Development Programme
UNESCO
United Nations Educational, Scientific and Cultural Organization
UNESCO-IOC
UNESCO- Intergovernmental Oceanographic Commission

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UNFCCC
United Nations Framework Convention on Climate Change
UNIDO
United Nations Industrial Development Organization
USA
United States of America
USACE
US Army Corps of Engineers
USGS
US Geological Survey
WECAFC
Western Central Atlantic Fishery Commission
WSSD
World Summit on Sustainable Development

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1. PROJECT
SUMMARY

PROJECT RATIONALE, OBJECTIVES, OUTPUTS/OUTCOMES, AND ACTIVITIES.

RATIONALE

The distinctive biophysical characteristics of the Gulf of Mexico Large Marine Ecosystem (GoM LME)
make it one of the most productive marine ecosystems in the world and an important global reservoir of
biodiversity. However, this high productivity is at risk from a suite of anthropogenic threats that include
excessive fishing effort, destruction of critical coastal and marine habitats, and nutrient-enrichment
resulting in a "Dead Zone" of over 18,000 km2 that forms every year ­ one of the largest hypoxic zones of
water in the world. Additionally, the LME is the focus of extensive oil and gas production as well as a
rapidly increasing tourism industry.
Many stocks in the Gulf of Mexico are over-fished, or are at (or close to) their maximum yield. Intensive
fishing, the primary force driving biomass changes in the GoM LME, is compounded by two other
significant factors. Habitat modification, including loss of critical habitats and connectivity, resulting
from poorly planned growth in coastal and urban areas along the GoM coast, translates into a trend of
urban growth at the expense estuaries, marshes, seagrasses, coral reefs, mangroves and other vital
ecotones. According to data from the FAO, in the last 30 years Mexico has lost more than half of its
mangrove coverage on both coasts. Depletion and impacts on fish stocks affects both countries given that
many stocks are shared, migratory, or connected via egg or larval transport. Loss of habitats impacts on
the life cycles of over 90% of GoM coastal and marine species, as does the increasing pollutant and
nutrient loads. Economic activities in the GoM are significant for both countries, with 85% of Mexico's
oil extraction originating in the region as well as 72% of the U.S. offshore petroleum production.

These growing anthropogenic threats evidence tight interdependencies in terms of causes and effects, and
an LME-wide, ecosystem-based management approach is required to effectively mitigate them in the
long-term. However, existing management approaches are not consistent with an ecosystem-based
perspective and there are currently no agreed bi-national programmes for managing the GoM resources
taking into account ecosystem-based requirements. Furthermore, the two countries have institutional
frameworks for coastal and marine resources protection, but no effective regional inter-sectoral project
coordination mechanism currently exists. In the absence of GEF intervention, fragmented efforts with a
national and an often sectoral focus will continue to be the norm.

The proposed GEF alternative will, through a TDA-SAP process, remove identified constraints and
barriers, develop common mechanisms and tools, and promote reforms and investments, to set the bases
for application of the ecosystem approach in the management of the GoM LME. This will be
complemented by discrete capacity-building activities and pilot projects in three critical aspects of the
ecosystem approach: productivity, conservation and adaptive management, and robust monitoring and
evaluation frameworks, as well as cross-sectoral engagement. The transition towards the ecosystem-based
management of the GoM LME will depend on a greater convergence of policy tools including long-term
joint programs and actions, a clearer distribution of competencies at all three levels of government, and a
robust monitoring and evaluation program. This will require a truly regional GoM initiative supported
through a combination of GEF financing and co-financing including a reoriented baseline.

Within this integrated approach, the project will address specific IW Priorities, in particular reduction of
nutrient over-enrichment from land-based pollution that creates anoxic "dead" zones in coastal waters,
and restoration and maintenance of costal and marine fish stocks and associated biological diversity,
complemented by efforts to address degradation of coastal resources and processes. In particular, the

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"dead zone" that forms every year in the Gulf of Mexico in critical areas for commercial and recreational
fisheries will require cross-sectoral, integrated suites of measures and reforms to address this issue as
detailed in the IW Strategy. The project will also develop mechanisms and undertake reforms for
maintaining fisheries resources to within safe biological limits, and encourage the sustainable use of all
exploited living marine resources in the GOM LME. As an OP9 initiative, it emphasizes the multi-focal
connections that characterize the system. The project seeks to create a co-operative framework, together
with the necessary capacities, thereby enabling Mexico and the U.S. to address both imminent threats to
the water body and develop joint ecosystem-based management approaches

OBJECTIVES AND OUTPUTS/OUTCOMES

The long-term development/environmental goal of the project is to promote a more sustainable
development of the Gulf of Mexico LME through ecosystem-based management approaches. The project
objective is to set the foundations for LME-wide ecosystem-based management approaches for the
rehabilitation of marine and coastal ecosystems, recovery of depleted fish stocks, and reduction of
nutrient overloading.

OUTCOME 1: Transboundary issues analysed and priorities defined [Total Cost US$25,170,000 Co-
financing: US$24,742,000; GEF Request: US$427,500]
Rationale: The Transboundary Diagnostic Analysis (TDA) initiated in the PDF-B phase will be updated.
Priority knowledge gaps within the GoM LME will be filled, in the areas of productivity, biodiversity,
pollution and eutrophication, socio-economic conditions, legal/regulatory review, stakeholder analysis.
Capacity to undertake environmental assessments will be enhanced through the provision of training and
joint work between the United States and Mexico.

Outputs:
1.1 Capacities and gaps in regional monitoring methods/standards identified
1.2 Key ecosystem assessment and management gaps identified
1.2.1 Biodiversity hot spots in the GoM LME assessed and key knowledge gaps identified
1.2.2 Existing information and data on status and trends in fisheries assessed
1.2.3 Ecosystem-wide nutrient over-enrichment and contaminant sources, flows and levels assessed
1.2.4 Environmental impacts of transboundary pollution on the GoM ecosystem assessed
1.2.5 Information on nutrient over-enrichment and related Harmful Algal Blooms (HABs) collected
and integrated
1.3 Governance analysis of relevant policy and regulatory frameworks completed
1.4 Analysis undertaken of the socioeconomic impacts of priority transboundary issues, including a
preliminary LME wide economic valuation of near shore and marine goods and services
1.5 TDA revised, finalized, published and disseminated

OUTCOME 2: Country agreement on and commitment to regional and national policy, legal and
institutional reforms to address the agreed priority transboundary issues previously defined [Total
Cost US$10,130,000 Co-financing: US$9,000,000; GEF Request: US$1,130,000]

Rationale:
The Strategic Action Programme (SAP) and associated National Action Programmes (NAPs) will enable
the littoral states to reach a consensus on ecosystem priorities, targets, governance reforms, programmes
and projects to protect, manage, restore and sustain the shared resources of the GoM LME. It will include
an estimation of the required financial resources and a strategy to mobilize these resources. The SAP will
play a key role in ensuring that global environmental benefits are provided in tandem with facilitating
sustainable and environmentally sound economic development in the LME over the coming decades.
Targeted strategies to address the key transboundary issues identified in the preliminary TDA will inform

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and enhance development of the SAP focusing on reduction and control of nutrient over-enrichment,
sustainable management and use of exploited living marine resources, as well as the recovery of depleted
fish stocks to within safe biological limits, and the establishment of representative marine protected areas
in both countries. Additionally, the pilot projects (see outcome 3) will feed back into the SAP/NAP
development process. Robust stakeholder involvement, including strong interaction with the private
sector (oil and gas, fisheries, tourism and other industries), will underpin the SAP. Together with the
TDA, it will be a living document, which is actively incorporated into the LME adaptive management
approach. The development of the SAP will be supported by a series of capacity building and
institutional strengthening activities, some of which are entirely co-financed by the countries. These are
indicated in the Outputs below as Fully Co-Financed.

Outputs:
2.1 Strategies and actions developed for the reduction and control of nutrient over-enrichment and HABs
and for the elimination of dead zones
2.1.1. Regional Plan of Action for the Yucatan Peninsula (RPA-YUCATAN) developed and
implemented by Mexico as a major contribution to reduce land based sources of pollution
into the GoM LME - Fully Co-Financed
2.1.2. Strategic Partnerships developed between GoM LME programme and institutions responsible
for integrated management of the major GoM river basins, as well as the main coastal cities
2.1.3. Stocktaking undertaken of the Papaloapan watershed Commission to define opportunities for
replication in the Grijalva-Usumacinta and Panuco river basins in order to provide for strong
inter-linkages between watershed management authorities and coastal managers
2.1.4. Strategies developed for harmonizing legislative, policy and regulatory frameworks on
agricultural practices at LME wide levels, building upon the Gulf of Mexico Governors
Alliance

2.2 Strategies and actions formulated for sustainable management and use of exploited living marine
resources, and for the recovery of depleted fish stocks to within safe biological limits
2.2.1. Bilateral initiatives for regional surveying of productivity and oceanography, stock
assessment and population assessments encouraged and strengthened - Fully Co-Financed
2.2.2. A review undertaken of effectiveness of compliance measures with existing fisheries legal
and regulatory frameworks in both countries, especially with regards to illegal, unregulated
and unreported fishing (IUU), excessive fishing capacity, and enforcement and surveillance,
and appropriate reforms and measures proposed.
2.2.3. Fisheries management plans developed for selected key commercial fisheries

2.3 Establishment of representative marine protected areas (MPAs)
2.3.1. Recovery plans developed for depleted priority non-commercial species and associated marine
flora and fauna for additional species not currently addressed
2.3.2. Management and capacity building requirements defined for the restoration of degraded
marine coastal wetlands
2.3.3. Marine and coastal spatial zoning processes in individual countries strengthened and
implemented thus enhancing sectoral links among sectoral users in marine and coastal zones-
Fully Co-Financed
2.3.4. LME-wide strategies for conserving biodiversity and habitats in the coastal zones of GoM
LME supported and harmonized at a regional level
2.4 The Strategic Action Programme (SAP) and National Action Programmes (NAPs) formulated and
endorsed at the highest levels
2.5 Commitments to SAP implementation obtained and sustainable financing arrangements formulated


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OUTCOME 3: LME-wide ecosystem-based management approaches encouraged and strengthened
through the successful implementation of Pilot Projects [Total Cost US$45,014,780 Co-financing:
US$42,854,780; GEF Request: US$2,160,000]

Rationale: A priority focus within the overall project is to deliver tangible global benefits in the
participating countries through the selection and implementation of `on-the-ground' activities.
Consequently, clearly defined regional and national pilot demonstration projects to advance SAP
implementation will be undertaken during the execution of the full project. Three priority pilot projects
were jointly identified by participating countries during the PDF phase that are fully incremental and will
assist Mexico to participate more robustly in ongoing programmes undertaken by the United States, and
assist both countries to strengthen regional approaches to ecosystem-based management of the LME.

The pilots are all sited in the same area, Terminos Lagoon, in order to achieve greater cost-effectiveness,
maximize synergies and set the foundations for integrated, ecosystem-based approaches to natural
resource management. By setting the pilots in the same location, the pilot strategies will generate practical
experiences to address a complex baseline of overlapping policies and competencies for protected area
conservation, social and economic development, and threats to terrestrial, coastal and marine biodiversity.
The harmonized development of the three pilots will moreover contribute to defining a stronger baseline,
and help enable the development of validated integrated approaches that will facilitate upscaling to other
States and at a national level. Options for replication beyond the project area will also be enhanced.

Pilot Project 1: Enhanced natural habitat conservation in the coastal and marine areas of the Gulf
of Mexico LME

Extensive coastal wetlands, critical ecosystems for the exceptional productivity of fish and shellfish,
provide essential habitat rich in biodiversity, and provide important ecosystem services associated with
the improvement of water quality, sediment filtration, and flood and erosion control. The pilot will use the
opportunities available to protect these fragile habitats, including through the use available data, to assess
present coastal land use patterns, to define and protect healthy ecosystems, and to conduct restoration in
areas with degraded or lost coastal habitats. The United States has extensive expertise in habitat
restoration (particularly with salt marshes, sea grasses, and mangroves) and in bringing stakeholders at all
levels to consensus in designing and implementing habitat projects. This expertise will be made available
to Mexico in order to increase opportunities and chances of success. The project will therefore promote
the ecosystem approach for conservation and management of wetlands, particularly mangrove
ecosystems, sea grass beds and sand dunes, in order to maintain their functional and structural integrity, to
conserve associated biodiversity, and to ensure economic and social benefits for future generations. This
will be achieved through restoration of deteriorated coastal areas and habitats with an emphasis on critical
coastal habitats; development of mangrove monitoring methods; and development of cost-effective
strategies to mitigate impacts such as erosion due to extreme meteorological events and inappropriate
coastal infrastructure.

Pilot Project 2: Enhancing Shrimp Production through Ecosystem Based Management

In the Gulf's fisheries, some of the most productive in the world, shrimp are one of the most highly
valued species for both countries. Currently, over-exploitation is a common problem in Mexico due to
the great demand for food and jobs, the use of modern technologies that make fishing more efficient, and
the use of non-selective fishing gear resulting in excessive by-catch of non-target species, discards, and
habitat damage. Coastal and marine habitat modifications also contribute to the depletion of fish stocks.
The object of this pilot project is to contribute to the recovery of depleted species through an ecosystem
based management approach, focusing mainly on the shrimp fishery. The overall outcomes of the pilot

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project will be: strengthened capacities for stock assessments and data collection for future ecosystem-
level analysis; establishment of baseline information, including available environmental variability
information, for tracking improvements in stock status and fisheries abundance as new regulatory and
management practices are implemented; stakeholders representing all involved sectors and interests are
fully-informed and fully-involved; coherent project planning and implementation is employed through an
effective communication process; effective and coordinated surveillance and enforcement mechanisms
are established, as are enhanced capacities for enforcing compliance of regulations; an enhanced
understanding is achieved of the interactions of fishery species and protected species with higher and
lower components of the food web, including human extractive activities, for assessing the potential
impacts of fishing in non target species; and a contribution is made to the benefits represented by other
commercially important species.

Pilot Project 3: Joint Assessment and Monitoring of Coastal Conditions in the Gulf of Mexico

Coastal degradation is one of the main transboundary problems identified for the Gulf of Mexico.
Degradation, together with an absence of ecosystem-based management information relating to fisheries,
environmental quality, and other aquatic resources, makes management of the GoM LME challenging.
Without a consistent and comprehensive LME-wide regional monitoring system, informed management
actions remain largely site specific.

The object of this pilot project is to strengthen capacities for joint monitoring, assessment and evaluation
of the coastal environment in support of the GoM LME management goals and objectives through:
development of a set of coastal ecosystem health indicators; strengthened capacity and enhanced
integrated ecosystem based management; completed baseline sampling for the determination of the
ecological condition of the estuarine and coastal environments adjoining Terminos Lagoon; active
participation of regional and local management authorities, scientists, and other stakeholders; an
evaluation of the potential for extending sampling protocols to adjacent states or systems in Mexico; and
the preparation and dissemination of a State of the Coast of the Gulf of Mexico. The pilot project will
build upon the substantial knowledge and track record of coastal conditions monitoring in the U.S.
portion of the Gulf of Mexico, creating a complementary ecological monitoring system in Mexico's
portion of the Gulf of Mexico and so providing the basis for enhanced bilateral cooperation. This joint
monitoring and assessment survey will contribute to meeting the project objective by creating a consistent
baseline of environmental information throughout the LME, which will be used to better define required
regulatory and policy reforms as well as to target restoration areas.

Outputs:
3.1 Pilot Project on Natural Habitat and Ecosystem Conservation of Coastal and Marine Zones of the
Gulf of Mexico: Wetlands, Mangroves, Sea Grass Beds and Sand Dunes effectively implemented
3.2 Pilot Project on Enhancing Shrimp Production through Ecosystem Based Management effectively
implemented
3.3 Pilot Project on Joint Assessment and Monitoring of Coastal Conditions in the Gulf of Mexico
effectively implemented

OUTCOME 4: Monitoring and Evaluation System for the Project and the GoM LME established
[Total Cost US$19,869,000 Co-financing: US$19,400,000; GEF Request: US$469,000]

Rationale: Effective monitoring and evaluation (M&E) is recognized as an indispensable tool in project
and program management. The GoM LME M&E plan and the process, stress reduction, and
environmental status indicators developed as part of it in accordance with GEF guidance, will serve both
as a corrective function during the project cycle, enabling timely adjustments, and as a guide to

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structuring future projects more effectively. In order to ensure that the M&E mechanism and indicators
are populated with high quality data, a regional Data and Information Management (DIM) system will be
developed, building on existing systems within the region. In addition, standards and protocols for the
collection, processing, analysis and compilation of data and GIS information will be created and
mechanisms for sharing of data and information input into the DIM System will be initiated. A key output
of this particular Outcome will be a regular biennial regional status report on large-scale ecosystem
impacts in the GoM LME.

Outputs:
4.1 Monitoring & Evaluation mechanisms set up including an M & E system for the project
4.2 Suite of GEF M&E indicators developed (process, stress reduction, and environmental and
socioeconomic status) to monitor SAP implementation.
4.3 GoM LME Environmental Information System developed
4.4 Bi-annual SEE ABOVE regional status reporting protocol developed on large scale ecosystem
impacts in the GoM LME

OUTCOME 5: Effective project coordination defined [Total Cost US$2,316,000 Co-financing:
US$2,000,000; GEF Request: US$316,000]

Rationale: This component will develop a sustainable institutional network to address the GoM LME
environmental problems and root causes, and help implement the transfer of institutional arrangements
from the support of GEF to ownership by the region.

Outputs:
5.1 Regional Project Coordination Unit set up
5.2 Steering Committee and Regional Technical Advisory Group (R-TAG) established
5.3 Intersectoral coordination established through the development of Intersectoral committees (ISCs) or
their equivalent in both countries, including private sector involvement
5.4 An appropriate regional coordination mechanism jointly defined
5.5 Information needs within the relevant sectors identified and addressed in order to ensure active and
informed participation
5.6 Robust public awareness strategies developed that are targeted at the different stakeholder levels and
groups

KEY INDICATORS, ASSUMPTIONS, AND RISKS (FROM THE LOGFRAME).

As reflected in the logical framework, given that the focus of this project is foundational capacity building
through a SAP development process in accordance with GEF guidance, the majority of the indicators are
process indicators. However, the demonstration projects, in particular that on Joint Assessment and
Monitoring of Coastal Conditions will set the basis for the definition of Environmental Status indicators.
Additionally, the Program will define stress reduction indicators during Phase 1, in the process of
preparing the SAP.

Key indicators for the five outcomes detailed above are:

Outcome 1 Indicator: Revised TDA available and agreed upon by both countries Y2 (P)
Outcome 2 Indicator: SAP endorsed at ministerial level in both countries Y4 (P)
Outcome 3 Indicator: Pilot Projects all implemented and delivering on schedule Y4 (P, SR and ES)
Outcome 4 Indicator: Gulf of Mexico LME Data and Information Management System established Y4 (P)

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Outcome 5 Indicator: The project team is effectively coordinating the project and meeting the objective.
All outputs completed within budget and according to the agreed work plan Y1 to
Y4 (P)
Risks
The risks confronting the project were evaluated during the project preparation stage, and risk mitigation
measures have been designed. Four main risks have been identified, and are summarized below:
Risk

Risk Mitigation Measure
Governments at all levels
L Approval by the governments of this project reflects support from the different
and key stakeholder
levels (federal, state and municipal). However, national commitment to needed
groups do not remain
sectoral, institutional, legal and economic reforms needs to be forthcoming and
committed to undertaking
effective delivery of the project will only occur if there is country commitment
required sectoral,
and the project has effectively communicated its role and expected outputs. The
institutional, legal and
reliance on the intersectoral committees as well as the clear requirement for
economic reforms, and
national financial commitments through the NAPs shall be stressed throughout the
financially and politically
project and will be key to overcoming this risk. Moreover, the project builds upon
committed to a regional
a strong suite of existing bi-national initiatives, and these will contribute to laying
management framework
the bases for an effective development and implementation of the SAP and
associated NAPs
Relevant government
L It is important that scientific and technical groups providing inputs are committed
agencies not willing to
to joint work and that there is reasonable access to national data and information.
share and provide data and
National data can often be sensitive to the countries involved, but to ensure the
information
SAP process proceeds successfully, there is a need for countries and organisations
to be committed to providing the necessary data and information. An
understanding of the value of a regional Data and Information Management
(DIM) system, and a growing appreciation of its benefits, should encourage
stakeholders to be forthcoming with information and data.
LME-wide objectives may M Infrastructure development for tourism, the commercial fishing industry, the oil
conflict with local/
industry, and agriculture are all important economic activities for the countries.
national interests
Local and national resistance and objections to proposed changes to these sectors
are likely to arise. Broad stakeholder participation and support, achieved through
targeted awareness and information strategies, as well as stepwise consensus
building, will be required and are built into the project as critical components.
Routine and effective involvement of stakeholders in planning, management and
decision-making can only be accomplished by on-going encouragement,
strengthened capacities, and financial commitment by the project, donors and the
countries themselves
Effective private sector

For the long-term sustainability of the GoM LME Program, the project aims to
involvement is difficult to
demonstrate to productive sectors the long-term benefits to be derived from any
achieve
jointly defined regional coordination mechanism that is established and that their
own further investment in the project will be far less than the costs which would
accrue to them if these mechanisms were not in place. Although there may be
specific niches within the productive sectors that are non-responsive, current high
levels of CSR and investment in environmental projects, such as by PEMEX,
indicate that this risk is low.
[Rating: L = Low Risk; M = Medium Risk; H= High Risk]





12

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2.
COUNTRY OWNERSHIP

COUNTRY ELIGIBILITY

Both countries are GEF members. Mexico is eligible for GEF financial support under paragraph 9(b) of
the GEF Instrument.

COUNTRY DRIVENNESS

Over the last four decades the countries have demonstrated a willingness to co-operate in matters relating
to the environment of the Gulf of Mexico both through bilateral programmes and active participation in
regional programmes. These include: international agreements such as MEXUS-Gulf between the
Instituto Nacional de la Pesca (INP) and the US Southeast Fisheries Science Centre (SEFSC) established
in 1976; annual U.S. - Mexican Bilateral Fisheries Talks; attendance of Mexican officials at meetings of
the U.S. Gulf of Mexico Fishery Management Council; the North American Free Trade Agreement Good
Neighbor Environment Committee and Commission for Environmental Co-operation; the EPA-led Gulf
of Mexico Programme; and the Northern Border Environmental Programme. Both countries belong to
IOCARIBE, the UNESCO-IOC Sub-commission for the Wider Caribbean (which includes the Gulf of
Mexico), the Western Central Atlantic Fishery Commission (WECAFC) of FAO and UNEP's Wider
Caribbean Environment Program. Country drivenness of the project is also shown by the commitment of
the countries in terms of significant financial resources in support of the project, including in-kind
contributions. The governments have also indicated that they will provide necessary scientific expertise to
the GoM LME Project from national organizations, and at-sea facilities for data collection, ship time, and
meeting space as required.

3.
PROGRAM AND POLICY CONFORMITY

FIT TO GEF OPERATIONAL PROGRAM AND STRATEGIC PRIORITY

In terms of Strategic Programs in the international waters focal area for GEF 4, the project conforms to
both SP1 and SP2 as it will provide for strategies and actions for the sustainable management and use of
exploited living marine resources, for the protection and restoration of critical coastal and marine habitats
and to address reduction and control of nutrient over-enrichment and Harmful Algal Blooms. As called
for in the International Waters Focal Area Strategy and Strategic Programming for GEF4, land-based
sources of pollution that create anoxic "dead" zones are a priority and the Gulf of Mexico hypoxic zone is
the largest in the world. The project addresses the cross-sectoral collaboration and synergies required in
order to coordinate regional efforts to address the distribution, dynamics and causes of hypoxia. The
project will also develop mechanisms and undertake reforms for maintaining fisheries resources to within
safe biological limits, and encourage the sustainable use of all exploited living marine resources in the
GoM LME. These efforts will complement activities and reforms geared at reducing ecosystem stress on
critical coastal areas including bays, estuaries, and wetlands.

Through the international waters focal area, the GEF has helped establish management and policy
frameworks in large marine ecosystems that provide the necessary foundation for marine protected areas
to be successful. One of the pilots in the project specifically focuses on the rehabilitation and restoration
of coastal areas and critical habitats. As an OP9 initiative, it emphasizes the multi-focal connections that
characterize the system, and seeks to create a co-operative framework, together with the necessary
capacities, thereby enabling riparian countries that share the ecosystem to address both imminent threats
to the water body and develop joint ecosystem-based management approaches.


13

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The Program addresses GEF eligibility criteria agreed under the International Waters focal area by:
a) assisting groups of countries to better understand the environmental concerns of their international
waters and work collaboratively to address them;
b) building capacity of existing institutions, or through new institutional arrangements, to utilize a
more comprehensive approach for addressing transboundary water-related environmental concerns;
and
c) implementing sustainable measures that address priority transboundary environmental concerns.

SUSTAINABILITY (INCLUDING FINANCIAL SUSTAINABILITY)

This project will be sustained through the far-reaching support mechanisms that are being incorporated
into its development. It will bring together the private sector, civil society representatives (including
members of the Regional Councils for Sustainable Development and NGOs), government agencies at all
levels (SEMARNAT, the Secretary of the Navy, port authorities, riparian state and municipal
governments), and donors interested in supporting work within the region. Once under implementation,
both the project and the pilot projects will bring about evident economic and social benefits thus
generating an incentive to replicate these efforts. Within the pilot projects, there are built-in mechanisms
for sustaining the outcomes after project support is complete, as well as monitoring and evaluation that
emphasizes acquiring improvements throughout the process and in subsequent implementation.

The improved coordination of institutions (SEMARNAT, INP, riparian state governments, municipalities)
with mandates that impact on the GoM LME, at both national and bi-national levels, is a keystone of this
project. Key examples are the MEXUS-Gulf initiative and the Gulf Governors Alliance. Moreover, this
project builds upon existing mechanisms such as the permanent Inter-ministerial Commission for the
Integrated Management of Oceans and Coasts (CIMIOC) of Mexico that represents a paradigm shift from
a short-term, sectoral perspective to a long-term integrated management regime that recognizes the
interconnections between biological systems and economic and social systems. Inter-sectoral linkages
promoted by the project will provide for greater coordination and communication between economic
sectors and spheres of government, in order to develop integrated management actions based on the
ecosystem approach. Similarly, the project feeds into existing policy frameworks such as the Land Use
Planning Programme for the Coast and Marine Areas of the Atlantic littoral currently being developed in
Mexico. In addition, the project will catalyze the already dynamic relationship between the U.S. and
Mexico in the GoM LME and build upon a strong baseline as reflected in the fact that the pilot
demonstration projects seek to strengthen opportunities, expertise and know-how so that Mexican
counterparts can better participate in, and contribute to, ongoing efforts by the U.S. in the region.

Finally, the development of the SAP and the NAPs includes devising mechanisms for regional and
national support commitments to the project activities and to reach the objectives of the SAP. The
creation of institutional mechanisms through the GoM LME as well as a country-driven regional
coordination mechanism will also ensure that the efforts initiated under this project are national and
regionally supported and will be on going after the conclusion of project activities.

REPLICABILITY

This project will draw on lessons from other GEF LME projects both regionally and globally, while the
results and lessons learned from this project will benefit subsequent efforts to manage LMEs and coastal
and enclosed seas. In this context, efforts will be made to cooperate and share information with other
transboundary water management projects in the region. In particular, this initiative will be developed in
close coordination with the GEF LME project "Sustainable Management of the Living Marine Resources
of the Caribbean Large Marine Ecosystem and Adjacent Regions", which is currently under preparation.

14

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These two projects share key outcomes. Additionally, these initiatives share the support of important
partners in the region including U.S.-NOAA and U.S.-EPA, as well as platforms for leveraging other
partnerships and resources such as Blue Water to White Water.

STAKEHOLDER INVOLVEMENT

Stakeholder involvement has been recognized as an integral part of the development phase of the GoM
LME project, and will continue to be emphasized during the implementation of this project. The large
number and great diversity of stakeholders identified in the GoM LME, at all levels, present a challenge
for this project and for a holistic approach to the governance of the LME in general. However, this
situation also presents valuable opportunities for enriching and enhancing the project by engaging the key
stakeholders in the project, as well as for ensuring the sustainability of project outcomes in the post-
project period.

The project will work with the several fora that already exist at both national and bi-national levels for
bringing diverse groups of stakeholders and resource users together including, at the bi-national level, the
MEXUS-Gulf Fisheries Cooperation Program and ongoing bilateral fisheries talks. At national levels,
Mexico has already established the Inter-ministerial Commission for the Integrated Management of
Oceans and Coasts (CIMIOC), and the US has established the Gulf of Mexico Alliance, a partnership of
Gulf States and 13 Federal agencies, and to which Mexican representatives are invited. In Mexico there is
a network of Regional Consultative Councils for Sustainable Development, with representatives from
NGOs, academia, the private sector and federal and state governments from each state. The
representatives from the riparian states of the Gulf of Mexico are actively engaged in the development of
the Land Use Planning Program for Coasts and Oceans, and it is foreseen that they will be also actively
participating in this project. The project will build upon these initiatives and develop mechanisms to
achieve a highly participatory approach that targets a wide array of stakeholder groups ranging from the
private sector to community resource users. Project sustainability is understood to be closely associated
with full engagement by key stakeholder groups. Therefore the project has a specific output related to
identification of targeted information needs within relevant sectors, and the development of robust public
awareness and participation strategies tailored to different stakeholder levels and groups.

MONITORING AND EVALUATION
Project monitoring and evaluation will be conducted in accordance with established UNIDO and GEF
procedures and will be provided by the project team, with added support from the UNIDO GEF
coordinator and Evaluation Unit and the UNIDO regional office in Mexico. The Logical Framework
provides performance and impact indicators for project implementation along with their corresponding
means of verification. The Logical Framework Matrix in Annex B also identifies the indicators in GEF
Process (P), Stress Reduction (SR) and Environmental Status (ES) framework for reporting in Annual
APR/PIRs. These will form the basis on which the project's Monitoring and Evaluation system will be
built. The project's Monitoring and Evaluation Plan will be presented and finalized as part of the Project's
Inception Report following a collective fine-tuning of indicators, means of verification, and the full
definition of the project staff's M&E responsibilities. The Project Coordination Unit will be responsible
for day-to-day monitoring of project activities and for taking measures to strengthen performance.
Monitoring will include regular feedback to the Steering Committee. Annual Project Performance Review
(PIR/APR) will be completed yearly followed by a Steering Committee meeting.
Approximately US$236,000 will be allocated for the monitoring and evaluation (M&E) activities that will
be undertaken by the project team, independent experts and UNIDO.


15

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4.
FINANCIAL MODALITY AND COST EFFECTIVENESS

Costs of the GEF Alternative represent baseline and incremental costs totalling US$430,499,780. New
and additional incremental resources required to achieve project objectives are US$102,499,780. Of this,
a request is made from GEF for US$ 5.0 million while US$97,954,780 has been raised as co-funding.
This results in a 1:19.6 GEF to co-funding ratio.
PROJECT COSTS

Project Components/Outcomes
Co-financing ($) GEF ($)
Total ($)
1. Transboundary issues analysed and priorities defined
24,700,000
427,500
25,127,500
2. Country agreement on and commitment to regional and
9,000,000 1,130,000 10,130,000
national policy, legal and institutional reforms to address
agreed priority transboundary issues
3. LME-wide ecosystem-based management approaches
41,674,780 2,160,000 43,834,780
encouraged and strengthened through the successful
implementation of Pilot Projects
4.Monitoring and Evaluation System for the Project and the GoM
19,400,000 469,000
19,869,000
LME established
5. Effective project coordination
2,000,000
316,000
2,316,000
96,774,780
4,502,500
101,277,280

PROJECT MANAGEMENT UNIT BUDGET:

LOCALLY RECRUITED CONSULTANTS. It is estimated that 1,020 weeks of consultants are needed for the
project. This is equivalent to 5 people over the 4 years of the project, including the Chief Technical
Advisor for the project, one technical assistant, an administrator, one specialist in database management
and geographic information systems, and a specialist on socio-economics and stakeholder analysis.
Salaries for locally recruited consultants were estimated at USD $ 1,000 per week.

INTERNATIONALLY RECRUITED CONSULTANTS. No international consultants will be hired for project
management.

OFFICE FACILITIES, EQUIPMENT, VEHICLES, ETC. This includes $250,000 for office space (at $5,000
per month over four years), $100,000 for office equipment and supplies etc., $50,000 for adaptation of
office space, $280,000 for vehicles, which includes two vehicles for the use of the project coordinating
unit ($35,000 each ­ only one of these vehicles will be purchased with GEF funds, and with appropriate
justification), one vehicle for field work (mainly for the pilots, $60,000), a small boat for field work
($50,000), and the use of ships of opportunity for coastal work and collections of offshore samples
($100,000). It is calculated that $100,000 will be spent for communications (internet, fax, telephone, etc.)
over the four years of the project, and $30,000 per year on office maintenance for a total of $120,000.


TRAVEL. Since the project involves two countries and three pilot projects, travel to Mexico City (4 trips
per year x 4 years at $2,000 each totals $32,000) and Miami (2 travels per year x 4 years at $2,000 each
totals $16,000) to coordinate with the national focal points for the project are expected. Also travel to
Corpus Christi (Texas) (2 trips per year x 4 years at $2,000 each totals $16,000) to coordinate with the
Harte Research Institute and the Texas A&M University campus there. Visits to the pilot projects in the
field (4 trips per year x 4 years at $4,000 each totals $64,000), attendance to workshops (4 trips per year x
4 years at $3,500 each totals $56,000) and training courses (4 trips per year x 4 years at $4,000 each totals
$64,000) etc., have also been considered.


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MISCELLANEOUS. Expenses other than those mentioned above are considered here, particularly funds for
unexpected expenditures.

Estimated consultant
GEF ($)
Other sources ($)
Project total
Component
weeks
($)
Locally recruited consultants
1,020
316,000
700,000
1,016,000
Internationally recruited
0 0 0 0
consultants*
Office facilities, equipment,
0
900,000
900,000
vehicles and communications
Travel
0
250,000
250,000
Miscellaneous
0
150,000
150,000
Total

316,000 2,000,000
2,316,000

CONSULTANTS WORKING FOR TECHNICAL ASSISTANCE COMPONENTS:

838 weeks of national consultants will be hired for the technical assistance components, and 212 weeks of
international consultants. A relatively small amount funds have been allocated to international
consultants, since the United States has offered technical assistance and technology transfer in the
cofinancing letter. Additionally, national consultants will be hired to coordinate the three pilot projects.
Since these will be part time consultants, half the number of weeks is given. The duration of the
conservation and fisheries pilots is four years (216 weeks), so 108 weeks are allocated, and the
monitoring pilot is for three years (162 weeks), so 81 weeks are allocated. Salaries for locally recruited
consultants were estimated at USD $ 1,000 per week, and for internationally recruited consultants the
salary was USD $ 2,500 per week.

Estimated consultant

Other sources ($)
Project total
Component
weeks
GEF ($)
($)
Local consultants
2,135
1,092,500
1,042,500
2,135,000
International consultants
812
330,000
1,700,000
2,030,000
Total 2,947
1,422,500
2,742,500
4,165,000

CO-FINANCING SOURCES
Co-financing Sources
Name of co-financier



Type
(source)
Classification
Amount ($)
Status
SEMARNAT
National Government
In kind
15,574,780
Confirmed
National
Government
Cash
Confirmed
PEMEX National
Government
In
kind
1,200,000
Confirmed
National
Government
Cash
Confirmed
NOAA National
Government
In
kind
78,400,000
Confirmed
National
Government
Cash
Confirmed
EPA National
Government
In
kind
1,600,000
Confirmed
National
Government
Cash
Confirmed
Sub-total co-financing
96,774,780



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COST-EFFECTIVENESS

The project has been designed to ensure that outcomes are achieved in a cost-effective manner. The
design includes three pilot projects that are all sited in the same area, Terminos Lagoon, in order to
achieve greater cost-effectiveness, maximize synergies, and set the foundations for integrated, ecosystem-
based approaches to natural resource management. Setting the pilot projects in the same location ensures
that they will generate practical experiences to address a complex baseline of overlapping policies and
competencies for protected area conservation, social and economic development and threats to terrestrial,
coastal and marine biodiversity. Thus, the pilot projects will contribute to testing cost-efficiency models
from a variety of different angles including ones focused on fisheries management and productive uses,
habitat restoration and management, and robust M&E tools. Overall, efforts to establish functional and
effective ecosystem-based management approaches are themselves cost-effective as the complex linkages
and feedback mechanisms between natural systems, productive uses, governance frameworks, impacts on
the LME from associated land-use activities are addressed in an integrated and comprehensive manner.

5.
INSTITUTIONAL COORDINATION AND SUPPORT

CORE COMMITMENTS AND LINKAGES

UNIDO provides support activities to Latin America that complement activities scheduled under this
project. In line with GEF's IW priorities, UNIDO is focusing attention on broadening the use of the LME
approach in IW, and extending its geographical coverage in Latin America. UNIDO provides expertise in
support of foundational capacity building projects such as this one. UNIDO has been the Executing
Agency for two LME projects that use the TDA-SAP methodology. The UNIDO-executed GCLME
project has led to the establishment of a multi-country LME Commission. Therefore, UNIDO can provide
strong support for the application of TDA/SAP to Large Marine Ecosystem projects like the Gulf of
Mexico. According to the document (para. 126) on comparative advantages presented to Council in the
June 2007 Council Meeting, UNIDO has comparative advantage in water management, use of water
resources, sustainable use of integrated transboundary river basins, wetlands, coastal zones and LME and
recovery and sustainable management of industrial fisheries. Priority will be given to establishing strong
linkages with other GEF funded projects in the region including IWCAM.

CONSULTATION AND COORDINATION

UNIDO brings experience in GEF IW projects, with the advantage of having a country office in the
region. UNIDO will seek to ensure that the Gulf of Mexico countries work with other GEF projects and
bilateral and multilateral donor agencies in the region in order to address the transboundary priority
environmental problems of the GoM LME in a coherent and synergistic manner. Similarly, efforts will be
made to ensure complementarity between, and to leverage necessary inputs from, pertinent ongoing
bilateral and multilateral regional and national projects within the GoM LME, including those being
executed by NGOs and the private sector.

PROJECT IMPLEMENTATION / EXECUTION ARRANGEMENTS

The GEF Agency for the project will be the United Nations Industrial Development Organization
(UNIDO). UNIDO will be responsible for both the implementation and the execution of the project.
SEMARNAT will also participate in the execution of the project.

Regional co-ordination and collaboration will be facilitated through a Regional Project Coordination Unit
(PCU), which will be located in Mexico. A Chief Technical Advisor (CTA) will be hired to facilitate the

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successful technical execution of project activities and will be housed in the PCU. The PCU will have
other staff working part-time/full-time. A Regional Project Steering Committee, consisting of high-level
official country representatives from the U.S. and Mexico and relevant stakeholders will oversee the
implementation / execution of the project. It will meet at least once a year, A Regional Technical
Advisory Group (R-TAG) will be established that will advise the Steering Committee and the PCU on
GoM technical issues and ensure coordination in support of ecosystem-based management approaches.
Finally, each country will have an Inter-Sectoral Committee (ISC) or its equivalent, to assure broad
intersectoral coordination and broad government stakeholder participation.



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ANNEX A: INCREMENTAL COST ANALYSIS

A. PROJECT BACKGROUND

Broad Development Objectives:

The long-term development/environmental goal of the project is to promote a more sustainable
development of the Gulf of Mexico LME through ecosystem-based management approaches. The
project objective is to set the foundations for LME-wide ecosystem-based management approaches to
rehabilitate marine and coastal ecosystems, recover depleted fish stocks, and reduce nutrient
overloading.

In order to achieve this objective, the purpose of this project will be to update the Transboundary
Diagnostic Analysis (TDA) prepared during the PDF B phase, formulate a Strategic Action Programme
(SAP) and associated National Action Programmes (NAPs) and undertake pilot projects that set the basis
for SAP implementation. The SAP will consist of a series of actions to monitor and assess the changing
conditions of the Gulf of Mexico Large Marine Ecosystem (GoM-LME) with a focus on restoring and
sustaining fisheries and fish stocks, and reducing and controlling nutrient enrichment of the GoM-LME to
safe ecosystem health levels. These actions will be supported by appropriate legal, policy and institutional
reforms and investments to address the priority transboundary issues identified in the TDA formulation
process. The project will also facilitate the initial implementation of the SAP to manage shared coastal
and marine resources and achieve sustainable development for the GOM LME. This will involve the
definition of an appropriate regional body and the implementation of three pilot demonstration projects. It
is noted that although Cuba endorsed the PDF-B project document their experts did not subsequently
participate in PDF-B activities, and the relevant government authorities indicated in a letter dated 27
February 2007 that they would not participate in the Full-Size Project.

A key principle of the project is to build upon, coordinate, and enhance existing approaches. For example,
considerable work has been undertaken in the Mississippi river basin by different universities and state
agencies, and in the Yucatán Peninsula under the GPA, as well as by various agencies in the Gulf of
Mexico LME such as EPA and NOAA. Such activities are at a national level and one of the outputs of the
project will be to provide a framework for coordination and harmonization at the bi-national level and to
replicate or scale up such activities to encompass the whole LME.

B. INCREMENTAL COST ASSESSMENT

Baseline
Approximately 55 million people live in the coastal states of the GOM, 40 million in the USA and 15
million in Mexico. The Gulf of Mexico LME is a major asset to these countries, in terms of fisheries,
tourism, agriculture, oil, infrastructure, trade and shipping. Commercial fishing and seafood processing
are an important component of the LME's economy, with the most important species being brown, white
and pink shrimp, and red grouper. The infrastructure for oil and gas production in the Gulf of Mexico
(including oil refineries, petrochemical and gas processing plants, supply and service bases for offshore
oil and gas production, platform construction yards and pipeline yards) is concentrated in the coastal
regions of both the USA and Mexico. The Gulf of Mexico LME contains major shipping lanes, and the
volume and value of shipping and port activities has increased in the region.

The five states that make up the Gulf Region in Mexico contribute approximately 10% of the gross
domestic product for the agriculture and livestock, forestry and fisheries sector. The environmental cost of
this production, based on national averages is equivalent to 11.8% of the regional GDP, without taking
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into account the aspects of global relevance in the Gulf of Mexico ecosystem. It is also likely that the
national average of environmental costs is lower than in the Gulf States given the intensity of agricultural
and livestock related activities in Veracruz, Tamaulipas and especially Tabasco.

Habitat conservation and restoration
CONANP will continue to declare protected areas, mostly terrestrial, aside from special reserves such as
the soon-to-be announced expansion of the Yum Balam (largely land-based) reserve to include a marine
sanctuary for an emblematic species in Holbox Island, the whale shark, or the manatee sanctuary
established in Chetumal Bay on the southern border with Belize. However, it is unlikely that productive
marine systems outside of landscape, biodiversity (coral reefs) or keystone species considerations would
be established. PEMEX will continue to support the implementation of management plans for the
protected areas in the company's operational zone such as Pantanos de Centla and Laguna de Términos.
CONAFOR will also continue to support mangrove restoration efforts under its competitive subsidy
program, without taking into consideration strategic nature of factors such as primary productivity,
climate change adaptation, etc. Ramsar resolution on marine protected areas is consistent with national
policies but in the absence of GEF support would not be considered as a priority nor would synergies
between coastal and marine ecosystems be actively sought. This baseline is estimated at US$ 21 million.

Pollution
CNA will continue to monitor simple parameters to report on beach water conditions, harmful algal
blooms will be reported and monitored, although with no systematic information sharing protocols with
the USA. Water sanitation and treatment facilities will be built and operated by CNA and the municipal
governments. The US action plan on hypoxia will continue to be implemented in the Mississippi Delta,
however in the absence of GEF support, Mexico will have no systematic way assimilate relevant
knowledge generated in the US and replicate in relevant programs such as RPA-YUCATAN (see below).
In the absence of the ecosystem approach, agricultural run-off and nutrient loading will continue to be
viewed as a result of seasonal fluctuations in the Gulf. The oil industry is the single most important
economic sector in Mexico. Oil extraction is particularly important in the states of Tabasco and
Campeche, the reserves of which are considered to be amongst the most important in the Western
Hemisphere. PEMEX will continue to operate its environmental management and industrial security
program, including pollution mitigation practices, emergency protocols and restoration. Mexico ­ through
SEMARNAT- will continue to prepare its National Implementation Plan for the Stockholm Convention
on POPS, including abatement measures for unintentional releases. This region has been selected for a
pilot project for the Global Program of Action (Regional Plan of Action for the Yucatan Peninsula RPA-
YUCATAN), and close cooperation with the Gulf of Mexico project is foreseen. This baseline is
estimated at US$ 100 million.

Policy Framework
Mexico has made important advances in consolidating its environmental policy, and the past and current
administrations have placed importance on mainstreaming of the environment through cross-sector
planning and budgeting. In 2006, SEMARNAT adopted a National Environmental Policy for the
Sustainable Development of Oceans and Coasts, which establishes public policy guidelines and strategies
in an effort to reinforce integrated environmental management of the coastal zone through structural
reform, effective inter-institutional coordination and wide ranging public participation. Mexico published
a National Fisheries Chart at the end of the 1994-2000 administration and although new versions were
published in 2004 and 2006, it that was not taken on board by subsequent administrations as a result of
which several fishing stocks were depleted. Most recently, fundamental modifications have been made to
several official standards and it is expected that further fine-tuning of the legal and policy framework
would continue to take place. However in the absence of GEF support, it is unlikely that a harmonized
policy framework for the LME between Mexico and the USA, as well as between the Mexican Federal
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Government and the State and Municipal governments, would be achieved. This component of the
baseline is estimated at US$ 8 million.

Regional coordination efforts
Bilateral activities will continue to be carried in the Gulf of Mexico out on a wide-ranging number of
issues including wildlife, habitat, shipping, petroleum industry-related emergency contingency plans,
shared watersheds, etc. Nevertheless, these efforts are predominately sectoral in nature, and do not
contemplate a shared approach, nor do they provide an enabling environment for synergies through the
ecosystem approach. The baseline is estimated at US$ 20 million.

Sustainable Livelihoods
SAGARPA currently provides limited support to riparian communities in the form of extension programs,
some rural aquaculture initiatives, and subsidized seeds, fertilizers and other inputs for subsistence
farming. In spite of the limited support for aquaculture, there is no real institutional effort made to provide
alternative income to rural coastal fisher communities. CONAFOR operates several subsidy programs
principally for reforestation and commercial plantations, and is the main financial source for restoration
of ecosystems (see above in habitat). PEMEX through the National Indigenous Commission and other
institutions provides some support for productive alternatives in agriculture. CONANP allows for
productive activities in the influence and buffer zones of the region's protected areas but does not provide
any financial support, and the management plans are not also linked to potential financiers. Also, full
stakeholder participation in the identification of these productive alternatives is still somewhat limited in
spite of important efforts in public outreach and awareness-raising. The baseline is estimated at US$ 15
million.

Summary of Baseline Investment

Issue Detail
Cost
US$
1
Habitat conservation and restoration
21,000,000
2 Pollution
100,000,000
3 Policy
Framework
8,000,000
4
Regional coordination efforts
20,000,000
5 Sustainable
livelihoods
15,000,000
Total Total Baseline Expenditures (4 years)
164,000,000


Global Environmental Objective

The principal global benefit of the project is an enhanced understanding of LME functions, to serve as
input into LME management strategies through the TDA and SAP processes, and to establish an enabling
environment and ecosystem-based management practices that will contribute to the protection and
maintenance of ecosystem functions and services. The Gulf of Mexico LME's primary productivity
supports an important global reservoir of biodiversity and biomass of fish, sea birds and marine
mammals. The LME supplies a diverse range of goods and services to the global community but these
stand threatened by human-induced pressures, including overfishing. These threats are transboundary in
nature, and cannot be effectively abated through stand-alone national initiatives. Global benefits can be
secured through the institution of an LME ecosystem-based management framework, allowing the
countries to strengthen the management of LME living resources, and address land-based and marine
pollution including the reduction of nutrient loads that contribute to hypoxic zones in the LME.

22

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The expected result of the set of interventions will be to reduce coastal pollution, restore damaged
habitats, and restore depleted stocks. The Project will make an important contribution by providing the
needed building blocks such as information systems and exchange, reinforced capacity and mechanisms
for stakeholder participation. An enhanced knowledge of the oceanography of the Gulf of Mexico LME
will assist the countries in addressing uncertainty regarding ocean-atmosphere links.


Alternative

The proposed GEF Alternative is directed at removing identified constraints and barriers to the use of the
ecosystem approach in the management of the GOM LME, including discrete capacity-building activities,
pilot projects in three critical aspects of the ecosystem approach: productive, conservation and adaptive
management, as well as cross-sectoral engagement. The transition towards the ecosystem-based
management of the GOM LME will depend on a greater convergence of policy tools including long-term,
joint programs and actions, a clearer distribution of competencies at all three levels of government, and a
robust monitoring and evaluation program. Five outcomes have been mutually identified, to be supported
through a mix of GEF financing and co-financing including reoriented baseline.

Outcome 1: transboundary issues analysed and priorities defined
An objective, scientific and technical Transboundary Diagnostic Analysis (TDA) defining the
transboundary environmental problems affecting the goods and services of the LME from an ecosystems
perspective will be revised and disseminated. The TDA will respond to the priority issues identified by
both countries including transboundary pollution mitigation, reduction and control; weak transboundary
fisheries stock management; coastal resource degradation; incomplete knowledge on the LME's
biodiversity, a non-comprehensive legal and policy framework; and the lack of a coordinated approach
for the LME management and conflict resolution issues for the Gulf of Mexico. Under the alternative,
GEF resources and co-financing will be used to finalize the development of the TDA through a capacity
needs and information gap assessment on the priority issues, as well as targeted training, as needed. This
will include the identification of biodiversity hotspots, ecosystem-wide sources of contaminants, and
preliminary economic valuation of the LME goods and services.
(US$ 427,500 GEF, US$ 24,700,000 Co-finance)

Outcome 2: The SAP and associated NAPS are formulated and adopted at ministerial level
Nationally endorsed SAP and NAPs with accompanying sustainable financing plans will pave the way
towards continued incremental improvement in the GOM LME based on a solid foundation of regional
commitment and consensus. GEF resources will leverage considerable co-financing to identify and
promote strategic partnerships within the SAP to address underlying socio-economic and governance
failures for the sustainable management of the LME. Domestic and global co-benefits will be generated
through LME-wide agreements on improved legal and policy frameworks; the incorporation of additional
globally relevant protected areas, including marine protected areas; targeted capacity building and
institutional strengthening activities and concerted action on ecosystem priorities and targets. The SAP
and NAPs will also include the creation or strengthening of existing institutional mechanisms for the
regional coordination of LME-implemented activities.
(US$ 1,130,000 GEF - US$ 9,000,000 Co-finance)

Outcome 3: demonstration projects successfully implemented
Three priority pilot projects were jointly identified by participating countries to advance SAP
implementation, and to set the basis for its long-term sustainability. The pilot projects are fully
incremental, will leverage significant co-financing and will contribute to the adoption of ecosystem-based
management of the LME by assisting Mexico and the US to coordinate conservation, fisheries and
monitoring activities. The pilot strategies will generate practical experiences to address a complex
23

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baseline of overlapping policies and competencies for protected area conservation, social and economic
development, and threats to terrestrial, coastal and marine biodiversity. The harmonized development of
the three pilots will contribute to defining a stronger baseline, and help enable the development of
validated integrated approaches that will facilitate upscaling and replication to other States and at a
national level. Successful implementation of the pilots will also provide concrete steps forward towards
achieving the ecosystem goals to be established in the SAP.
(US$ 2,160,000 GEF - US$ 41,674,780 Co-finance)

Outcome 4: Monitoring and Evaluation System for the Project and the GOM LME established
Effective monitoring and evaluation (M&E) is recognized as an indispensable tool in project and program
management. The Gulf of Mexico M&E plan and the process, stress reduction, and environmental status
indicators developed as part of it in accordance with GEF guidance, will serve both as a corrective
function during the project cycle, enabling timely adjustments, and as a guide to structuring future
projects more effectively. GEF resources will mobilize co-financing to harmonize the currently disparate
monitoring efforts in the LME, with agreed bi-national standards and protocols for the collection,
processing, analysis and compilation of data and GIS information including the preparation of a regular
bi-annual regional status report on large-scale ecosystem impacts in the GOM LME.
(US$ 469,000 GEF - US$ 19,400,000 Co-finance)

Outcome 5: Effective project coordination
The GEF alternative proposes improved regional mechanisms to meet and address the coordination needs
and gaps that currently inhibit the carrying out of system-wide interventions in the LME. By the end of
the project, it is expected that an appropriate long-term regional coordination mechanism will be defined
by both countries. This will include joint definition of a long-term regional coordination mechanism
building upon existing bi-national initiatives and the establishment of a Regional Technical Advisory
Group (R-TAG). Incremental support will help promote the transfer of institutional arrangements from
the support of GEF and other donors to ownership by the region. GEF funding will also identify and
apply best practices for public awareness and involvement in order to mobilize regional political and
stakeholder commitments to the broader development goals of the LME
(US$ 316,000 GEF - US$ 2,000,000 Co-finance)

Systems Boundary
Incremental costs have been assessed temporally, over the planned four-year implementation of GEF-
supported activities, and geographically, through the marine and coastal waters of 5 Mexican Gulf States
as well as the target sites of the pilot projects. In this particular project only Mexico is eligible for GEF
financing, however some baseline information has been included for the United States of America. The
analysis also covers the suite of thematic issues identified in the TDA process, some building on past and
present bilateral efforts.

Summary of Costs
The baseline, comprising activities that would be pursued irrespective of project investment, has been
estimated at US$ 164,000,000. Incremental Costs amount to US$ 101,277,280, of which the GEF would
fund US$ 4,502,500. The total Alternative is US$ 265,277,280. The GEF contribution amounts to 4.6 %
of the cost of the total Incremental Cost and 1.7 % of the cost of the Alternative. The GEF will provide
funding for activities that generate clear global benefits, and could not be justified solely on domestic
benefits.

24

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Summary of GEF and other donors Investment ­ The Overall Incremental Cost

Outcome Total GEF
Co-finance

1 TDA
finalized
25,127,500
427,500
24,700,000
2
SAP finalization and
10,130,000
1,130,000
9,000,000
implementation
3 Pilot
projects
43,834,780
2,160,000
41,674,780
4 Monitoring
and
19,869,000
469,000
19,400,000
evaluation
5 Coordination

2,316,000
316,000
2,000,000
Total
101,277,280
4,502,500
96,774,780


Incremental Cost Analysis per Outcome

Outcome Baseline
GEF
Co-Funding
Increment
Alternative
1. Transboundary issues
analysed and priorities
$48,000,000
$427,500
$24,700,000
$25,127,500
$73,127,500
defined
2. Country agreement /
commitment to reforms x
$41,000,000
$1,130,000
$9,000,000
$10,130,000
$51,130,000
priority tb issues defined
3. LME-wide EBM
approaches encouraged x
$33,000,000
$2,160,000
$41,674,780
$43,834,780
$76,834,780
Pilot Projects defined
4. M&E System for the
Project and the GOM
$34,000,000
$469,000
$19,400,000
$19,869,000
$53,869,000
LME established
5. Effective project
$8,000,000
$316,000
$2,000,000
$2,316,000
$10,316,000
coordination
Total
$164,000,000
$4,502,500
$96,774,780 $101,277,780 $265,277,280


Outcome 3 - Pilot Projects

Total Co-
Outcome Baseline
GEF
Increment Alternative
finance
1. Natural Habitat and
Ecosystem
$ 9,000,000
670,000 $12,408,448 $13,078,448
$22,078,448
Conservation
2. Enhancing Shrimp
Production through
$ 5,000,000
720,000 $17,866,332 $18,586,332
$23,586,332
EBM
3. Joint Assessment &
Monitoring
$ 19,000,000
770,000 $11,400,000 $12,170,000
$31,170,000
TOTAL
$33,000,000 $2,160,000 $41,674,780 $43,834,780
$76,834,780

25

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Incremental Cost Matrix

Component
Baseline
Increment
Alternative

Overall Objective: To set the foundations for LME-wide ecosystem-based management
$ 164,000,000 GEF: $ 4,502,500
Total Alternative:
approaches to rehabilitate marine and coastal ecosystems, recover depleted fish stocks and
NOAA/EPA: 80,000,000 $265,277,280
reduce nutrient overloading
SEMARNAT/PEMEX::


16,774,780


Total: $ 101,277,280
Explanatory note:
A financial baseline for the project has been set at $ 164 million, over 4 years, established using a `business as usual' scenario where, despite existing bi-national
agreements on fisheries such as MEX-US Gulf, the shared resources of the GOM are unsustainably exploited. In the absence of the GEF intervention, fragmented
management approaches not consistent with ecosystem-based management will continue within the two countries and in particular Mexico. Currently there are no
agreed bi-national programmes for managing the GOM resources from an ecosystem-based perspective and although the two countries have institutional
frameworks for coastal and marine resources protection, no effective regional intersectoral project coordination mechanism exists.

The proposed GEF alternative is required in order to remove identified constraints and barriers to the use of the ecosystem approach in the management of the
GOM LME, through discrete capacity-building activities and pilot projects in three critical aspects of the ecosystem approach: productivity, conservation and
adaptive management, as well as cross-sectoral engagement. The transition towards the ecosystem-based management of the GOM LME will depend on a greater
convergence of policy tools including long-term joint programs and actions, a clearer distribution of competencies at all three levels of government, and a robust
monitoring and evaluation program. This will require a truly regional GOM initiative supported through a combination of GEF financing and co-financing
including a reoriented baseline.

Within this integrated approach, the project will address specific IW Priorities, in particular land-based pollution and depletion of coastal/marine fisheries. In
particular, the "dead zone" that forms every year in the Gulf of Mexico in critical areas for commercial and recreational fisheries will require cross-sectoral,
integrated suites of measures and reforms to address this issue as detailed in the IW Strategy. The project will also develop mechanisms and undertake reforms for
maintaining fisheries resources to within safe biological limits, and encourage the sustainable use of all exploited living marine resources in the GOM LME. As
called for in the IW Strategy, this LME suffers from fisheries depletion but the stocks and associated biodiversity are not yet too degraded.

The alternative scenario includes financing from GEF, SEMARNAT and NOAA.

26

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Outcome 1: Transboundary issues analyzed and priorities defined
$ 48,000,000
GEF: $ 427,500
Total Alternative:

NOAA/EPA:
$ 73,127,500
$24,000,000
SEMARNAT: $700,000

Total: $ 25,127,500
Explanatory note:
A financial baseline for this Outcome has been set at $ 48 million, over 4 years, established using a `business as usual' scenario where bi-lateral activities will
continue to be carried in the Gulf of Mexico out on a wide-ranging number of issues including wildlife, habitat, shipping, petroleum industry-related emergency
contingency plans, shared watersheds, etc. However, current initiatives are predominantly country driven and are regionally fragmented with limited global
benefits. Both countries at present have their own approach to monitoring; standards are not uniform throughout the region and there are many gaps in
environmental monitoring in Mexico. In addition, there is currently little integration of results on ecosystem health between the countries again resulting in limited
global benefits. Existing benefits include common work on some listed species (CITES) and the North American Biodiversity Network.

Under the alternative, GEF resources and co-financing will be used to finalize the development of the TDA through a capacity needs and information gap
assessment on the priority issues, as well as targeted training as needed. This will include the identification of biodiversity hotspots, ecosystem-wide sources of
contaminants, and preliminary economic valuation of the LME goods and services. This will result in: increased strategic focus of the bilateral programs in the
Gulf of Mexico; greater convergence of policy tools including long-term joint programs and actions; enhanced national and regional capacity for monitoring, data
and information storage, and dissemination of information to support decision-making; and improved legal/management/planning structures for addressing the
priority transboundary problems within the framework of the ecosystem approach, including sustainable fisheries management, protection of coastal habitats, and
land- and sea-based pollution.

Outcome 2: Country agreement on and commitment to regional and national policy, legal and
$ 41,000,000
GEF: $ 1,130,000
Total Alternative:
institutional reforms to address the agreed priority transboundary issues
NOAA/EPA: $6,000,000 $ 51,130,000
SEMARNAT:
$3,000,000

Total: $ 10,130,000
Explanatory note:
The financial baseline for Outcome 2 has been set at $ 41 million, over 4 years, and has been established using a `business as usual' scenario. It is expected that
the Regional Plan of Action for the Yucatan Peninsula RPA-YUCATAN will still be developed by Mexico as a major contribution to reduce land based sources of
pollution into the GOM LME. However, agricultural subsidies will continue to favor the intensive use of agro-chemicals and continue to load the Gulf ecosystem
with nutrients in its drainage system. Recovery plans for depleted priority non-commercial species and associated marine flora and fauna are unlikely to be
addressed. State-level and federal protected areas will continue to be declared in the absence of any shared assessment of biodiversity hotspots and transboundary
and migratory species habitats. Habitat restoration programs will continue as reforestation or commercial plantation initiatives in the absence of broader
27

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biodiversity goals and ecosystem criteria. Some action plans currently under preparation for climate change adaptation will be developed, as will piecemeal
mangrove programs. Mexico's Protected Area System will continue to incorporate new PA (mostly territorial) based on ecosystem representativity. Ultimately,
the lack of a comprehensive ecosystem approach will fail to generate significant global benefits.

Under the alternative, GEF resources and co-financing will be used to develop a programmatic approach for action plans with inter-agency agreements and
processes, including the development of a Strategic Action Programme (SAP) and associated National Action Programmes (NAPs). This will result in harmonized
approaches for policy, legal and institutional reforms for addressing priority transboundary issues including consensus on ecosystem priorities, targets, governance
reforms, programmes and projects to protect, manage, restore and sustain the shared resources of the GOM LME. Other incremental benefits will include: the
development of strategies for harmonizing legislative, policy and regulatory frameworks on agricultural practices at LME wide levels, thus building upon the Gulf
of Mexico Governors Alliance; the formulation of strategies and actions for the sustainable management and use of exploited living marine resources, and for the
recovery of depleted fish stocks to within safe biological limits; the development of Strategic Partnerships between GOM LME program and institutions
responsible for integrated management of the major GOM river basins, as well as the main coastal cities. Additional global benefits will be generated by
addressing the balance of the protected areas at the systemic level, while advancing the implementation of resolution IX.4 of the Ramsar convention as well as
strengthening Mexico's globally relevant Protected Area System (SINAP) through the addition of MPAs.

Outcome 3: LME-wide ecosystem-based management approaches encouraged and strengthened
$ 33,000,000
GEF: $ 2,160,000
Total Alternative:
through the successful implementation of the Pilot Projects
NOAA/EPA: 33,600,000 $ 76,834,780

SEMARNAT: 6,874,780
PEMEX: 1,200,000

Total: $ 43,834,780
Explanatory note:
The financial baseline for Outcome 2 has been set at $ 33 million, over 4 years, and has been established using a `business as usual' scenario. Currently, there are a
number of national efforts to conserve natural habitats in the coastal and marine areas of the GOM but they are generally uncoordinated. Fisheries management
practices are used by Mexico but do not use the ecosystem approach. There is currently no `joined up' coastal assessment monitoring programme in Mexican
waters, similar in scope that undertaken by the U.S. It is expected that a number of activities similar in ambit to the proposed pilot projects would be undertaken
under the baseline to try to rectify this situation. However, many are likely to be promoted without considering the ecosystem perspective and without scoping and
prioritization.

Under the alternative, GEF resources and co-financing will be used to develop pilot projects that will deliver tangible global benefits within the participating
countries through the selection and implementation of `on-the-ground' activities. The three pilot projects are fully incremental and will assist Mexico to participate
more robustly in ongoing programmes undertaken by the United States, and both countries to strengthen regional approaches to ecosystem-based management of
the LME. The pilots are all sited in the same area, Terminos Lagoon, in order to achieve greater cost-effectiveness, maximize synergies and set the foundations for
integrated, ecosystem-based approaches to natural resource management. By setting the pilots in the same location, the pilot strategies will generate practical
experiences to address a complex baseline of overlapping policies and competencies for protected area conservation, social and economic development and threats
to terrestrial, coastal and marine biodiversity. The harmonized development of the three pilots will moreover contribute to defining a stronger baseline, and help
28

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enable the development of validated integrated approaches that will facilitate upscaling to other States and at a national level. Successfully completed
demonstration projects will also serve as a basis for replication in the region and outside the region and will provide concrete steps towards achieving agreed
ecosystem quality objectives (or EcoQOs) as set out in the SAP.

Outcome 4: Monitoring and Evaluation System for the Project and the GOM LME established
$ 34,000,000
GEF: $ 469,000
Total Alternative:

NOAA/EPA: 16,400,000 $ 53,869,000
SEMARNAT: 3,000,000

Total: $ 19,869,000
Explanatory note:

The financial baseline for Outcome 2 has been set at $ 34 million, over 4 years, and has been established using a `business as usual' scenario. Under the present
situation, monitoring activities are carried out by diverse government actors at principle locations on the Mexican Gulf Coast, with additional monitoring and
evaluation of diverse sites by academic and NGO actors, according to institutional interests. Both countries have national environmental data centres, but there is
no regional information system and only limited sharing of data. There are unequal capacities amongst the government agencies and civil society to accurately
monitor and evaluate the state of the Gulf ecosystem and there is an absence of a programmatic approach to monitoring and evaluation, which results in a limited
capacity to understand the LME dynamics.

Under the alternative, GEF resources and co-financing will be used to develop a comprehensive monitoring and evaluation system that supports the ecosystem-
based approach for managing the GOM LME and which is relevant and readily available for all stakeholders. In order to ensure that the M&E mechanism and
indicators are populated with high quality data, a regional Data and Information Management (DIM) system will be developed, building on existing systems
within the region. This will increase the understanding of the LME and aid in quantifiably valuing the goods and services it provides. Additional global benefits
will be generated through monitoring ecosystem health to protect globally relevant coastal and marine biodiversity.

Outcome 5: Effective project coordination
$ 8,000,000
GEF: $316,000
Total Alternative:

SEMARNAT:
$ 10,316,000
$ 2,000,000

Total: $ 2,316,000
29

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Explanatory note:

The financial baseline for Outcome 2 has been set at $ 8 million, over 4 years, and has been established using a `business as usual' scenario. Under the baseline
situation, there are currently no regional coordination mechanisms in existence so there are only limited opportunities to address transboundary and biodiversity
issues using an ecosystem approach. Intersectoral coordination exists to a lesser or greater degree in the GOM and principally occurs only at the national level.
Active and informed participation of the relevant sectors in Mexico is patchy. Some sectors are highly engaged whilst others are not. Furthermore, existing
stakeholders at the national level are not well identified or organized for addressing priority GOM LME issues. This lack of uniformity of stakeholder participation
in environmental decision-making generates disparate public buy-in for environmental actions.

Under the alternative, GEF resources and co-financing will be used to develop a regional coordination mechanism to help countries harmonize policies and
legislation and to share experiences and best practices in protecting their coastal and marine resources. An intersectoral coordination mechanism will help to
ensure an effective multisectoral approach to developing and implementing the project at both the national level and throughout the GOM LME and will help
ensure sustainable multi-country ecosystem based management and implementation. Stakeholder strengthening will increase both the national impact of
stakeholder inputs to national environmental issues and will help stakeholders better understand the transboundary context of their actions throughout the entire
LME. Ultimately, improved capacity within relevant sectors regarding the transboundary problems affecting the LME will help ensure active and informed
participation in the project and will have global benefits by helping reduce or minimize the transboundary environmental problems affecting the for the GOM
LME.





30

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ANNEX B: PROJECT LOGICAL FRAMEWORK


Objectively verifiable indicators

Goal
Sustainable development of the Gulf of Mexico LME enhanced through ecosystem-based management approaches
Objectives/Outcomes
Indicator
Baseline
Target
Sources of
Risks and Assumptions
P: Process Indicator
verification

SR: Environmental Stress Reduction
Indicator
E: Environmental Status Indicator
Objective: To set the
Improved national and regional
Despite existing bi-
Ecosystem
Project
Countries remain supportive of
foundations for LME-wide
capacities for monitoring,
national agreements
based
Management
regional management framework
ecosystem-based
rehabilitation and sustainable
on fisheries such as
management
Unit (PMU)
National commitment to needed
management approaches to
management of the GoM LME.
MEX-US Gulf the
approach is
Project files and
sectoral, institutional, legal and
rehabilitate marine and
Y4
shared resources of
widely
documents
economic reforms remains
coastal ecosystems, recover

the GoM are
implemented
Steering
forthcoming
depleted fish stocks and
Strategic partnerships
unsustainably
and linked to
Committees (SC) Broad stakeholder participation is
reduce nutrient overloading
established with key stakeholder
exploited
conservation,
annual reports
achieved, including the private

groups in the main watersheds

rehabilitation,
Working group
sector
draining into the GoM, as well
Existing management
and resources
and technical
Assume continued national
as with coastal cities, to support
approaches are not
management
reports
commitment to the regional
initiatives to reduce land-based
consistent with
programs
Interministry
programme at each sector level,
sources of pollution. Y4
ecosystem-based
along the Gulf Committee
including the provision of national

management (EBM)
of Mexico
reports
resources

Annual project
review
Outcome 1 Transboundary
Revised TDA available and
Fragmented and
TDA,
TDA document
Close, joint working relationship
issues analyzed and priorities
agreed upon by both countries
sectoral analysis of
published and
among scientific and technical
defined (P).
Y2
selected regional
broadly
groups providing input is
parameters
disseminated,
forthcoming
provides basis
for informed
management
decisions at a
regional level
Outcome 2 Country
SAP endorsed at ministerial
No agreed bi-national
SAP agreed
SAP document
Countries continued commitment
agreement on and
level in both countries. Y4
programme for
and endorsed
to regional approach
commitment to regional and
managing the GoM

31

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national policy, legal and
resources from an
Continued cooperation among key
institutional reforms to
ecosystem-based
regional institutions and national
address the agreed priority
perspective
governments
transboundary issues (P)
Outcome 3 LME-wide
Pilot Projects all implemented
Not part of the
All three
Demonstration
Failure or delays in Parties'
ecosystem-based
and delivered on schedule. Y4
baseline program
demonstration
project reports
involvement to integrate on-
management approaches

projects fully
ground actions
encouraged and strengthened
and
through the successful
satisfactorily
implementation of the Pilot
implemented
Projects (P, SR and E)
and all
objectives
completed
Outcome 4 Monitoring and
GoM LME Data and
Not part of the
GoM LME
Existence of
Lack of METADATA to support
Evaluation System for the
Information Management
baseline program
data and
DIM system and
the Monitoring System
Project and the GoM LME
System established. Y4

information
DIM standards

established (P)
system fully
and protocol
Failure of participant parties to
operational
document
provide updated, high quality

information to the System
Stakeholders
have full
access to the
system
Outcome 5
The project team is effectively
Countries in the
Project
Project
Effective delivery of the project
Effective project coordination coordinating the project and
region have
implemented
monitoring
will only occur if there is country
(P).
meeting the objective. All
institutional
in an effective
reports and files
commitment and the project has
outputs completed within budget frameworks for
manner in
Steering
effectively communicated its role
and according to the agreed
coastal and marine
accordance
committee
and expected outputs.
work plan. Y1 to Y4
resources protection,
with agreed
minutes

but no effective
work plans
Intersectoral
regional intersectoral
and budgets
committee
project coordination

minutes
mechanism currently
Regional
exists.
coordination
mechanism
meeting minutes

32

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Outcome 1 Transboundary issues analyzed and priorities defined
Outcomes/Outputs/Activities
Indicator
Baseline
Target
Sources of
Risks and Assumptions
P: Process Indicator
verification

SR: Environmental Stress Reduction
Indicator
E: Environmental Status Indicator
1.1 Capacities and gaps in
Detailed gap analysis
Each country at
A regional
Working group
Scientific and technical groups
regional monitoring
undertaken based on extensive
present has its own
assessment of
reports, project
providing inputs are committed
methods/standards identified
review of literature, information approach to
monitoring
monitoring reports to joint work
and data. Y1
monitoring and
capacity gaps
and files

indicators are not
completed


uniform throughout
Gap analysis
the region. There are
report
many gaps in
environmental
monitoring.

1.2 Key ecosystem assessment Detailed ecosystem assessment
Ecosystem-based
A regional
Working group
Countries and organisations are
and management gaps
and management gap analysis
management is not
assessment of
reports, project
willing to provide data and
identified
concluded based on extensive
being used for stock
ecosystem and monitoring reports information on key ecosystems
review of literature, information management in the
management
and files
and management gaps
and data by Y2
Gulf of Mexico
capacity gaps


completed
Ecosystem
assessment and
management gap
analysis report
1.2.1 Biodiversity hot spots in
Regional working group
Biodiversity hot spots A regional


GoM LME assessed and key
approves assessment of
assessed but national
assessment of
Biodiversity hot
knowledge gaps identified
biodiversity hot spots and key
efforts are not
biodiversity
spots report
knowledge gaps by Y2 Q2
regionally coordinated hot spots
completed
33

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1.2.2 Existing information and Assessment of status and trends
Current initiatives are
Assessment of Status and trends
Countries and organisations are
data on status and trends in
in GoM fisheries, particularly
country driven and are status and
as defined in
willing to provide data and
fisheries assessed
commercial aspects of shrimp,
regionally fragmented trends in GoM fisheries report
information on key ecosystems
reef fish, blue crab, red snapper,
fisheries,
and management gaps
mackerel and anchovies
particularly

fisheries finalized by Y2 Q2
commercial
aspects of
shrimp, reef
fish, blue crab,
red snapper,
mackerel and
anchovies
fisheries
finalized
1.2.3 Ecosystem-wide nutrient Contaminant sources, in
Nutrient over-
A regional
Report on
Relevant regional organizations
over-enrichment and
particular LBS point and non
enrichment and
assessment of
assessment of
and river basin management
contaminant sources, flows
point, identified and assessed by contaminant sources,
nutrient and
ecosystem-wide
authorities are committed to
and levels assessed
Y2 Q2
flows and levels are
contaminant
nutrient over-
supporting project objective
assessed but national
sources
enrichment and

efforts are not
completed
contaminant
Watershed and coastal
regionally coordinated
sources, flows and management available tools will
levels
be harmonized and a shared
vision established towards a
healthy regional ecosystem.
1.2.4 Environmental impacts
Integrated analysis, including of Current assessment of A regional
Report on the

of transboundary pollution on
previous assessments, agreed by the environmental
report on the
environmental
the GoM ecosystem assessed
regional working group,
impacts of
Status of the
impacts of
describing transboundary
transboundary
Gulf of
transboundary
pollution impacts by Y2 Q2
pollution are
Mexico
pollution
predominantly
completed

country driven and are
regionally fragmented
1.2.5 Information on nutrient
Integrated analysis of nutrient
Current initiatives are
Integrated
Report on nutrient
over-enrichment and related
over-enrichment and related
country driven and are analysis of
over-enrichment
HABs collected and integrated HABs undertaken by Y2 Q2
regionally fragmented nutrient over-
related HABs
enrichment
and related
HABs
undertaken
34

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1.3 Governance analysis of
Detailed document completed
Current analysis of
Detailed
Governance
Relevant government agencies at
relevant policy and regulatory
outlining current status and
relevant policy and
regional and
Analysis report
national and federal levels are
frameworks completed [as a
shortfalls of relevant national
regulatory
national level
supportive of efforts to
basis for 2.1.4]
policies, legislation and
frameworks relating
governance
harmonize regional approaches.
institutional arrangements
to the GoM LME are
analysis
related to natural resource
predominantly
completed
management and use in project
country driven
area as a basis for harmonizing
policy frameworks at a regional
level by Y3
1.4 Analysis of the
Integrated analysis describing
Current initiatives are
Preliminary
Socioeconomic
Quality information will be
socioeconomic impacts of
socioeconomic impacts
either non-existent or
assessment of
impacts report
available to the project.
priority transboundary issues,
finalized by Y2
country driven
value of

Institutional cooperation and
including a preliminary LME

environmental
support will be forthcoming
wide economic valuation of
Preliminary valuation of near
goods and

near shore and marine goods
shore and marine goods and
services
Economic
and services, undertaken
services assessed by Y3
completed.
Valuation report

1.5 TDA revised, finalized,
Revised TDA available and
Fragmented analysis
TDA,
TDA document
Additional data and information
published and disseminated
agreed upon by both countries
of selected regional
published and
will be available to fill the gaps
by Y3
parameters
broadly
from the initial TDA
disseminated,

provides basis
SC and national agreement
for informed
attained with regards to TDA
management
findings
decisions at a
regional level

35

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Outcome 2 COUNTRY agreement on and commitment to regional and national policy, legal and institutional reforms to address the agreed priority
transboundary issues
Outcomes/Outputs/Activities
Indicator
Baseline
Target
Sources of
Risks and Assumptions
P: Process Indicator
verification

SR: Environmental Stress Reduction
Indicator
E: Environmental Status Indicator
2.1 Strategies and actions for
Joint agreement on coordinated
Inadequate reduction
Coordinated
Report on joint
Countries continued financial and
the reduction and control of
strategies to work with relevant
and control of nutrient strategies and
agreement for the
political commitment to regional
nutrient over-enrichment,
institutions in coastal areas, and
over-enrichment,
institutional
establishment of
approach
HABs and for the elimination
river basin management
HABs have increased
networking
defined targets to

of dead zones developed
authorities for establishment of
and extensive dead
will help to
reduce and control Continued cooperation among
defined targets by Y3
zones have developed
reduce HABs
nutrient over-
key regional institutions and
in the GoM
zones in GoM
enrichment
national governments




Relevant government agencies at
national and federal levels are
supportive of efforts to
harmonize regional approaches

Private sector, in particular in
agriculture, are supportive of
project objective

36

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2.1.1 Regional Plan of Action
RPA-Yucatan activities fully
RPA Yucatan is
Implemented
RPA-YUCATAN

for the Yucatan Peninsula
coordinated and harmonized
currently being
RAP-Yucatan
meeting minutes;
(RPA-YUCATAN) developed with GoM project programme
developed in a joint
will act as a
workshop reports;
by Mexico as a major
by Y3
effort between
catalyser to
RPA-YUCATAN
contribution to reduce land
Mexico
replicate this
document
based sources of pollution into
(SEMARNAT) and
approach to
RPA-specific
the GoM LME, implemented.
the US (NOAA). It
reduce LBS in actions reports
was presented at the
other areas of
GPA meeting in
concern in the
Beijing in October
GoM LME
2006 and is currently
region
being adopted and its
implementation
initiated by Mexican
water authorities
2.1.2 Strategic Partnerships
Number of agreements defined
There are currently no Linkages sand Strategic
Relevant regional organizations
between GoM LME
between GoM programme and
strategic partnerships. agreements
Partnership
and river basin management
programme and institutions
relevant river basin counterparts White Water to Blue
between
Planning
authorities are committed to
responsible for integrated
to coordinate and harmonize
Water (WW2BW) US watershed and documents;
supporting project objective
management of the major
nutrient reduction strategies by
initiative, adopted by
coastal
project monitoring
GoM river basins, as well as
Y3
Mexican authorities is management
reports and files
the main coastal cities,
currently being
authorities
developed
implemented in
enhances
Mexico's driven
reduction of
initiatives, on-ground
LBS of
actions, policy and
pollution into
regulatory framework. the GoM
2.1.3 Stocktaking of the
Gap analysis carried out. Y1
Previous work of the
Application of Gap analysis
Lack of commitment from
Papaloapan watershed

Papaloapan watershed relevant
findings.
watershed management
Commission to define
Relevant experiences to be
commission can be
experiences in
authorities.
opportunities for replication in replicated and documented. Y3
used to identify
the Grijalva-
Relevant
the Grijalva-Usumacinta and
opportunities for
Usumacinta
experiences
Panuco river basins in order to
replication.
and Panuco
documented.
provide for strong inter-
river basins
linkages between watershed
management authorities and
coastal managers.
37

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2.1.4 Strategies for
By the end of year 3, both
The development and
Harmonized
Draft legal
Relevant government agencies at
harmonizing legislative,
countries have developed and
implementation of
legislative,
modifications;
national and federal levels are
policy and regulatory
encouraged the adoption of Best strategies to
policy and
project monitoring supportive of efforts to
frameworks on agricultural
Management Practices that
harmonize legislative, regulatory
reports and files
harmonize regional approaches
practices at LME wide levels
provide for harmonized nutrient policy and regulatory
frameworks


developed, building upon the
control and reduction in
frameworks at the
enhanced to
Gulf of Mexico Governors
agricultural practices.
national level is
improve
Alliance.
carried out in a
overall
`piecemeal' manner
environmental
with little regional
performance
scope or application
and strengthen
of the ecosystem
informed
approach
decision

making in
GoM


2.2 Strategies and actions
Targets defined and agreed for
National strategies for Joint actions
Project monitoring Private sector is supportive of
formulated for sustainable
main commercial stocks by end
the sustainable
and strategies
reports and files
ecosystem based management
management and use of
of Y4
management and use
set to manage

approaches and of set targets
exploited living marine
of exploited living
fisheries will

resources, and for the
marine resources are
enhance the
recovery of depleted fish
currently poorly
recovery of
stocks to within safe
enforced and do not
depleted
biological limits formulated
take into account the
fisheries
ecosystem approach
stocks
2.2.1 Bi-lateral initiatives for
Surveys of productivity,
Current knowledge of Joint regional
Project monitoring
regional surveying of
oceanography, stock assessment regional stocks, and in surveys will
reports and files
productivity and
and population assessments will particular of
help recover

oceanography, stock
be coordinated and undertaken
transboundary stocks,
depleted
Joint survey
assessment and population
through cooperative studies by
is incomplete and has
fishery stocks. reports
assessments encouraged and
Y4
been predominantly

strengthened

carried out by each
nation state and not
regionally.
38

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2.2.2 Review effectiveness of
Best management practices and
No baseline focused
Fishing
Fishing
Weak institutional commitment
compliance measures with
code of conduct for responsible
on ecosystem-based
activities will
Management
existing fisheries legal and
fisheries implemented. Y4
fisheries management
be managed
Plans based on
regulatory frameworks in both
under the
Ecosystem Based
countries, especially with
IUU levels will be reduced,
scheme of
Management
regards to Illegal, Unregulated excess fishing capacity
FAO Code of
(EBM)
and Unreported (IUU) fishing, identified and addressed, and
Conduct for

excessive fishing capacity,
enforcement and surveillance
Responsible
Records of IUU
and enforcement and
activities enhanced Y4
Fisheries

surveillance, and propose
leading to
CONAPESCA
appropriate reforms and
reduction of
records.
measures.
IUU
2.2.3 Develop fisheries
Fisheries management plans for
Currently recovery
Management
Agreed recovery
Relevant government authorities
management plans for
selected key commercial
plans are either non-
plans
plans; Project
as well as private sector, are
selected key commercial
fisheries developed. Y4
existent or localised
implemented
monitoring reports supportive of the measures
fisheries
and weak
that will
and files
developed
improve
processes to
recover
depleted key
commercial
fishery
resources
39

---

2.3 Establishment of
Establishment of a
Currently MPAs are
Establishment
Agreed MPA plan; Countries/local government are
representatives marine
representative suite of MPAs
country driven and are of MPAs
Project monitoring willing to develop, implement
protected areas (MPA)
that take into account EBM, and regionally fragmented based on the
reports and files
and endorse MPAs
provide for sharing of best
Ecosystem

practices at a regional level by
Based
Y4
Approach
(EBA) will
generate
greater
consensus in
the Region
and prevent
degradation of
ecosystem and
marine
resources,
strengthening
and enriching
the distinct
national
protected
areas system.
2.3.1 Recovery plans for
Detailed regional guidelines
Currently recovery
Bi-national
Regional guideline
depleted priority non-
developed, agreed and
plans for depleted
agreement at
documents;
commercial species and
disseminated for
priority species and
federal and
Project monitoring
associated marine flora and
implementation of recovery
associated marine
state level on
reports and files
fauna developed for additional plans for priority non-
flora and fauna are
recovery plans
species not currently
commercial species by Y4
either non-existent or
for defined
addressed
localised and weak
priority
marine and
coastal non-
commercial
species.
40

---

2.3.2 Management and
Training provided to promote
On-ground
Action plans
Evidence of
Institutional commitment will
capacity building
best practice in managing
rehabilitation and
and on-ground delivery of
ensure that training will build
requirements to restore
marine coastal resources and
restoration projects of rehabilitation
training in project
capacity at the systemic and not
degraded marine coastal
restoration of degraded marine
degraded marine
and restoration monitoring reports only individual level.
wetlands defined
coastal wetlands, sea grass beds
coastal areas are
projects will
and files
and sand dunes by Y4
carried out in a
be conducted
`piecemeal' manner
in an
with little regional
integrated
scope or application
manner using
of the ecosystem
EBA and
approach
under strong
institutional
coordination
2.3.3 Marine and coastal
By the end of year 4, both
The development and
Policy
Project monitoring Relevant government agencies at
spatial zoning processes in
countries have developed
implementation of
changes at
reports and files;
national and federal levels are
individual countries
concrete approaches (legal,
plans and regulations
federal and
Draft legal, policy
supportive of efforts to
strengthened and implemented regulatory, and/or BMP
for protecting coastal
state level
and regulatory
harmonize regional approaches
thus enhancing sectoral links
specifications) that promote
habitats at the national reflect bi-
modifications

among sectoral users in
strengthened and harmonized
level is carried out in
national
marine and coastal zones
land and sea use planning
a `piecemeal' manner
agreement on
with little regional
establishment
scope or application
of integrated
of the ecosystem
coastal zone
approach
management

2.3.4 LME-wide strategies for Agreed conservation strategies
Current marine &
Conservation
Final report on
Relevant government agencies at
conserving biodiversity and
and management plans
coastal zone
strategies,
results of the
national and federal levels are
habitats in the coastal zones of elaborated and strengthened,
management
supported by
conservation pilot
supportive of efforts to
GoM LME supported and
and national endorsement
initiatives are country
stakeholder
project (3.1);
harmonize regional approaches
harmonized at a regional level promoted by Y4
driven and are
groups in both

regionally fragmented countries will
Project monitoring
be
reports and files
strengthened

and
implemented
41

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2.4 The Strategic Action
SAP and NAPs formulated and
A regional SAP will
SAP and
SAP and NAP
Long-term financial and political
Programme (SAP) and
endorsed at ministerial level in
not be completed and
respective
documents;
national commitment to the
National Action Programmes
both countries by Y4
endorsed under
NAPs
Endorsement
project
(NAPs) formulated and
baseline conditions.
completed and letters
endorsed

endorsed at
appropriate
levels (federal,
state)
2.5 Commitments to SAP
Evidence of private sector
National budgets are
Investment
Letters of
Countries, at both national and
implementation obtained and
commitment to supporting
stressed and adequate
plan
intent/commitment federal levels, may be unable or
sustainable financing
specific SAP activities Y4
budget is not provided developed that by relevant
unwilling to commit the
arrangements formulated

for environmental
defines SAP
institutions and
necessary resources for effective

matters. Minimal
co-financing
authorities
SAP implementation.
application of
commitments

economic instruments
Both countries have long-term
in addressing priority
financial and political
water-related issues in
commitment to the project, at
the GoM LME
both national and federal levels.


42

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Outcome 3 LME-wide ecosystem-based management approaches encouraged and strengthened through the successful implementation of the Pilot Projects

Outcomes/Outputs/Activities
Indicator
Baseline
Target
Sources of
Risks and Assumptions
P: Process Indicator
verification

SR: Environmental Stress Reduction
Indicator
E: Environmental Status Indicator
3.1 Pilot Project on Natural
Specific project sites with
There are national
Natural habitat Project monitoring Country support to facilitate the
Habitat and Ecosystem
emphasis on critical habitats
efforts to conserve
conservation
reports and files
LME-wide dissemination of
Conservation of Coastal and
such as mangrove ecosystems,
natural habitats in the
demonstration
results of the pilot project, with
Marine Zones of the Gulf of
wetlands, sea grass beds and
coastal and marine
project
R-TAG technical
participation of all sectors and
Mexico: Wetlands,
sand dunes rehabilitation
areas of the GoM but
successfully
review reports
stakeholders.
Mangroves, Sea Grass Beds
actions implemented and coastal they are currently
completed


and Sand Dunes
ecosystems health improved Y4 uncoordinated
Project progress
LME-wide objectives may


reports; Project
conflict with local interests
Strategies and actions for
monitoring reports
conservation in selected sites
and files

using ecosystem approach. Y4


Cost effective strategies to
mitigate impacts from erosion,
meteorological events
developed, Y4
43

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3.2 Pilot Project on Enhancing Recovered depleted species
Fisheries management Fisheries
Project monitoring
Shrimp Production through
through an ecosystem based
using the ecosystem
management
reports and files
Country support to facilitate the
Ecosystem Based
management approach, focusing approach is not
demonstration
LME-wide dissemination of
Management
mainly on the shrimp fisheries.
undertaken by Mexico project
R-TAG technical
results of the pilot project, with
Y4
successfully
review reports
participation of all sectors and

completed

stakeholders.
Strengthened capacities for
Project progress

improved stock assessments and
reports; Project
LME-wide objectives may
data collection. Y4
monitoring reports conflict with local interests

and files

Established effective and


coordinated surveillance and
enforcement mechanisms. Y4

Improved knowledge of current
socioeconomic conditions
derived from shrimp fisheries.
Y4
3.3 Pilot Project on Joint
Joint monitoring, assessment
There is currently no
Regional
Project monitoring
Assessment and Monitoring of and evaluation of the coastal
regional coastal
coastal
reports and files
Country support to facilitate the
Coastal Conditions in the Gulf environment of the Gulf of
assessment
assessment

LME-wide dissemination of
of Mexico
Mexico Large Marine
monitoring
monitoring
R-TAG technical
results of the pilot project, with

Ecosystem capacity developed.
programme
programme
review reports
participation of all sectors and
Y3
demonstration
stakeholders.
project
Project progress

successfully
reports; Project
LME-wide objectives may
completed
monitoring reports conflict with local interests
and files




44

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Outcome 4 Monitoring and Evaluation System for the Project and the GoM LME established
Outcomes/Outputs/Activities
Indicator
Baseline
Target
Sources of
Risks and Assumptions
P: Process Indicator
verification

SR: Environmental Stress Reduction
Indicator
E: Environmental Status Indicator
4.1 M&E mechanisms set up
Monitoring and evaluation
Not a part of the
Effective
Annual reviews
Project Management structure is
including an M & E system
support provides timely
baseline program.
M&E
and mid-term/final operational very early in project
for the project
assistance to keep project on

mechanisms in evaluations
implementation
track and recommend strategies
place
to ease bottlenecks. Y4
4.2 Suite of GEF M&E
GEF M&E indicators are
Not a part of the
GEF M&E
Project progress
Relevant institutions are ready to
indicators developed (process, successfully monitoring the
baseline program.
indicators will reports; Project
make available and distribute
stress, environmental status)
progress of the project. Y1

set the basis
monitoring reports data broadly.
to monitor SAP
for
and files
implementation.
harmonized

environmental
status
indicators for
the Bi-annual
regional status
report (4.4)
4.3 GoM LME Environmental Operational GoM LME Data
Countries in the
GoM LME
Existence of DIM
Relevant institutions are ready to
Information System developed and Information Management
region have national
Data System
system; DIM
make available and distribute
System established by Y2
environmental data
established
standards and
data broadly.
centres, but there is no and functional protocol document
regional information

system and only
limited sharing of
data.
45

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4.4 Bi-annual regional status
First bi-annual report published
Uncoordinated
Completed
Bi-annual regional Timely delivery of data and
report developed on large
by end of Y2 and second report
national and
Reports
status report
information from the
scale ecosystem impacts in the in Y4
international efforts to widely
participating countries
GoM LME
monitor
disseminated

environmental
and used by
impacts in the GoM
decision-
LME are carried out.
makers and
resource
managers

46

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Outcome 5 Effective project coordination
Outcomes/Outputs/Activities
Indicator
Baseline
Target
Sources of
Risks and Assumptions
P: Process Indicator
verification

SR: Environmental Stress Reduction
Indicator
E: Environmental Status Indicator
5.1 Regional Project
Project coordination is properly
Not part of the
Project
SC meeting
Efficiency of start up of the
Coordination Unit (PCU) set
staffed and executing the
baseline.
executed
minutes; Project
project.
up
project according to the agreed
under a well
reports
Timely appointment of CTA and
work plan and budget. Y4
staffed
Country Focal Points
coordination
unit according
to the agreed
work plan and
budget
5.2 Steering Committee and
Steering Committee meetings
Not part of the
Steering
SC meeting
High-level national input will
Regional Technical Advisory
are held to provide annual
baseline.
Committee
minutes; project
only occur if there is country
Group (R-TAG) established
project oversight. Y4
established
monitoring reports commitment and the project has
and meeting
and files
effectively communicated its role
according to
and expected outputs.
established

timeframe
5.3 Intersectoral coordination
ISCs or their equivalent are
Intersectoral
National
ISC meeting
High-level national input will
established through the
established and meetings
coordination exists to
intersectoral
minutes; project
only occur if there is country
development of Intersectoral
scheduled by Y1
a lesser or greater
mechanism
monitoring reports commitment and the project has
committees (ISCs) or their
degree in the GoM
developed to
and files
effectively communicated its role
equivalent in both countries,
states.
improved
and expected outputs.
including with private sector
wider cross-

involvement
sectoral public
Transfer of benefits is embraced

participation
as a concept in private sector
47

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5.4 An appropriate regional
Regional coordination
No regional
Regional
Regional
Country commitment to regional
coordination mechanism
mechanism formally established mechanism in place
coordination
agreement signed;
approach and to built upon
jointly defined
by Y4
for government, donor mechanism
meeting minutes;
existing joint agreements


and other stakeholder
established
project monitoring
coordination,
that builds
reports and files
consultation, strategic upon existing
planning in promoting bi-national
multi-country
frameworks
integrated sustainable
and
management of the
agreements
GoM LME.

5.5 Information needs within
Information needs within the
Active and informed
Good
Project monitoring Country support to the
the relevant sectors identified
relevant sectors identified and
participation of the
understanding
reports and files;
Stakeholder Involvement Plan
and addressed in order to
training provided to build
relevant sectors
of information Evidence of
ensure active and informed
capacity in order to ensure
associated with the
needs within
delivery of
participation
active and informed
GoM LME is patchy.
the relevant
training
participation. Y3 Q2
Some sectors are
sectors


highly engaged whilst providing the
others are not.
basis for
developing
targeted
awareness and
outreach
programs
5.6 Robust public awareness
Public Participation and
Existing stakeholders
Stakeholders
PPA committee
Routine and effective
strategies targeted at the
Awareness (PPA) strategies
at national level are
at all levels
meeting reports;
involvement of stakeholders in
different stakeholder levels
involving national experts,
not well identified or
are informed
National PPA
planning, management and
and groups developed
private sector, civil society,
organized for
about the
meeting reports;
decision-making can only be
NGOs and other interested
addressing priority
project and
Project monitoring accomplished by on-going
parties are ongoing. Y4
GoM LME issues.
therefore
reports and files
encouragement, strengthened
actively

capacities, and financial
participating
commitment by donors and
in its
countries.
implemen-
The project assumes the support
tation
and involvement of the private
sector

48

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ANNEX C: RESPONSE TO PROJECT REVIEWS

A) CONVENTION SECRETARIAT COMMENTS AND IA/EXA RESPONSE

49

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B) STAP EXPERT REVIEW AND IA/EXA RESPONSE

STAP ROSTER TECHNICAL REVIEW OF THE PROPOSED GEF-IW PROJECT:
"INTEGRATED ASSESSSMENT AND MANAGEMENT OF THE GULF OF MEXICO
LARGE MARINE ECOSYSTEM"

(MEXICO AND UNITED STATES OF AMERICA)

By J.A. Thornton PhD PH CLM
Managing Director
International Environmental Management Services Ltd ­ United States of America

Introduction
This review responds to a request from the United Nations Development Programme (UNDP) and the
United Nations Industrial Development Organization (UNIDO) to provide a technical review of the
proposed International Waters project seeking to develop a Strategic Action Program (SAP) for the Gulf
of Mexico Large Marine Ecosystem (LME).

I note that I am a designated expert on the STAP Roster of Experts with particular experience and
knowledge concerning watershed management and land-ocean interactions. I have served as Government
Hydrobiologist with the Zimbabwe Government, Chief Limnologist with the South African National
Institute for Water Research, Head of Environmental Planning for the City of Cape Town (South Africa),
and, most recently, as Principal Environmental Planner with the Southeastern Wisconsin Regional
Planning Commission (USA), a position that I hold concurrent with my position as Managing Director of
International Environmental Management Services Ltd, a not-for-profit corporation providing
environmental education and planning services to governments worldwide. In each of these positions, I
have had oversight of projects and programs designed to assess contaminant loads to aquatic ecosystems
from land-based activities, and to develop appropriate and affordable mitigation measures to reduce such
loads and minimize their impacts on the aquatic environment, both freshwater and marine.

This review is based upon a thorough review of the UNDP Project Document (74 pages inclusive of the
Logical Framework Analysis and Incremental Cost Reasoning), and the three Pilot Project narratives
("Restoring Depleted Shrimp Stocks through Ecosystem-based Management Practices in the Gulf of
Mexico Large Marine Ecosystem," 15 pages; "Joint Assessment and Monitoring of Coastal Conditions in
the Gulf of Mexico," 16 pages; and, "Habitat and Ecosystem Conservation of Coastal and Marine Zones
of the Gulf of Mexico: Wetlands, Mangroves, Sea Grass Beds and Sand Dunes," 34 pages) of the GEF-
UNDP/UNIDO International Waters project, entitled: "Integrated Assessment and Management of the
Gulf of Mexico Large Marine Ecosystem." Other, relevant documents served as reference sources,
including the GEF Operational Strategy, Agenda 21, and related materials establishing the necessity and
priority of land-based activities to control marine pollution as set forth in the Global Program of Action
for the Protection of the Marine Environment from Land-Based Activities (GPA).

Scope of the Review
This review addresses, seriatim, the issues identified in the Terms of Reference for Technical Review of
Project Proposals.

Key Issues
Key issue 1. Scientific and technical soundness of the project. Overall, the project appears to be
scientifically and technically sound. The approach proposed, which includes a further development of the
preliminary Transboundary Diagnostic Analysis (TDA), conduct of targeted demonstration projects,
formulation of an agreed Strategic Action Program (SAP), and implementation of project management
50

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arrangements--including project monitoring and evaluation, designed to contribute to the creation of a
formal intergovernmental cooperation mechanism for the transboundary waters of the Gulf of Mexico
LME, adequately addresses the needs to initiate multilateral actions to reduce land-based impacts on the
Gulf of Mexico LME.

The Gulf of Mexico is a major international waterway. As such, it has been extensively studied by the
adjacent countries, at least insofar as their economic interests extend into its waters. Beyond that coastal
economic zone, the oceanography of the Gulf has been studied since the Gulf of Mexico forms the point
of origin of the Gulf Stream, a major contributor to the global circulation of the North Atlantic Ocean.
However, all of these investigations, as is noted in the Project Document have been relatively
uncoordinated or sectorally driven. This has resulted in a fragmented knowledge base, focused primarily
on the nearshore waters of the Gulf of Mexico LME. Consolidation of this knowledge base would have
significant scientific value to the oceanographic community, helping researchers to highlight gaps in
knowledge, identify specific areas of research requiring attention, and develop greater insights into this
globally important marine resource.

It also should be noted that the coastal countries have differing capacities to conduct oceanic research and
monitoring and differing abilities to respond to threats facing the Gulf of Mexico. Through the conduct of
joint research and scientific activities within the framework of this project, it is anticipated that capacities
will be strengthened. It is equally likely that the institutional relationships developed as a result of this
project will contribute to the development of ongoing relationships between Gulf organizations that will
extend beyond the project period. Indeed, it is a stated objective of the project to create not only the
framework of an institutional mechanism for the joint management of the Gulf of Mexico but also
contribute to a shared understanding the Gulf of Mexico LME.

As one of the first major transboundary ocean basins to evidence anthropogenic hypoxia, the Gulf of
Mexico is potentially the forerunner of the future state of many enclosed oceanic basins in proximity to
terrestrial nutrient sources, and receiving nutrient-rich runoff from major river systems. In the case of the
Gulf of Mexico, the Mississippi River, draining the central portions of the United States of America (US)
is the single largest source of nutrient input to the Gulf, but several major rivers draining the US
southwest and Mexico also contribute to the development of hypoxia in the Gulf. As a result, this project
can also serve as a demonstration project for actions to limit marine pollution from land-based activities,
the goal of the Protocol to the United Nations Convention on the Law of the Sea (UNCLoS) of the same
name. Lessons learned from this project, when shared through the scientific literature, technical symposia
and the IW-LEARN best practices database, amongst others, could contribute to the prevention or
management of similar conditions elsewhere in the world.

To this end, the inclusion of three demonstration projects within the proposed Gulf of Mexico project, and
focused on the three priority concerns identified during the framework TDA preparation, seek to address
specific issues of concern; namely, depleted shrimp stocks through ecosystem-based management
practices, joint assessment and monitoring of coastal conditions, and habitat and ecosystem conservation
of coastal and marine wetlands, mangroves, sea grasses and sand dunes. Experiences gained through these
activities will contribute to the global knowledge base relating to LMEs and their associated drainage
areas. The joint assessment and monitoring project will form the basis for ongoing collaboration between
the coastal countries, while the shrimp production project will prepare a methodology, embodied in an
ecosystem model, which could form the foundation for the development of similar approaches to
managing other high value, over-harvested marine organisms within the Gulf (and elsewhere). The siting
of all three demonstration projects within the area of the Terminos Lagoon takes advantage of the
substantial body of knowledge already acquired on this embayment, in addition to contributing to the
synthesis and integration of this knowledge the necessary policy instruments for the efficient and rapid
implementation of a fully integrated near shore ocean management program within the project period.
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In the end, the marriage of these scientific findings with the institutional, legal and policy instruments that
currently exist or that will be developed during the project period will aid in the creation of an appropriate
regulatory framework, and creation of the necessary infrastructure to support and sustain the
environmentally-sound management of the Gulf of Mexico.

Key issue 2. Identification of global environmental benefits and/or drawbacks of the project, and
consistency with the goals of the GEF. The proposed project establishes a framework within which to
address the three major causes of environmental stress within the aquatic environment of the Gulf of
Mexico; namely, eutrophication, habitat modification, and over-harvest of commercially important
species. The activities associated with the development of a Strategic Action Program to address these
three principle environmental concerns, identified during project preparation, will have relevance to the
human response to these issues in other areas. Based upon the evaluation completed as part of the GEF
IW-supported Global International Waters Assessment (GIWA), these three threats represent some of the
most commonly occurring threats to the marine environment on a worldwide basis. Consequently,
development of mechanisms to mitigate, moderate or manage these impacts is wholly consistent with the
GEF IW focal area. Operational Program 9 (OP 9) of the GEF seeks to encourage a broadly-based,
multisectoral approach to resolving conflicts in the area of international and transboundary waters.
Further elaborated as Strategic Objective 1 (SO-1) of the IW portfolio under GEF-4, OP 9 builds multi-
state cooperation mechanisms to address priority concerns through an ecosystem-based management
strategy.

To this end, the proposed project further addresses two strategic priorities within the GEF IW portfolio;
namely, the management of fish stocks and associated biodiversity (SP-1), and the reduction of
eutrophication or enrichment of coastal waters caused by anthropogenic nutrient inputs (SP-2). In terms
of the former priority, this project would have crosscutting linkages to the protection of marine
biodiversity, immediately relative to shrimp and ultimately relative to other species, especially those of
economic value.

The participation of the relevant governmental organizations with responsibility for the marine
environment, including environmental protection and marine fisheries agencies, would be an important
element in ensuring the implementation of the project outcomes. This participation is provided through
the relevant national, state, and local government agencies. Establishment of a functional operational
agency, as proposed in the project document, also will contribute to achieving this objective.

Finally, true global benefit is presumed as a result of the connection of the Gulf of Mexico with the
Atlantic Ocean by means of the Gulf Stream Current. This part of the Atlantic Ocean circulation has
significant implications for the European climate, among other benefits.

Key issue 3. Regional context. The Gulf of Mexico is bounded by the landmass of North America. Within
this landmass, the nations of Mexico and the United States of America comprise the southern/western and
northern extremes of the Gulf, respectively, while the island state of Cuba is located at the eastern
extreme of the Gulf. While Cuba was a participant in the project development activities, the country has
opted not to participate in the SAP formulation. From a socio-political perspective, this posture does not
detract from the conduct of the proposed project, and the emphasis of the GEF IW program on
information sharing and dissemination would mean that the results of the project will be available to the
government of Cuba for their consideration. That said, the dominant geographic positions of Mexico and
the US are such that the project area encompasses virtually all of the land mass draining to the Gulf.

Both Mexico and the United States are members, inter alia, of the North American Free Trade Agreement
(NAFTA) area, which entity provides the regional context for this project. Amongst its other provisions,
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the NAFTA includes environmental provisions that are recognized and supported by this project. In
addition, there are numerous other binational and international agreements to which the participating
countries are party that contribute to the regional context for this project. One of the binational initiatives
that merits noting is the Gulf of Mexico Alliance, comprised of the six Mexican and five US states that
border the Gulf and supported by the federal agencies and other stakeholders from both countries. As
noted in the project document, this Alliance could provide "a model for regional and international
collaboration."

The proposal clearly indicates an intention to disseminate information and results on a regional basis, both
within the Gulf of Mexico Basin and elsewhere. In part, this dissemination process will utilize the offices
of the national and state governments in both countries. The project also proposes inclusion of other
stakeholders, particularly from commerce and industry, nongovernmental organizations (NGOs), and
academia, who will also contribute to the regional context within which the project is to be executed.

Key issue 4. Replicability. The implementation of the three demonstration projects is a key feature of this
project, and clearly contributes to the potential for replication of beneficial practices and techniques.
Further, the inclusion of mechanisms for disseminating information and results achieved fosters
replication of effective and successful measures. To this end, the project explicitly includes a variety of
stakeholders outside of the governmental bodies noted as participating in the project. As noted above,
these stakeholders include the private sector, NGOs, and academia. The inclusion of the latter will
promote the use of the project findings within classrooms and in the community. Participation of NGOs
and academic institutions will help to disseminate knowledge of the Gulf, share information on best
management practices (BMPs), and facilitate public "buy in" with respect to the project outcomes.
Similarly, inclusion of the private sector participants will encourage their participation in the
implementation of the strategies identified under the SAP.

Outside of the project area, the documentation of project results and dissemination of the outputs through
websites, scientific publications, and other media will facilitate replication of the techniques and
approaches in other LMEs bounded by significant landmasses. As noted elsewhere, potential areas for
replication can be identified in the GIWA inventories; many of the world's enclosed gulfs and seas would
benefit from the integrated land and water resource management approach being proposed for the Gulf of
Mexico. To this end, the participation in the project of global and regional NGOs, scientific institutions,
corporations and other stakeholders provides a mechanism for targeted dissemination of information
leading to possible replication of BMPs in appropriate situations elsewhere in the world.

Key issue 5. Sustainability of the project. A significant element of the sustainability of the project rests
upon the participation of the local, state and national governments, their operational agencies, and other
civil institutions. This participation is indicated in the project document through tasks to be performed by
these (largely unspecified) entities, through the governmental financial commitments to the project
(Section III), and through agency participation in project management (Section I, Part III). While there is
always a risk that agency budgets may limit participation--this risk being identified in the project
document--the likelihood is that these agencies and organizations will continue to maintain an interest in
the project outcomes. In the case of this project, the level of risk has been determined to be low to
moderate, which seems a reasonable representation of the prevailing situation in the region.
Consequently, there is a high likelihood that the project will be sustainable beyond the period of GEF
intervention. This likelihood is increased through participation in the project by civil society stakeholders,
identified as NGOs, corporations, and local governments. These stakeholders, yet to be identified under
most Outcomes except as external consultants in the organigram presented in Part II of Section IV of the
proposal (with the exception of Outcome 3 as elaborated in the pilot projects as annexed to the project
document as Annexes 1 through 3), have a more immediate and direct link to a sustainable strategy for
the management of the marine resources of the Gulf and its riparian lands. Based upon the stakeholder
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identified in Annexes 1 through 3, there is a high likelihood of the project securing sustainable
participation in other aspects of the project.

Beyond this factual basis, the target of the project, embodied in at least one of the pilot projects, is
sustainable management of high value marine resources; namely, shrimp. Development of resource
management plans, a stated output of the project, and the inferred desire of the economic stakeholders for
continuation of their livelihoods, would also suggest a strong potential for sustainability of the strategies
developed within the framework of the SAP. Dissemination of the outputs of the project as a whole, and
not only of the pilot projects, will encourage "buy in" by civil society in a more general sense, leading to
sustainable outcomes.

Finally, the project proposes the creation of a bi- or multi-lateral body that would coordinate actions
among the Gulf countries that will build from and continue the momentum of the project coordination
unit (PCU) and its professional staff. The evolution of the PCU into a coordination mechanism bodes well
for the sustainability of the project outcomes.

Key issue 6. Targeted Research Projects. Targeted technical demonstration and capacity building projects
are key features envisioned within the GEF International Waters Operational Program. These activities
are clearly included as major elements of this proposed project. The interventions proposed under the
pilot projects, funded in part by the GEF, strive for sustainability and the continuation of successful
interventions beyond the project period. Consequently, it is important that the demonstration projects
continue to be monitored, and the results reported using the information dissemination mechanisms
previously identified, beyond the project period. Such an approach is totally consistent with the catalytic
nature of the GEF, and an essential element to the sustainability of the project.

Capacity building and institutional strengthening, envisioned in the project document, become the basic
building blocks upon which this project will succeed or fail, both from the point of view of its
sustainability and from its scientific and technical integrity. Inclusion in this aspect of the project of not
only governmental entities but also corporate and community stakeholders should form a broad base from
which targeted research can be translated to practical experience and hence into replicable BMPs.
Secondary Issues
Secondary issue 1. Linkage to other focal areas. This project is formulated as an International Waters
project under OP 9 of the GEF Operational Strategy. While no specific crosscutting areas are identified,
the project clearly has linkages to the crosscutting area of protection of aquatic biodiversity in terms of its
potential beneficial impact on fisheries, as embodied under Strategic Priority 1 of GEF-4.

Secondary issue 2. Linkages to other proposals. The project constitutes the first LME project in the Latin
America and Caribbean (LAC) Region. Consequently, no specific linkages exist between this project and
other GEF IW initiatives in the LAC Region. However, the project does propose to make explicit use of
the GEF IW-LEARN network as a means of disseminating the results and outputs of the project.

Additionally, the project identifies specific linkages with ongoing initiatives of the United Nations,
including: the United Nations Environment Programme (UNEP) Wider Caribbean Regional Seas
Programme, the Food and Agriculture Organization of the United Nations (FAO) Western Central
Atlantic Fisheries Commission (WECAFC), and the United Nations Education, Scientific and Cultural
Organization (UNESCO)-Intergovernmental Oceanographic Commission (IOC) Sub-commission for the
Wider Caribbean (IOCARIBE).

The project also recognizes the complementarities between the management of transboundary waters of
the Gulf of Mexico and the management of the national coastal waters, linking with national- and state-
level programs within each of the participating countries. In addition, the project has complementarities
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with other (global) projects utilizing land-based actions to minimize degradation of the marine
environment as a result of land-based activities under the GPA.

These linkages contribute to a high degree of connectivity within this project, and contribute to the
likelihood that the actions undertaken will be sustainable, and that the lessons learned can and will be
transferred beyond the project boundaries to other, similar situations and locations.

Secondary issue 3. Other beneficial or damaging environmental effects. The project has no known or
obvious damaging environmental impacts associated with the activities proposed to be executed. The
beneficial impacts of the project have been fully articulated above, and include the implementation of
targeted interventions that address both chronic land-based sources and potential, catastrophic ocean-
based events that contribute to the degradation of the Gulf of Mexico and its resources.

The provision of trained staff and institutional capacities needed to enforce and enhance existing
environmental protection regulations, and the dissemination of successful management measures further
contribute to the benefit of the Gulf and its drainage basin in both coastal countries. All of these benefits
accrue not only within the project area, but also, as a result of their wider dissemination using the
electronic and other media provided, also to the wider Caribbean basin and beyond.

In this latter regard, the explicit connections between the project and ongoing national initiatives are
noteworthy. Specifically, these connections are embodied in large part within the elements of Outcome 2
that are fully cofinanced.

Secondary issue 4. Degree of involvement of stakeholders in the project. The involvement of stakeholders
is extensive, although limited to national-, regional-, and international-level governmental bodies,
functional bodies including academia and NGOs, and resource users. Involvement of the wider public is
catered for through informational programming inherent in the project dissemination proposals, and
through the involvement of NGOs. It should be noted that the proposal states that identification of local
level stakeholders was not undertaken. Given the scale of the Gulf and its drainage area, and the potential
numbers of such organizations, both governmental and nongovernmental, this decision is not
unreasonable. Nevertheless, it is to be hoped that the involvement of national institutions will provide
opportunities for these entities to liaise with their counterpart state and local governmental bodies during
the course of the project. The exception to this generalization is the pilot projects, which make explicit
linkages with such local institutions and organizations. In this regard, the participation of the relevant
national regulatory agencies and ministries, NGOs and academic institutions in the execution and
implementation of the project activities, including the project's explicit support for capacity building and
institutional strengthening with respect to these organizations, is critical to the sustainability of the project
and its expansion into areas not specifically involved in the pilot projects.

Secondary issue 5. Capacity building aspects. Capacity building is a critical element of the proposed
project. Creation and strengthening of appropriate institutions, conduct of the pilot projects, and
recognition of the need for regional level coordination within the Gulf of Mexico form the core of the
GEF-financed elements of the project as noted under Outcomes 2, 3 and 5. Dissemination of lessons
learned with respect to coastal development policy, fisheries management practices, and environmental
information dissemination are essential elements of the GEF-financed pilot project activities (Outcome 3)
and the information management system (Outcome 4). These latter elements also should be implemented
in conjunction with the IW-LEARN initiative being executed by the UNDP and the UNEP best practices
database. These efforts will enable wider dissemination of knowledge of practices that have positive
effects. Such knowledge is an essential element in building capacity and strengthening institutions in the
region. Institutional "twinning" between agencies of Mexico and the United States could also be
considered in this vein.
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Secondary issue 6. Innovativeness. Development of appropriate management practices for the
management of hypoxia in enclosed and semi-enclosed LMEs, such as the Gulf of Mexico, is a critical
element for the protection of the marine environment, within the context of an integrated land- and water-
based management program. By creating and strengthening the appropriate human resources, institutions,
data acquisition and dissemination systems, and shared management mechanisms, the proposed
management program will complement other pollution abatement and "blue water" management
measures being implemented by the basin governments and stakeholders. The proposed actions and
approaches reflect state-of-the-art practices, and their application in the Gulf of Mexico will significantly
advance current practice in this Basin as well as in the wider Caribbean region as a whole. In this manner,
the project promotes innovation and development of regionally applicable remedial practices and
experiences.

General Conclusion and Recommendations
Overall, it is the conclusion of this reviewer that the proposed project is wholly consistent with the GEF
International Waters operational program, its broader philosophy, and funding criteria. Consequently, this
project is recommended for funding.



RESPONSE TO STAP REVIEW

We would like to thank the Reviewer for his very positive STAP Review. This includes his remarks that
the proposed Gulf of Mexico LME project is: scientifically and technically sound; the proposed actions
and approaches reflect state-of-the-art practices; the approach is strongly participatory in ambit and
provides a mechanism for targeted dissemination of information; its BMPs are potentially replicable
globally; it is sustainable beyond the period of GEF intervention; and it is consistent with the GEF
International Waters Operational Program, its broader philosophy, and funding criteria.

We appreciate the Reviewer's comments that support the aim of the project: namely, to marry its
scientific findings with the institutional, legal and policy instruments that currently exist or that will be
developed during the project period to assist in the formation of an appropriate regulatory framework, and
to develop the necessary infrastructure to support and sustain the environmentally-sound management of
the Gulf of Mexico through the LME approach.

The Reviewer further supports the five Outcomes of the project and stresses that the approach proposed
adequately addresses the needs to initiate multilateral actions to reduce land-based impacts on the Gulf of
Mexico LME. The reviewer is also supportive of the three pilot demonstration projects within the
proposed Gulf of Mexico project which focus on the three priority concerns identified during the
framework TDA preparation and indicates that experiences gained through these activities will contribute
to the global knowledge base relating to LMEs and their associated drainage areas.

The only real criticism levelled at the project by the reviewer relates to the identification of stakeholder
groups. Reference is made in the project document that a significant element of the sustainability of the
project rests upon the participation of the local, state and national governments, their operational
agencies, and other civil institutions. However, the reviewer states that the tasks to be performed under
each Outcome will be undertaken by largely unspecified entities.

In response to this, we agree that stakeholder groups have not as yet been identified for specific
Outcomes/Outputs (apart from Outcome 3). This is largely because the scale of the GoM LME will
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require the involvement of diverse stakeholder groups and although key groups have already been
identified during the preparatory stage, the project itself will continue to enhance robust and informed
stakeholder involvement. In order to ensure full stakeholder participation, the project will aim to identify
the specific key stakeholders for each outcome and ensure active and informed participation from the
relevant sectors (Output 5.5). It will also ensure that different stakeholder levels and groups are targeted
through the development of a robust public awareness strategy (Output 5.6). Key groups will probably
participate in more than one Outcome. Additionally, the engagement of other stakeholder groups, such as
those working in specific watersheds including the Mississippi river to address land-based sources, will
itself be a major undertaking within the project.

It is also noted that the reviewer has indicated that as capacity building is a critical element of the
proposed project, the dissemination of lessons learned with respect to coastal development policy,
fisheries management practices, and environmental information dissemination are all essential elements
of GEF-financed pilot project activities (Outcome 3) and the information management system (Outcome
4). He indicates that they should also be implemented in conjunction with the IW-LEARN initiative being
executed by the UNDP and the UNEP best practices database. We acknowledge that these efforts will
enable wider dissemination of best practice and consequently have reflected this in the project document.



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C) GEF SECRETARIAT AND OTHER AGENCIES' COMMENTS AND IA/EXA RESPONSE
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