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ANNEX A - INCREMENTAL COST ANALYSIS
Integrated Management of the Ecosystems of the Gulf of Fonseca
1.
Background
1.1 The Gulf of Fonseca is situated along the Central American Pacific coast, bordering the
Republic of Honduras to the North, the Pacific Ocean to the South, the Republic of El
Salvador to the west; and the Republics of Nicaragua and Honduras to the east. It is a tropical
estuarine system made up of a set of interrelated ecosystems, such as its interior estuary,
mangroves, and continental and island coasts encompassing an area of 3,200 km2.
Mangroves occupy 1,100 km2, accounting for approximately 22% of the entire area of
mangroves along the Pacific coast of Central America. Six main tributary watersheds and
other smaller ones cover an area of approximately 21,000 km2. The Goascorán and Río
Negro watersheds are transboundary, the first shared by El Salvador and Honduras, the
second by Honduras and Nicaragua. Along with the Gulfs of Guayaquil, Nicoya, Chiriqui and
Panama, the Gulf of Fonseca is one of the most important tropical coastal systems along the
Eastern Pacific Ocean in Latin America due to the size of the estuarine complex and
mangrove belt and its proximity to areas with high concentrations of nutrients such as
seasonal upwellings and seamounts.
1.2 Similarly, it is also considered as one of the most biologically rich maritime areas of Central
America and provides spawning, nursery and feeding areas for a range of species of fish,
shellfish, including stocks that have traditionally supported the most productive artisanal
fisheries in the region. Given its physical and ecological characteristics, the Gulf also
accounts for a significant share of shrimp farmed in Central America, an important source of
revenue for all three countries. But all these important functions are threatened by several
factors that affects the Gulf's ecosystems functionality and integrity. As one of the only two
multinational maritime formations in Central America with transboundary watersheds, the
Gulf requires particularly close international coordination to maintain the integrity of its
ecosystem.
1.3 In 1993, the Presidents of the three countries signed the Amapala Agreement, where they
declared their interest in conserving and preserving the Gulf due to its importance for each
country. In the context of Plan Puebla Panamá (PPP), the three countries also selected the
Gulf of Fonseca as a priority area, and in 2004 asked the IDB to design a project that would
promote the integrated management of its ecosystems. Therefore, as a part of the preparation
of the present proposal, in 2005 a donor round for the Gulf of Fonseca was held at Zacate
Grande Island, Honduras, and the Ministers and Secretaries of the MARN, SERNA, and
MARENA signed the document called Declaration of Zacate Grande, where they agreed to
push forward a trinational coordination initiative for the integrated management of the Gulf ,
at the same time that they considered the aim of managing this important ecosystem in a
sustainable manner as a means of enhancing their countries' development with a regional
perspective. Effective integrated management of the Gulf and its ecosystems requires
additional support from different donors, besides the non-reimbursable GEF funding. With
the endorsement of the involved Governments, the IDB has been coordinating the
formulation of a joint effort towards this end. The following section summarizes the baseline
situation.
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B. Analysis of the Baseline Scenario (current situation without the proposed GEF Project)
1.4 The overall environmental condition of the Gulf has been studied during the latest months
through among others-- a Transboundary Diagnosis Analysis (TDA), as a key part of the
formulation process of this proposal. A series of emerging and interconnected problems
affecting the marine and coastal resources are threatening the medium and long-term
functional integrity of the Gulf's ecosystems. Some of these threats appear to be relatively
localized whereas others are common to the three countries or transboundary in nature. These
threats are synthesized as follows: increase of pollution and sedimentation; overexploitation
of fish and shellfish; transboundary conflicts among fishers; overuse of water resources; and
habitat degradation. These direct threats have their origin in the following set of
transboundary and interrelated root causes: poor coordination between the involved countries
and the absence of common tools in order to co-manage the Gulf's resources with a regional
perspective; absence of harmonized legal/financial mechanisms and planning instruments for
guaranteeing the sustainability of the Gulf's marine and coastal ecosystems; and limited
sustainable alternative livelihoods.
1.5 From the TDA process it was evident that a situation involving three countries with parallel
institutions, with different technical and operational capacities at the local and national levels,
with diverse problems, realities and priorities, as well as the interaction between various
economic and social sectors, generates a set of issues that hinder an appropriate coordinated
response by the involved countries. Additionally, the analyses undertaken for the TDA,
including a simply hydrological model, provide evidence of the connection between severe
erosion and pollution in the tributary watersheds and sedimentation and contaminant loads in
vulnerable parts of the Gulf such as its estuaries, mangroves and seagrass beds. Excessive
sedimentation and contaminant loads can lead to habitat degradation and eventually to
declines in coastal and marine resources shared by all three countries. In this baseline
scenario, several fundamental questions remain unanswered such as the extent to which
sedimentation is human-induced, the micro-watersheds contributing the most pollution and
sediments, and the ecosystemic and socioeconomic conditions that have led to the decline of
fisheries stocks in the Gulf. These circumstances and the questions underlying them
constitute the main argument for proceeding with a cost-effective approach where all three
countries can tackle the problems in a cooperative manner.
1.6 The Gulf of Fonseca has been the recipient of some funding initiatives that have been used
for the design of the project and its eventual implementation. DANIDA has been one of the
predominant international cooperation agencies, helping to establish a common strategic
framework for management and development in order to address some environmental
problems through the project PROGOLFO. This project had been carried out by the
governments of El Salvador, Honduras, and Nicaragua from 1999 to 2003 through MARN,
SERNA and MARENA. One of the major contributions of this effort was to generate a
significant amount of information on the coastal marine zone of the Gulf of Fonseca, which
has been used as a basis for developing this GEF-IW project. Additionally, the project
PROARCA financed by USAID has also contributed to the involvement of the three
countries in a joint management of the Gulf, by developing and sharing information, tools
and methods for the integrated management of marine and coastal key ecosystems in Central
America1.
1 There are two projects that are at the initial implementation stages: (i) `Conservation of Coastal
Ecosystems in the Gulf of Fonseca' financed by AECI-ARAUCARIA, which comprises an execution
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1.7 While important funds have been invested, there has been a tendency to focus on single
productive sectors from a country-based perspective and not taking fully into consideration
the interrelated nature of the problems in the Gulf. In this context, cooperative and integrated
management of the Gulf can only be achieved by building a common understanding of the
Gulf of Fonseca as a maritime body linked to its tributary watersheds with coastal and marine
resources shared by the three countries locally and nationally, by engaging and promoting
ownership in the project among actors involved in the three countries by means of practical
activities that can attain measurable field results, and by basing concerted management
decisions on scientific knowledge of both the tributary watersheds and the Gulf's waterbody
dynamics.
C. Analysis of the Alternative Scenario (with the GEF Project)
1.8 The GEF Alternative will build upon and complement the ongoing programs and activities of
the baseline scenario. Through the baseline activities alone, it will not be possible to achieve
a development that is consistent with the sustainable use of the Gulf's ecosystem. The project
has the objective to foster the sustainable use of the Gulf of Fonseca's marine and coastal
resources and the integrated management of its ecosystems through the support of a
trinational framework for cooperation. The project will achieve this objective through a series
of activities divided into four main components:
1.9 Component 1: Institutional Strengthening for Regional Management of the Gulf. This
component will be achieved through the following activities: (i) strengthening the technical
and operational capacities of key stakeholders in regional and local institutions, as well as
social actors; (ii) reinforcement of the trinational coordination framework; (iii) enhancement
of the mechanisms for the involvement of the civil society in the Gulf's management; and (iv)
consolidation of the information node for monitoring the Gulf of Fonseca by linking in the
local and national information systems with a Regional one.
1.10
Component 2: Management of Coastal and Marine Ecosystems. This component consists
of the following activities: (i) design and implement a trinational coastal management plan
for the Gulf of Fonseca as a foundation for effective local Coastal Resource Management
(CRM); (ii) develop fisheries and aquaculture policy and co-management for the Gulf among
the three countries; (iii) enhancing the financial sustainability for the management and co-
management of the Gulf's resources; (iv) environmental restoration of mangrove ecosystems.
1.11
Component 3: Pollution and Sediment Prevention and Control /Decision-making Models.
This component will be achieved through the following activities: (i) expansion of the
hydrometric and water quality monitoring network in the tributary watersheds of the Gulf of
Fonseca; (ii) update of bathymetric information and establishment of monitoring the
atmosphere, the hydrodynamics, and water quality within the Gulf of Fonseca; (iii)
implementation and start-up of a hydrological model in the tributary watersheds of the Gulf
of Fonseca; (iv) implementation and start-up of a hydrodynamic and water quality model for
the Gulf of Fonseca; and (v) designing and execution of a regional strategy for pollution and
sediment control in the Gulf of Fonseca.
period from 2005 to 2010, and. currently is performing baseline studies; and (ii) `Millennium Account'
that through agreements with each country, will be carrying out activities for the productive sector and
watershed management in the Gulf's area.
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1.12
Component 4: Promotion of sustainable livelihoods. This component consists of: (i)
sustainable use of natural resources and development of alternative livelihoods; and (ii)
support the adoption of cleaner production in targeted sectors and industries.
1.13
This intervention will result in global environmental benefits such as: (i) an overall
improvement in the status of the Gulf's marine and coastal resources, including shared
fisheries resources, and the prevention of regional (trinational) conflicts over resource use, as
a consequence of fully-endorsed social, environmental and economic cooperative agreements
for their management in a highly participatory manner; (ii) an enhancement of pollution and
sediment control in the Gulf (coastal and marine waters) through harmonized policies,
regulations and actions to reduce erosion, liquid and solid wastes, and agrochemicals from
tributary watersheds including two transboundary watersheds. This will contribute to the
conservation of habitats which sustain the fisheries production not only in the Gulf itself, but
also along the rest of the Central American Pacific coast, as well as the maintenance of
biological diversity of global importance; (iii) an advance in the scientific understanding and
assessment of marine and coastal ecosystems as a fundamental basis for sound decision-
making; (iv) at the end, the project will generate global benefits through an integrated
approach to Gulf-wide management as reflected in an innovative approach to developing
Central America's first multi-national coastal management plan. This and the combined
actions of the Project at the field level will strengthen long-term, cross-cutting, and
sustainable protection of strategic ecosystems such as the wetlands and mangroves that have
been declared to be of global importance by the Ramsar Convention, as habitat for numerous
local and migratory bird species.
1.14
National and regional benefits include, among others: (i) improved technical and
operational capacities of institutions, civil society organizations, professional and academic
networks, private sector associations, users' groups and local governments for an integrated
management of the Gulf, and supported by a common CRM benchmark system; (ii) better
legal and technical basis for a permanent regional arrangement for management of the Gulf of
Fonseca; (iii) a coherent regional framework of policies for managing ecosystems negotiated
by the three countries, reflecting a shared vision of the Gulf as an integral system; (iv) new
mechanisms for leveraging the financing for managing coastal and marine ecosystems
amongst three countries; (v) regional adoption and replication by the private sector and co-
administrators (users of mangroves, cooperatives of fishers, co-managers of protected areas)
of innovative cleaner production technologies and good practices.
1.15
Local benefits include, among others: (i) a progress in the offer of sustainable alternative
livelihoods, which are critical for creating better prospects for bolstering the income of the
population, at the same time that it boosts not only food security but also the well-being of its
inhabitants; (ii) a pressure reduction on key resources of local scope such as the mangrove
forest; (iii) improved local socio-economic conditions through reduced water pollution; (iv)
increased capacity of local institutions as well as of Municipalities to protect public goods
against free riders that will enhance the long-term carrying capacity of the Gulf's ecosystems.
The achievements of benefits at local and national levels will be largely financed by non-GEF
co-financing.
D. Analysis and calculation of the incremental costs
1.16
Table 1 summarizes the baseline and incremental cost. Table 2 presents the analysis of
the baseline and incremental costs needed to achieve global benefits under the GEF
Alternative. The baseline costs are estimated at US$ 13,000,000 and were calculated based on
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the basis of current and projected government expenditures in the Gulf for the lifetime of the
project, as well as funds from other projects carried out by civil society, productive
associations, as well as from international cooperation programs. The quantities indicated for
the incremental cost of US$ 26,326,000 are derived from the GEF budget and the confirmed
co-financing. The GEF contribution to finance the incremental costs is US$ 5,000,000. The
main source of co-financing for the project is from the Millennium [Challenge] Account
(MCC) with US$ 14,400,000. Other sources of co-financing are the Spanish Agency for
International Cooperation (AECI) with an amount of US$ 4,000,000, and the Japan
International Cooperation Agency (JICA) with US$ 936,000. Therefore, the total amount for
the GEF Alternative is US$ 39,326,000 (baseline + incremental).
Table 1. Summary of Baseline and Incremental Costs under the GEF
Alternative
Component
Baseline
Total
(Thousands
Incremental
(Thousands
US$)
(Thousands US$)
US$)
827
1,360
2,187
COMPONENT 1: Institutional Strengthening for the Regional Management of
the Gulf
COMPONENT 2: Management of Costal and Marine Ecosystems
5,712
3,255
8,967
COMPONENT 3: Pollution and Sediment Prevention and Control/Decision
3,902
8,136
12,038
Support Models
2,558
12,251
14,809
COMPONENT 4: Promotion of sustainable livelihoods
Other Costs
0
1,324
1,324
Totals
13,000
26,326
39,326
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Table 2. Incremental Costs Matrix
Component
Category
Cost (US$)
Local Benefits
Global Benefits
thousands
COMPONENT 1:
Baseline
827
Progress has been made towards Although associations of
Institutional Strengthening
establishing mechanisms for
municipalities, NGOs, national
for the Regional
guaranteeing the participation of institutions and the private
Management of the Gulf
all stakeholders of the Gulf
sector are aware of the need to
Region. However, there still are work for addressing common
some limitations such as an
transboundary environmental
apparent lack of functional
problems, the perspectives for
regional management structure
reducing the Gulf's resources
and incipient technical and
degradation and
operational capacities of the
overexploitation and improving
involved local and regional
the conservation of globally
authorities as well as civil society important marine ecosystems
organizations in order to
will keep constrained by the
effectively apply integrated
lack of a harmonized and
management and planning
integrated management
practices in a coordinated
framework for the Trinational
manner.
Gulf of Fonseca.
GEF Alternative
2,187
Technical and operational
A model for regional
capacities of institutions, civil
management will be tested
society and local governments for through the strengthening of a
integrated management
trinational structure which will
improved. Local participation
include integrated institutional
enhanced. Improved access to
frameworks for managing the
environmental information
Gulf's common ecosystems, the
systems and general awareness. execution of several strategies
for guaranteeing the
participation of all relevant
stakeholders involved; and
enhanced trinational capacities
to systematize information for
an adaptive management.
Total Incremental Cost
1,360
The GEF will cover 82% of the incremental costs under this
activity
GEF Incremental Cost
1,120
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Component
Category
Cost (US$)
Local Benefits
Global Benefits
thousands
COMPONENT 2:
Baseline
5,712
Some development has been
None
Management of Costal and
made towards the management of
Marine Ecosystems
individual ecosystems within the
Gulf, but there is a lack of
harmonizing plans for coastal
zoning, regulating fisheries /
aquaculture activities,
encouraging co-management of
specific areas, and restoring key
ecosystems such as mangroves.
Neither exists secure financial
sources for covering recurrent
costs for addressing the
integrated ecosystem
management.
GEF Alternative
8,967
Through the design and
The prospect of managing in a
implementation of an agreed
sustainable manner a globally
coastal management plan in a
important marine area will be
trinational collaborative manner, increased through the
the pressure on key resources of implementation of an
local scope such as the mangrove innovative ecosystem based
forest will be diminished. The
approach and other co-
development of fisheries and
management models adaptable
aquaculture policies and the
to the existent conditions (either
promotion of co-management
local or regional), involving
plans will enable local
local populations, productive
institutions (both governmental associations, governmental
and non-governmental) to
institutions at a national level
sustainable use, protect and
and other relevant stakeholders.
manage their coastal resources.
Financial sustainability for
Alternative sources of funding for continuing this management
environmental management will model would be secured.
be also identified and leveraged.
Total Incremental Cost
3,255
The GEF will cover 51% of the incremental costs under this
activity
GEF Incremental Cost
1,666
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Component
Category
Cost (US$)
Local Benefits
Global Benefits
thousands
COMPONENT 3: Pollution
Baseline
3,902
Nor national neither regional
None
and Sediment Prevention
watershed strategy for pollution
and Control/Decision
control is available. and
Support Models
monitoring has been restricted to
meteorological and hydrometric
stations in very few places within
the Gulf area.
GEF Alternative
12,038
Activities under this component The emerging trends that
will enhance the monitoring of
threaten the marine and coastal
meteorological, hydrometric,
ecosystems will continue to
hydrodynamic, and water quality intensify and reduce the
parameters for establishment a
functional integrity of the Gulf.
baseline and trends for the
Control/decision-making
environmental conditions in the models will serve as tools for
Gulf. This will enable to improve developing a regional
local socioeconomic conditions (trinational) pollution reduction
through reduced water pollution, strategy in the tributary
diminishing at the same time the watersheds and within the
main driven force for morbidity Gulf's waterbody, allowing the
and morbidity, which is
conservation and ecological
gastrointestinal disease.
integrity of the ecosystems that
sustains the fisheries and the
biological marine diversity of
global importance.
Total Incremental Cost
8,136
The GEF will cover 17% of the incremental costs under this
activity
GEF Incremental Cost
1,380
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Component
Category
Cost (US$)
Local Benefits
Global Benefits
thousands
COMPONENT 4:
Baseline
2,558
Although some producers may
Activities will continue to be
Promotion of sustainable
benefit from the use of the Gulf's carried out only by few actors
livelihoods
natural resources (i.e. fisheries,
in a way that is compatible with
aquaculture), these resources are the Gulf's ecological resilience.
used in an unsustainable manner /
overexploited / degraded.
Therefore the usual productive
activities are less profitable due
to the increment of effort / private
costs, and even the extinction.
Limited market opportunities and
lack of incentives reduce the
attractiveness of innovative /
alternative productive options.
GEF Alternative
14,809
Local producers will diversify
By contributing to a shift from
their production as well as will
unsustainable productive
participate in activities that will practices towards sustainable
be encouraged with new
use of environmental goods and
incentive mechanisms. Current
services (including alternative /
productive activities carried out innovative livelihoods), it will
in a sustainable manner will
be an enhancement of the
continue to be promoted,
resilience of marine ecosystems
contributing to the increase of
of global relevance, as well as
communities' economic-financial their integrity will be improved.
return, therefore reducing the
pressure on fragile resources.
Production sectors and industries
that exert the greatest impact on
the Gulf will adopt cleaner
production practices, diminishing
the discharges that are critical to
water pollution.
Total Incremental Cost
12,251
The GEF will cover only 4% of the incremental costs under this
activity
GEF Incremental Cost
500
Baseline
0
GEF Alternative
1,324
Other Costs
Total Incremental Cost
1,324
The GEF will cover only 25% of the incremental costs under this
activity
GEF Incremental Cost
334
Baseline
13,000
Includes activities carried out by government and other donor
programs under execution
GEF Alternative
39,326
Baseline + Incremental costs
Total Incremental Cost
26,326
Includes GEF Funding, the Government of El Salvador,
TOTALS
Honduras, and Nicaragua Contribution of US$1,990,000,
US$4,000,000 million from AECI, US$ 936,000 from JICA and
US$ 14,400,000 from the Millennium [Challenge] Account
(MCC).
GEF Incremental Cost
5,000
Does not Include US$600,000 from GEF PDF B
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ANNEX B - LOGICAL FRAMEWORK
INTEGRATED MANAGEMENT OF THE ECOSYSTEMS OF THE GULF OF FONSECA
OBJECTIVES, RESULTS AND
VERIFIABLE INDICATORS
A
M
CTIVITIES
EANS OF VERIFICATION
ASSUMPTIONS
GOAL: Contribute to the health of
After 3 years of having finalized the project:
the trinational coastal and marine
a. The coverage of the mangroves is the same
a. Aerial photography, and
Integrated Ecosystem
ecosystems of the Gulf of Fonseca,
or has expanded compared to the current
official statistics of mangrove
Management in the Gulf of
as well as the well-being of the
extension (Baseline: Mangroves: 57,400 ha).
coverage from environmental
Fonseca continues to be
population settled along its coastal
b. Land-based pollution is controlled or
authorities
considered a joint strategic action
zone and lower binational tributary
reduced as measured by Biological Oxygen
b. Monitoring reports of BDO.
for El Salvador, Honduras, and
watersheds.
Demand (BOD) at the mouths of the major
Nicaragua.
tributary watersheds (Baseline: estimated
total BOD 170,000 kg/day at the mouths of
Co-financing from other projects
the watersheds based on TDA).
comes in timely manner.
c. Sedimentation in the Gulf of Fonseca is
c. Monitoring reports of
controlled or reduced compared with the
The partnerships with local
sediment discharges
current estimated amount (Baseline: estimated
governments, NGOs, and civil
total sediment discharges 23,000 116,000
society remain in place.
tons/day at the mouths of the watersheds).
d. The number of inhabitants living in the
d. Socioeconomic surveys/
Gulf's area deriving at least 50% of their
statistics
income from environmentally sustainable
activities and / or alternative livelihoods
Oral reports of beneficiaries
linked to the use of marine and coastal
resources has increased by 10%, compared to
a baseline to be updated through a survey in
Year 1 (Baseline:20,000 artisanal fishers;
53,000 persons dedicated to aquaculture; to
be refined during year 1 ).
PURPOSE: To foster the
At the end of the project:
sustainable use of the Gulf of
a. The Trinational Commission for managing
a. Review of meeting minutes
Governments from the three
Fonseca's marine and coastal
the ecosystems of the Gulf of Fonseca is
and agreements of the
countries cooperate in the
resources and the integrated
operating efficiently as a participatory and
Trinational Commission of
development and enhancement of
management of its ecosystems
representative regional cooperation structure
the Basin
the legal framework, policies and
through the support of a trinational
(Baseline: Amapala Agreement of 1993
regulations for the integrated
framework for cooperation.
calling for the establishment of a Trinational
management of the Gulf.
Commission is not implemented)
b. Based on the Transboundary Diagnosis
There is political will in the three
Analysis, the regional information node and
b. Agreements signed between
countries to sign the Trinational
its models, the countries share systematically
institutions.
Agreement and ensure the
scientific information on the environmental
Reports of monitoring and
Commission's continuity.
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OBJECTIVES, RESULTS AND
VERIFIABLE INDICATORS
A
M
CTIVITIES
EANS OF VERIFICATION
ASSUMPTIONS
status and trends of the Gulf's tributary
evaluation
Priority of the key stakeholders in
watersheds as well as its waterbody, so as to
the three countries is maintained
Annual statistical bulletin and
make it possible to agree upon
with regard to the sustainable
semi-annual report on the
strategies/actions for pollution and sediment
development of the Trinational
status of the Gulf
control prevention and adaptive ecosystem
Gulf of Fonseca.
management. (Baseline: In 2006 there is no
Midterm and final evaluation
There is sociopolitical stability in
harmonized monitoring network or
reports.
the Gulf of Fonseca region, which
systematic exchange of data on water quality
enables to improve the conditions
and sedimentation processes in the Gulf or
for integrated ecosystem
its tributaries, and existing information
management.
systems have limited coverage).
c. Memoirs of advances made
c. A set of policies, norms and procedures for
in the implementation of the
The trinational agreements
the use of coastal-marine resources of the
coastal management plan
established for the joint
Gulf will have been harmonized based on
management of the ecosystems of
consensus, and their implementation will be
Reports on the new
the Gulf of Fonseca remain in
monitored using a common CRM benchmark
legal/political framework
place.
system. (Baseline: in 2006 no Coastal
Publication of regional
Resource Management (CRM) benchmark
policies endorsed by the
system is being used by any of the 19
countries and presented in the
municipalities).
project's website
d. Co-management plans for at least two
d. Reports on monitoring of
overexploited shared resources (shrimp and
the co-management plans'
fish) are being implemented with fisher
implementation
associations, local governments and
organizations of each country. (Baseline:
Annual statistical bulletin and
There are no co-management plans for
semi-annual report on the
fisheries resources).
status of the Gulf
Periodic reports of the
national entities in charge of
coastal resource management
(fisheries).
Midterm and final evaluation
reports.
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OBJECTIVES, RESULTS AND
VERIFIABLE INDICATORS
A
M
CTIVITIES
EANS OF VERIFICATION
ASSUMPTIONS
COMPONENT 1: Institutional Strengthening for Regional Management of the Gulf
Activity 1.a: Strengthening the
a. At the end of year four, at least 60
a. Evaluation documents of the
MARN, SERNA, and MARENA
technical and operational capacities
professionals in the regional offices of
progress of the
and other actors willing and
of key stakeholders of regional and
SERNA / MARN / MARENA / SANAA /
implementation of the
committed to send qualified
local institutions, as well as social
ENP / ANDA (Nicaragua) are trained (and
institutions strengthening
personnel to the events for
actors.
equipped) in the application of
plans
transferring and training in
hydrological, hydrodynamic and
hydrological / environmental
Registries of assistance and
environmental monitoring models in the
monitoring models.
evaluation reports of training
Gulf and its tributary watersheds (Baseline:
sessions
Local governments and other
limited technical capacity and equipment
actors involved are willing and
for the Gulf`s management in regional
committed to participate in the
offices as documented in TDA).
b. Evaluation documents of the
training events.
b. At the end of year three, 40 employees in
progress of the
the 19 Municipalities are trained
implementation of the
participatory mapping, local CRM,
institutions strengthening
pollution prevention, risk management,
plans
environmental education, and
environmental monitoring and evaluation
Registries of assistance and
(Baseline: limited local government
evaluation reports of training
capacity for the Gulf`s management as
sessions
documented in the TDA).
c. At the end of the project, Municipalities
and their Federations have basic
c. Receipt documents for
communication equipment and other
equipment and supplies.
facilities needed in their association for
carrying out trinational initiatives of mutual
interest (Baseline: scarce and obsolete
equipment/facilities in the Municipalities
for designing and developing projects
amongst the Municipalities)
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OBJECTIVES, RESULTS AND
VERIFIABLE INDICATORS
A
M
CTIVITIES
EANS OF VERIFICATION
ASSUMPTIONS
Activity 1.b: Reinforcement of
a. The Trinational Commission meets at least
a. Minutes of the Trinational
Priority of the stakeholders in the
trinational coordination framework
two times per year starting year one
Commission meetings with
three countries is maintained with
(Baseline: the Commission does not exist).
record of participants.
regard to the sustainable
b. At the end of year two, database of projects
development of the Trinational
operating in the Gulf and webpage
Agreements signed.
Gulf of Fonseca.
elaborated consistent with IW:LEARN
Federations, NGOs,
guidance (Baseline: database does not
b. Project database and Web
representatives of civic
exist).
page in operation.
associations, and the private
c. From year three on, organization of at least
sector interested in participating
one workshop per year for information-
c. Memoirs of the workshops.
in the forums.
coordination of donors and developers of
projects in the Gulf (Baseline: information
Specific responsibilities are
coordination of donors is developed in a
assigned by the institutions and
non systematic basis).
other stakeholders in order to
d. Feasibility study for Sea Grant model for
d. Study's final report.
maintain and update the database
applied research, extension and education
of projects and organizing the
completed by year three (Baseline:
information / coordination
Preliminary discussions have been held on
workshop.
the need for a regional Sea Grant
program).
Annex B
5 of 12
OBJECTIVES, RESULTS AND
VERIFIABLE INDICATORS
A
M
CTIVITIES
EANS OF VERIFICATION
ASSUMPTIONS
Activity 1.c.: Enhancement of the
a. The Trinational Advisory Group and the
a. Reports of the Trinational
Civil social organizations and
mechanisms for the involvement of
network of local committees meet at least
Advisory Group Network
public institutions are committed
the civil society in the Gulf's
twice a year for planning and following-up
of local committees.
to assume responsibilities
management
the project's activities, and reports on those
regarding the Advisory group.
meetings are disseminated (Baseline: the
Media leaders, private
Advisory Group doesn't exist).
organizations, gremial groups, and
b. At the end of the first year, the regional
b. Assessment documents of
the educational sector keep their
social communication strategy for
the degree of advance
willingness to be involved in the
disseminating the project's activities
related to the
project execution
through grassroots groups is designed and
implementation of the
its implementation started during the
social communication
second year (Baseline: social
strategy
communication strategy and associated
activities / outputs do not exist).
Oral reports of beneficiaries
Will of the government
c. At the end of the project, 10 education
institutions, NGOs, and
centers (primary and secondary level),
c. Non-formal education
municipalities of the three
related to the project intervention sites in
project documents produced
countries to share information.
the three countries have included formal
by education centers
and non-formal education projects and
activities related to the Gulf's ecosystems
in their institutional structure (Baseline:
Gulf-wide formal environmental education
programs related to the Gulf's ecosystems
do no exist).
d. Selected groups of key decision makers
d. Reports of key decision
(gremial groups, donors, conservation and
makers' participation in
development NGOs, farmer groups, etc.)
events / forums / workshops
have been provided with information
where information is shared
responding to their demands through the
work of Municipal Environmental Units
(Baseline: involvement of these groups in
the sustainable management of the Gulf is
incipient).
Annex B
6 of 12
OBJECTIVES, RESULTS AND
VERIFIABLE INDICATORS
A
M
CTIVITIES
EANS OF VERIFICATION
ASSUMPTIONS
Activity 1.d: Consolidation of the
a. At the end of year one, at least 5
a. Letter(s) of understanding
information node for monitoring the
cooperation agreements established among
and/or technical cooperation
Gulf of Fonseca by linking the local
associations of local governments, NGOs,
agreements between groups
and national information systems
training and research institutions, and the
that generate information on
with a Regional one.
CCAD for determining responsibilities and
the Gulf's resources /
allocating resources in tasks related to
ecosystems.
information management (Baseline: no
agreements have been signed).
b. At the end of year two, the regional
b. Memorandum of
information node is established in order to
understanding that establishes
develop the monitoring and evaluation
the regional information node
system that estimates the performance and
signed.
impact of managing in a trinational manner
the Gulf's resources (Baseline: regional
Minutes derived from the
information node does not exist).
node's meetings.
c. At the end of the project, 30 stakeholders of
the Gulf will have participated in different
c. Evaluation documents of the
forums for the exchange of experiences in
progress of the forums and
the management of transboundary
exchange of experiences
bodywaters, including IW: LEARN
Agreements signed on
activities (Baseline: Gulf's stakeholders
exchange of information and
have not participated in any exchange).
good practices.
d. At the end of year four, a document with
index of systematized information and
d. Document of systematized
record of good practices will be produced
information and record of
and posted in the project's webpage
good practices posted in the
(Baseline: document doesn't exist).
project's Web page.
Annex B
7 of 12
OBJECTIVES, RESULTS AND
VERIFIABLE INDICATORS
A
M
CTIVITIES
EANS OF VERIFICATION
ASSUMPTIONS
COMPONENT 2: Management of Coastal and Marine Ecosystems
Activity 2.a: Design and
a. At the end of year three, the coastal
a. Elaborated plans and acts of
There are technical tools and legal
implement a trinational coastal
management plan formulated through a
endorsement.
mechanisms that facilitate
management plan for the Gulf of
participatory mapping process in the
national and regional conditions
Fonseca as a foundation for
municipalities and the consolidation of the
for designing and implementing
effective local Coastal Resource
best available information is officially
the plan.
Management.
endorsed by the Trinational Commission,
Innovative mechanisms for
local authorities and interested groups.
maintaining the dialogue among
(Baseline: plan does not exist).
institutions and civil society
b. At the end of the project, the coastal
b. Annual reports of plan's
organizations are enhanced with
management plan is under implementation
implementation. .
the development of the coastal
with advances reported using the common
management plan.
CRM benchmark system (Baseline:
advances in local CRM in the Gulf are not
being reported).
Activity 2.b: Develop fisheries and
a. At the end of the second year, criteria and
a. Fisheries / aquaculture policy
Users of resources, local and
aquaculture policies and co-
indicators for the harmonization of legal
documents endorsed by the
national authorities in charge of
management plans for the Gulf
instruments and procedures for fisheries
Governments and published
artisanal and industrial fisheries,
among the three countries.
and aquaculture are approved by line
on the website of the
as well as the aquaculture sector,
agencies (Baseline: common criteria and
project/CCAD.
are aware of their impacts on the
indicators do not exist).
Gulf of Fonseca and the need for
b. Follow up report on the
b. At the end of year three, Fisheries and
designing and implementing
implementation of the new
Aquaculture Policy adapted to the local
regional plans / policies for
policies
reality of the Gulf is endorsed and its
enhancing the sustainable
implementation started before the end of
management of
the project (Baseline: Fisheries and
fisheries/aquaculture
Aquaculture Policy only exists for CA).
.
c. At the end of year four, at least 500 fishers
Political will of the national and
in each country and three cooperatives in
c. Periodic record of fishers /
local governments of the 3
suitable areas are participating in co-
cooperatives involved in co-
countries and the municipal
management (registries updated, by-catch
management actions.
governments to harmonize the
reduction measures adopted) (Baseline:
environmental legislation.
limited experiences in fisheries co-
management in the Gulf).
d. At the end of the project, agreements
Willingness of the competent
d. Agreements signed
among governments, industries, individual
authorities to participate in the
(alongside an implementation
producers, cooperatives and institutions for
process of harmonization and
schedule) between different
innovative dispute settlement mechanisms
dissemination of the legal
actors for disputing
will be established (Baseline: these
instruments.
settlements.
agreements do not exist).
Annex B
8 of 12
OBJECTIVES, RESULTS AND
VERIFIABLE INDICATORS
A
M
CTIVITIES
EANS OF VERIFICATION
ASSUMPTIONS
Activity 2.c: Enhancing the
a. At the end of year three, two financial
a. Progress report / records of
The legal frameworks from the
financial sustainability for the
mechanisms / instruments for covering the
revenues / income derived
countries enable to establish the
management and co-management of
recurrent cost of the Trinational
from the financial instruments
financial instruments /
the Gulf's resources.
Commission are be designed (Baseline:
/ mechanisms.
mechanisms, including a potential
mechanisms / instruments do not exist).
Trust Fund.
b. Document of feasibility
b. At the end of year four, feasibility analysis
analysis of the Trust Fund and Commitments from the notional
and financing strategy of a potential
agreements for its creation
budgets are accomplished.
Trinational trust fund is finished (Baseline:
and management.
do not exist).
c. At the end of the project, the first
c. Memoir of meetings /
roundtable of investors and potential
roundtable.
donors is held (Baseline: roundtable held
occasionally).
d. At the end of the project, countries are
d. Records of yearly allocation
willing to allocate financial resources for
to the Trinational Commission
the Trinational Commission operation
form the Ministries of Finance
(Baseline: countries only allocate financial
of each country.
resources for the operation of their own
institutions).
Activity 2.d: Environmental
a. At the end of year three, a land tenure
a. Study's final document
Alternatives to generate fuel form
restoration of mangrove ecosystems.
study to determine appropriate intervention
different sources are available.
strategies for the allocation of resource
Financial resources for
rights in multiple use mangrove
performing restoration activities
ecosystems (ME) is completed (Baseline:
are provided in a timely manner.
ME are not addressed systematically).
b. At the end of the project, at least 100 ha of
b. Aerial photography.
mangrove are restored and 10 forestry
plantations for the production of firewood
are developed (Baseline: there are no
forestry plantations and ME are seriously
degraded).
Annex B
9 of 12
COMPONENT 3: Pollution and Sediment Prevention and Control/Decision Making Models
Activity 3.a: Expansion of the
a. At the end of year one, protocols for
a. Technical report on the critical
The offices of the national and
hydrometric and water quality
monitoring and analysis are harmonized
values of the parameters and
local governments, the NGOs, and
monitoring network in the tributary
(Baseline: common protocols do not
protocols agreed
other sectors affected are willing
watershed of the Gulf of Fonseca
exist).
to let their technical personnel to
receive advanced academic
b. At the end of year one, four new
b. Bi-annual report on the status of
training.
hydrometric stations for complete
the Gulf
Government institutions facilitate
coverage of the seven principal
access to installed equipment.
watersheds that discharge into the Gulf
will be installed (Baseline: ten
The fisheries sector and Navy in
hydrometric stations for minor
the three countries are interested
tributaries are in operation, but only
in participating in and supporting
three near where the rivers discharge
the project.
into the Gulf are functioning).
The three countries facilitate the
free transit of the research boats in
their territorial waters.
a. At the end of year one, surveying and
a. Technical report on the results of
All the cartographic, climatic, and
Activity 3.b: Update of bathymetric
hydrographic capabilities will be
the assessment survey.
hydrometric information on the
information and establishment of
assessed (Baseline: MAHC has
tributary watersheds of the Gulf,
monitoring the atmosphere, the
preliminary information on
will be provided at no cost by the
hydrodynamics, and water quality
capabilities).
competent institutions of each
within the Gulf of Fonseca.
b. At the end of year one, strategic sectors b. Formalized agreements with key
country.
will be incorporated as key partners in
sectors.
obtaining information through signed
agreements (Baseline: these sectors
The estimates of current and
are not part of the information node).
future demand for water will be
c. At the end of year three, updating of
c. Technical report on the results of
provided by each country.
selected gaps in the bathymetry of the
application of the models,
Gulf completed (Baseline: Assessment
associated with each of the
of gaps to be completed in year 1).
scenarios considered.
Annex B
10 of 12
a. At the end of year two, the main
a. Reports on the characterization
Historical information will be
Activity 3.c: Implementation and
watersheds that drain into the Gulf will
of the main watersheds.
available on tides, currents, winds,
start-up of a hydrological model in
be characterized (Baseline: During the
and concentrations of pollutants.
the tributary watersheds of the Gulf
TDA a preliminary (small-scale)
of Fonseca.
characterization of the watersheds was
completed).
The up-to-date bathymetry and
b. At the end of year two, an inventory of
b. Inventory reports of main point
data from the monitoring
the main point sources of pollution (by
sources of pollution (including
campaigns carried out under
sector) including their georeferenced
their georeferenced location)
activity 3b will be available.
location will be done (Baseline: A
systematic inventory of point sources is
not available).
c. At the end of year two, the analysis of
c. Inventory reports of main non-
non-point agricultural sources of
point agricultural sources of
potential pollution (agrochemicals) and
pollution and sediments
sediments from tributary watersheds
will be completed (Baseline: During
the TDA, a preliminary analysis of
potential erosion in the tributary
d. Technical report on the results of
watersheds was undertaken).
calibration and validation of the
d. At the end of year three, a hydrological
model.
model for seven watersheds will be
calibrated and verified (Baseline:
Technical report on the results
hydrological model is not currently
of application of the model to
available).
the remediation scenarios.
a. At the end of year three, hydrodynamic
a. Reports on development and
Activity 3.d: Implementation and
and water quality model of the Gulf will
evaluation of scenarios.
start-up of a hydrodynamic and
be calibrated and verified (Baseline:
water quality model for the Gulf of
Hydrodynamic model is not currently
Technical report on the results
Fonseca.
available).
of calibration and validation of
the model.
a. At the end of year three, medium term
a. Agreements on water quality
There is political will to enter into
Activity 3.e: Designing and
water quality and sediment targets for
and sediment targets
an agreement to reduce pollution
execution of a regional strategy for
the Gulf are set (Baseline: The
and sedimentation at the highest
pollution and sediment control in
foundation for agreeing on targets
level.
the Gulf of Fonseca.
does not exist).
Information for decision taken is
b. At the end of year four, a trinational
b. Document on pollution and
provided in a timely manner
pollution and sediment control
sedimentation reduction strategy
strategy for preventing the impacts
endorsed by the three countries
Efficient coordination among the
from main tributary watersheds on
and published on the website of
involved institutions at different
Gulf ecosystems is be agreed upon
the project/CCAD.
levels (local, national, regional)
(Baseline: no common strategy is
working to date).
Annex B
11 of 12
c. At the end of the project, investments
c. Records of yearly private and
for pollution and sediment control are
public investments in pollution
aligned with the strategy (Baseline:
and sediment control of each
investments are made without
country.
consideration of potential impacts on
the Gulf).
COMPONENT 4: Promotion of Sustainable Livelihoods
Activity 4.a: Sustainable use of
a. At the end of year two, five financially
a. Reports on projects' performance
Private owners and farmers
natural resources and development
viable and innovative pilot projects
(including output indicators),
perceive benefits derived from the
of alternative livelihoods.
using environmental goods and
according to the targeted group.
adoption of best practices, as well
services of the Gulf for youths and
as from the development of
other target groups are implemented in
Field visits
activities of sustainable
each country with results reported by
management
year three (Baseline: limited
Groups that intervene in the use /
opportunities exist for youths for
management of natural resources
innovation in sustainable use of the
are willing to establish
Gulf's environmental goods and
cooperation agreements to
services).
coordinate pre-investment of
b. At the end of year two, subject to the
b. Minutes and inter-institutional
programs and projects
accomplishment of agreed criteria
agreements related to the
among the three countries, at least 9
coordination and management of
Community leaders, private
sustainable projects submitted by
projects.
owners and NGOs are willing to
micro- and artisanal producers are
support / participate in this
selected and begin implementation
Reports on monitoring and
component's activities
(Baseline: to be established in year
evaluation of productive
one).
projects.
c. At the end of year three, at least three
Municipalities (one in each country)
Field visits
introduce an incentive scheme in areas
that fall under their responsibility to
c. Municipalities records / reports
promote innovation in resource use,
on innovative schemes for
pollution and sediment control.
encouraging pollution /
(Baseline: existing incentive schemes
sedimentation control.
to be inventoried by the end of year 1).
d. At the end of year four, 30 alternative
producers with high multiplier effects
(10 per country) will have participated
d. Reports on monitoring and
in technical exchanges with other
evaluation of productive
projects / programs that have designed
projects.
payment for environmental services'
mechanisms specifically designed for
Field visits
watersheds (Baseline: no exchanges
exist at this point).
Annex B
12 of 12
e. At the end of year four, at least 30
e. Reports on monitoring and
small community-based initiatives /
evaluation of productive
enterprises / organizations that in a
projects.
cooperative and collective manner--
use the Gulf's resources will receive
Field visits
support from the project (Baseline:
preliminary inventory of eligible
organizations exists).
Activity 4.b: Support the adoption of
a. At the end of year four, three industries
a. Cleaner production guidance
Institutions that carry out
cleaner production in targeted
per each of the three priority sectors
documents
administrative and natural
sectors and industries.
will be trained in cleaner production
resource management activities
within the Gulf establish
governmental institutions (Baseline:
inventory of target companies to be
cooperation agreements with
conducted in year one).
private owners and industries.
Municipalities work in close
b. At the end of year three, at least three
b. Monitoring and evaluation reports
coordination with national
model clean production projects in
on-site pollution and
institutions regarding the
three priority sectors in the Gulf of
sedimentation
provision of updated and accurate
Fonseca area are disseminated.
information of industries.
(Baseline: Opportunities for
Report on visits to producers
disseminating clean technology in the
Information derived from
Gulf are limited).
component 3 (above) is used
efficiently for performing this
c. At the end of year four, a trinational
component.
network of technical assistance
c. Agreements that supports the
providers in cleaner production is
trinational network alongside
established in the Gulf of Fonseca
documents / lessons learned /
region (including tributary watersheds).
posted in the Project's web site.
(Baseline: a trinational network does
not exist).
Annex C
1of 15
A
1
NNEX C FINAL STAP ROSTER REVIEW
Integrated Management of the Ecosystems of the Gulf of Fonseca (RS-X1019)
Alan White
February 21, 2007
Preface
A review of this kind can take different approaches and perspectives and each reviewer will
certainly have his/her own views. As a preface, I admit that I have my own ideas about how best
to promote a strategy for "integrated ecosystem management of the Gulf of Fonseca" based on
experience in other parts of the world. This is inevitable given a topic of this scope and with a
wide range of possible approaches about how to best implement it. Any critical statements are
intended to encourage the planners and implementers of this project to think beyond the strategies
being proposed. Most importantly, all my comments are in good faith and given the critical need
for programs such as this one to protect and sustain coastal and marine resources, I certainly hope
that it can proceed with adequate support in the most effective and timely manner possible.
The review presented below was preceded by reading through the project documents that were
provided: the draft IDB Project Document; the GEF Project Executive summary; the logical
framework; the Financial Sustainability Analysis and several research reports and baseline studies
on fisheries, hydrology, climatic patterns and conditions in the area. These various reports were
helpful to give a full picture of the area of concern and provided insights into the management
issues and their various causes. Nevertheless, considering that I have not visited the management
area nor had direct contact with persons who have, I have depended entirely on the reports
provided as basis for my comments and recommendations. Suggestions are based primarily on
my experience working on integrated coastal management (ICM) in Southeast Asia.
This review follows the outline suggested by the Guidelines for STAP Reviews and is comprised
of three sections: 1) an introduction that presents some broad points that can be considered for
integration into the proposal as appropriate, 2) a discussion on the `key issues' listed for the
technical review, and, 3) more specific recommendations. Finally, the reviewer is available for
further consultation and can send references as needed.
Introduction
This project appears very timely and needed to address the pending and escalating environmental
and social issues affecting the Gulf of Fonseca. It is also an area that is naturally productive
through its fisheries and agriculture sectors as well as growing seaport traffic. Thus, the project
area is very important for the economies of Honduras, Nicaragua and El Salvador primarily
through the fisheries (capture and aquaculture) industries that are almost totally dependent on the
Gulf's resource base for existence. The proposed mega-port in the Gulf is an additional economic
opportunity while at the same being a major environmental concern.
The proposed project to undertake the "Integrated Ecosystem Management of the Gulf of
Fonseca" is a large and complicated undertaking that intends to develop and implement integrated
1 Final submitted in response to several minor comments on the draft version from the IDB and in
knowledge that responses to this review are being prepared.
Annex C
2of 15
coastal resources management in the three countries of concern. In general, the project proposal
appears very well researched with much thought and good analysis applied to make the project as
realistic and doable as possible, given the large scope and complexities of the endeavor.
The title sets the tone with "integrated" being essential to long term success. Integration has
many meanings and is sometimes ignored simply because it is too broad a term to easily define.
Yet, integrated management is certainly a foundation upon which this project can proceed. Yet,
what integrated means for this project in practical terms, could benefit from a short paragraph in
the proposal that guides implementers as to the main thrust of "integration". A key concept to
convey is the need for full horizontal and vertical integration among the institutions that will
implement and sustain the project. Also, the links between land and sea should be emphasized
given the important role land-use practices play in the Gulf water quality and its improvement.
These points are emphasized in the proposal while an explicit statement would be beneficial.
Then "ecosystem management of the Gulf of Fonseca" is really the main undertaking of the
project. A slight variation in the title could convey a more direct statement of the real project
goal, which is to manage the human uses and impacts on ecosystems of the Gulf. Although titles
rarely state the "management of people" as such, it is bit of a misnomer to imply that the
"ecosystems" will be managed. This point is raised to set the stage for the discussion later that
highlights the need for figuring out how the project will minimize or manage the various human
impacts that in turn are causing the degradation of the water quality, habitats, fisheries and other
natural resources of the Gulf. And, since this is occurring in the context of a complex
socioeconomic-environmental and political system that has tremendous momentum in the
direction of long term degradation, slightly more emphasis on managing the forces that degrade
the ecosystems would tip the focus the project more towards addressing, head on, the main issues.
The theme of ecosystem management could also be translated into "ecosystem-based
management" since an important aspect of this project is that the Gulf is one large and closely
connected ecosystem or network of ecosystems that is overlaid by three political jurisdictions.
Building on the essential need to think "ecologically" because of these interconnections is
certainly a theme that can be emphasized in all aspects of planning and education pertaining to
the Gulf management process. This also helps build a common identity for the Gulf users and
their management scheme which must cut across political boundaries and be all inclusive.
In presentation of the issues to be addressed in the project proposal, it is important that for the
issues to be fully understood and addressed, the project design needs to get to the point quickly as
to the known causes of the issues facing the Gulf. To the extent possible, issues need to be
quantified and possible implications of not addressing them noted. A case in point is the rate of
sedimentation, although quantified in a table, a small graph projecting existing deposition rates
into the future would be a powerful reminder that the Gulf could fill with sediment, if left
unchecked. In this regard, several more graphs or tables that highlight the magnitude of key
issues like sedimentation, changes in hydrology or declines in fish biomass and the major decline
in mangrove cover due to aquaculture expansion, would strengthen the rationale for the project.
In this regard, a graphical analysis of the issues and their underlying causes is essential to make
the project rationale understandable.
Then, in presenting the strategies, the proposal needs a bit more focus on the level of activity that
will make the biggest difference in reversing the current trends. This is at the level where most
degradation is occurring. Although this focus will vary among the project components or areas of
management focus (e.g. fisheries, habitats, hydrology, watersheds, etc.) between local vs. national
and/or transnational levels of implementation. Development of a more detailed work plan that is
Annex C
3of 15
focused more from the bottom (local) up to national and transnational could be an important
undertaking of the early stages of project implementation. This exercise with local stakeholders
would have the effect of engaging all the important participants in a planning process that would
encourage buy in and make them feel part of the decision process from the beginning. Since,
large GEF supported projects are sometimes seen as more top down when more than one country
is concerned; a participatory planning process would help to mitigate this perception early in the
project implementation.
Connected to the need to engage stakeholders at the local level, the program will need to deliver
tangible outcomes at a scale that will sufficiently generate more buy-in, counterpart and action.
When a program is spread too thinly and involved in many different kinds of activities and
interactions, it must be careful to achieve tangible results that are highly visible and measurable.
This goes without saying but is mentioned because it leads to the following suggestions regarding
engaging the municipal governments as the core of the field work with communities to ensure
that substantial results can be achieved that people can witness and support for expansion.
An initial impression is that the project is attempting to cover a large area and may be trying to
address a variety of issues beyond its capacity to be effective. In this regard, it is worth pointing
out that similar projects project this image in their proposals and as a result spend their first year
deciding what they can effectively accomplish. The project targets need to be focused and not
too ambitious while still a bit optimistic to create a challenge for the project management to
attain. For the most part though, the targets as spelled out in the proposal and Logical Framework
are quite manageable and focused.
Overall, the proposal is well prepared and very thorough in its coverage of the outcomes and the
activities to accomplish the outcomes. The threats analysis also leads logically into the outcomes
and activities so that the proposal is comprehensive and seems to cover its bases without any
major gaps. But, because the project is quite broad in nature and addressing a range of issues
spread over a wide geographical area, I encourage the implementers to try to be more specific in
some cases and to give the main emphasis or focus of work for the project. This can be done by
articulating the issues as noted and linking these directly to the strategies and activities.
I understand that several major forces will permanently change the areas' resources and
ecosystems, if not redirected soon. These forces are destruction of the coastal and marine
environment from over fishing; habitat destruction and changes from shoreline land use
(primarily aquaculture and harvesting of wood) and from large amounts of sediments being
deposited in the Gulf from inland erosion and land use problems as well other types of pollution.
Although these are all major challenges, the proposed project provides an excellent framework to
address the issues in an integrated manner using known approaches. Yet, achieving the
objectives as set out will not be easy if the most important stakeholders are not fully engaged in
the planning and implementation process throughout the project.
In the Philippines, a factor contributing to the increasing awareness about coastal resources
management (CRM) or integrated coastal management (ICM) is that many local municipal and
city governments are engaged in the planning for and management of their coastal areas and
resources. More than 100 coastal municipalities and cities (covering 3500 km of coastline) have
CRM plans that are being implemented with their own budgets and personnel and with such best
practices in place as: improved coastal law enforcement, marine protected areas (MPAs), zoning
schemes for marine uses including tourism and aquaculture, licensing of selected activities. In all
cases, coral reefs, mangroves and their associated fisheries, among other resources, are a high
priority for protection and management and are usually the beneficiary of the law enforcement
Annex C
4of 15
and MPAs. Nevertheless, this scale of management at the local government level is still
relatively new and requires much technical assistance to make it viable.2
The Philippines, similar to the Gulf of Fonseca, has severe over fishing and destructive fishing
issues to deal with. And, in many cases, this is mixed with growing pollution problems of
sedimentation and domestic waste and from industry in urban areas. Local coastal residents
depend on fisheries for livelihood. These issues in coastal and marine areas, among others, have
highlighted the need for integrated planning and management as the most viable means to manage
all the various uses under one umbrella of the local government with some guidance from the
national government and with technical inputs from donor projects and NGOs. And in the
Philippine case, the local government has full jurisdiction over its coastal and marine resources to
15 km offshore. Although the national government sets the broad policy context, all enforcement
is devolved to the sustaining unit of management of the municipality and city. Thus, although
local stakeholder communities are important in the management process, being the primary
stakeholders of a given fishery, communities operate under the laws of the local government, and
the only organized and sustained enforcement, registration and licensing for small-scale fisheries,
and for most aquaculture, is through the local government (municipality or city). Localized law
enforcement through the volunteer groups in the Philippines although effective in some areas, is
variable. A new system is emerging whereby the local governments form a coastal law
enforcement unit that coordinates with neighboring municipalities and has some support from the
national police and coast guard.
This point regarding the local government role needs to be fully reflected in the Gulf of Fonseca.
Past projects that were too heavily controlled by the national government (including national
marine protected areas) in the Philippines have failed in many areas because of poor or
unenthusiastic participation of the communities or local governments. Several instructive
projects in the Philippines, such as Apo and Gilutongan Islands described in the literature have
the support of the municipal government as well as the immediate coastal communities.
Technical assistance has been provided by outside projects in both cases but the sustaining factors
have been the full participation of the local authorities and community groups (e.g. fishers,
tourism operators, small business owners, etc.).
Another analogy that could help in the design of Gulf of Fonseca project is the recently adopted
coastal resource management benchmark system for local governments in the Philippines. This
"CRM benchmark system" is a relatively simple and yet robust system by which local
governments and national government can set targets and measure advances in the development
of CRM or ICM within local governments around the country. In the case of the Gulf, such a
system could be designed and tested for the project area that would need to be adopted by each of
the three countries. This system is described in several publications on the website
www.oneocean.org.
In addition to the CRM benchmark system, the Philippines is rapidly establishing and improving
MPAs to help sustain the larval sources for target fishery and vulnerable marine species as well as
for stricter biodiversity conservation objectives. Most MPAs include no-take zones or "sanctuary
areas" are established for multiple reasons, including improved food fish catch as well as
developing tourism opportunities in some areas. The planning for MPAs needs to be flexible and
consider all the conservation concerns of a given area, community and local government. In this
2 Philippines is most likely farther along in decentralizing CRM or ICM functions to local governments
than in the Gulf of Fonseca. The Philippine experience is rich in this regard and could offer some lessons
for policy reform. Information on the Philippine experience is available on the website: www.oneocean.org
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regard the newly established MPA rating and evaluation system in the Philippines is valuable to
ensure consistency in MPA design and in establishing common criteria for good MPA
management and results.3 The Project might consider adopting a similar rating and evaluation
system for the MPAs or managed zones within the Gulf covering marine and mangrove areas.
Another key point about management of fisheries is that true no-take zones are essential for reef
and estuarine ecosystems and their associated fisheries to recover to a relatively natural state. It
has been shown in various studies that reef fish abundance, diversity and biomass recover quickly
inside no-take or `sanctuary' zones within MPAs. It has also been shown that fisheries outside of
no-take marine reserves tend to recover to some extent from a spill-over effect together with
limitations on fishing methods in the same area.
A few key points that could be considered for incorporation into the proposal based on the above,
are:
a. The role of local governments could be strengthened to assist to sustain and
institutionalize the project at the local level, monitor the more strictly protected areas and
to integrate with the municipal or city development plans.
b. The CRM or ICM planning process could be incorporated into the initial stage of the
local area management to ensure proper baseline assessment to planning and
implementation so that the local government builds on addressing all their CRM needs.
The CRM benchmark system can be adjusted and adopted to make larger project wide
interventions more consistent and to help to institutionalize the project objectives within
the local government system up to national and tri-national level.
c. There are tested database models that the project could benefit from. One is the
"municipal coastal database" which is quite a complete cross section of information
management designed for local governments implementing ICM. This is available
through the website: www.oneocean.org of the Coastal Resource Management Project in
Philippines. Another is the MPA Coast and Reef Database available through the website:
www.coast.ph.
d. The MPA rating system being initiated in the Philippines can assist to guide the protected
area planning and development process of the project. The various protection zones could
be monitored and evaluated as separate MPAs so that local stakeholders could begin to
identify with the management regime for areas that affect their traditional uses and
practices. In this regard, the MPA management and rating system could help standardize
the localized management efforts and to engage more closely the stakeholders for a
particular place. All titles could be determined locally.
e. The need for improved national policy can partly be addressed by linking lessons being
learned through the management of the protected areas within the Gulf and the evolving
policy of integrated coastal management (and fisheries) so that it is part of whole
management process. The three national governments can improve their ICM policies by
beginning to integrate fisheries and aquaculture management from this process.
3 The Coastal Conservation and Education Foundation, Inc. (CCEF) based in Cebu City along with more
than 20 partners nationwide (government and non-government) have endorsed the MPA rating system so
that a common MPA guide exists for the country. This is available at www.coast.ph or by email at
ccef@mozcom.com
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f. Appropriate and participatory CRM plans can help set the trend within project areas and
local governments for effective implementation of MPAs and associated management
plans. The implication is that stakeholder involvement is essential and to fully address
the problems of illegal and over fishing and destruction of mangroves, stakeholders to the
smallest community must be involved and feel some benefit from the project.
These introductory paragraphs set the stage for some suggestions to make the project more
focused, effective and doable. This may require some shifting of priorities among the four
project components. Since Component 3 that begins to address the pollution issues will require
large investments and long term strategies that can only be designed and planned for during the 5
year life of the Project, the balance of funds used for Component 3, versus 1, 2 and 4 needs to be
carefully evaluated. Being strategic in the implementation of some planned "regional"
interactions could save resources for the essential needs of effectively assisting coastal resources
management in the three countries. A balance is needed between actions in the present that make
a measurable difference and those that build institutional sustainability at the national and tri-
national scales that are often time consuming, expensive and may not pan out over time.
Key issues
Scientific and technical soundness of the project
The scientific basis of the project as proposed is sound in that it is based on the most recent and
tested scientific knowledge regarding conservation and management of marine and coastal
resources as indicated in the literature and from various coastal management projects. Lessons
from other projects are cited in the background to the project proposal and clearly there is a
logical plan of activities based on tested and known scientific and technical solutions.
But, whether there is sufficient information and knowledge available on the dynamics,
functioning and structure of the Gulf of Fonseca ecosystems covered is a question given the scope
of the program, and the complexities of the Gulf hydrology and mangrove and estuarine
ecosystems. Yet, baseline information does exist and sets the stage for measuring change over
time for the important resources. The project will need to carefully design a monitoring program
that builds on the existing baseline information so that changes and trends are measured.
To the extent that the program is able to support management regimes that focus on particular
areas and ecosystems, part of the management process will be to improve on the baseline
information for these areas. This would also need to be fully internalized with the local and
national governments of concern and not dependent on the project as such. This has implications
for building capacity in local and national institutions to perform this role.
The approaches for collecting relevant information for management of resource uses and their
impacts, local economic activities, water management are implied to be scientific and done, for
the most part, by national agencies and research organizations. A question to ask is at what scale
can more participatory approaches be applied? It is known that the more contact stakeholders
have with a resource area or to the extent they are dependent on a particular resource base, they
will generate more responsive and effective management plans. To this extent, the project will
need to engender site-specific management in appropriate areas of concern working through local
governments and stakeholders. It is not clear to what extent this will be possible given the broad
focus of the project and the key role of national agencies without a significant role for local
municipalities and in some cases community groups in the monitoring process.
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The proposed modeling efforts to better understand the dynamics of the watershed and main
sources of sediment and other pollution, are a significant and well planned start on the process of
designing an effective management plan. It is to the credit of the project designers that this
incremental and scientifically based type of analysis is proposed. If good monitoring data can
indeed be collected and analyzed in a consistent manner, it will provide essential information to
policy makers in each government responsible for making decisions that will assist in addressing
these issues. It will also be important that this research and modeling data be presented in a
format that is easily understood by policy makers and the general public as well. This will lead to
more buy in from each country and the various stakeholders affecting and using Gulf waters.
Such a hydrological modeling approach can also emphasize the common threats to the Gulf
waters and its mutually shared resources. This should support the ecosystem basis for
management.
The work on watershed and hydrological modeling raises the question of boundaries to the
project since in theory full watersheds should be management areas of concern. Although it is
implied that full watersheds will be considered in the analysis, it is not clear that full data sets will
be readily available for this analysis. Small projects typically cannot provide meaningful
technical assistance in such broad fields of environmental management where watersheds are
large and complex.
From a scientific and technical perspective, the scope of the project is quite broad with four
components doing rather different sets of activities. It will be necessary to carefully integrate the
four components so that they complement each other. The manner that these can most easily
complement each other is by working through the municipal and national governments and by
having common pilot field projects that are supported by each component. This line of thought
leads to another suggestion that the municipal governments become an important focus of the
program in general as discussed earlier. This is suggested because the level of government
together with community that will most probably have the largest impact on the creation of
tangible benefits that can be measured and witnessed by local stakeholders will be the
municipalities. Municipalities will most easily work with coastal communities and interface with
non-government organizations that work directly at the community level.
The broad scope of the project necessitates that the issues described in the background
information and baseline are focused and match the overall objectives and strategies of the
Project. A careful matching of the management issues to be addressed with the proposed
objectives and strategies will ensure that the project has a tangible and doable framework.
Questions related to the use of technology
The primary technology to be used for managing the Gulf natural resources is the development
and implementation of a zoning plan for the ecosystems and for fisheries and other resource uses.
In relation to development of this zoning plan, it is suggested that this not be a top-down process.
On the one hand, information of the distribution of the resources of the Gulf from scientific
surveys, mapping and other means of collection and analyzing such data will normally be a fairly
centralized process and decisions about the wisest plan will come from experts. This is normally
the case in large scale coastal projects and also one of the reasons why many fail to achieve their
most basic objectives. This is because the planning does not involve the stakeholders in a
meaningful way.
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The process that is suggested to be incorporated into the project proposal would be to center the
mapping and zoning process in each municipality through the involvement of the communities in
a participatory manner whereby they map the resource distribution, the issues, their use patterns
and possible management zones. This participatory map can then be superimposed over a more
centralized, and scientifically generated map so that the potential conflicts of interest between
management authorities and resource users can be seen.
This is then the starting point for more intense local municipal government planning together with
stakeholders who, in the end, will determine how effective the implementation of the zones and
user regulations will be. Examples of this approach have been well documented in the various
integrated coastal management projects in the Philippines. Publications that highlight this process
are located on the websites: www.oneocean.org and www.coast.ph.
Another technology related to management of habitat and zoning is how the mangroves will be
protected from recurring encroachment and harvesting of wood among other uses. The proposal
is quite clear on how this will be approached and indicates that full engagement of the resource
users will be essential to change their use patterns. Also, alternative livelihood projects are
targeted for areas of heavy mangrove depletion. These make sense but will need to be locally
designed and implemented to be effective. It is also suggested that some form of land
(mangrove) tenure instrument be adopted so that resource users can be organized and have a legal
identity that allows them limited access to the resource in return for stewardship and maintenance
over the mangrove area of concern. Such approaches are working well in Asia where national
governments often award 25 year leases to legal organizations formed by communities to manage
mangrove and their associated fisheries resources.
Similarly, methods to be used for monitoring the coastal and marine environment should be
specified. A standard marine data collection system should be employed that is both
scientifically rigorous as well as applicable for community and/or volunteer groups to apply. The
sustainability of a localized effort over time will depend on how easy it is to replicate monitoring
over many years beyond the project support. Methods that are used in the Philippine context
have been adapted for local use as a national standard and can be seen in the book, "Coral Reef
Monitoring for Management" by Uychiaoco et al. (2001) and through the MPA Report Guide of
the Coastal Conservation and Education Foundation (www.coast.ph).
Engaging NGOs and academic partners will tend to solve this problem of adequate monitoring
capacity. In addition is necessary to create `systems' for information management, ICM and
MPA evaluation and reporting, etc. so that these systems become embedded into the managing
organizations and take a life of their own.
Indicators are needed to measure progress towards the objectives but they need to be quite simple
so that project participants and local stakeholders can understand and endorse them. The
indicators can provide benchmarks of success that will help to push the project along knowing
that the ultimate goal and objectives will take time and long term investment. The indicators are
as specified in the project logical framework are quite appropriate while they are oriented to the
"project" and not the stakeholder governments as such. It would be useful to review indicators of
the Coastal Resource Management Projects (CRMP) supported by USAID in the Philippines that
had indicators that were essentially the same as those ultimately adopted by the local
governments for their own CRM or ICM programs. This convergence of indicators helped build
ownership of the project through local institutions (CRMP 2004: www.oneocean.org). A
prototype of this system of indicators is available in a book: "Monitoring and Evaluating
Municipal/City Plans and Program for Coastal Resource Management (DENR-CMMO 2003).
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The project does not seem controversial in any way and gaps that might exist revolve around the
ability of the project to become sustainable. There are no easy short cuts to building sustainability
at the local levels in the Gulf of Fonseca. The project thus needs to be fully sensitive to the local
government systems and to the culture of the communities involved from the fishers to the
aquaculture operators to understand what will constitute long term and sustainable actions.
Other "technology" used in this project is mostly related to communication tools and
dissemination of information and in the conduct of training and planning workshops of various
kinds. It also pertains to the methods used in bringing people together and in soliciting the
support of policy makers and key government officials as well as those from the private sector.
The methods used in accomplishing these tasks are quite dependent on the personalities and skills
of the project personnel to be successful. In this regard, it is suggested that state of art techniques
are used to stimulate community and local government participation through various forms of
engagement that are well documented in the literature.
Questions related to institutional arrangements
The Project proposes the development and institutionalization of a tri-national regional body to
oversee the implementation of the Project in the three countries. This body is already tentatively
formed with commitments in place. A concern in relation to the formation and capacity building
needed for such a regional body is that it could take a significant portion of the Project resources
to make it functional and sustainable. It is suggested that the value of investing in this regional
body with its broad goals be carefully weighed with the value of providing more focused
technical assistance to particular countries in need. In this regard, it is prudent to keep aspirations
for the regional body practical. It is also suggested that this body be connected or linked to other
already existing regional bodies in Central America as appropriate.
The institutional arrangements of most urgent concern are those within nations and down to sub-
national levels. It is at this level that most Gulf management concerns will be implemented and
where most assistance is needed to ensure that ICM can be more widely implemented.
The project might also consider developing "demonstration" sites where ongoing and successful
management can be displayed. This has proved useful in many ICM projects to share lessons
with others as a learning tool. This could also be useful in the context of the 3 nations whereby
each one has at least one demonstration project area to display and show off its work, so to speak.
This will ensure that each country tries its best to implement a successful project site.
Identification of the global environmental benefits
The project clearly identifies global environmental issues and benefits linked to the Gulf of
Fonseca and the larger context of the Central American Pacific and Atlantic coastal areas. These
are well articulated in the project proposal with respect to mangroves and the estuarine
environment they depend on together with the fisheries and rich biodiversity associated with
these ecosystems. The potential global environmental benefits from the project are large and these
potential benefits are relatively easy to measure within the project monitoring framework.
Positive outcomes will primarily be through improved management and protection of the
ecosystems and their respective habitats in the Gulf. And, to the extent that good baseline data
exists on these habitats, changes can be measured and quantified in terms of biodiversity
conservation and economic returns as well. ICM demonstration sites will play a key role in this.
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A question to address is to what extent the benefits of ecological and habitat management will be
eroded by increasing sedimentation and pollution in the Gulf. Although, it is not entirely clear
how dependent the Gulf ecosystems are on clear and clean water or their relative degree of
tolerance for sediments, but in the long term, the Gulf will only withstand limited amounts of
sediment before the entire system changes dramatically from its historical state.
The link to the terrestrial ecosystems and watersheds makes the project area diverse, dynamic and
complex. If this integrated system can be managed well, it will represent a significant step
forward for integrated approaches to coastal and marine conservation from a global perspective.
No negative environmental effects can be anticipated from the project as designed.
How does the project fit within the context of the goals of GEF?
The project fits well within the overall strategic thrust of the GEF-funded International Waters
(IW) initiatives. As proposed it should assist the three countries to better understand the
environmental concerns of their IWs and work collaboratively to address them. It will also build
the capacity of existing institutions both regionally and nationally and it intends to implement
measures that address selected trans-boundary environmental concerns, which is a major thrust of
the project as designed. Given these intents, the project with its broad focus can achieve these
outcomes more or less depending on many decisions yet to be made. The outcomes in this realm
depend in part on points raised elsewhere in this review.
Regional context
The regional scope is certainly present in the project through the three nations. Based on almost
30 years working in Southeast Asia, I know the difficulties of building meaningful regional
partnerships that last and that accomplish tangible outcomes. There are examples of adoption of
standard data collection and processing protocols, use of data for management design across
borders and more. But, the regional collaboration among countries through top levels of
government in the field of environmental management is still weak in central and Latin America.
Yet, the existing tri-national agreements and commitments signed by these three countries
certainly bode well for a positive outcome as a regional entity that will work effectively.
Replicability and sustainability of the project
The Project as proposed is unique and depends on the buy in and support of the member countries
and the various partner agencies. If the project works as planned, it will replicate itself since it
has to become self-sustained to succeed. The proposed regional mechanism should provide focus
and means for coordinating national efforts, thereby enhancing the efficiency and effectiveness of
individual country undertakings. Involvement of the private sector, inter-governmental financial
institutions, investors and commercial banks are all important for sustainability. The project
design emphasizes the need for the involvement and investment of these agencies. But to be
realistic, the history of multi-country institutional arrangements working efficiently and ensuring
financial sustainability for its own operation are few. Partnerships are difficult to form and thus
need to be very carefully developed and nurtured over several years to make them viable.
Linkages to other focal areas, programs and action plans at regional or sub regional levels
The project has various natural links to other GEF focal areas and programs at regional and sub-
regional levels. A comment is that the project needs to focus on those focal areas and programs
that will be mutually beneficial to communicate and cooperate with. Various international
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conventions, treaties and agreements exist among the countries of Central America while few are
strictly implemented or adhered to. The potential for this project to improve on that is substantial
given the ground work done in preparation for the tri-national effort.
Degree of involvement of stakeholders in the project
"Stakeholders" in the proposed Project can have many different meanings. This is because
stakeholders range from nations to local fishers and private sector aquaculture operators. In ICM
demonstration sites that involve area-wide interventions, community involvement and stakeholder
participation are especially important for success. The project design includes a good
understanding of the need for stakeholder involvement and indicates that the Project will follow
this path. Comments above add some ideas on how this can be improved through the full
engagement of municipal governments in co-management arrangements with the communities
under their jurisdictions. Another question is whether the project has the resources for adequate
stakeholder involvement. National and local government and private institutions will need to play
major roles to assist with stakeholder involvement in a facilitated process with sufficient
resources to support this activity.
Capacity building aspects
The project is geared towards building capacity at the local, national and tri-national levels. The
balance of effort at these levels, as discussed, still needs to be determined in more exact terms.
Implementing ICM demonstration sites requires capacity building at local government levels as
noted. The intensity of efforts at this level can be quite high. It is at this level that the project
needs to bring in partners as much as possible in various collaborative agreements to work
together. The project design does incorporate these kinds of agreements while those that might
make the most difference at the local levels will not be determined until activities begin through
national planning of project implementation. Successful local level interventions require
consistency over time using familiar technical assistance and consultants that can integrate well
with the local decision makers and managers. Sporadic and variable technical assistance does not
lead to measurable results in local projects. In this regard, the investments needed are often larger
than anticipated, especially in lesser developed countries. In the existing design, the project may
be underestimating the resources needed to fully develop and implement Gulf wide management
to produce tangible outcomes.
Innovativeness
The Project design is innovative in that it packages a proposal that will address multiple issues in
an integrated framework. This is never an easy undertaking. The design also carefully includes an
economic and livelihood development program that will complement the resource management
efforts to lessen the dependency of the resource users on the Gulf's natural resource base. The
strategies proposed to implement the four project components are relatively innovative while
these strategies are dependent on having good leaders within the Project team and framework to
make them work. The project needs to build a strong and dynamic team that encourages
leadership and autonomy in its management system so that innovative actions can occur at multi
levels and in different contexts and areas. Project management should avoid being too rigid and
hierarchical so that the team will take their own initiatives. Also, by adopting a "rolling design"
that builds on the principles of adaptive management, the project may be more efficient and
innovative.
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Specific comments on the Proposal
1. Project context. This section is substantially complete. Nevertheless, it could benefit
from several graphs that depict change over time as the data permits to give an indication
of what the future will look like if the trends are left unchecked. Also, the maps, as
presented, are small and would be more useful if presented in a larger format.
2. Project context. The discussion on aquaculture would benefit from more detail on the
extent of the shrimp farming activities and how this has impacted the mangrove areas
since this appears to be the single most important development trend affecting mangrove
and estuarine ecosystems in the Gulf. Also, the level of shrimp exports from Honduras is
large. This industry could be a major stakeholder in the management of the area, if
interested and engaged to do so. More information on this would be useful.
3. Project context. The section that covers legal and institutional is informative. A table
that summarizes the laws and what they cover would be extremely useful for project
implementers and could be an early product of the project.
4. Issues and their causes. This concise summary is very helpful. It would be useful to
emphasize the transnational nature of pollution. The section that covers the decline of
mangroves should differentiate a bit more between the problems of cutting for wood and
conversion to shrimp ponds. The solutions to these two causes are very different.
5. Lessons learned. This section could include a few of the ideas suggested in the
introduction as appropriate. In general, the few lessons noted are extremely relevant. Of
these, a lesson to emphasize is the need to coordinate among donor projects in the area
and to coordinate vertically through the various levels of government. Also, the co-
management of protected areas is an important lesson that can be refined through project
implementation as work plans develop with local cooperators.
6. Project Strategy. This paragraph is a bit long and wordy. It is suggested to state the
strategy first in more concise terms in a shorter paragraph and then introduce the
components as part of the strategy and other details supporting the general strategy.
7. Concurrence of regional and national plans. This section sets the tone for how the three
countries will concur on approaches through a standard framework under the tri-national
body guidance. It is suggested that a simple benchmark system be introduced here that
would link the three country efforts in a technical way to guide management of Gulf
resources. Such a system was explained in the introduction and is referenced.
8. Project objectives. The log frame seems quite doable with objectives and means of
verification that are achievable and measurable for the most part. Nevertheless, in light
of comments in this review, several minor clarifications might be considered that would
help the project to better align across the 3 countries in relation to the actual development
of management plans and benchmarks for this process.
9. Component I--Institutional building. The main comment on this important component is
that it will need to evolve with the project in relation to the needs of the institutions. In
Philippine ICM projects, it worked well to train national agency personnel as resource
persons for local municipal government training and capacity building. Also, having
indicators for improved governance in relation to environmental management gives the
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agencies, national and local, goals to strive for in improving their ability to manage
coastal resources. I suggest that referring to the series of eight guidebooks titled:
"Philippine Coastal Management Guidebook Series" to assist with institutional
development legal frameworks that have been tested over time. Capacity building for
local and national government will need extensive training. Some training materials that
are already packaged and ready for use, albeit in English, are available through the
website: www.oneocean.org. A series of training courses were developed to support
ICM in the Philippines that include all aspects of ICM and MPA management.
10. Component II--Ecosystem management. This component to manage ecosystems and
fisheries needs to apply an adaptive management approach as much as possible. The
solutions to these issues may vary among the countries and be quite site specific.
Although it is clear that integrated management plans will be developed, it is not obvious
whether these will be implemented throughout the area or in pilot sites. It was suggested
that pilot areas might be more effective to more quickly start field level implementation.
This is also where the municipal governments must play a major role in planning and
implementation. Linking the alternative income projects to the field level work will help
speed changing the behavior of communities towards fisheries and mangrove wood
extraction. For fisheries management, a few pointers include:
·
It is important to not reward illegal fishers with alternative livelihoods;
·
There is no easy replacement for coastal law enforcement to curb serious offenses of
illegal fishing, effective coastal law enforcement must be pursued as needed;
·
Baseline assessments need to be fairly simple and easy to replicate using local
technology, otherwise monitoring will lapse and the value of showing trends based on the
baseline will not occur;
·
Fishery reserves (no-take areas) should be inside of core protected areas and not different
to simplify management;
·
It is important to feedback baseline assessments and trends to fishers and other resource
users in a timely manner to keep their interest and so they can learn; and,
·
Fishers and other resource users' participation in the assessments is preferable.
11. Component III--Pollution. This component is very well planned and has an achievable
outcome. A question is whether demonstration sites are needed to start to implement
strategies that emerge from the research, monitoring and modeling efforts.
12. Component IV. This complementary and supportive component will need to be very
responsive to what is practical in terms of supporting alternative livelihoods and income
generation. The potential for creativity is high in this component while the bottom line is
that economic development should be as environment friendly as possible. It also needs
to be profitable and have good business plans to back up potential projects. The various
livelihood projects for fishers and those involving aquaculture seem appropriate but one
caveat is that these are all experimental and could take considerable resources and time to
operate successfully. It might be best to focus on only one or two projects and make sure
that they succeed. Most such projects tend to fail once the donor project ends. In
addition, experience has shown that mechanisms that collect and manage funds locally
tend to be more effective and tend to build incentives for local stakeholders. Collecting
user fees that are tied to particular site visits is a good means for engaging local
stakeholders who are involved in protecting and managing the sites.
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Component IV could also include selected cost-benefit analysis to guide policy
development, especially as a tool to question development of shrimp ponds in mangrove
areas. This conversion of mangrove habitat has been shown to produce negative
economic returns when full valuation of ecosystem services is factored into the analysis.
Such studies have been done in Thailand, Malaysia and Philippines that have guided
national policy towards improved protection of mangrove ecosystems in recent years.
13. Information, education and communication (IEC). It is noted that IEC is included in each
project component. The IEC tool, if used wisely, can really enhance the effectiveness of
the project. At the same time it can be expensive, time consuming and not address the
right issues with the right audiences. Thus, some good planning should be invested in the
design of an IEC strategy that is project wide. It might be better to include this set of
activities in a separate component or at least to clearly link the various IEC activities
across the components. Websites are useful depositories for all the project information
and can serve as a functional library and way of organizing much information.
Nevertheless, local stakeholders do not normally use these means of obtaining
information so there is a need for other means of disseminating important documents.
14. Project administration. The three country arrangement will add to the complexity of
project management. At the same time a transparent project management system can
help make it efficient by having a very systematic process in place for administration in
the central office. One note of caution is that organizational structure could bog down if
the Consultative Forum and Regional Technical Committee are not streamlined in
function and mandates. Also, the use of small grants to NGOs is an effective means to
engage local stakeholders. At the same time, they will require technical assistance and
guidance to work effectively within the project framework. A dedicated support system
for the small grants will help make this doable.
15. Disbursement schedule. Year one is shown to have the highest rate of disbursement,
presumably because of capital purchases and since more consultants will be employed in
this year. But, from lessons learned in other projects, the first year should be used more
for planning and setting up systems and making sure that right personnel are involved.
And, often spending is less than projected in the first year but peaks in the 2nd or 3rd year
of the project.
16. Financial Viability. The overall amount of funding is not too large for this scale of
project. This highlights the need for counterpart support and leveraging other donor
projects together with the need for substantial investments of the national governments.
These concerns have been addressed in the proposal for the most part.
17. Project risks. It appears that the largest risk is the relative lack of stability among the 3
countries at the borders. Yet, the 3 countries have signed agreements to manage the Gulf
and have committed resources to this endeavor. During the project implementation, these
transnational conflicts could be a delicate issue and in this regard, it will be necessary to
continually highlight the larger good and shared problems of the 3 countries, so that
bilateral issues do not take the center stage. This will require good leadership on the part
of the GEF project team.
18. Project challenges. Working in 3 countries simultaneously will require having similar
approaches to coastal management in each country. In this regard, the concept of
"scaling up ICM" from local to national and then to international might be a way to unify
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the overall framework and approach of the project. In the Philippines, for example, the
evolving ICM certification system is responsive to local governments, their capacities
and their jurisdictions under national law while it is not too restrictive on what local
governments can and cannot do. This could easily be applied in the Gulf of Fonseca,
given its relatively small size and common issues to be addressed.
Summary and final points
The comments included in this review are intended to help improve the project proposal. My
main message is that given the level of funding of this project, which is relatively small, I think
that some fine tuning of the proposal could help make it a little more efficient and easy to follow
as a guiding document. The project intends to implement tangible projects to build institutions, to
improve management the coastal resources in the Gulf, plan for improvement of water quality
and strategically implement an economic development package to support effective investments
in management. Measuring the potentially positive changes through local monitoring and
evaluation activities will help make the project more visible and sustainable since it will increase
the buy in of local and national organizations. At the same time, these measurable successes will
rest on the strategic balance of local actions versus national and regional activities and how they
contribute to progress at these three levels of implementation. Several final points:
·
The role of local governments can be highlighted more to ensure a local government
base for the regulations being planned and implemented.
·
The need for an integrated planning and implementation process at the local government
level should be promoted so that a broader and more sustainable impact results.
·
Consider adopting a variation of the `CRM or ICM benchmark system' being applied in
the Philippines as a framework to guide local and national government ICM
·
Consider the MPA rating and evaluation system or a variation for protected areas.
·
Ensure that coastal and marine (mangrove, estuarine, etc.) assessment methods are both
standardized over time and that they can be utilized by local organizations with
scientific guidance to ensure participation in the process to build sustainability.
·
Analyze and test national policy vis-à-vis the need to support for ICM at the local level
to make it effective.
·
Use maps in helping understand geographical oriented sets of activities. Engage
stakeholders in mapping resources uses and issues to augment more scientifically
derived maps. Geographic information systems should be used as possible to
complement various participatory processes in planning.
________________________
Submitted by A. White
February 8, 2007--draft
February 21, 2007--final
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ANNEX C1 IDB RESPONSE TO STAP REVIEW
Integrated Management of the Ecosystems of the Gulf of Fonseca (RS-X1019)
A.
Comments in Introduction
STAP Comment 1: "what integrated means for this project in practical terms, could benefit from
a short paragraph in the proposal that guides implementers as to the main thrust of
"integration". A key concept to convey is the need for full horizontal and vertical integration
among the institutions that will implement and sustain the project. Also, the links between land
and sea should be emphasized given the important role land-use practices play in the Gulf water
quality and its improvement. These points are emphasized in the proposal while an explicit
statement would be beneficial".
IDB Response 1: A definition of integration has been added to the section entitled "Project
Strategy" (paragraph 1.40).
STAP Comment 2: In presentation of the issues to be addressed in the project proposal, it is
important that for the issues to be fully understood and addressed, the project design needs to get
to the point quickly as to the known causes of the issues facing the Gulf. To the extent possible,
issues need to be quantified and possible implications of not addressing them noted. [...] In this
regard, a graphical analysis of the issues and their underlying causes is essential to make the
project rationale understandable.
IDB Response 2: Quantitative information on threats and root causes has been added in project
document. Explanatory tables are included in section B. Description of the Gulf. Additionally,
full graphical information appears in the Transboundary Diagnostic Analysis.
STAP Comment 3: Development of a more detailed work plan that is focused more from the
bottom (local) up to national and transnational could be an important undertaking of the early
stages of project implementation. This exercise with local stakeholders would have the effect of
engaging all the important participants in a planning process that would encourage buy in and
make them feel part of the decision process from the beginning. Since, large GEF supported
projects are sometimes seen as more top down when more than one country is concerned; a
participatory planning process would help to mitigate this perception early in the project
implementation.
IDB Response 3: The notion of a `bottom-up' participatory planning process was used in the
formulation of the project particularly with the involvement of focus groups representing various
resource users and a distinct process involving the 19 municipalities of the Gulf Region (see
section C. entitled `Consultation and Participation' in paragraphs 5.12 to 5.14). The concept is to
continue using this approach through the implementation of the project through the Trinational
Advisory Forum and the network of local committees that will engage in specific activities such
as the design of the coastal management plan, fisheries co-management, and restoration of
mangroves. See more details in sub-sections of Project Strategy such as paragraph 1.40, numeral
(a) (ii) and (b), cost-effectiveness (paragraph 1.43), innovation (paragraph 1.44); Component 1 (a)
and (c) (paragraphs 2.4 and 2.6); Component 2 (a) (paragraph 2.9); and Component 4 (a)
(paragraph 2.20).
STAP Comment 4: Overall, the proposal is well prepared and very thorough in its coverage of
the outcomes and the activities to accomplish the outcomes. The threats analysis also leads
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logically into the outcomes and activities so that the proposal is comprehensive and seems to
cover its bases without any major gaps. But, because the project is quite broad in nature and
addressing a range of issues spread over a wide geographical area, I encourage the
implementers to try to be more specific in some cases and to give the main emphasis or focus of
work for the project. This can be done by articulating the issues as noted and linking these
directly to the strategies and activities.
IDB Response 4: Links between threats, issues and activities have been clarified in the project
document. See these links for example in Component 1 (a) and (b) (paragraphs 2.4 and 2.5);
Component 2 (b) and (c) (paragraphs 2.10 and 2.11); Component 3 (e) (paragraph 2.18);
Component 4 (b) (paragraph 2.22).
STAP Comment 5: In the Philippines, a factor contributing to the increasing awareness about
coastal resources management (CRM) or integrated coastal management (ICM) is that many
local municipal and city governments are engaged in the planning for and management of their
coastal areas and resources. More than 100 coastal municipalities and cities (covering 3500 km
of coastline) have CRM plans that are being implemented with their own budgets and personnel
and with such best practices in place as: improved coastal law enforcement, marine protected
areas (MPAs), zoning schemes for marine uses including tourism and aquaculture, licensing of
selected activities.
IDB Response 5: As indicated in the legal analysis of the TDA, El Salvador, Honduras and
Nicaragua are at distinct stages of devolution of environmental and natural resources management
responsibilities to local governments. In most cases, municipal responsibilities in coastal
resource management (CRM) in the Gulf of Fonseca are incipient. One of the challenges is to
develop local capacities in step with the decentralization process currently in progress in each of
the three countries. The other challenge is to promote this increased local responsibility in CRM
while respecting considerations that are of national interest (see section on `Root Causes',
paragraphs 1.30 to 1.35).
STAP Comment 6: This point regarding the local government role needs to be fully reflected in
the Gulf of Fonseca. Past projects that were too heavily controlled by the national government
(including national marine protected areas) in the Philippines have failed in many areas because
of poor or unenthusiastic participation of the communities or local governments.
IDB Response 6: The project strategy has been adjusted to emphasize the role of local
governments in line while remaining in line with national legal framework of the three countries.
(see paragraph 1.40). See also IDB response 3 above.
STAP Comment 7: Another analogy that could help in the design of Gulf of Fonseca project is
the recently adopted coastal resource management benchmark system for local governments in
the Philippines. This "CRM benchmark system" is a relatively simple and yet robust system by
which local governments and national government can set targets and measure advances in the
development of CRM or ICM within local governments around the country. In the case of the
Gulf, such a system could be designed and tested for the project area that would need to be
adopted by each of the three countries.
IDB Response 7: The notion of a CRM benchmark system has been added to Component 2 (a)
(paragraph 2.9).
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STAP Comment 8: The role of local governments could be strengthened to assist to sustain and
institutionalize the project at the local level, monitor the more strictly protected areas and to
integrate with the municipal or city development plans.
IDB Response 8: See IDB Responses 3, 5 and 6 above.
STAP Comment 9: The CRM or ICM planning process could be incorporated into the initial
stage of the local area management to ensure proper baseline assessment to planning and
implementation so that the local government builds on addressing all their CRM needs. The
CRM benchmark system can be adjusted and adopted to make larger project wide interventions
more consistent and to help to institutionalize the project objectives within the local government
system up to national and tri-national level.
IDB Response 9: See IDB Response 7 above.
STAP Comment 10: The MPA rating system being initiated in the Philippines can assist to guide
the protected area planning and development process of the project. The various protection zones
could be monitored and evaluated as separate MPAs so that local stakeholders could begin to
identify with the management regime for areas that affect their traditional uses and practices. In
this regard, the MPA management and rating system could help standardize the localized
management efforts and to engage more closely the stakeholders for a particular place. All titles
could be determined locally.
IDB Response 10: In keeping with the requirements of GEF IW SP and in order to avoid
overlaps with GEF BD Focal Area, the decision was made to reduce the emphasis on MPAs and
to focus on fisheries and mangrove co-management areas.
STAP Comment 11: The need for improved national policy can partly be addressed by linking
lessons being learned through the management of the protected areas within the Gulf and the
evolving policy of integrated coastal management (and fisheries) so that it is part of whole
management process. The three national governments can improve their ICM policies by
beginning to integrate fisheries and aquaculture management from this process.
IDB Response 11: We agree. This is consistent with the project strategy proposed (see
paragraph 1.40) and Component 2 (b) (see paragraph 2.10).
STAP Comment 12: Appropriate and participatory CRM plans can help set the trend within
project areas and local governments for effective implementation of MPAs and associated
management plans. The implication is that stakeholder involvement is essential and to fully
address the problems of illegal and over fishing and destruction of mangroves, stakeholders to
the smallest community must be involved and feel some benefit from the project.
IDB Response 12: See IDB Response 3 above.
STAP Comment 13: [...] the balance of funds used for Component 3, versus 1, 2 and 4 needs to
be carefully evaluated. Being strategic in the implementation of some planned "regional"
interactions could save resources for the essential needs of effectively assisting coastal resources
management in the three countries. A balance is needed between actions in the present that make
a measurable difference and those that build institutional sustainability at the national and tri-
national scales that are often time consuming, expensive and may not pan out over time.
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IDB Response 13: We agree. The balance of funds has been adjusted with a reduction in
Component 3 in relation to 1, 2, and 3 thus placing more emphasis on actions that can have an
immediate and measurable difference within the time frame of the project (see detailed budget in
Appendix I).
B.
Key issues
B (a) Scientific and technical soundness of the project
STAP Comment 14: The project will need to carefully design a monitoring program that builds
on the existing baseline information so that changes and trends are measured.
IDB Response 14: Much of the work undertaken during the preparation of the TDA was to
assemble the existing baseline information. The intent of the activities described in Component
1(d) and 3(a) and (b) (see paragraphs 2.7, 2.14 and 2.15 respectively) is to consolidate existing
monitoring networks rather than establish new ones. Additionally, the M&E System also
considers this approach (see paragraphs 4.18 and 4.19, as well as Annex E).
STAP Comment 15: The approaches for collecting relevant information for management of
resource uses and their impacts, local economic activities, water management are implied to be
scientific and done, for the most part, by national agencies and research organizations. A
question to ask is at what scale can more participatory approaches be applied? It is known that
the more contact stakeholders have with a resource area or to the extent they are dependent on a
particular resource base, they will generate more responsive and effective management plans. To
this extent, the project will need to engender site-specific management in appropriate areas of
concern working through local governments and stakeholders. It is not clear to what extent this
will be possible given the broad focus of the project and the key role of national agencies without
a significant role for local municipalities and in some cases community groups in the monitoring
process.
IDB Response 15: We agree with this observation and have strengthened the role of local
municipalities and resource users groups in data collection and monitoring. This strengthened
role is evident in the use of the participatory mapping process for the formulation of the coastal
management plan for the Gulf of Fonseca (Component 2 (a); see paragraph 2.9), the fisheries co-
management (Component 2 (b): see paragraph 2.10), mangrove restoration (Component 2 (d): see
paragraph 2.12)and the inventory of point sources for the hydrological modeling (Component 3
(c); see paragraph 2.16).
STAP Comment 16: The proposed modeling efforts to better understand the dynamics of the
watershed and main sources of sediment and other pollution, are a significant and well planned
start on the process of designing an effective management plan. It is to the credit of the project
designers that this incremental and scientifically based type of analysis is proposed. If good
monitoring data can indeed be collected and analyzed in a consistent manner, it will provide
essential information to policy makers in each government responsible for making decisions that
will assist in addressing these issues. It will also be important that this research and modeling
data be presented in a format that is easily understood by policy makers and the general public
as well. This will lead to more buy in from each country and the various stakeholders affecting
and using Gulf waters. Such a hydrological modeling approach can also emphasize the common
threats to the Gulf waters and its mutually shared resources. This should support the ecosystem
basis for management.
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IDB Response 16: We agree with this observation. To ensure effective use of the modeling for
policy making and priority setting purposes, the proposed approach is to provide training to
municipal environmental units and national government representatives on watersheds,
sedimentation and pollution processes (Component 1(a); see paragraph 2.4), to involve them in
characterizing their own watersheds draining into the Gulf to ensure an understanding of the data
used for the modeling (Component 3 (c); see paragraph 2.16), and to generate modeling results
(maps and time series) that can be easily interpreted by national and local governments and
organizations participating in the Trinational Advisory Forum (see paragraph 4.11).
STAP Comment 17: The work on watershed and hydrological modeling raises the question of
boundaries to the project since in theory full watersheds should be management areas of concern.
Although it is implied that full watersheds will be considered in the analysis, it is not clear that
full data sets will be readily available for this analysis. Small projects typically cannot provide
meaningful technical assistance in such broad fields of environmental management where
watersheds are large and complex.
IDB Response 17: The overall boundaries of the project are the full tributary watersheds and the
Gulf of Fonseca. However, the intensity of activities varies across this study area. For example,
the activities of Component 2 (resource management) are limited to the boundaries of the 19
coastal municipalities and adjacent coastal waters. The hydrological modeling covers entire
watersheds in that it will be based on data from satellite imagery and detailed land use and
topographical maps for instance.
STAP Comment 18: It will be necessary to carefully integrate the four components so that they
complement each other. The manner that these can most easily complement each other is by
working through the municipal and national governments and by having common pilot field
projects that are supported by each component. This line of thought leads to another suggestion
that the municipal governments become an important focus of the program in general as
discussed earlier. This is suggested because the level of government together with community
that will most probably have the largest impact on the creation of tangible benefits that can be
measured and witnessed by local stakeholders will be the municipalities. Municipalities will most
easily work with coastal communities and interface with non-government organizations that work
directly at the community level.
IDB Response 18: We agree. This is stressed in section "Project Strategy" numeral (b)
(paragraph 1.40). The notion of common field pilot projects supported by each component has
been incorporated in the design of Component 2 and Component 4 (a) (see paragraph 2.20). See
also IDB Responses 5, 6 and 15.
STAP Comment 19: The broad scope of the project necessitates that the issues described in the
background information and baseline are focused and match the overall objectives and strategies
of the Project. A careful matching of the management issues to be addressed with the proposed
objectives and strategies will ensure that the project has a tangible and doable framework.
IDB Response 19: The linkages between the issues in the background section and strategies of
the project have been clarified throughout part II "Project objectives and description" (see
paragraphs 2.1 to 2.22).
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B (2) Questions related to the use of technology
STAP Comment 20: The process that is suggested to be incorporated into the project proposal
would be to center the mapping and zoning process in each municipality through the involvement
of the communities in a participatory manner whereby they map the resource distribution, the
issues, their use patterns and possible management zones. This participatory map can then be
superimposed over a more centralized, and scientifically generated map so that the potential
conflicts of interest between management authorities and resource users can be seen.
IDB Response 20: This approach has been incorporated in Component 2 (a) (see paragraph 2.9).
STAP Comment 21: It is [...] suggested that some form of land (mangrove) tenure instrument be
adopted so that resource users can be organized and have a legal identity that allows them
limited access to the resource in return for stewardship and maintenance over the mangrove area
of concern.
IDB Response 21: This approach has been incorporated in Component 2(d) (see paragraph 2.12).
STAP Comment 22: Similarly, methods to be used for monitoring the coastal and marine
environment should be specified. A standard marine data collection system should be employed
that is both scientifically rigorous as well as applicable for community and/or volunteer groups
to apply. [...] Engaging NGOs and academic partners will tend to solve this problem of
adequate monitoring capacity. In addition is necessary to create `systems' for information
management, ICM and MPA evaluation and reporting, etc. so that these systems become
embedded into the managing organizations and take a life of their own.
IDB Response 22: Details in monitoring protocols are included in the draft terms of reference
available for these activities. Engagement of local governments, NGOs and community
organizations has been planned for (see also IDB Response 15).
STAP Comment 23: The indicators are as specified in the project logical framework are quite
appropriate while they are oriented to the "project" and not the stakeholder governments as
such. It would be useful to review indicators of the Coastal Resource Management Projects
(CRMP) supported by USAID in the Philippines that had indicators that were essentially the
same as those ultimately adopted by the local governments for their own CRM or ICM programs.
IDB Response 23: CRM benchmark system has been incorporated into Component 2(a) (see
paragraph 2.9). See also IDB response 7.
B c.
Questions related to institutional arrangements
STAP Comment 23: It is suggested that the value of investing in this regional body [Trinational
Commission] with its broad goals be carefully weighed with the value of providing more focused
technical assistance to particular countries in need. In this regard, it is prudent to keep
aspirations for the regional body practical. It is also suggested that this body be connected or
linked to other already existing regional bodies in Central America as appropriate.
IDB Response 23: We agree in both cases. The basic commitment to a regional cooperation
framework rests on the Declaration of Amapala where CCAD has been identified as the
coordinating entity as an existing regional body in Central America (see paragraph 1.1).
Nonetheless, all three countries agree that the establishment of the Trinational Commission and
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its functions must be the result of a systematic drafting and negotiation process involving all
responsible parties including each country's Ministry of External Affairs (see paragraph 4.1).
STAP Comment 24: The project might also consider developing "demonstration" sites where
ongoing and successful management can be displayed. This has proved useful in many ICM
projects to share lessons with others as a learning tool. This could also be useful in the context
of the 3 nations whereby each one has at least one demonstration project area to display and
show off its work, so to speak. This will ensure that each country tries its best to implement a
successful project site.
IDB Response 24: See IDB response 18.
B d.
Identification of the global environmental benefits
STAP Comment 25: The project clearly identifies global environmental issues and benefits
linked to the Gulf of Fonseca and the larger context of the Central American Pacific and Atlantic
coastal areas. [...] A question to address is to what extent the benefits of ecological and habitat
management will be eroded by increasing sedimentation and pollution in the Gulf. Although, it is
not entirely clear how dependent the Gulf ecosystems are on clear and clean water or their
relative degree of tolerance for sediments, but in the long term, the Gulf will only withstand
limited amounts of sediment before the entire system changes dramatically from its historical
state.
IDB Response 25: We agree. Some research has been undertaken on the potential impacts of
contaminants on selected estuaries of the Gulf, which indicates that increasing contaminants
discharges could affect indicators of health. Limited evidence exists on the impacts of
sedimentation on Gulf ecosystems although research in similar circumstances has shown that
accelerated sediment accumulation can lead to nearshore seagrass and even mangrove die-off.
B e.
How does the project fit within the context of the goals of GEF?
STAP Comment 26: The project fits well within the overall strategic thrust of the GEF-funded
International Waters (IW) initiatives. As proposed it should assist the three countries to better
understand the environmental concerns of their IWs and work collaboratively to address them. It
will also build the capacity of existing institutions both regionally and nationally and it intends to
implement measures that address selected trans-boundary environmental concerns, which is a
major thrust of the project as designed. Given these intents, the project with its broad focus can
achieve these outcomes more or less depending on many decisions yet to be made. The outcomes
in this realm depend in part on points raised elsewhere in this review.
IDB Response: None.
B f.
Regional context
STAP Comment 27: [...] the regional collaboration among countries through top levels of
government in the field of environmental management is still weak in central and Latin America.
Yet, the existing tri-national agreements and commitments signed by these three countries
certainly bode well for a positive outcome as a regional entity that will work effectively.
IDB Response: We agree.
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B g.
Replicability and sustainability of the project
STAP Comment 28: The proposed regional mechanism should provide focus and means for
coordinating national efforts, thereby enhancing the efficiency and effectiveness of individual
country undertakings. Involvement of the private sector, inter-governmental financial
institutions, investors and commercial banks are all important for sustainability. The project
design emphasizes the need for the involvement and investment of these agencies. But to be
realistic, the history of multi-country institutional arrangements working efficiently and ensuring
financial sustainability for its own operation are few. Partnerships are difficult to form and thus
need to be very carefully developed and nurtured over several years to make them viable.
IDB Response 28: For these reasons, financial sustainability of the project was subject to a
specific analysis where a survey was conducted of lessons learned from other GEF IW projects
(see Annex F). See also Component 2 (c) (paragraph 2.11).
B h.
Linkages to other focal areas, programs and action plans at regional or sub regional
levels
STAP Comment 29: The project has various natural links to other GEF focal areas and
programs at regional and sub-regional levels. A comment is that the project needs to focus on
those focal areas and programs that will be mutually beneficial to communicate and cooperate
with. Various international conventions, treaties and agreements exist among the countries of
Central America while few are strictly implemented or adhered to. The potential for this project
to improve on that is substantial given the ground work done in preparation for the tri-national
effort.
IDB response 29: Linkages with other GEF focal areas have been clarified (see Section G,
paragraph 1.41).
B i.
Degree of involvement of stakeholders in the project
STAP Comment 30: The project design includes a good understanding of the need for
stakeholder involvement and indicates that the Project will follow this path. Comments above
add some ideas on how this can be improved through the full engagement of municipal
governments in co-management arrangements with the communities under their jurisdictions.
Another question is whether the project has the resources for adequate stakeholder involvement.
National and local government and private institutions will need to play major roles to assist with
stakeholder involvement in a facilitated process with sufficient resources to support this activity.
IDB Response 30. See IDB responses 5, 6, 15, 16.
B j.
Capacity building aspects
STAP Comment 31: Sporadic and variable technical assistance does not lead to measurable
results in local projects. In this regard, the investments needed are often larger than anticipated,
especially in lesser developed countries. In the existing design, the project may be
underestimating the resources needed to fully develop and implement Gulf wide management to
produce tangible outcomes.
IDB response 31: We agree. The intent is to rely on local providers of technical assistance such
as Zamorano in Honduras in order to ensure sustainability.
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B k. Innovativeness
STAP Comment 32: The strategies proposed to implement the four project components are
relatively innovative while these strategies are dependent on having good leaders within the
Project team and framework to make them work. Project management should avoid being too
rigid and hierarchical so that the team will take their own initiatives. Also, by adopting a "rolling
design" that builds on the principles of adaptive management, the project may be more efficient
and innovative.
IDB Response 32: The project adopts a flexible adaptive management approach in execution.
See Chapter 3. Execution. See also innovation in "Project Strategy" (paragraph 1.44).
C.
Specific comments on the Proposal
STAP Comment 33: Project context. This section is substantially complete. Nevertheless, it
could benefit from several graphs that depict change over time as the data permits to give an
indication of what the future will look like if the trends are left unchecked. Also, the maps, as
presented, are small and would be more useful if presented in a larger format.
IDB Response 33: See TDA (Annex G).
STAP Comment 34: Project context. The discussion on aquaculture would benefit from more
detail on the extent of the shrimp farming activities and how this has impacted the mangrove
areas since this appears to be the single most important development trend affecting mangrove
and estuarine ecosystems in the Gulf. Also, the level of shrimp exports from Honduras is large.
This industry could be a major stakeholder in the management of the area, if interested and
engaged to do so. More information on this would be useful.
IDB Response 34: More information has been provided (see paragraph 1.11). The industry is
included as a major stakeholder through ANDA.
STAP Comment 35: Project context. The section that covers legal and institutional is
informative. A table that summarizes the laws and what they cover would be extremely useful for
project implementers and could be an early product of the project.
IDB Response 35: See Section D entitled Regional and National Policies and Institutional
Framework (see paragraphs 1.14 to 1.23).
STAP Comment 36: Issues and their causes. This concise summary is very helpful. It would be
useful to emphasize the transnational nature of pollution. The section that covers the decline of
mangroves should differentiate a bit more between the problems of cutting for wood and
conversion to shrimp ponds. The solutions to these two causes are very different.
IDB Response 36: This has been clarified. Summary of root causes is in paragraphs 1.37 to 1.39,
whereas section about decline of mangroves is in paragraph 1.35 and Tables I-7 and I-8.
STAP Comment 37: Lessons learned. This section could include a few of the ideas suggested in
the introduction as appropriate. In general, the few lessons noted are extremely relevant. Of
these, a lesson to emphasize is the need to coordinate among donor projects in the area and to
coordinate vertically through the various levels of government. Also, the co-management of
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protected areas is an important lesson that can be refined through project implementation as
work plans develop with local cooperators.
IDB Response 37: This has been incorporated in the lessons learned section (see paragraph 1.51).
Also donor coordination is included as a specific activity of the project. See Component 1 (b)
(paragraph 2.5).
STAP Comment 38: Project Strategy. This paragraph is a bit long and wordy. It is suggested to
state the strategy first in more concise terms in a shorter paragraph and then introduce the
components as part of the strategy and other details supporting the general strategy.
IDB Response 38: Our decision was to keep the strategy more explicit as it was the result of an
intense consultation with all three countries.
STAP Comment 39: Concurrence of regional and national plans. This section sets the tone for
how the 3 countries will concur on approaches through a standard framework under the tri-
national body guidance. It is suggested that a simple benchmark system be introduced here that
would link the three country efforts in a technical way to guide management of Gulf resources.
Such a system was explained in the introduction and is referenced.
IDB Response 39: This has been incorporated. See IDB response 7.
STAP Comment 40: Project objectives. The log frame seems quite doable with objectives and
means of verification that are achievable and measurable for the most part. Nevertheless, in light
of comments in this review, several minor clarifications might be considered that would help the
project to better align across the 3 countries in relation to the actual development of management
plans and benchmarks for this process.
IDB Response 40: Adjustments to the log frame have been made to correspond to the responses
above.
STAP Comment 41: Component I--Institutional building. The main comment on this important
component is that it will need to evolve with the project in relation to the needs of the institutions.
In Philippine ICM projects, it worked well to train national agency personnel as resource
persons for local municipal government training and capacity building. Also, having indicators
for improved governance in relation to environmental management gives the agencies, national
and local, goals to strive for in improving their ability to manage coastal resources. I suggest
that referring to the series of eight guidebooks titled: "Philippine Coastal Management
Guidebook Series" to assist with institutional development legal frameworks that have been
tested over time. Capacity building for local and national government will need extensive
training. Some training materials that are already packaged and ready for use, albeit in English,
are available through the website: www.oneocean.org. A series of training courses were
developed to support ICM in the Philippines that include all aspects of ICM and MPA
management.
IDB Response 41: We agree. See Component 1, paragraph 2.3 (a) and footnote 40.
STAP Comment 42: Component II--Ecosystem management. [...] It was suggested that pilot
areas might be more effective to more quickly start field level implementation. This is also where
the municipal governments must play a major role in planning and implementation. Linking the
Annex C-1
11 of 12
alternative income projects to the field level work will help speed changing the behavior of
communities towards fisheries and mangrove wood extraction.
IDB Response 42: We agree and this is consistent with the co-management approach proposed in
Component 2 (c).
STAP Comment 43 : Component III--Pollution. This component is very well planned and has an
achievable outcome. A question is whether demonstration sites are needed to start to implement
strategies that emerge from the research, monitoring and modeling efforts.
IDB Comment 43: The proposal is to include the activities promoting cleaner production in
Component 4 (b) in demonstration sites (see paragraph 2.22).
STAP Comment 44: Component IV. The potential for creativity is high in this component while
the bottom line is that economic development should be as environment friendly as possible. It
also needs to be profitable and have good business plans to back up potential projects. It might
be best to focus on only one or two projects and make sure that they succeed. Most such projects
tend to fail once the donor project ends.
IDB Response 44: Environmental, economic and financial viability are three of the key
eligibility criteria for the selection of the projects in Component 4 (a) (see paragraphs 2.20 and
2.21). Business plans will be required to ensure sustainability and technical assistance will be
provided for the preparation of these business plans. Successful experience exists in the
management of these types of activities by specialized NGOs in Honduras, El Salvador and
Nicaragua.
STAP Comment 45: Information, education and communication (IEC). It might be better to
include this set of activities in a separate component or at least to clearly link the various IEC
activities across the components. Websites are useful depositories for all the project information
and can serve as a functional library and way of organizing much information. Nevertheless,
local stakeholders do not normally use these means of obtaining information so there is a need
for other means of disseminating important documents.
IDB Response 45: Linkages between IEC strategy and other components have been clarified See
component 1 (c) (paragraph 2.6).
STAP Comment 46: Project administration. The three country arrangement will add to the
complexity of project management. At the same time a transparent project management system
can help make it efficient by having a very systematic process in place for administration in the
central office. One note of caution is that organizational structure could bog down if the
Consultative Forum and Regional Technical Committee are not streamlined in function and
mandates.
IDB Response 46: Streamlined, transparent Operating Regulations for the project will be in place
prior to its initiation. The IDB has used such regulations effectively in other GEF IW projects.
STAP Comment 47: Disbursement schedule. Year one is shown to have the highest rate of
disbursement, presumably because of capital purchases and since more consultants will be
employed in this year. But, from lessons learned in other projects, the first year should be used
more for planning and setting up systems and making sure that right personnel are involved.
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And, often spending is less than projected in the first year but peaks in the 2nd or 3rd year of the
project.
IDB Response 47: We agree and received a similar comment in our internal management review.
Corresponding adjustments have been made to the disbursement schedule (see paragraph 4.17
and Table IV-2).
STAP Comment 48: Financial Viability. The overall amount of funding is not too large for this
scale of project. This highlights the need for counterpart support and leveraging other donor
projects together with the need for substantial investments of the national governments. These
concerns have been addressed in the proposal for the most part.
IDB Response 48: We agree. Counterpart and leveraging of other donor projects have been
firmed up.
STAP Comment 49: Project risks. It appears that the largest risk is the relative lack of stability
among the 3 countries at the borders. Yet, the 3 countries have signed agreements to manage the
Gulf and have committed resources to this endeavor. During the project implementation, these
transnational conflicts could be a delicate issue and in this regard, it will be necessary to
continually highlight the larger good and shared problems of the 3 countries, so that bilateral
issues do not take the center stage. This will require good leadership on the part of the GEF
project team.
IDB Response 49: We agree. The commitment has also been to: (a) ensure that the negotiation
of all formal agreements involve relevant parties including the Ministries of External Affairs of
each respective country; and (b) limit the scope of the project to issues that do not entail boundary
considerations.
STAP Comment 50: Project challenges. Working in 3 countries simultaneously will require
having similar approaches to coastal management in each country. In this regard, the concept of
"scaling up ICM" from local to national and then to international might be a way to unify the
overall framework and approach of the project. In the Philippines, for example, the evolving
ICM certification system is responsive to local governments, their capacities and their
jurisdictions under national law while it is not too restrictive on what local governments can and
cannot do. This could easily be applied in the Gulf of Fonseca, given its relatively small size and
common issues to be addressed.
IDB Response 50: See responses 5,6 and 7 above.
Summary and final points
IDB Response: These have all been addressed in the responses above.
________________________
Submitted by A. White
February 8, 2007--draft
February 21, 2007--final
ANNEX D. LETTERS OF ENDORSEMENT
1.) Letter of Endorsement (El Salvador)
2.) Letter of Endorsement (Nicaragua)
3.) Letter of Endorsement + Official Communication (Honduras)
-----Original Message-----
From: carolina bocanegra [mailto:carolabocanegra@yahoo.com]
Sent: Thursday, March 22, 2007 9:42 AM
To: Weitnauer Z., Emelie B.
Cc: Cooperacion Externa SERNA; sdespacho@serna.gob.hn
Subject: PROYECTO GOLFO
Estimada Emilie:
Esperando que te encuentres bien, el motivo del presente es para informarte sobre el
Proyecto Golfo de Fonseca. Hemos estado dando seguimiento y sabemos que el tiempo
es corto para la presentación de este proyecto. Al respecto quiero reiterarte el interés de
la Secretaría en desarrollar el mismo.
En ese sentido estamos anuentes con el contenido técnico del proyecto, sin embargo les
solicitamos un poco de tiempo pues el proyecto esta siendo analizado por la Cancillería
ya que aún cuando el proyecto no tiene ninguna intención de intervenir en aspectos
políticos, la zona misma del golfo es altamente sensible en este aspecto, por lo que para
el País es de suma importancia poder asegurar prevalezca el Derecho Internacional
que garantize la paz y soberanía de los 3 Estados que son parte del proyecto y por ello,
ante la nota enviada por ustedes sugieriendo la inclusion de un parrafo que aclare esta
situación en el documento, la Ministra ha solicitado que sea Cancillería que dictamine
si es válido o no este aspecto.
Creemos que el BID puede avanzar con la presentación del proyecto ante el GEF pues
en su parte técnica y alcanze no tenemos ningún problema, solamente que necesitamos
analizar otros aspectos de índole mas que todo político, que realmente no creo que
cambien en si la estructura del mismo. La nota de endoso se dará una vez que la
Ministra sepa el dictamen de cancillería y me autorize darles la nota.
Atentamente
Carolina Bocanegra
Directora
Cooperación Externa y Movilización de Recursos SERNA
Punto Focal Operativo del GEF en Honduras.
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ANNEX E - MONITORING AND EVALUATION PLAN
A.
Monitoring and reporting structures
1.1
The following periodic reports will facilitate the monitoring and evaluation of Project results and
impacts, as well as facilitate the adaptive management on behalf of the Regional Project
Coordination Unit (UCPR) and provide guidance to the planning and management decisions of
the Trinational Commission for the Integrated Management of the Ecosystems of Gulf of
Fonseca.
1.2
Day-to-day monitoring. The Project will operate based on detailed Annual Work Plans developed
at the beginning of each project year with the support from the Regional Technical Committee
and through a participatory process involving local organizations, user groups, and government as
represented in the Advisory Forum and the local committees. The Annual Work Plans will be
approved by the Regional Executive Committee for the Integrated Management of the
Ecosystems of Gulf of Fonseca established in accordance with the Operating Regulations and by
the Tirnational Commission once created. The work plan will define activities to be carried out
and results to be generated throughout the year. The work plan will have a series of short-term
process indicators linked to milestone events and products. The UCPR will coordinate the day-to-
day monitoring of these indicators to ensure that the project intervention is on-track and delivers
the expected results. In this context, partners in the execution, including co-administrators and
users of ecosystems and natural resources, government institutions, NGOs and others will help
collect the data needed for day-to-day monitoring. The IDB Country Office that is selected, as
having lead responsibility for Bank supervision, will conduct periodic inspection visits to the
Project site and maintain a Project Performance Monitoring Report (PPMR), the Bank's main
system tool for monitoring of projects.
1.3
Mid-year Progress Reports. Half-way through each Project year, the UCPR will prepare a
summary report to IDB/GEF and the Regional Executive Committee (or the Trinational
Commission once created) in order to inform on the progress made during the first six months
execution of the Annual Work Plan. The Mid-year Progress Report will focus on short-term
results and challenges, and will be less detailed than the Annual Project Report.
1.4
Annual Reviews. At the end of each Project year, the UCPR will elaborate an Annual Project
Report to summarize project results. The preparation of each Annual Project Report will be
preceded by a consultation workshop in the Advisory Forum to solicit feedback from local
stakeholders in the ecosystems management on the project's performance with a focus on those
project activities with a strong participatory element (i.e., Component 2 and 4). The annual report
should include considerations on: (i) project performance over the past year, including key results
produced and, where possible, information on the progress towards Project objectives, (ii)
identification of constraints and unforeseen barriers to execution including those that could affect
the achievement of objectives, the reasons for these constraints, and what is being done to
overcome them, (iii) expenditure reports, (iv) lessons learned, and (v) recommendations for
adaptive management of the Project strategy to optimize impact of the intervention. The Annual
Project Report will be shared with the Advisory Forum and approved by the Regional Executive
Committee (or the Trinational Commission once created). The designated IDB task manager, in
collaboration with the IDB Country Office selected as having lead responsibility for Bank
supervision, will conduct an annual administration mission to the site to discuss the main findings
of the Annual Project Report and discuss its implications for the subsequent Annual Work Plan.
1.5
GEF Project Implementation Review. In addition to the Annual Project Report, the UCPR will
prepare the mandatory GEF Project Implementation Review (PIR), in collaboration with the
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designated IDB task manager. The PIR will be reviewed and analyzed by the IDB before sent it to
the GEF Secretariat.
1.6
Reports and publications. To document the lessons learned and knowledge generated by the
Project, the UCPR will prepare, consolidate and disseminate technical reports on a variety of
thematic areas related to management effectiveness and the sustainable use of the ecosystems of
the Gulf of Fonseca (i.e., conservation impacts of local co-management schemes, trinational
pollution control strategy and characterization of water quality, innovative sustainable
livelihoods, among others). These reports will: (i) hold the Project team accountable with regard
to its responsibility to generate technical results at the highest level, (b) help summarize and
document the Project's results, and (c) serve to disseminate and replicate the Project's lessons
learned and knowledge to interested parties in the participating countries, in the wider region, as
well as world-wide. Technical reports will be made available through the Project's web site.
1.7
Results which are deemed particularly important and that are of interest beyond the Gulf of
Fonseca will be disseminated through project publications. An independent peer review
mechanism involving experts from the organizations conducting research in the Gulf of Fonseca
area will be used to ensure the quality of the published material. Collaboration will also be
sought with international and regional institutions and national universities (i.e. the University of
Zamorano, the University of Central America, the Centre for Aquatic Ecosystem Research,
CATIE, NOAA, CI, TNC, among others) in terms of dissemination of best practices and
involving students and researchers in matters relating to the integrated management of the Gulf.
The Project's dissemination strategy will be determined in collaboration with the IDB and
executing partner institutions. A Project web-site will also facilitate dissemination of results.
Socialization of Project results will also be ensured at both formal and informal local events and
meetings (for example, amongst local communities through schools and public venues).
B.
Independent evaluations
1.8.
Mid-term Review. A mid-term review1 will be carried out when 35%2 of the GEF resources have
been disbursed of after 24 months after the Project contract goes into effect, whichever comes
first. The review will determine if the project strategy is generating the desired impact, or if
adjustments are necessary to ensure the achievement of Project objectives. The review team will
include a representative from the Bank's Office of Evaluation and Oversight (OVE), will focus
on the effectiveness, efficiency and timeliness of project implementation and will solicit feedback
from stakeholders participating in execution such as the co-management partners and other local
actors. The review will highlight issues affecting the execution of each component that require
decision and action, and it will provide preliminary lessons learned about Project design,
implementation and management. Particular attention will be paid to whether the involved
institutions are internalizing and mainstreaming Project results into their work, as well as progress
in implementation of the Business Plan for the integrated management of the ecosystems of Gulf
of Fonseca. Recommendation of the Mid-term Review will be an important input for the UCPR
as well as for IDB and the implementing partners, in assessing progress, as well as possible needs
for change during the second half of the Project's lifespan.
1.9.
Final Evaluation. By the end of the Project, a Final Evaluation will be performed to determine if
the Project indeed reached its objectives. An independent team of experienced expert(s)
commissioned by the IDB will perform the evaluation. The evaluation team will evaluate the
Project's results both in terms of ensuring global environmental benefits, as well as local and
1
The Mid-term and final evaluations will be performed by a team of consultants contracted by the IDB, using the fee
resources provided by the GEF.
2 The 35% target is considered as an appropriate timing to allow consideration of adjustments in sufficient time for
implementation.
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trinational benefits. The evaluation team will identify lessons learned and particular successful
Project results, and these will be disseminated broadly in the three countries and to other IDB and
GEF financed projects in the region. The team will moreover evaluate the sustainability of Project
results, and recommend to the involved parties how they could further enhance sustainability. The
Bank, including a representative of OVE, will conduct a final administration mission to discuss
the results of the final evaluation with the Trinational Commission for the Integrated
Management of the Ecosystems of Gulf of Fonseca.
1.10.
Other evaluations. In addition to the compulsory independent Mid-term Review and Final
Evaluation, the Project may participate in program-specific or thematic evaluations performed by
the GEF Evaluation Office, or by the GEF Secretariat to determine effectiveness and impact of
the overall GEF portfolio. The Project may also participate in evaluations of country programs to
determine effectiveness of the Project portfolios of participating institutions.
C.
Learning and knowledge sharing
1.11.
In addition to publications and reports mentioned above, the lessons learned and knowledge
generated throughout the project intervention will be shared widely through networking with
interested parties outside the area of the Gulf of Fonseca. To increase dialogue, the project will
participate in information exchange and learning networks, such as those promoted by GEF,
CCAD, TNC, IW/LEARN, the Global Water Partnership and other technical forums.
D.
Monitoring Plan
1.12.
Monitoring Strategy. Building on existing initiatives, the UCPR will coordinate the collaborative
development of a permanent, integrated and cost-effective monitoring and evaluation system. The
system will facilitate trinational decision-making processes and adaptive management by the
stakeholders through monitoring progress in achieving the Project's objectives and provide an
integrated overview of the status of the ecosystems of the Gulf of Fonseca (see Project
Components 1 and 3). The monitoring and evaluation system will be internalized in existing
institutions such as INETER in Nicaragua, SNET and CENDEPESCA in El Salvador and the
Center for Studies and Control of Pollutants in Honduras through agreements clearly identifying
responsibilities and involving staff and local stakeholders, in order to insure continuity after the
life of the project. This system will not only provide valuable information on the state of the
ecosystems of the Gulf of Fonseca linked to some of the Project indicators at the Goal and
Purpose level defined in the log frame matrix (Annex E to the GEF Executive Summary), but will
also be used for the continuous monitoring of Project effects (results). Within the first year, the
UCPR will ensure the consolidation of the baseline information for all indicators in the log-frame.
The total estimated costs for monitoring and evaluation are US$400,0003 (See Table 1).
1.13.
As per IDB guidance, monitoring and evaluation at the Project level will be oriented by the
following key questions: (1) how effective are the cooperation agreements and the process of
designing and implementing the coastal-management plan and the regional pollution control
strategy, for bringing about a consensus among the three countries on the strategic guidelines for
the integrated management of the Gulf?; (2) have the capacities for management and co-
management of coastal-marine resources been improving in the Gulf area?; (3) to what extent
have the industries adopted clean production technologies, and the communities internalized /
diversified the sustainable use of the ecosystems of Gulf of Fonseca and good practices in their
productive activities, and what types of socioeconomic benefits are being generated?; (4) has
there been an improvement in the dissemination of information, awareness-raising, and scientific
knowledge of the Gulf of Fonseca as a regional ecosystem, so that management decisions are
3 These costs include US$80,000 for the Mid-term Review and Final Evaluation which will be covered by the GEF fee to the
IDB (in other words they are not charged to the GEF grant of the Full Size Project)
Annex E
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being made on the basis of the best available and accurate information?; (5) what are the trends
observed in the ecological integrity of the ecosystems of Gulf of Fonseca and how is the Project
contributing to maintaining them?
1.14.
Data Collection and Analysis. Some monitoring activities can be done through desk-study of
written documents, such as reports, work plans, and meeting minutes. Other information related
to process indicators (i.e. the effectiveness and efficiency of the trinational institutional set-up and
co-management arrangements), will be done mainly through evaluations and interviews with
institutional actors and stakeholders, as well as the review of meeting reports, minutes and
agreements of the Trinational Commission for the Integrated Management of the Ecosystems of
Gulf of Fonseca. In terms of stress reduction indicators, (i.e. the extent to which the regional
strategy for pollution control with a phased investment plan by watershed is agreed upon and
implemented) will be assessed using both direct (i.e. # of production plants with effluents into the
Gulf of Fonseca watersheds applying effluent treatment and pollution control technologies or #
fishing boats participating in sustainable co-management schemes) and indirect (i.e. amount of
resources invested in pollution control measures ) indicators. Finally, environmental indicators
(i.e. mangrove cover, water quality, sedimentation burden) will be measured through a
combination of cost-effective methodologies, including inventories, satellite imagery, and
participatory methods (i.e. water quality measurements, stock fishing registers involving fisher's
participation), and measurements of ecological integrity.
1.15.
Table 1 below summarizes the monitoring plan for the outcome indicators at the Project Goal and
Purpose level, indicating: (a) definition of the outcome indicator, (b) indication of the type of
indicator4, (c) baseline value and target, (d) method/means of verification, (e) periodicity, (f)
responsible party, (g) an indication of the expenditure category (component # or administrative
costs), and (h) the estimated costs associated with the monitoring of each indicator.
4 Process indicators related to the sustainability, trinational and participatory nature of management decisions; stress
indicators related to pollution phased out and improved regulation; and environmental indicators related to changes in water
quality and ecological integrity.
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Table 1: Tentative monitoring plan of indicators at the goal and purpose level
Type of
Responding
Charged to
Indicator (see
to key IDB
Component or
Baseline value and
Method/Means
Perio-
Responsible
Impact Indicator
footnote 4
question (see
Administrative
Cost
target
of verification
dicity
Party
US $
above)
paragraph
Costs?
1.13 above)
GOAL LEVEL
Three years after the end of the Project, Environmental
5
Baseline :
Aerial
Every 2
UCPR
Component 2
40,000
the area of mangrove in the Gulf's coastal
Mangroves
photography
years
zones
is
maintained
or
improved
coverage: 57,400 ha
Local
compared to the level at the end of year 1.
Target:
Satellite images
governments
Mangroves coverage
is maintained or
expanded 10%
Three years after the end of the Project, Stress
3
Baseline:
Monitoring
Every
UCPR
Component 3 - 4
70,000
the land-based pollution is reduced reduction
Estimated total BOD
reports of BDO
year
compared to the level at the end of year 1.
170,000 kg/day at
National
the mouths of the
Agencies
watersheds based on
TDA
Local
Target:
governments
Total estimated
BDO is reduced
15%.
Three years after the end of the Project, Stress
2 and 3
Baseline:
Monitoring
Every
UCPR
Component 3
70,000
the sedimentation is controlled or reduced reduction
Estimated total
reports of
year
compared to the level at the end of year 1.
sediment discharges
sediment
National
23,000 116,000
discharges
Agencies
tons/day at the
mouths of the
Local
watersheds
governments
Target:
Estimated total
sediment discharges
at the mouth of the
watersheds is
reduced 10%
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Table 1: Tentative monitoring plan of indicators at the goal and purpose level
Type of
Responding
Charged to
Indicator (see
to key IDB
Component or
Baseline value and
Method/Means
Perio-
Responsible
Impact Indicator
footnote 4
question (see
Administrative
Cost
target
of verification
dicity
Party
US $
above)
paragraph
Costs?
1.13 above)
Three years after the end of the Project, Stress
2, 3 and 5
Baseline:
Socioeconomic
Every 2
UCPR
Component 4
30,000
the number of inhabitants living in the reduction
20,000 artisanal
surveys
years
Gulf's area deriving at least 50% of their
fishers; 53,000
/ statistics
Municipalit-
income from environmentally sustainable
persons dedicated to
ies
activities and / or alternative livelihoods
aquaculture.
Oral reports of
linked to the use of marine and coastal
Percentage of fishers
beneficiaries
resources
has
increased
by
10%,
and persons
compared to a baseline to be updated
dedicated to
through a survey in Year 1
aquaculture using
sustainable practices
will be updated in
Year 1
Target:
10% of increase of
fishers and persons
dedicated to
aquaculture using
sustainable practices
PURPOSE LEVEL
At the end of the Project, the Trinational
Regional
1 and 4
Baseline:
Review of
Yearly
UCPR
Component 1
15,000
Commission for managing the
process
Amapala Agreement
meeting minutes
ecosystems of the Gulf of Fonseca is
of 1993 calling for
and agreements
operating efficiently as a participatory
the establishment of
of the Trinational
and representative regional cooperation
a Trinational
Commission of
structure
Commission is not
the Basin
implemented
Target:
Commission
established, working
efficiently and
making decisions
based in accurate
information
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Table 1: Tentative monitoring plan of indicators at the goal and purpose level
Type of
Responding
Charged to
Indicator (see
to key IDB
Component or
Baseline value and
Method/Means
Perio-
Responsible
Impact Indicator
footnote 4
question (see
Administrative
Cost
target
of verification
dicity
Party
US $
above)
paragraph
Costs?
1.13 above)
By the end of the project, the countries
Regional
4
Baseline:
Agreements
Every 2
UCPR
Component 1
20,000
share systematically scientific
process / stress
There is no
signed between
years
information on the environmental status
reduction
harmonized
institutions.
and trends of the Gulf's tributary
monitoring network
watersheds as well as its waterbody, so as
or systematic
Reports of
to make it possible to agree upon
exchange of data on
monitoring and
strategies/actions for pollution and
water quality and
evaluation
sediment control prevention and adaptive
sedimentation
ecosystem.
processes in the Gulf
or its tributaries, and
existing information
systems have limited
coverage.
Target:
An information node
of the Gulf of
Fonseca by linking
in the local and
national information
systems with a
Regional one is
established.
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Table 1: Tentative monitoring plan of indicators at the goal and purpose level
Type of
Responding
Charged to
Indicator (see
to key IDB
Component or
Baseline value and
Method/Means
Perio-
Responsible
Impact Indicator
footnote 4
question (see
Administrative
Cost
target
of verification
dicity
Party
US $
above)
paragraph
Costs?
1.13 above)
By the end of the project, a set of policies, Regional
1 and 5
Baseline:
Memoirs of
Every 2
UCPR
Component 2
30,000
norms and procedures, for the use of process / stress
No Coastal Resource advances made
years
coastal-marine resources of the Gulf, will reduction
Management (CRM)
in the
Municipalit-
have
been
harmonized
based
on
benchmark system is
implementation
ies
consensus, and their implementation will
being used by any of
of the coastal
be monitored using a common Coastal
the 19 municipalities
management
Resource
Management
benchmark
Target:
plan
system.
Coastal Resource
Management (CRM)
Reports on the
benchmark system is
new
in place and being
legal/political
used by the 19
framework
municipalities of the
Policies
Gulf.
approved
By the end of the project, co-management
Stress
2
Baseline:
Reports on
Every 2
UCPR
Component 2
20,000
plans for at least two overexploited
reduction /
There are no co-
monitoring of the years
shared resources (shrimp and fish) are
environmental
management plans
co-management
Cooperative
being implemented with fisher
for fisheries
plans'
s' reports
associations, local governments and
resources.
implementation
organizations of each country
Target:
Co-management in
place with at least 3
cooperatives of
artisanal fisheries,
including voluntary
by-catch reduction
SUBTOTAL
295,000
Costs related to monitoring report writing, data management by Regional Project Executing/Coordination Unit staff (US$5,000/year)
25,000
Mid-term review and final evaluation
80,000
TOTAL
400,000
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ANNEX F - FINANCIAL SUSTAINABILITY ANALYSIS
Contents
1. Introduction........................................................................................................................................... 2
2. Some Experiences with Financial Sustainability in other GEF International Waters Programs .......... 4
2.1.
Partnerships in Environmental Management of the Seas of East Asia (PEMSEA)...................... 5
2.2.
Strategic Action Plan for the Red Sea and Gulf of Aden (PERSGA)........................................... 7
2.3.
Reversing Environmental Degradation Trends in the South China Sea and the Gulf of Thailand
(SCS) 8
3. Description of the Financing Mechanism ........................................................................................... 11
3.1.
National Budget .......................................................................................................................... 11
3.2.
Port Fees...................................................................................................................................... 12
3.3.
Aquaculture Industry................................................................................................................... 13
3.4.
Institutional Contributions .......................................................................................................... 14
3.5.
Tourism ....................................................................................................................................... 16
3.6.
Extraction of Renewable Resources ........................................................................................... 17
3.7.
Paying for Environmental Services............................................................................................. 17
3.8.
Corporate Social Responsibility.................................................................................................. 19
4. Evaluation of the Financing Mechanism ............................................................................................ 20
4.1.
Financial Sustainability Strategy ................................................................................................ 21
4.2.
Priority Mechanisms ................................................................................................................... 25
5. Discussion ........................................................................................................................................... 27
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1. Introduction
The Gulf of Fonseca is situated in the Central American Pacific Ocean, and is shared by El Salvador,
Honduras, and Nicaragua. The IDB-GEF project Integrated Ecosystem Management of the Gulf of
Fonseca seeks to prevent degradation and maintain the integrity of its ecosystems by implementing
integrated management of marine and terrestrial resources, and fostering their sustainable use. The
project's area of influence is encompassed by the three countries' 19 coastal municipalities.1 The project
includes the following components: (1) institutional strengthening for regional management of the Gulf,
(2) coastal and marine ecosystem management, (3) pollution prevention and control, and (4) support for
generating regional environmental goods and services. GEF financing is foreseen for five years, and
therefore after this time horizon it is expected that the resources for continuing the project activities will
be reduced considerably. Hence the importance of having a financial sustainability strategy that
proactively anticipates these needs for financing in the post-GEF project stage, and that designs
mechanisms that make it possible to sustain the project impacts in the long run.
The financing requirements after the period of project implementation may be divided between funds
needed for project coordination and management per se, and funds needed for project activities such as
taking water quality measurements in the Gulf and pilot projects, among other possibilities. The precise
nature of the project activities once the implementation period concludes is difficult to determine at this
time. Some activities begun during the project period may be absolutely self-sufficient when the project
ends.
It is anticipated that there will be some activities that will not be completely finished by the end of the
project, and that others will still be in the planning phase. Nonetheless, it is possible that the funds
available for the activities will be significantly lower than the levels of funds during the years of project
implementation. This possibility should be considered carefully during the development of the activities
in the period of project implementation, so that there can be an adequate transition between the project
implementation and post-project stages.
This document discusses how the project can attain an adequate transition between the project
implementation and post-project stages. In particular, this document focuses on the financial resources
necessary that may be available for paying for activities in the post-project stage. This is a broad
definition of "financial sustainability." To add greater precision, one could see financial sustainability as
"the ability to secure stable and sufficient long-term financial resources, and to allocate them in a timely
manner and appropriate form."2
This definition takes into account two important concepts. First, the project needs sources of money in
the post-project stage. Second, over the life of the project, it is crucial that financial decisions be made
that are carefully considered, as well as effective and transparent which are the sign of a well-managed
organization. The project needs a strong business plan as a key aspect of its operation from the beginning
and that takes into account the activities in the post-project stage.
1 The municipalities of Conchagua, La Unión, San Alejo, Meanguera del Golfo, and Pasaquina, in the department of
La Unión, in El Salvador; the municipalities of Goascorán, Alianza, Nacaome, San Lorenzo, and Amapala in the
department of Valle, and Choluteca, Marcovia, Namasigue, and El Triunfo in the department of Choluteca, both in
Honduras; and the municipalities of Somotillo, Villanueva, Chinandega, El Viejo, and Puerto Morazán in the
department of Chinandega, in Nicaragua.
2 Emerton, L., Bishop, J. and Thomas, L. (2006). Sustainable Financing of Protected Areas: A global review of
challenges and options. IUCN, Gland, Switzerland and Cambridge, UK, p. 24.
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Developing a business plan should be one of the priorities upon initiation of the project. This business
plan should include a description of the costs, benefits, and long-term sustainability of each activity. The
activities with low costs, high benefits, and solid prospects in the long term should clearly be the most
desirable. In addition, the activities that are financed in part or in full by some group of interested actors
are particularly interesting, for it is likely that they will be viable in the long run. For example, organic
agriculture is a potentially profitable activity, with good prospects in the long run, if adequately
developed. This is only one of the many possibilities that may be considered.
To date a large number of GEF international waters projects have begun operations. To learn from these
prior projects and identify the lessons learned that may be applicable to the activities in the Gulf of
Fonseca, the project directors of a number of GEF international waters projects currently under way were
contacted and several published reports were obtained on evaluations of already-completed GEF projects.
The next section reviews the information that was collected. One clear conclusion from this exercise is
that attaining financial sustainability is extremely difficult and that the needs for funds should be
considered in early stages of the process of project planning, and should not be left for the end of the
project.
After the section that reviews some lessons learned from other projects, we analyze some of the sources
of resources that could be considered for covering recurrent expenditures in the post-project stage, such as
administrative costs and resources for project activities. After describing some of the financing
mechanisms that could be considered, we evaluate them using a variety of criteria, including their
potential for generating income, their political viability, and their stability, among others.
This document addresses some of the types of financing mechanisms that could be considered.
Nonetheless, the analysis developed here is preliminary, and it is expected that during the course of the
project a significant effort will be made to evaluate more carefully the different prospects for financing, to
develop the institutional mechanisms necessary for their implementation, and to implement the actions
identified as necessary.
Finally, another important consideration is to decide how to share the recurrent expenses in the post-
project stage among the three countries that surround the Gulf of Fonseca. One possibility is to divide
these expenses into equal parts, as is currently done among the member countries of the Central American
Maritime Transport Commission (COCATRAM).3 Another possibility is to share the expenses among the
member countries based on payment capacity, as is done, for example, in the International Commission
for the Protection of the Danube River (ICPDR), which finances its operations with funds from the 13
member countries. Of these countries, Austria and Germany contribute 50% of the ICPDR's budget,
while the other 11 countries cover the other 50%.4 One can also use some other mechanisms that lead to
contributions of varying amounts. The choice as to how to divide up expenses is another decision that is
probably best made in early stages of project implementation, instead of leaving it for the end of the
project. In addition, it is important to consider that some of the mechanisms discussed here may work
better in some countries than others.
3 López, Juan Antonio (2003). "Informe Sobre la Tarifa Portuaria para el Financiamiento de la COCATRAM."
Prepared for Abt Associates.
4 Source: Email communication with Andrew Hudson, principal technical adviser to International Waters, UNDP-
GEF. August 2006.
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2. Some Experiences with Financial Sustainability in other GEF
International Waters Programs
Considering that the GEF's International Waters program started operations in 1991, in preparing this
diagnostic document, earlier documents prepared by the GEF Evaluation Unit for it were consulted,
focusing on the different aspects of financial sustainability and on those projects that developed
mechanisms to attain it. In addition, personnel were contacted from some of the international waters
projects based on recommendations of experts on major experiences with financial sustainability that
could be useful for designing the project in the Gulf of Fonseca.5 The main criterion for identifying these
projects was their degree of innovation in terms of use of mechanisms of financial stability to continue
developing their activities beyond the horizon for implementation of the GEF project. It is important to
note that the sample of projects presented here is not exhaustive.
The questions asked of the project personnel contacted included: (i) "What are the key aspects in the
design of your operations that could ensure financial sustainability?"; (ii) "What is the scale of these
operations and where would the funds come from once the GEF project has concluded?"; and (iii) "Do
you know of any other international waters project that was successful in attaining financial sustainability
for some of its operations?" Following are the experiences of financial sustainability for three of these
projects: Partnerships in Environmental Management of the Seas of East Asia (PEMSEA),
Implementation of the Strategic Action Plan for the Red Sea and Gulf of Aden (PERSGA), and Reversing
environmental degradation trends in the South China Sea and the Gulf of Thailand (SCS). In addition,
some ideas are outlined as to how the financial sustainability arrangements used in these projects could be
useful in the context of the Gulf of Fonseca.
The main conclusions from this analysis include: (i) Attaining financial sustainability in international
waters projects is a difficult task that should be addressed from the early stages of designing the GEF
project. (ii) No financial sustainability strategy can be applied without considering the particular context
of the countries in which it is undertaken, and in this regard it is vital to be mindful that alternatives that
work in certain countries may not work in others. (iii) Any project that seeks to attain financial stability
should generate incentives for the inhabitants of its area of influence to sustainably manage and use the
ecosystems, in particular among the members of the communities whose ability to make a living is linked
to natural resources and the environment. (iv) The different interest groups at every level should be
involved and should be familiar with the project and its benefits, thus the project team should make an
effort to communicate and act transparently. At the local level, the support and active participation of the
community is needed to attain sustainability in the long run. For this reason, if the project actions have a
negative impact on the possibilities of persons having access to their means of subsistence, the project
must offer alternatives for income generation. Otherwise, the project's impact will not be sustainable in
the long run. At the national level the leaders should be informed of the project objectives, to ensure
there is commitment and support, and to have funds earmarked from the national budget to support its
activities. This can be accomplished by establishing good communication with high-level members of the
government and showing them the economic and environmental benefits that stem from the project
actions. At the regional level there should be periodic regional meetings to identify and focus on regional
benefits, and thereby pave the way for subsequent actions by each government. In terms of international
donors it is important to establish, in the early stages of project implementation, a list of potential donors
and a strategy for contacting them in order to explore financing opportunities and to secure their
participation in donors' meetings. (v) There should be a website to facilitate communication to discuss
5 The persons consulted to define the sample of projects to be contacted were: Juha Uitto, expert in monitoring and
evaluation with GEF/UNDP, and Andrew Hudson, principal technical adviser for International Waters, GEF/UNDP.
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potential pilot projects and to share information with the interested actors who have access to the Internet.
Additionally, tools of this type increase the transparency of the project actions.
2.1. Partnerships in Environmental Management of the Seas of East Asia (PEMSEA)6
PEMSEA is considered one of the model international waters projects in relation to its use of public-
private partnerships. Establishing such partnerships has made it possible to guarantee the financial
sustainability of activities important for attaining the project objectives that entail promoting better
environmental management of the seas of East Asia. Although a recent evaluation of GEF's International
Waters Program notes that most of the PEMSEA partnerships generate local benefits, it also recognizes
that they make it possible to guarantee baseline investments, without which transboundary and global
benefits are not possible. Among the advantages of such partnerships mentioned are: minimal GEF funds
are required, they are highly replicable, and they foster competitive and transparent processes for
awarding contracts for the work involved.7
Some examples of such partnerships that PEMSEA has developed are summarized as follows:
6 Participating countries: Brunei Darussalam, Cambodia, Philippines, Indonesia, Japan, Malaysia, Democratic
Republic of Korea, People's Republic of China, Republic of Korea, Singapore, Thailand, and Vietnam. Date of
approval of by GEF: January 11, 1998. Implementing agency: UNDP. Executed by the International Maritime
Organization. Funds: GEF6: $16,220,200. Co-financing: $12,320,000.
7 Communication with Maria Corazón M. Evarbia. Technical Officer for Environmental Investments. GEF-UNDP-
IMO. PEMSEA Philippines, and Mee et al., Program Study on International Waters. 2005, p. 32.
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Table 1. Some Pilot Partnerships in PEMSEA8
Location Project
Philippines
- Integrated solid waste management system
San Fernando City
- Municipal authority offered the land for sanitary landfill
- 8 companies submitted bids
- Bidder selected in May 2004
- Amount: US $5 million
Philippines
- Integrated solid waste management system
Province of Bataan
- Project presented to 30 potential investors
- Government offered the land for sanitary landfill
- Government offered to contribute 30% of the capital costs
- Profits distributed based on percentage of capital contributed
- 7 companies submitted bids
- Is in adjudication process
- Amount: US $7 million
Vietnam
Integrated industrial wastewater and hazardous waste treatment system
Danang
Amount: US $10 million
Philippines
Bataan Coastal Care Foundation finances 50% of the local coastal zone
Province of Bataan
management projects and the provincial government finances the other
50%
Gulf of Thailand,
Training in emergency response to oil pollution is financed by the
Manila Bay, Bohai Sea shipping and insurance industries.
Regional
GEF Project Marine Electronic Highway in the Malacca Strait has a
component financed by the private sector
In the case of the Gulf of Fonseca many of the coastal municipalities face serious problems of lack of
environmental and basic sanitation infrastructure for which existing public funds are insufficient. One
particularly critical case is the town of Puerto Morazán (municipality of Puerto Morazán, Chinandega,
Nicaragua), where the lack of a sewage system means that the waste generated by this population is
disposed with no treatment whatsoever into the Estero Real.9 It is precisely in such situations that
establishing partnerships between the public and private sectors would make it possible to guarantee
investments in infrastructure that are urgently needed. Nonetheless, it is important to consider that
establishing such arrangements requires at least the following elements:
i)
The municipal governments involved have the economic capacity or can access resources of
other organizations to subsidize the project, either by providing basic infrastructure or
through funds to make the project attractive to potential investors.10
ii)
The order of magnitude of the projects provides a critical mass to ensure their profitability
after including the subsidy from the public sector.
iii)
There is a private sector that is at least somewhat developed that may have interest in this
type of investment.
8 Adapted from Mee et al., Program Study on International Waters. 2005. Global Environment Facility Monitoring
and Evaluation Unit, p. 31.
9 Office of the Mayor of Puerto Morazán, Data Ficha Perfil de Proyecto Sistema de Aguas Servidas para el Poblado
de Puerto Morazán. 2005. This project has an estimated budget of US$ 75,000.
10 The profitability of this type of project per se is not attractive for private investors. Hence the need to incorporate
public capital to attract potential investors.
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iv)
The regulatory framework allows establishing such arrangements involving private
participation in the provision of sanitation services.
v)
The project has an investment support structure that takes charge of designing projects and
holding meetings of potential private investors and donors.
In this regard, it is likely that in the context of the Gulf of Fonseca such alternatives are financially
viable only in projects for urban centers with larger populations, such as La Unión, Choluteca, and
Chinandega. One possibility that could be explored for the rural areas that face perhaps the most
serious basic sanitation problems is including the developments needed in those areas in projects
designed for the large urban centers. In this way, private participation would have to accept providing
the service in less profitable areas if private actors wish to have access to the investment opportunity
with better prospects, i.e. the one in the urban centers.
2.2. Strategic Action Plan for the Red Sea and Gulf of Aden (PERSGA)11
PERSGA is governed by a Council that includes the ministries of environment of the member countries,
and which defines annually the technical and financial policies that govern the organization's activities.
The member countries contribute funds for the operation of PERSGA, and its projects and activities are
financed mainly with funds from international donors, though in recent months the project has developed
a strategy for seeking funds from the private sector in the context of corporate social responsibility
initiatives.
This full-scale GEF project included, from its design, a subcomponent for "developing a financial
sustainability and resource mobilization strategy" that includes, among other aspects:
i)
"Reviewing the opportunities for self-financing of the different components of the SAP at the
regional and national levels;
ii)
Assessing the feasibility of establishing the proposed Red Sea and Gulf of Aden
Environmental Fund;
iii)
Evaluating existing economic instruments within the PERSGA member countries and
iv)
Seeking funds from bilateral and multilateral donors."12
The final evaluation of this GEF project emphasizes that although the project has had conversations with
the World Bank and other donors to secure support for setting up the Red Sea Environmental Fund, it has
not been possible to establish this fund. This project's experience highlights the importance of striking a
balance in the portfolio of options for generating long-term resources between sources external to and
sources internal to the project, so as to diversify the risk of financial unsustainability.
Although the instruments included in PERSGA's 2004 business plan have not been fully implemented,
the Terminal Evaluation Mission for this project emphasizes, with respect to the development of a
Business Strategy and Plan for PERSGA, that such an approach facilitates an adequate transition between
the GEF-funded stage and subsequent stages. Members of the regional PERSGA team13 consider that the
11 The Regional Organization for the Conservation of the Environment of the Red Sea and Gulf of Aden (PERSGA)
Participating countries: Saudi Arabia, Djibouti, Egypt, Jordan, Somalia, Sudan, and Yemen. Date of approval by
GEF: January 11, 1997. Implementing agencies: UNDP, UNEP, World Bank. GEF funds: $19,340,000. Co-
financing: $25,650,000.
12 PERSGA/GEF. Terminal Evaluation Report of the GEF Supported Project for the Implementation of the Strategic
Action Programme (SAP) for the Red Sea and the Gulf of Aden. 2004, p. 13.
13 Telephone interview with Khulod Tubaishat, Regional Policy Adviser to the GEF project Implementation of a
Strategic Action Program for the Red Sea and the Gulf of Aden. September 2006.
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implementing the business plan met with difficulties because its design was entrusted to persons external
to the project. The person interviewed considers that the decisive factor in designing a successful business
plan is the active participation of the entire project team and of the relevant regional actors. This is how
PERSGA recently revisited the business plan prepared by external consultants and developed a
participatory process for obtaining ideas from members of the regional team on options for the financial
sustainability of this project. One of the results of this process was a document that goes back to the
project's logical framework and translates each objective into specific activities that private-sector donors
may be interested in financing as part of their corporate social responsibility strategies. This document
has been used successfully to obtain financing from commercial banks and private firms in Saudi Arabia
for some project activities. PERSGA keeps its current and potential donors informed of its progress
through high-level forums and a bulletin with project news.
The importance of PERSGA's experience for the IDB-GEF Gulf of Fonseca project lies in: (i) the need to
have the active participation of the relevant actors and the project team in designing the project's business
plan, and (ii) the use of the business plan as a tool for seeking funds from private donors. In the context
of the Gulf of Fonseca the strategy of seeking funds from the private sector has greater potential in those
industries with a solid presence in the region and a large volume of operations. In this regard aquaculture,
particularly in Honduras, is a sector with which the GEF project could explore partnerships, for in
principle it is interested in preserving the Gulf's water quality to ensure the long-term sustainability of its
operations. Another sector that the project should consider is ports, particularly with the related
developments of industry in the Port of la Unión. For example, in 2005, the Comisión Ejecutiva Portuaria
Autónoma de El Salvador (CEPA) awarded a contract to the company Cutuco Energy to generate energy
for the port's operations for $1.0 billion dollars. If the GEF project is able to establish partnerships with
CEPA, it might be possible to include clauses in the concession contracts for activities associated with the
port developments that guarantee the commitment of the private concessionaire to finance some of the
activities that benefit both the operation of the port and the ecosystems of the Gulf of Fonseca, for
example, activities to reduce sedimentation. There are positive precedents in the region of successful
partnerships between port enterprises and NGOs for implementing plans to mitigate the environmental
impact of port operations for example between the Empresa Nacional Portuaria de Honduras (ENP) and
CODDEFFAGOLF14 to implement the project Social and Environmental Compensation for the Dredging
of the Port of Henecán in the city of San Lorenzo, for an amount of $4,558,000. Though a voluntary
approach to corporate social responsibility such as that used by PERSGA may be more sustainable in the
long run and be looked on more favorably in the region, it could also be more difficult to implement.
2.3. Reversing Environmental Degradation Trends in the South China Sea and the Gulf of
Thailand (SCS)15
The study on GEF's International Waters Program (Mee et al., 2005) highlights this project as having an
innovative management structure that has made it possible to adequately prioritize actions, striking a
balance between attaining regional objectives and developing local strategies for action. In this way, the
project has developed a series of pilot projects for conservation of mangroves, wetlands, and non-oceanic
coral reefs that respond to regional conservation goals, but which take account of the differences in
pressures on ecosystems, government structures, and human capacity available (Mee et al., 2005, p. 48).
In terms of financial sustainability, the team for this project has worked through three strategies16: seeking
funds from national budgets, seeking funds from international donors, and generating self-reliance with
14 Comité para la Defensa y Desarrollo de la Flora y Fauna del Golfo de Fonseca.
15 Reversing Environmental Degradation Trends in the South China Sea and the Gulf of Thailand.
Participating countries: Cambodia, China, Indonesia, Malaysia, Philippines, Thailand, Vietnam. Date of approval
by GEF: December 12, 2001. Implementing agency: UNEP. GEF funds: $16,750,000. Co-financing: $16,400,000.
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activities internal to the project. Although the project recognizes that the first two sources are
unsustainable in the long run, it has been successful in securing funds from the national budgets by
promoting the participation of members of the national and local government in the process of choosing
the pilot projects. For example, in China all the pilot projects have been designated nature reserves, so
they will automatically continue receiving resources from the national budget that will remain when the
GEF project has concluded. In addition, the project has organized donors' forums to explore
opportunities for financing; among the concrete results of these activities the project secured a
commitment from GEF to finance seven additional projects that have stemmed from the South China Sea
project.
As for financial self-reliance at the local level, this project is exploring arrangements for co-management
of the pilot projects that involve different interested actors and seek to develop business plans that identify
potential sources of alternative income for the local population and assign a value to the environmental
services provided by the ecosystems. Examples of these projects include establishing apiaries in
mangrove zones, projects for making crafts, and ecotourism, among others.17 Although the impacts of
these local pilot projects and their degree of success generating financial sustainability cannot be
evaluated yet, as they are being implemented, recent studies from the GEF Evaluation Office note: "The
experiences of the international waters projects indicate that addressing local causes of transboundary
environmental degradation through a range of financial and nonfinancial incentives can in fact produce
global environmental benefits."18 Hence the importance of this approach, which seeks to generate benefits
for offsetting costs incurred at the local level to protect the environment.
In the context of the Gulf of Fonseca this project's experience is important because it shows the need to
produce local benefits as a prerequisite to obtaining transboundary and global benefits. Most of the
population in the Gulf lives in poverty, and unless they are compensated for preserving the
environmental services of the ecosystems or have another alternative for subsistence, it is very difficult to
achieve integrated ecosystem management. In addition, in the Gulf of Fonseca there is a presence of
strong civil society organizations in the three countries, through which one can channel pilot projects,
create partnerships, and organize actions that yield local benefits. It is important to note that the NGOs in
the three countries are actively carrying out different projects that are detailed below, and which
demonstrate their capacity for implementing initiatives to improve environmental and social conditions
and to establish intersectoral partnerships. For example, in Honduras the NGO CODDEFFAGOLF has
an agreement with SERNA for co-managing the country's protected areas, and is implementing the
project Social and Environmental Compensation for the Dredging of the Port of Henecán in the city of
San Lorenzo, for the Empresa Nacional Portuaria de Honduras (ENP); in El Salvador, the NGO
CODECA19 co-manages the priority area of the Conchagua volcano and implements the Environmental
Management Plan of the Bay of La Unión; in Nicaragua, MARN has agreements for the co-management
of protected areas with SELVA20 and LIDER21 for the Estero Padre Ramos and the Cosiguina volcano,
respectively. For these reasons, establishing pilot projects for generating alternative sources of income
16 Email correspondence with Sulan Chen, Ph.D. Associate Expert of the UNEP-GEF Project Coordination Unit for
the South China Sea. July 2006.
17 A complete list with detailed information on this type of pilot project can be found at
http://www.unepscs.org/index.php?option=com_content&task=view&id=17&Itemid=34
18 Todd et al. The Role of Local Benefits in Global Environmental Programs. Global Environment Facility,
Evaluation Office. 2006, p. 130. Available at:
http://www.gefweb.org/MonitoringandEvaluation/MEOngoingEvaluations/MEOLocalBenefits/meolocalbenefits.ht
ml
19 Asociación Coordinadora de Comunidades para el Desarrollo del Cacahuatique
20 Asociación Somos Ecologistas en Lucha por la Vida y el Ambiente.
21 Fundación Luchadores Integrados para el Desarrollo Rural.
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that are designed with a business perspective could be a promising area for assuring the long-term
sustainability of the project's impacts in the Gulf of Fonseca.
2.4. Some conclusions on financial sustainability experiences of other GEF international waters
projects
Consulting GEF's monitoring and evaluation documents and interaction with personnel from the projects
described above suggest the following conclusions:
i)
Achieving financial sustainability for this type of project is difficult. Nonetheless, there are
some alternatives that have yielded results in other GEF international waters projects and that
are worth exploring.
ii)
The fact that certain models have been successful in these projects does not mean that they
can be so in all contexts. Several of the persons interviewed agreed on the need to critically
evaluate the viability of these models and to consider the perspectives of the project team and
the relevant actors for constructing a financial sustainability strategy that provides answers to
the specific realities of each region.
iii)
The financial sustainability strategy is closely related to the project's institutional
sustainability, represented in the countries' strong commitment to cooperate for carrying out
joint actions to achieve the project objectives. As part of the institutional structure, it is
especially important that the project have personnel and resources to foster investment in its
activities and to create intersectoral partnerships that facilitate the long-term sustainability of
its impacts.
iv)
The diversification of different options reduces the project's risk of financial unsustainability.
v)
The concept of financial sustainability has two dimensions. The first refers to generating
funds so that the operating structure of the project can continue functioning once the GEF
resources have terminated. The second refers to generating resources to compensate the local
residents for the benefits they lose when sustainable use is made of environmental resources.
This second dimension is more geared to seeking alternatives to ensure that the project
impacts are sustainable in the long run, but not necessarily its operating structure. Some of
the ways in which this second dimension of financial sustainability is observed include
intersectoral partnerships and fostering the creation of financially sustainable businesses
and/or projects, among others. The international waters projects that have been successful in
generating financial sustainability for some of their components are adopting both concepts
of financial sustainability.
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3. Description of the Financing Mechanism
Although a group of international donors may have interest in financing activities involving the integrated
management of coastal-marine zones, and these resources may be critical, at least in the early stages of
the project, it is important to develop stable mechanisms within the region that generate sufficient funds
to maintain conservation activities with a solid financial basis. A variety of perspectives should be
considered for financing activities, and it is important to bear in mind that some sources, such as ports,
apply more to certain countries in the context of the Gulf of Fonseca. The sources that may have the
greatest potential to generate significant sums of money are the following:
· National budget resources;
· Port fees;
· Tariffs on shrimp exports;
· Institutional contributions (international agencies, foreign donors, and private sector);
· Fees levied on airport arrivals.
Other mechanisms, with perhaps less potential to generate large sums of money, include:
· Higher entrance fees to natural parks and protected areas;
· Hotel taxes;
· Taxes on the extraction of renewable resources, such as artisanal fisheries;
· Payment for environmental services, such as the protection of watersheds and carbon
sequestration.
Following is a brief description of these sources. After that, these different alternatives are evaluated
using a variety of criteria, such as their potential for generating resources, their political viability, and the
transaction costs associated with collecting the money.
3.1. National Budget
National budget resources potentially constitute a major source of revenues used to give funds to several
organizations that work in the region. For example, Honduras pays for its participation in COCATRAM
with national budget resources. Nonetheless, the national budget has the problem of lack of stability, since
different sectors compete to meet their budget needs. This alternative requires a commitment by the
governments of El Salvador, Honduras, and Nicaragua to the integrated management of the Gulf of
Fonseca ecosystems and to going forward in the processes of public decentralization in each country.
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3.2. Port Fees
Levying special fees at ports that would be earmarked to the project activities and collected from the
boats that use the ports in the Gulf of Fonseca have the potential to generate a moderate sum of money.
These resources could come from a simple fee for each boat. The fee could also be based on the amount
of freight transported by the boat. Alternatively, the fee could be based both on the amount of freight
transported and on its potential risk to the environment.
A special fee based on the tons imported or exported has a number of variations, and has already been
used for different purposes in the region. Several of the COCATRAM member countries use such
financing mechanisms.22 For example, Guatemala charges US$ 0.05 per ton of imports and exports,
including bananas and oil, to generate funds to cover its annual quota for COCATRAM.23 Additionally,
Guatemala collects US$ 0.09 per tons of imports and exports to pay for its Port Security Program.
At present, the traffic of boats in the Gulf of Fonseca is low compared to other ports of the region, such as
Acajutla, Puerto Corinto, and Puerto Cortés. From 2002 to 2004 the port of San Lorenzo (Honduras)
received approximately 0.65 to 0.8 million tons of freight; with economic growth, this figure may rise. It
is estimated that the port of La Unión in El Salvador received 0.8 million tons in 2005; this is expected to
reach 1.9 million tons in 2015. Using these figures, and assuming a fee of $0.05 per ton, it is estimated
that San Lorenzo could generate approximately $35,000 annually, and the Port of La Unión could
generate from $40,000 to $95,000 annually.
Concerns about the competitiveness of the ports should be expected with any proposal to increase port
fees, therefore an analysis has been done of the amount of the fee relative to the average rate per ton
charged in the region. With this perspective, a tariff of $0.05 per ton, or a similar amount, could represent
a small percentage of the cost per ton that the ports typically charge for the use of their facilities. As a
result, the impact on the ports would be small. Table 2 shows the typical charges per ton estimated by
Gavarrete and Fernández24 for certain types of freighter vessels in three ports of the region. For most
types of freight the fees represent a small percentage, with the exception of bulk liquids at Acajutla and
Corinto.
22 Gavarrete and Fernández, 2001b.
23 COCATRAM is the Central American Commission on Maritime Transport (Comisión Centroamericana de
Transporte Marítimo). When COCATRAM started up its operations, financing was established that would come
from a fee of US$ 0.05 that would be charged based on the freight handled in the ports, with the exception of oil and
bananas. Subsequently, the board of directors of COCATRAM established that a budget would be drawn up and the
countries would contribute to it in equal shares. The contribution of each member country to COCATRAM is
$113,333.33 annually. The countries make quarterly payments, until they have paid in this amount. Source:
communication with Rosa María Rodríguez, COCATRAM project manager.
24 Gavarrete and Fernández, 2001.
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Table 2. Typical Charges at Three Ports of the Region (U.S.$ per ton)
Type of Freight
Acajutla
San Lorenzo
Corinto
Solid Bulk
$13.90
$4.22
$8.58
Liquid Bulk
$1.22
$6.67
$1.60
Containers
$21.30
$16.74
$10.93
General Freight
$23.67
$18.90
$10.74
Source: Gavarrete and Fernández (2001, Table 10-14).
3.3. Aquaculture Industry
The aquaculture industry depends on the Gulf of Fonseca for obtaining shrimp post-larvae and clean
water for breeder ponds. At the same time, the industry generates a significant amount of exports, in
Honduras and Nicaragua. In 2004, Honduras generated US$ 152 million, as it became the country's third
leading export.25 In Nicaragua, shrimp farming and shrimp exports have been growing 8% to 10%
annually from 1992 to 2003, reaching 14 million pounds, equivalent to US$ 23 million in 2003.26 In El
Salvador, aquaculture has not seen the same growth as in Honduras and Nicaragua.
The aquaculture industry could generate moderate revenues through a fee on exports that could provide
funds for the activities of the post-project stage. Given the high level of production, even a relatively
modest fee of $0.0025 per pound of shrimp exported would generate approximately $35,000 in Nicaragua
and more than $100,000 per year in Honduras. It is important to note that for example in Honduras,
aquaculture enjoys an exemption on the payment of taxes on exports, since it is a non-traditional export.
Shrimp exporters pay only a fixed sum that does not depend on the volume exported to obtain an "Export
Certificate."27
Another way of tapping into the significant resources of the aquaculture industry and at the same time
provide incentives for using cleaner production technologies would be to work with the shrimp industry
to certify it as organic production, which involves limiting the size of the populations cultivated, not using
inorganic fertilizers, systematically monitoring the environment, and other criteria.28 Organic shrimp
farming allows the producers to fetch a comparatively higher price than non-organic shrimp, so in
principle they would have an economic incentive to produce using organic methods. In terms of
profitability, studies done at organic farms in Brazil shows that organic farming has lower variable costs
than conventional farming, but fixed costs are greater since its production is on a lower scale.
Nonetheless, if organic shrimp producers diversify the number of species in the ponds, they can distribute
their fixed costs and achieve greater profitability thanks to the higher market price they fetch for their
products.29
25 Central Bank of Honduras, 2005. Exportaciones de Bienes de Honduras 2000-2004. Available at:
http://www.bch.hn/download/exportaciones_2000_2004.pdf
26 IICA-JICA. 2004. Cadena Agroindustrial de Mariscos en Nicaragua. Available at:
http://www.iica.int.ni/Estudios_PDF/Cadena_Marisco.pdf
27 The fees paid to DIGEPESCA-SAG have an approximate cost of $40 and include a permit for selling shellfish
($10), an export certificate ($8), and a phytosanitary certificate ($22). These amounts are paid once a year and are
independent of the volume exported. Source: ANDAH and DIGEPESCA-SAG.
28 These criteria are described in greater depth in www.naturland.de.
29 Alter Wainberg, Alexandre. 2005. Shrimp farm strives for success after organic conversion. Available at:
http://www.new-ventures.org/pdf/Wainburg-Apr05.pdf#search=%22organic%20certification%20shrimp%22
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3.4. Institutional Contributions
The project's investment support structure should play a leading role in aggressively seeking financial
support from a variety of international agencies, foreign donors, non-governmental organizations,
foundations, and private-sector contributors.
International agencies such as the Global Environment Facility (GEF), the United Nations Development
Program (UNDP), the World Bank, and the Inter-American Development Bank (IDB), and foreign donors
such as the United States Agency for International Development (USAID), the European Union, JICA,
AECI, GTZ, DANIDA, HIVOS of the Netherlands, the Portuguese International Cooperation Agency,
CIDA, the Italian Government, and the Government of Luxembourg, among others, may continue playing
a potentially very important role. In addition, international organizations have been supporting the
development of projects in the Gulf zone carried out through local NGOs or personnel from the municipal
environmental offices that include: reforestation, reduction of the vulnerability of coastal populations,
sustainable agricultural development, support for sustainable fishing, co-management and conservation of
protected areas, ecotourism, and waste management, among others. The participation of these
international agencies may take a variety of forms. For example, some members of the NGO Naturland
suggested making contact with GTZ to establish public-private partnerships (PPP) to export organic
shrimp.30 Such a partnership would include a company exporting shrimp in the Gulf area, a company
importing shrimp in Germany or the United States, and a third organization to certify the shrimp as
organic, such as Naturland or Bio Suisse.31
Non-governmental organizations (NGOs) such as CARE International and the Nature Conservancy, and a
variety of foundations such as the Goldman Foundation and the Fondo Gallego Amigos de la Tierra xx[?:
not entirely clear if this is just one foundation; couldn't find on Internet; `real' name would probably be in
gallego not castellano. These are two separate foundations. I suggest to leave the name in Spanish] can
also continue playing important roles. For example, the Nature Conservancy has established a fund called
EcoEnterprises that has two components: an investment fund that provides venture capital to profitable
businesses that work in sustainable agriculture (including organic agriculture, apiculture, and
aquaculture), non-timber products, forestry plantations, and ecotourism; and limited technical assistance
funds to provide business consulting services to potential investment projects for the fund. The fund
invests in businesses in all stages of development that have a volume of sales no larger than $3 million.
One of the requirements for the businesses that are going to receive funds is to have the cooperation of a
non-profit environmental or community organization, such as the Comité para la Defensa y Desarrollo de
la Flora y Fauna del Golfo de Fonseca (CODDEFFAGOLF).32 Other venture capital funds that should be
considered include Verde Ventures of UNDP, and New Ventures of the World Resources Institute (WRI).
It is important to acknowledge that one of the major strengths of the Gulf of Fonseca is the presence of
numerous civil society organizations through which international donors can channel funds for projects,
which can facilitate the flow of funds to the project from institutional contributions. The following table
illustrates the order of magnitude of the institutional contributions that the local NGOs and environmental
offices of the 19 coastal municipalities have received from international donors.
30 Source: telephone interview with Stefan Bergleiter. August 2006.
31 See: http://www.bio-suisse.ch.
32 See: http://www.garrobo.org/morazan/cgolf/cgolf-en.html.
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Table 3. Illustration of amounts of some international donations channeled through NGOs in the
Gulf of Fonseca33
Donor Project
Amount
Implementing
(in US$ or
agency
currency
indicated)
Empresa Nacional Portuaria Social and Environmental Compensation due to $4,558,000
de Honduras (ENP)
Dredging of the Port of Henecán in the city of San
Lorenzo
LF
OIKOS and Portuguese
Reducing the vulnerability of poor families in the $182,590
International Cooperation
Gulf of Fonseca
Agency
EFFAGO
HIVOS of Netherlands
Juntos hacia el Desarrollo Sostenible (Together $885,000
DD
towards Sustainable Development)
Swedish Society for Nature
Juntos hacia el Desarrollo Sostenible (Together $192,796
CO
Conservation
towards Sustainable Development)
Inter-American Foundation Financing of microcredit
$300,000
PRODERE Government of
Restoration of critical areas, sustainable $600,000
Italy
agricultural development, and conservation of the
Cacahuatique reserve
Junta
de
Galicia
Tourism infrastructure in Conchagua and $400,000
implementation of environmental management
A
actions for the Bay of La Unión.
Government of
Water and environmental sanitation projects such $700,000
Luxembourg
as the construction of wood-burning stoves that
CODEC
save firewood, wastewater systems, training,
reforestation, soils, and fertilizers.
AECI
Management of agriculture in the Conchagua 500,000 euros
buffer zone, small farms, tourism, soil conservation
practices, and training with a gender perspective.
AECI
Integral solid waste management Phases I and II
$791,720
AECI
Development of Sustainable Productive Projects
$264,320
AECI
Sustainable Tourism Development, Island of $158,952
34 O
Meanguera
AECI Food
Security
$264,920
OLF
AECI
Project for Introduction of Drinking Water in $265,208
G
Hisquil, La Unión
ASI
AECI
Instruments for Land Use Management, El Carmen $72,000
Chirilagua
In addition to seeking contributions from organizations, one should explore collecting personal donations.
There was such an experience in Guatemala with the "Amigos de Yaxhá" card, a debit card that allowed
its users to make small donations when using it to pay for their purchases in a series of establishments,
thereby contributing to the financing of one of the natural parks in the Mayan Biosphere Reserve (MBR),
in northern Guatemala. Other alternatives include offering ATM users the opportunity to make donations.
Implementing such negotiations would require negotiations with the pertinent banking institutions and
commercial establishments. In the case of the Gulf of Fonseca, one could explore similar financing
mechanisms for the operation of protected natural areas of the Gulf of Fonseca. There are 10 declared
33 Source: Informe de Gira de Entrevistas y Cuestionarios Actores Locales Diagnóstico Socioeconómico Análisis
de Diagnóstico Transfronterizo Golfo de Fonseca. 2006.
34 ASIGOLFO is the Association of Municipalities of the Gulf of Fonseca in El Salvador (Asociación de
Municipalidades del Golfo de Fonseca).
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protected natural areas in the coastal-marine zone of Honduras and three in the coastal-marine zone of
Nicaragua. In El Salvador, there are two areas that have co-management agreements, although they are
still proposed for official designation as protected natural areas. In Nicaragua and Honduras there are
also agreements for co-management of protected areas with local NGOs (SELVA and LIDER, and
CODDEFFAGOLF, respectively), with respect to which arrangements for collecting funds involving the
private sector could be put in place.
3.5. Tourism
The number of tourists who go to the Gulf of Fonseca is much smaller than in other better-known and
more developed areas of Central America. For example, recent studies by PROARCA35 for the protected
areas of Nicaragua indicate that the number of visitors to the Estero Padre Ramos, co-managed by
SELVA, has decreased from 363 to 162 from 2004 to 2005, and the tourists visiting the Cosiguina
volcano, co-managed by LIDER, has increased form 50 in 2003 and 94 in 2004 to 180 in 2005.
Nonetheless, the study notes that the records kept may not be all that reliable; accordingly, the co-
manager NGOs were contacted, and they gave estimates of 300 and 250 visitors per year for the Estero
Padre Ramos and Cosiguina volcano, respectively. Despite the possible upward trend in the number of
visitors, there is not yet a critical mass for generating significant resources. In the case of Honduras the
protected areas do not yet have management plans, and there is no budget for keeping a record of the
number of visitors in the 10 protected areas.36 As a result, generating income through these sources, such
as imposing higher taxes for hotel guests or entry fees to national parks in the region has little likelihood
of success.37
Collecting income from all the tourists who visit each country could potentially generate a large sum of
money, part of which could be used for activities around the Gulf of Fonseca. In 2005, El Salvador as
well as Honduras and Nicaragua experienced an increase in the number of tourists who visited the country
and in the amount of resources generated from tourism. In 2005, El Salvador and Honduras received more
than one million visitors, and Nicaragua was visited by approximately 700,000 tourists.38 To ensure that
the citizens of El Salvador, Honduras, and Nicaragua are not prejudiced, the fee can be applied only to
foreigners, or a merely symbolic fee can be created for citizens. A fee of approximately US $10 to US
$20 per foreign passenger has the potential to generate millions of dollars a year in each country.
A fee at the airport normally represents a relatively small fraction of the price of a ticket. Air fare from
the United States to Central America can easily cost US$ 500, therefore a fee of $10 to $20 would not add
more than 4% to the price of the ticket. Although establishing such fees may be seen as a threat to
tourism, it is important to bear in mind that the capacity and willingness of foreign tourists to pay exceeds
such a charge.
Such fees are currently used in other Central American countries, such as Belize, to generate resources for
the Protected Areas Conservation Trust (PACT), established in 1996. When visitors leave the airport, they
pay a fee of US$ 3.75, in addition to the general exit tax of $11.25. (Visitors receive separate receipts and
a note that explains that the $3.75 charge is earmarked directly to the PACT.) This fee and the resources
35 PROARCA, July 2005. Plan de Financiamiento a Largo Plazo Área Protegida Volcán Cosiguina y Estero Padre
Ramos, El Viejo Chinandega, Nicaragua.
36 Source: Telephone interview with Jorge Varela, Director of CODDEFFAGOLF, NGO co-managing 10 protected
areas in Honduras in the Gulf of Fonseca area.
37 Similar schemes have been implemented in some hotels in Guatemala to channel voluntary donations to programs
such as Habitat for Humanity, a non-governmental organization devoted to financing the construction of low-cost
housing. See: www.habitat.org/lac/donde_construimos/guatemala_profile.aspx.
38 SGSICA, 2006.
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collected from cruisers account for most of PACT's operating budget. In addition to covering the
operating costs, 5% of the resources collected are deposited into PACT's trust fund.39
The physical action of collecting an additional fee would be relatively easy; however, establishing the
legal bases for collecting this fee could require legal action. The political viability of approving a
measure such as this is not clear. Even so, and since it is a potentially important and relatively stable
source of financing, it is worth exploring the possibilities.
3.6. Extraction of Renewable Resources
Collecting taxes on the use of renewable resources appears to be a reasonable option, given that the
money would be used to ensure that these resources are protected and developed sustainably.
Nonetheless, it is dubious whether this alternative would be a major source of resources, particularly since
a considerable number of those who generate these products live in poverty, and are not in a position to
pay much more in taxes than they pay at present. In addition, trying to collect fees from a highly
dispersed population, such as the thousands of artisanal fishermen who work in the Gulf of Fonseca,
would be quite difficult.
In the case of the largest producers, such as those who are part of the large shrimp industries in Honduras
and Nicaragua, collecting new taxes may be hard to implement, given the political impact of these
industries due to the number of jobs they create.
Even if there were an arrangement for collecting such a tax, practical problems would arise when it comes
to implementing it. For example, in Nicaragua the MIFIC collects a fee from fishermen per pound
offloaded, yet many fishing boats offload in places other than the control posts, in order to pay less taxes.
An arrangement that could have better results is collecting fees based on the capacity of each fishing boat,
but changing the existing regulation to allow for such an arrangement would face strong opposition.
3.7. Paying for Environmental Services
The idea behind payments for environmental services is to compensate the users of ecosystems for the
environmental services that they provide, and thereby encourage them to choose this use for such
ecosystems, instead of another one.40 The Gulf of Fonseca offers environmental services such as
maintaining ecosystems appropriate for the development of aquaculture and fishing, which includes the
presence of mangroves, which are a source of shrimp larvae, as well as conservation of water resources,
scenic beauty, and biodiversity conservation in its protected areas. Another service offered by the Gulf is
its geographic position, which is strategic for developing marine tourism, using its bays for mooring and
protection from storms at sea. These examples show that there is some potential for generating income by
using this mechanism. Nonetheless, to date scant resources have been generated by such mechanisms in
developing countries. The lack of success appears to be due either to the high transaction costs entailed in
developing an agreement between those on the supply side and those on the demand side of
environmental services, and/or the difficulty enforcing such an agreement once it is reached.
In the Gulf of Fonseca these mechanisms could be implemented in the aquaculture industry, which is
more developed and better organized in Honduras and Nicaragua.41 Although traditionally there has been
a conflict between the conservation organizations and the aquaculture industry over the clearing of
39 See: http://www.pactbelize.org/index.php?option=displaypage&Itemid=50&op=page&SubMenu=.
40 Espinoza et al. 1999. El Pago de Servicios Ambientales y el Desarrollo Sostenible en el Medio Rural.
41 In Honduras aquaculturalists are grouped in the Asociación Nacional de Acuicultores de Honduras (ANDAH),
founded in 1986, which at present has 126 members.
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mangroves for building shrimp ponds42, it is important to bear in mind that the aquaculture industry has
some incentives to protect water quality and the mangroves, which provide it with the conditions
necessary for the reproduction of shrimp in its breeding ponds and provide shrimp larvae, respectively.
Other environmental services provided by the 1,100 km2 of mangrove forest in the Gulf of Fonseca43
include: natural protection against high tides; carbon absorption; maintenance of water quality through
sedimentation and absorption of nutrients; and the creation and maintenance of habitats for commercial
species of fish and crustaceans, of vital importance for fishing and the collection of shrimp larvae.44
Although fishing also benefits directly from these environmental services, the transaction costs of
collecting these payments would be higher than in the case of aquaculture due to the dispersion of the
main users, artisanal fishermen.
In addition, the ecosystems of the Gulf contribute to water conservation through their wetlands, some of
which have been declared to be of global importance by the Ramsar Convention, such as, for example, the
Wetlands System of Southern Honduras (69,711 hectares, declared on July 10, 1999), and the Estero Real
and Llanos de Apacunca deltas in Nicaragua (81,700 hectares, declared on November 8, 2001).45 In this
case, the beneficiaries of water conservation are also dispersed across the watersheds that drain into the
Gulf and the coastal zone, and include, among others, farming and ranching. For this reason,
implementing a scheme of payment for water conservation is hardly feasible.
The Program for Sustainable Agriculture in the Hillsides of Central America (PASOLAC) has supported
the development of six pilot experiences in payments for environmental services for water resources in
Honduras, Nicaragua, and El Salvador.46 Although none of these experiences is in the area of influence of
the Gulf of Fonseca, its implementation offers important lessons that should be considered. Most of these
arrangements are developed through water boards where the users of the service make contributions
additional to the price of the service to foster actions to conserve water sources. A recent study by the
CCAD47 indicates that as regards the potential for economic sustainability, only the experiences of Jesús
de Otoro in Honduras and Tacaba in El Salvador have average potential, while the other four initiatives
have only fair potential. One factor impacting on this situation is that the price does not cover the
operating costs. For example, in the case of Jesús de Otoro, the study highlights that the fee in 2003 was
25 lempiras, but in reality to cover the costs of providing the service, it should have been 50 lempiras.
In Nicaragua, schemes have been implemented to pay for similar environmental services in the
municipality of Río Blanco, where, at the community's initiative, an additional 2 córdobas fee began to be
charged to each household on its water bill for a fund to support the conservation of water sources. This
42 Benítez et al. 2000. A platform of action for the sustainable management of mangroves in the Gulf of Fonseca.
Centro de Estudios Ambientales y Sociales para el Desarrollo Sostenible (CEASDES), International Center for
Research on Women (ICRW), Comité para la Defensa de la Flora y Fauna del Golfo de Fonseca
(CODDEFFAGOLF).
43 300 km2 belong to Nicaragua (27%), 575 km2 to Honduras (52%), and 225 km2 to El Salvador (21%).
44 Proffitt, Edward. Twilley, Robert. Integrative Mangrove Management. Hurricane Mitch Program Project. United
States Geological Survey (USGS).http://mitchnts1.cr.usgs.gov/projects/intmangrove.html#summary
Martínez-Alier, Joan. 2001. Ecological Conflicts and Valuation Mangrove versus Shrimp in the late 1990s.
Department of Economics and Economic History. Universidad Autónoma de Barcelona. Spain.
45 http://www.ramsar.org/sitelist_order.pdf
46 CCAD, Mesoamerican Biological Corridor. 2004. Sistematización de experiencias de pago por servicios
ambientales para los recursos hídricos en el ámbito municipal (Honduras, El Salvador, Nicaragua) These
experiences include: Jesús de Otoro and Campamento (Honduras), Tacaba and El Guayabo (El Salvador), El
Regadío and San Pedro del Norte (Nicaragua).
47 Id.
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scheme was implemented three years ago and the fee has increased to 12 córdobas, and it has yet to reach
a level that guarantees its long-term sustainability.
Nicaragua's experience shows that such initiatives may contribute to obtaining resources for financing the
conservation of water sources at the local level. In other words, these schemes for the payment of
environmental services could be a type of project to be financed with this GEF project. Nonetheless,
Honduras's experiences show that even when the users are dispersed, their willingness to pay may affect
the sustainability of a scheme of payment for environmental services of this sort, making it hardly viable
in the long run as a mechanism for generating income for other activities of the GEF project.
3.8. Corporate Social Responsibility
Although there are different definitions of the term "corporate social responsibility," most of them
"emphasize the interrelationship between economic, environmental and social aspects and impacts of an
organization's activities, and that [social responsibility] `is taken to mean a balanced approach for
organizations to address economic, social and environmental issues in a way that aims to benefit people,
communities and society.'"48 In the context of the Gulf of Fonseca, there are numerous private companies
that generate employment for the inhabitants of the area, use the natural resources available in the zone,
and generate positive and negative impacts on the environment. Although the aquaculture industry is one
of the most consolidated in Honduras and Nicaragua, there are also other industries such as intensive
cultivation of fruits for export that are also found in these two countries. It should be noted that the
aquaculturalists in Honduras are grouped in the Asociación Nacional de Acuicultores de Honduras
(ANDAH), and that some member companies such as the Grupo Granjas Marinas S.A. of Choluteca
already have a corporate social responsibility program, which in 2005 donated a total of $1,283,688 to the
community, $63,030 of which was earmarked for environmental protection activities. Most of these
grants were for education and health activities.
In El Salvador, where aquaculture and intensive agriculture have not been developed, major industrial
activity is emerging around the new port at La Unión. Examples of developments include power
generating companies such as Cutuco Energy.
All these organized private industriesrepresent opportunities for implementing corporate social
responsibility strategies that supplement the initiatives of this GEF project. The GEF project needs to
earmark resources and personnel to seek financing in the private sector for activities that could be in the
interest of private economic actors to finance. For example, the shrimp industry could be interested in
financing activities related to monitoring and recovering water quality, and the insurance industry in
pollution prevention and environmental emergencies associated with port operations, to mention just a
couple of examples.
48 International Organization for Standardization (ISO) Strategic Advisory Group on Corporate Social
Responsibility, cited in "Perceptions and Definitions of Social Responsibility." International Institute for Sustainable
Development-IISD, 2004.
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4. Evaluation of the Financing Mechanism
Financing conservation activities in the Gulf of Fonseca could be a combination of different financing
mechanisms. Following is an evaluation of each of the mechanisms based on a series of characteristics,
with a summary of this analysis presented in Table 2. This evaluation considers the following criteria:
· Amount of financing. The mechanism would generate a significant amount of the necessary
financing.
· Stability of the financing mechanism. Available funds will not fluctuate significantly from one
year to the next.
· Exclusivity. The mechanism will generate financing earmarked exclusively for the project to
avoid having funds earmarked to other competing needs.
· Efficiency. The financial needs for an institutional mechanism to collect money efficiently.
· Polluter pays principle. The mechanism should link the entities that generate the need for
conservation activities with those that ultimately pay for them.
· Political viability. It is important to have the support of the interested parties to ensure the success
of the development and implementation of a financing mechanism.
As for the amount of the financing, several of the financing mechanisms have the potential to generate
significant sums of money: national budget resources, fees based on the tons of imports and exports at
each port, tariffs on shrimp exports, institutional contributions, and resources from airport fees.
Nonetheless, the potential of airport fees would depend on how the resources collected are distributed
among interests competing with one another (for example in Honduras, Copán, the Bay Islands, and other
significant tourism destinations). The other mechanisms have less potential. Hotel taxes and higher park
entrance fees do not have much potential to generate income due to the low number of tourists in the
region. Taxes on the extraction of renewable resources have little potential due to the relatively small
amount of resources generated. Payment for environmental services has been implemented only on a
small scale in developing countries, and it is difficult for this to be a source of significant sums of money.
In addition to the ability to generate significant funds, the stability of the sources of financing from one
year to the next is an important criterion. The port fees on imports and exports are relatively stable;
historically the quantity of freight transported has increased over the years. Similarly, shrimp exports have
increased over time, though pests or diseases have the potential to significantly reduce the exports in any
given year. Airport fees, park entrance fees, and hotel taxes are reasonably stable, but depend on the
willingness of tourists to visit the region. Funds from the national budget are, perhaps, a bit less stable,
since the amount of resources depends on the political will at the time the budget is distributed each year.
Payments for environmental services are potentially a stable source, nonetheless the experience in this
field is limited. Finally, the direct contributions of different institutions should not be seen as a
sustainable source of resources, since the availability of funds depends on the resources the institution has
and the institution's perception and interest in the project to be financed and its benefits.
The criterion of exclusivity is associated with the stability of the source of financing. It is important that a
source of financing dedicated exclusively to a single activity not be used for another activity with
competing needs. Any fund shared by many activities has this potential weakness. The financing of
conservation activities in the Gulf of Fonseca with resources from the national budget will probably have
to compete with an array of needs. In contrast, institutional contributions may be designated so that they
are exclusively related to conservation activities. Finally, most of the sources have the potential to be
used for activities within the Gulf of Fonseca, depending on how they are established. One concern is that
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money collected by government agencies may be earmarked for activities outside the reserve, unless
measures are in place to prevent that from happening.
Some of the financing mechanisms already have effective means of collecting money through airports or
sea ports. In particular, these two methods are effective because they require a limited number of
collection areas. Park entrance fees and hotel taxes are more difficult to implement because they are more
dispersed. Taxes on the extraction of renewable resources would be particularly hard to implement due to
the large number of persons involved. For example, there are thousands of fishermen working in the Gulf
of Fonseca. Payments for environmental services may be the most difficult to implement, since there is
no market associated with them, and therefore it must first be created. Significant contributions by
different institutions can also be hard to obtain and would require active, creative, and persistent actions
on the part of the agency managing the coastal-marine zone of the Gulf, with a view to maximizing the
potential of this alternative.
The polluter pays principle is generally cited as a desirable criterion to ensure payment for environmental
mitigation measures, and first captured world attention and the United Nations Conference on
Environment and Development held in Rio de Janeiro, Brazil, in June 1992. For most of the financing
mechanisms described here, there is a close association between the source of the funds and the cause of
the environmental problem, especially for aquaculture and port fees, since their infrastructure gives rise to
significant environmental impacts. General government funds are an exception, as there is little
connection between the need for the activities and the source of the funds.
The political viability of a given financing mechanism is a key factor. In practice, the political viability is
hard to specify beforehand, since it depends on various factors. In general, the greater the need for funds,
the less the political viability. The closer the financing mechanism is tied to a particular institution or
group of institutions, the greater the likelihood that there will be great resistance. The financing of the
general budget of the nation will likely face less political resistance, at least in the short term, with respect
to shrimp farming.
4.1. Financial Sustainability Strategy
Based on the foregoing analysis, which is summarized in Table 4, a preliminary prioritization of
alternatives for generating resources in the long run was drawn up, mindful of the potential amount of
financing that they could generate, their institutional and political viability, and their stability in the long
term. This prioritization can be observed in Table 5. First, including different mechanisms with different
probabilities of success and expected amounts in the portfolio of options seeks to reduce the project's risk
of financial unsustainability. Second, the prioritization of mechanisms is aimed at focusing the limited
resources that the project could earmark to seeking alternatives for financial sustainability on those
options that can produce the best returns.
These analyses and consultations led to the design of a preliminary financial sustainability strategy that is
reflected in subcomponent 4c of the GEF project and that includes the following elements: (i) Design and
implementation of a business plan for the GEF Project that relates the different components of the
project to potential sources of financing. In the context of the development of this business plan, which
shall be done with the active participation of the project team and other actors considered relevant, an
evaluation will be done of the different economic instruments that already exist or that could be created to
collect funds (for example, establishing payments for environmental services, charges for effluent
discharges and water uses or environmental funds with contributions from different sectors for a single
country or different countries of the region). This plan will seek to reduce the risk of financial
unsustainability by diversifying sources to include self-generated funds and funds external to the project,
and resources both public and private. In addition, a plan of action will be designed to obtain resources
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that prioritizes efforts to make operational those sources that can provide the largest sum of resources
with the greatest long-term sustainability; (ii) Design and operation of an investment support
structure entrusted with structuring projects to resolve environmental problems that require significant
investments. The functions of this structure include taking leadership in organizing investor roundtables
and donors' forums that would make it possible to establish partnerships and mobilize funds for large-
scale projects such as the design, construction, and operation of integrated solid waste management
systems, wastewater treatment plants, and drinking water and sanitation systems, among others; (iii)
Advising the productive projects selected to reach financing in activity a. of this component on
financial sustainability strategies. An effort will be made to provide advisory services on issues that
could include designing project budgets, accessing soft credit, presenting accounting information and
defining collateral to apply for loans, and establishing partnerships for marketing and commercialization.
The GEF Project's contacts with international NGOs, donors, and private sector representatives will be
tapped to facilitate identifying, creating, and taking advantage of business opportunities.
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Table 4. Financing Mechanisms and their Characteristics
Additional
Efficiency Polluter
Exclusivity
Political
Financing Mechanism funds per
Stability
of
pays
Institutional viability/
of the funds
viability
year
collection principle
Agreements required
National budget by
$100,000 -
Low-
Low Medium-
Low Medium-
Medium
country
$300,000
Medium
High
High
Port fees
$50,000 -
Medium-
Medium-
High High Medium
Medium
$100,000
High
High
Tax on shrimp exports
$50,000 -
Medium Medium-
Medium-
High Low-
Medium
$150,000
High
High
Medium
Institutional
$100,000 -
Low-
High Low-
Low High High
contributions*
$1,000,000
Medium
Medium
Corporate Social
$50,000
Low-
Low Low
High
Medium
Low
Responsibility
$150,000
Medium
Extraction of
Low Medium-
Medium-
Low Medium-
Low-
Low
renewable resources
High
High
High
Medium
Payment for
Low Medium
Medium-
Low Medium-
Medium Low
Environmental Services
High
High
Airport fees
$50,000 -
Medium-
Medium High Medium
Low Baja
$250,000
High
Park entrance fees
Low
Medium-
Medium-
High Medium
Medium-
High
High
High
High
Hotel taxes
Low
Medium-
Medium Medium
Medium
Low-
Medium
High
Medium
* Includes: Grants from NGOs, foundation, other international donors.
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Table 5. Prioritization of Financing Mechanisms49
6
3
·
Extraction of renewable resources (H, N,
·
Airport tax (ES50, H51, N)
ES)
·
National budget Reinvestment of national
·
Payment for environmental services (H,
sectoral funds captured in the region: tourism,
ES)
forestry, fishing (H)
·
National budget (ES)
·
Taxes on shrimp exports (H, N52)
·
Park entrance fees (N)
·
Corporate social responsibility: NGOs,
·
Fees for extraction of non-renewable
fishermen, aquaculture, agroindustry, thermo
resources (N)
electrical plants, hotels, restaurants (H)
p
lementation
5
2
f
im
·
Hotel taxes (ES, H, N)
·
Port fees (ES, H)53
y
o
·
National Budget Reinvestment of national
sectoral funds captured in the region: tourism,
icult
forestry, fishing (N)
i
ff
·
National Budget (N54)
D
4
1
·
Park entrance fees (H, ES)
·
Institutional contributions: national and
·
National budget (H)
international donors (ES, H, and N)
·
Payment for environmental services (N)
Magnitude of Financing
49 This prioritization was presented to the participants of the third trinational workshop held in La Unión. The
consulting team reorganized the initial prioritization, including the participants' comments and the experience of
other GEF projects, and suggests using this new version. The prioritization proposed by the participants in the
workshop is found in Appendix 1.
50 In El Salvador there is already an airport fee for tourists, nonetheless it is earmarked to a national fund for the
development of tourism and it is hardly feasible to earmark resources from this fund to activities in the Gulf of
Fonseca.
51 In Honduras, the airports have tourism taxes and are also in the process of privatizing their operations
52 This category is not relevant for El Salvador, since the aquaculture industry has not developed there.
53 This category is not relevant for Nicaragua since it has no ports in the Gulf of Fonseca.
54 In Nicaragua, for a project to have access to funds from the national budget, it must be entered in the National
System of Public Investment (Law 550). For this reason, this GEF project could begin to receive funds as of 2008.
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4.2. Priority Mechanisms
As indicated previously, this preliminary analysis notes that some options are more viable since they have
the potential to generate resources and sustainability in the long term, whose implementation should be
prioritized. In the first place, box 1 from the table above includes a mechanism that offers significant
funds that that is the most viable from the institutional standpoint:
Institutional contributions from international donors: It is difficult to estimate the amount of funds that
can be obtained after carrying out an aggressive campaign to market the Gulf of Fonseca among
international donors and foundations, for such funding depends on the projects which with the Gulf is
competing at the time applications are put in for grants, and donors' priorities. For purposes of
illustration, one can observe the co-financing considered in the analysis of incremental costs of this GEF
project.
Second are the mechanisms that require an average institutional effort for their implementation but which,
because of the amounts they could generate, should be accorded priority:
- Port fees, which have the potential to generate $50,000 to $100,000 annually, depending on the
amount of freight and the amount of the fee. At present freight traffic is not all that great;
nonetheless, this situation may change with the development of the Port of La Unión.
- In the case of Nicaragua, contributions from the national budget would appear to be a viable
option, according to the procedures established in the Law on the National System of Public
Investment (Law 550). Additionally, in Nicaragua the reinvestment of sectoral funds from the
national budget, which have been captured in the region through activities of the tourism,
forestry, and fisheries sectors, may also be an option that could be implemented. Together these
two alternatives could generate from $100,000 to $300,000 annually.
Third are those mechanisms that require a high institutional effort but which could potentially generate a
large sum of resources:
- Collecting a tax from foreign tourists who enter through the international airports, which could
generate $50,000 to $250,000.
- Tariffs from shrimp exports, which have the potential to produce $50,000 to $150,000 depending
on the level of the tariff and total exports.
- Corporate social responsibility activities, though at present they do not appear to be generating
much revenue for environmental activities, may be easier to implement than establishing tariffs or
fees, and could generate from $50,000 to $150,000.
- In Honduras the reinvestment of sectoral funds from the national budget that have been captured
in the region through activities of the tourism, forestry, and fisheries sectors.
Based on this prioritization and making an estimate of the different probabilities of successful
implementation of each mechanism (70% for those easy to implement, 50% for the mechanisms with
average difficulty in their implementation, and 30% for those quite difficult to implement), the following
approximations for the amounts to be attained were obtained:
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Table 6. Approximate amounts by mechanism
Priority Probability
Mechanism Range
of success
(in thousands of
dollars)
1
70%
Institutional contributions
70 to 700
2
50%
Port fees
25 to 50
2
50%
Corporate social responsibility
25 to 75
2
50%
National budget (N)
50 to 150
3
30%
Airport fee
15 to 75
3
30%
National budget (H)
30 to 90
3
30%
Tariffs on shrimp exports
15 to 45
Total
230 to 1,185
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5. Discussion
Financing for the Gulf of Fonseca requires a portfolio of financing mechanisms to provide a secure and
stable source of revenues and to diversify the risk of financial unsustainability.
Perhaps the most important characteristic of the mechanisms that have been considered in this preliminary
analysis is their capacity to generate sufficient funds. Those sources capable of generating more money
appear to be: the general budget of the nation, institutional contributions, airport fees, and park entrance
fees. Additional sources such as port fees and tariffs on shrimp exports are also potentially important.
More generally, no matter the type of mechanisms implemented, it is crucial that all aspects of the
financing be transparent, so that there are no concerns about how the resources have been spent. The
different interest groups should know how the money is collected, how much is received, and also feel
that the resources are being spent appropriately. Without the sense that the funds are being well-
administered, there will no doubt be a loss of support for the conservation activities in the Gulf of
Fonseca.
If the interest groups see value in the activities carried out in the Gulf of Fonseca, then the long-term
financing of these activities should not encounter difficulties. The region has the capacity to generate,
sustainably and for the long term, the amount of funds required by these activities.
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Appendix 1.
Prioritization of the Financing Mechanisms Suggested in the Consultation55
6
3
·
Extraction of renewable resources (H, N)
·
Airport fee
·
Payment for environmental services (H)
·
Extraction of renewable resources (ES)
·
National budget (ES)
·
Payment for environmental services (ES)
·
Hotel tax (ES, H, N)
·
Reinvestment of national sectoral funds
·
Airport fee (ES56, H57, N)
captured in the region: tourism, forestry,
·
Tariff on shrimp exports (N)58
fisheries (H)
·
Port fee (N)59
·
Park entrance fee (N)
p
lementation
·
Fees on extraction of non-renewable
resources (N)
f
im
y
o
5
2
icult
·
Tariffs on exports (H)
i
ff
D
·
Port fees (ES, H)
·
Tariffs on fuel sales (ES)
·
Corporate social responsibility: NGOs,
fishermen, aquaculture, agroindustry, thermo
electrical plants hotels, restaurants (H),
gasoline stations (H, ES)
·
Reinvestment of national sectoral funds
captured in the region: tourism, forestry,
fisheries (N)
4
1
·
Park entrance fee (H)
·
Institutional contributions: national and
·
National budget (H)
international donors (ES, H, and N)
·
Payment for environmental services (N)
·
National budget (N60)
·
Park entrance fees (ES)
·
Extraction of non-renewable resources (mining)
(ES)
Magnitude of the Financing
55 The consultation on the original proposal for financing mechanisms was carried out in the third trinational
workshop held in La Unión (El Salvador) The persons in attendance at the workshop were divided into three groups,
by country, and determined a prioritization based on their knowledge.
56 In El Salvador there is already an airport fee for tourists, yet it is earmarked to a national fund for the development
of tourism, and it is hardly feasible that resources from this fund will be earmarked to activities in the Gulf of
Fonseca.
57 In Honduras, the airports already have taxes on tourism; in addition, they are in the process of privatizing.
58 This category is not relevant for El Salvador, since the aquaculture industry has not been developed there.
59 This category is not relevant for Nicaragua, as it has no ports in the Gulf of Fonseca.
60 In Nicaragua, in order for a project to have access to funds from the national budget, it must be entered in the
National System of Public Investment (Law 550). For this reason, this GEF project could begin to receive funds as
of 2008.
Document Outline
- 03-22-07 Annex_F_-_Financial_Sustainability_Analysis.pdf