GAR: Mongolia: Establishment of Climate-Resilient … Establishment of Climate-Resilient ......

Grant Assistance Report

Project Number: 45145 May 2012

Proposed Grant Assistance Mongolia: Establishment of Climate-Resilient Rural Livelihoods (Financed by the Japan Fund for Poverty Reduction)

CURRENCY EQUIVALENTS (as of 2 May 2012)

Currency Unit – togrog (MNT) MNT1.00 = $0.00076 $1.00 = MNT1,313.00

ABBREVIATIONS ADB – Asian Development Bank APAN – Asia Pacific Adaptation Network CPS – country partnership strategy GIS – geographic information system ha – hectare HGO – herder group organization JFPR – Japan Fund for Poverty Reduction JICA M&E MOF

– – –

Japan International Cooperation Agency monitoring and evaluation Ministry of Finance

MOFALI NAEC

– –

Ministry of Food, Agriculture and Light Industry National Agricultural Extension Center

NGO – nongovernment organization PIU – project implementation unit PMU – project management unit SOE – statement of expenditure

GLOSSARY

aimag – province bagh – subdistrict dzud – severe winter negdel – livestock collective farm (pre-1991) soum – district

NOTES

(i) The fiscal year (FY) of the government ends on 31 December. FY before a calendar year denotes the year in which the fiscal year ends, e.g., FY2012 ends on 31 December 2012.

(ii) In this report, ―$‖ refers to US dollars.

Vice-President S. Groff, Operations 2 Director General R. Wihtol, East Asia Department (EARD) Director Y. L. Feng, Environment, Natural Resources, and Agriculture Division,

EARD Team leader T. Ueda, Natural Resources Economist, EARD Team members L. Medina, Project Officer, EARD

F. Radstake, Senior Environment Specialist, EARD M. Vorpahl, Senior Social Development Specialist, EARD

In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

JAPAN FUND FOR POVERTY REDUCTION (JFPR) JFPR Grant Proposal

II. Grant Development Objectives and Expected Key Performance Indicators Grant Development Objectives: The proposed project will promote a holistic approach to sustainable herding and livelihood diversification in the soums (districts) of Buutsagaan, Dzag, and Khureemaral, located in Bayankhongor aimag (province). Sustainable herding will comprise collective pasture management, water point management, hay and fodder preparation, and enhancement of winter livestock shelter. The assistance will also provide herder groups with opportunities for alternative income-generating activities to help them diversify their income sources. Income diversification lessens reliance on weather-sensitive herding, and thereby constitutes a means of climate change adaptation. The project impact is sustained rural livelihoods in project soums. The project outcome is climate-resilience of the livestock husbandry sector improved in project soums. The project outputs include (i) capacity for sustainable herding improved in project soums, (ii) water points established and managed in project soums, (iii) income generation diversified in project soums, and (iv) effective project management established. Formation of herder groups at inception is key to the project’s successful implementation and its sustainable impact.

Expected Key Performance Indicators: (i) About 70% of the herder households in each project soum join herder groups, by year 3; (ii) about 70% of the herder households in each project soum establish pasture use agreements with their respective soum governor, by year 3; (iii) a soum-level pasture management plan is prepared for each project soum, by year 3; (iv) at least 30 water points are constructed or rehabilitated in the project soums, by year 3; and (v) 50% of herder households in each project soum belong to herder groups directly and indirectly involved in supplementary income-generating activities, by year 4.

III. Grant Categories of Expenditure, Amounts, and Percentage of Expenditures

Category Amount of Grant Allocated in $ Percentage of Expenditures

1. Civil works 438,700 17.55

2. Equipment and supplies 660,120 26.40

3. Training, workshops, seminars, and public campaigns

149,950 6.00

4. Consulting services 507,825 20.31

5. Small grants 295,000 11.80

6. Grant management 328,985 13.16

7. Contingencies 119,420 4.78

Total 2,500,000 100.00

Incremental Cost 0

I. Basic Data

Name of Proposed Activity Establishment of Climate-Resilient Rural Livelihoods

Country Mongolia

Grant Amount Requested $2.5 million

Project Duration 4 years

Regional Grant Yes / No

Grant Type Project / Capacity building

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JAPAN FUND FOR POVERTY REDUCTION

JFPR Grant Proposal Background Information

A. Other Data

Date of Submission of Application

7 October 2011

Project Officer T. Ueda, Natural Resources Economist

Project Officer’s Division, E-mail, Phone

Environment, Natural Resources, and Agriculture Division East Asia Department (EARD) [email protected], +63 2 632 5597

Other Staff Who Will Need Access to Review the Report

S. Ferguson, EARD; K. Kojima, Office of Cofinancing Operations; S. Popov, EARD

Sector (subsectors) Agriculture and natural resources (land-based natural resources management, agriculture and rural sector development)

Themes (subthemes) Economic growth (widening access to markets and economic opportunities), social development (other vulnerable groups), environmental sustainability (natural resources conservation), capacity development (institutional development)

Targeting Classification Targeted intervention—household (TI-H)

Name of Associated Asian Development Bank (ADB)-Financed Operations

Water Point and Extension Station Establishment for Poor Herding Families

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Executing Agency Ministry of Food, Agriculture and Light Industry (MOFALI)

Grant Implementing Agency

Project Management Unit Ministry of Food, Agriculture and Light Industry Government Building #9, Enktaivan Avenue 16A Ulaanbaatar – 210349, Mongolia Contact Person: Ms. T. Erdenejargal, Director, External Cooperation Department Phone: +97 6 11 262853 Fax: +97 6 11 262853 E-mail: [email protected]

B. Details of the Proposed Grant

1. Description of the Components, Monitorable Deliverables and/or Outcomes, and Implementation Timetable2

Component A

Component Name Capacity for sustainable herding improved in project soums

Cost ($) $568,700

Component Description This component aims to improve the capacity of herders and aimag and soum governments with respect to sustainable herding, and places particular emphasis on pasture management, which is essential for climate-resilient herding. This project component will assist (i) herders who graze

1 ADB. 2008. Proposed Grant Assistance to Mongolia for Water Point and Extension Station Establishment for Poor

Herding Families. Manila (JFPR 9124-MON, for $2,000,000, approved on 30 July). 2 The design and monitoring framework is in Appendix 1.

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Component A

neighboring winter and/or spring pasture areas in forming herder groups; and (ii) each herder group in making an agreement with the respective soum governor regarding the use of a specific winter and/or spring pasture area. The project will help herder groups establish a herder group organization (HGO) for coordination among herder groups in each project soum. Herder groups and the HGO will be formed primarily to support collective pasture management by herder groups, but are also key to the success of the project as a whole. At the outset of the project, inception workshops—which are planned at the aimag, soum, and bagh (subdistrict) levels—will be held to widely disseminate the project design and activities among herders of the project soums. Because the project will involve all the herders in the project soums, it is imperative they fully understand the project concept. The workshops will also enable officials and citizen’s representatives from the project aimag, soum, and bagh governments to enhance their understanding of the project activities and their respective roles in implementing the project. Relevant government officials from nonproject soums adjacent to the project soums will be invited to the aimag workshop to enhance coordination between project and nonproject soums, and future implementation of the collective pasture management model in nonproject soums. Soum officials—especially from the soum veterinary and livestock breeding unit, and the soum land management officer—will cooperate with the project management unit (PMU) and the project implementation unit (PIU) in implementing this and other project components. The project will provide herder groups with training on herder group formation and pasture and livestock management. Herders will be trained on the preparation of pasture management plans, which will indicate seasonal pasture use, water sources, and fodder production areas. These herder group pasture management plans will be the basis of a pasture management plan in each project soum. The soum government officials are expected to facilitate the (i) formation of herder groups and HGOs, and (ii) preparation and implementation of pasture management plans at the herder group and soum levels. The herders will also be made aware of their roles, rights, and responsibilities under the pasture use agreements. Successful implementation of collective pasture management requires a three-step consultative approach. First, herders of project soums will consult each other and form herder groups based on respective winter and/or spring pasture areas. The project will encourage each herder group to include within it a certain percentage of poor households. The process will be facilitated by Soum government officials and the PIU. Second, representatives from herder groups will establish an HGO in each project soum to coordinate activities among herder groups, and each herder group will prepare a pasture management plan. Third, each herder group will enter into an agreement with the respective soum governor regarding user

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Component A

rights to a particular winter and/or spring pasture area, which will underpin sustainable pasture management by the herder group. The project will also provide training for herders and aimag and soum government officials in other areas in which herder groups will cooperate (e.g., fodder production, livestock feed preparation, and winter livestock shelter preparation and reinforcement), in order to enhance the preparedness of herders for adverse climatic events. The herder groups will also be introduced to the national livestock insurance program, to provide herders an option to reduce the risk of livestock loss. The project will assist herders in improving livestock health and productivity through training, in addition to regular services provided by soum veterinary and livestock breeding units. The project will carry out capacity development activities in cooperation with the National Agricultural Extension Center (NAEC), which is being assisted by the Japan International Cooperation Agency (JICA) project Enhancing the Extension System for Comprehensive Crop-livestock Management with respect to herders’ capacity development. The cooperation with NAEC is expected to reinforce the cooperation of soum veterinary and livestock breeding units (which are administered by NAEC) with the project.

Monitorable Deliverables/Outputs (i) A model winter livestock shelter is established in each project soum by year 2.

(ii) A model fodder production is demonstrated in each project soum by year 2.

(iii) About 70% of the herder households join herder groups in each project soum by year 3.

(iv) About 70% of the herder households establish pasture use agreements with their respective soum governor in each project soum by year 3.

(v) A soum-level pasture management plan is prepared for each project soum by year 3.

Implementation of Major Activities

(i) Review land use of project soums and identify pasture areas available for herder groups in months 4 and 5.

(ii) Conduct training on herder group formation and pasture management by month 6.

(iii) Assess preparedness and needs of herders and project soums, specifically against adverse climate events to identify the types of demonstration, based on the assessment by month 6.

(iv) Assist herders in forming herder groups and a herder group organization in each project soum in years 1–2.

(v) Assist herder groups in preparing pasture management plans, and each project soum government in preparing a soum-wide pasture management plan in years 1–2.

(vi) Conduct training on livestock husbandry, hay and fodder preparation, and disseminate best practices in years 1–2.

(vii) Establish pasture use agreements between herder groups and respective soum governors in years 1–3.

(viii) Establish a model winter livestock shelter and a model fodder production site in each project soum by year 2.

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Component A

Number of months for grant activities

(ix) Procure equipment and materials for fodder production, animal feed preparation, and preparation of winter livestock shelters in year 2.

(x) Assist herder groups and project soum governments in implementing pasture management plans in years 3–4.

(xi) Monitor the implementation of pasture management plans in cooperation with aimag and soum governments in years 3–4.

48 months

Component B

Component Name Water points established and managed in project soums

Cost ($) $544,900

Component Description Access to water is essential for climate-resilient herding. This component encompasses construction of new wells, rehabilitation of existing wells, and management of wells constructed and rehabilitated by the herder groups. To restore water access in the countryside, MOFALI has been prioritizing development of water points, many of which fell into disrepair during the economic collapse in the 1990s. An increase in water points can expand grazing areas and help reduce herder density in limited pasture areas. This component will also test the use of a solar-powered deep engineering well. This will be the third solar-powered deep engineering well (wells have been established in Dornogobi and Uvurkhangai aimags under the Water Point and Extension Station Establishment for Poor Herding Families Project) (footnote 1). The project design considers deep wells, but well types and locations will be determined based on the needs of herder groups and the existing inventory of water points in each project soum.

3 The project will also take stock of well construction and

rehabilitation planned by the central and local governments and donor-funded projects. The result of the assessment will be used by the HGO and soum governments in making a final decision regarding well locations and types, based on an agreed set of criteria. Well locations and types (e.g., deep and shallow wells) will be reflected in the herder group and soum pasture management plans. Initial projections of the number of water points to be rehabilitated and/or constructed must allow for adjustment during project implementation. Water points will be selected for development in a pragmatic manner, driven by cost-effectiveness, and technical and environmental considerations. Prior to the well construction and rehabilitation, a rapid environmental verification for each well will be conducted.

3 In 2010, there were 163 functional wells in pasture areas in Buutsagaan, including 12 engineering and 153 hand

wells; 23 functional wells in Dzag, including 1 engineering and 22 hand wells; and 83 functional wells in Khureemaral, including 14 engineering and 69 hand wells.

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Component B

Following the practice from the Water Point and Extension Station Establishment for Poor Herding Families Project, the PMU and PIU will carry out a rapid hydrogeological field survey and subsequent verification to identify a suitable well location based on herder group's needs. The PMU and PIU will prepare a final well site proposal in consultation with soum environmental inspector. The proposal will include general information (e.g., purpose, location, and schedule of construction); costs; technology (e.g., machinery, equipment, and raw and supplementary materials); waste control and management; social issues (number in the labor force, labor safety, and others); and background on the well location (e.g., air quality indicators; main climatic indicators; surface and groundwater resources, quality and regime; soil pollution and erosion risk; topography; geologic structure; land utilization and tenure; and plants and species). The soum environmental inspector will forward their conclusion to the department of environment and tourism of Bayankhongor aimag and seek approval on a no-objection basis. Upon approval of the proposal and after the contract is awarded, the contractor will carry out a simple geophysical study to confirm groundwater availability before drilling. After well construction, the PMU, PIU, herder groups and soum government officials will confirm the water point recharge rate based on the water balance assessment. Monitoring will be carried out during project implementation with the result reported to ADB through the semiannual progress report. To ensure the environmental impact is addressed, an initial environmental examination report has been prepared containing an environmental mitigation and monitoring plan. Contractors will be engaged through an appropriate tendering process in line with ADB’s Procurement Guidelines (2010, as amended from time to time), and will construct or rehabilitate the water points, with close monitoring by the herder groups. MOFALI will make financial contributions to the well construction and rehabilitation, and the herder groups will contribute 10% of the cost of new and rehabilitated water points, as required by the government. Well-recipient herder groups will receive training on how to operate and maintain the wells, and be responsible for the operation and maintenance costs, based on their respective water use agreements. The project will assist each of the herder groups in establishing a water use agreement with their respective soum governor, which will define the rights and obligations of the recipients. The agreement will also indicate vital information for the sustainable management of the water point (e.g., water recharge rates, water quality, and appropriate water tariffs), which will be estimated by the PIU experts through hydrological evaluation and regular field monitoring. The proposed water tariff rates take into account the operating costs, and the cost of parts replacement necessary to maintain the wells in the long term. Ownership of the water points will remain with the respective project soum governments, while the herder groups will acquire ownership of the pumps and

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Component B

equipment at the wellheads.

Monitorable Deliverables/Outputs (i) At least 30 water points are constructed or rehabilitated in three project soums by year 3.

(ii) All herder groups provided with new or rehabilitated water points establish water use agreements with respective soum governors by year 3.

Implementation of Major Activities Number of months for grant activities

(i) Conduct assessment of herder groups’ needs for water point establishment and rehabilitation in year 1.

(ii) Conduct rapid hydrogeological surveys to identify potential water point locations in years 1–2 (May–October).

(iii) Prepare proposals for well construction and/or rehabilitation for government approval in years 1 and 2.

(iv) Conduct training on water management in years 1–3. (v) Procure civil works for water point establishment and/or

rehabilitation in years 2 and 3. (vi) Monitor the implementation of the civil works contracts

by herder groups and local governments in years 2 and 3.

(vii) Establish water use agreements between respective soum governors and herder groups in years 2 and 3.

(viii) Monitor water point utilization including water recharge and report as part of semiannual project progress reports in years 2–4.

48 months

Component C

Component Name Income generation diversified in project soums

Cost ($) $592,000

Component Description This component aims to help herder households diversify their income generation. Given that existing herd size in the project soums far exceeds the pasture carrying capacity, the project will provide the herder groups with supplementary income-generating opportunities, which may include value added livestock-based production (e.g., milk and other dairy products, felt products), as well as other activities (e.g., crop production, bakery, and handicrafts). Income diversification is expected to reduce herding pressure on pastures and will induce herders to maintain herd size at the pasture carrying capacity. Particular attention will be given to female members of herder households, and herder households most in need of additional income (e.g., poor households, those less skilled in herding, and single-parent households). As part of the process of herder group and HGO formation and pasture management plan preparation, the project will engage herder groups in the discussion of existing non-herding activities, opportunities, and preferences. The project will organize and provide technical support for workshops and information dissemination events to familiarize herders with different types of income-generating activities. International nongovernment organizations (NGOs) have undertaken

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Component C

activities in each project soum to promote income diversification, and the PMU and PIU will assess what types of business worked, based (i) on lessons from the project soums, and (ii) possibly on business models used elsewhere in Mongolia, such as under the Water Point and Extension Station Establishment for Poor Herding Families Project. General knowledge of income generation is imperative to enable herder households to begin non-herding activities. The project will train herders on business planning, management, and marketing. This training will aim to provide herders with the foundation to initiate income-generating activities. After the training, herders who meet certain criteria (yet to be determined) will be encouraged to prepare brief business proposals, with the assistance of the PMU and PIU experts and local government staff. The project will provide vocational training for specific income-generating activities. Financial assistance in the form of small grants will be provided to each project soum to implement this component. The PMU will carry out a rapid survey of possible funding modalities and currently available funding opportunities in the project soums, and discuss them with MOFALI and the local governments to determine which is most suitable for the project. Each income-generating activity will be small in size, and no substantial environmental impacts are envisaged.

Monitorable Deliverables/Outputs 50% of herder households in each project soum belong to herder groups directly and indirectly involved in supplementary income-generating activities, by year 4.


(i) Conduct a rapid appraisal of the market and existing income-generating activities in each project soum by year 1.

(ii) Conduct a rapid review of modalities for small grant utilization and determine a suitable modality by year 1.

(iii) Establish a business plan review panel in each project soum by year 1.

(iv) Assess herders’ needs and capacity, and based on the assessment identify types of demonstration projects by year 1.

(v) Disseminate information of model income-generating activities to herders in year 1.

(vi) Conduct training for herders on business planning and management, and marketing in years 1–2.

(vii) Assist herder groups and/or herders in preparing business plans in years 1–2.

(viii) Conduct capacity development for herders on different income-generating activities and marketing in years 1–2.

(ix) Monitor business proposal implementation of herder groups and/or herders in years 2–4.

48 months

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Component D

Component Name Effective project management established

Cost ($) $794,400

Component Description MOFALI will be the executing agency responsible for overall supervision and implementation of the project. A steering committee—chaired by MOFALI, and including nominated representatives from the Ministry of Finance; the Ministry of Nature, Environment and Tourism; and the Bayankhongor aimag government—will provide oversight and policy guidance to the project and make strategic decisions, such as the final approval of water point sites and fund flows under component C. A PMU will be established under MOFALI in Ulaanbaatar. The PMU, headed by a project director, will be responsible for the management of the project’s day-to-day affairs, including regular planning; monitoring and reporting; supervision of PIU activities; and financial administration, knowledge sharing, and policy dialogue. The PMU will also be responsible for consultant recruitment and procurement of works, goods, and services. The project director is expected to coordinate with other relevant development agencies in Ulaanbaatar and Bayankhongor to build productive relationships with all key stakeholders. A PIU will be established in the Bayankhongor aimag agricultural department, to be staffed by a project coordinator, technical experts, and other support staff. The PIU will oversee the day-to-day project activities at the field level, under the supervision of the PMU director, and in close coordination with the governments of Bayankhongor aimag and project soums. In each project soum, the veterinary and livestock breeding unit and the land management officer will carry out activities in cooperation with the PIU. The units were established in 2010 to strengthen soum government’s capacity in livestock and agriculture extension, which had weakened significantly since the 1990s. To facilitate coordination between the PIU and the project soums, the veterinary and livestock breeding units will be designated as the project’s soum focal points. The project will strengthen these newly established units so that they can better serve the herders. In each project soum, the unit and the land management officer are expected to work closely with herder households and coordinate with other stakeholders, including relevant figures and officials of soum and bagh governments and NGOs.

Monitorable Deliverables/Outputs (i) Semiannual project progress and annual audit reports are submitted on time.

(ii) Semiannual newsletters for project stakeholders are prepared and disseminated.

(iii) Policy briefs on sustainable livestock and pasture management are prepared and disseminated.

(iv) An implementation completion report is submitted within 6 months after completion of the project.

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Component D


(i) Recruit PMU consultants to establish a PMU in Ulaanbaatar, in month 1.

(ii) Prepare a grant implementation manual and a project monitoring and evaluation plan, in month 2.

(iii) Recruit PIU consultants to establish a PIU in the aimag center, in month 2.

(iv) Engage the project aimag and soum governments in project implementation, in month 2.

(v) Hold project aimag-, soum-, and bagh-level inception workshops, in months 3 and 4.

(vi) Confirm and collect baseline information, by month 4. (vii) Prepare and submit a semiannual project progress

report by month 7, and every 6 months thereafter. (viii) Conduct initial pasture and livestock survey, by year 1

(mid-July–mid-October, 1 month for field survey and 2 months for assessment and report preparation).

(ix) Submit the audited statement of expenditure, by year 1.5 for 2012, and every year thereafter.

(x) Undertake a midterm review in year 3. (xi) Undertake a final review at the completion of project. (xii) Prepare and submit an implementation completion

memorandum within 6 months after the completion of the project.

48 months

2. Financing Plan for Proposed Grant to be Supported by JFPR

Funding Source Amount ($)

JFPR 2,500,000

Government 298,400

Community 61,600

Total 2,860,000

3. Background

1. Herding in Mongolia depends heavily on pasture lands throughout the year. Pasture degradation has been a threat to herding, which is the dominant means of earning a livelihood in rural Mongolia. The increasingly erratic climate hampers the growth of pasture and, consequently, causes significant livestock loss during winter and spring. The dzud (severe winter) during 2009–2010 killed about 9.7 million livestock, about one fourth of the national herd, and removed the means of livelihood for a large number of herder households. This unprecedented disaster should not be simply regarded as resulting from a climatic impact, but as a consequence of inadequate livestock and pasture management. 2. The poor livestock and pasture management stems largely from the open access to pasture lands that replaced regulated pasture land access in the early 1990s. Open access to pasture lands facilitated absorption of the unemployed by the herding sector following the transition from a socialist regime. As a result, both the number of herders and herd size increased to unprecedented levels, resulting in progressive pasture degradation. The number of herder families increased from 75,000 in 1991 to 170,142 in 2009. During the same period, the national herd increased significantly (from 24.7 million to 44.0 million), which mainly resulted

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from the increase in small livestock (i.e., goats and sheep). The number of goats increased by 300% (from 5.0 million to 19.7 million), while sheep increased by 35% (from 14.3 million to 19.3 million).4 The major cause of the expansion in the goat population was high cashmere prices. 3. Livestock numbers continue to increase, with the resulting overgrazing exceeding the pasture’s carrying capacity. This phenomenon can be related to long-term climate change.5 According to a recent study, from 1961 to 2006 pasture productivity decreased by 28.6% in desert areas and 52.2% in steppe areas.6 The decrease in the number of functional water points—which were no longer maintained by the government after the socialist regime—has reduced the pasture lands where water sources are available, and caused overgrazing in areas surrounding functional water points. The area of classified pasture land also slightly decreased from 124 million hectares (ha) in 1990 to 115 million ha in 2007, mainly as a result of the transfer of pasture lands into other types of land classification (e.g., protected areas, settlement, mining, and roads).7 4. The current land law allows open access to summer and autumn pastures and is regarded as the fundamental cause of pasture degradation. Although it does provide local governments sufficient authority to manage winter and spring pasture through agreements with herders of the soum, few soum governors exercise their authority. The major hindrances include the governors’ limited knowledge of how to exercise their authority, the difficulty of coordinating with the widely scattered herders, and the herders’ limited awareness of sustainable pasture management. 5. To address those hindrances, the Water Point and Extension Station Establishment for Poor Herding Families Project (footnote 1) assisted in coordinating herders for collective pasture management, and demonstrated the effectiveness of the approach. Using the same approach, herder groups will be formed in a participatory manner by herders that normally have their winter and/or spring camps in respective communal territories. These territory-based herder groups will be joined at the soum level into HGOs. Pasture allocation among herder groups within a soum will be decided in a participatory manner by herder group members themselves, with the support of the local government. Based on their collective decisions, the soum governor will establish pasture use agreements with the herder groups. Each herder group will then develop its own pasture management plan, and these will in turn be harmonized at the HGO level.8 This will also put in place the measures needed to help reduce the impact of climate change, such as the development and management of water points, hay making, and improvements in pasture productivity. 6. ADB provided a grant of $2.5 million to the government from the Asia-Pacific Disaster Response Fund in April 2010 as emergency assistance for the dzud during 2009–2010. The emergency assistance provided herder households of the 17 dzud-affected aimags, including Bayankhongor, with food, fuel, health and social services, and carcass removal. This nationwide

4

National Statistical Office of Mongolia. 2010. Mongolian Statistical Yearbook 2009. Ulaanbaatar. 5 Swiss Agency for Development and Cooperation. 2010. Livelihood Study of Herders in Mongolia. Ulaanbaatar.

6 Data sources are (i) D. Avaadorj and Y. Baasandorj. 2006. Physical properties of soil, in 2006. Proceedings of ‘Theoretical and Practical Conference on Issues and Challenges of Pasture Management’. Ulaanbaatar; and (ii) N. Lkhgvajav, 2006. Decrease of pasture land productivity. in 2006. Proceedings of ‘Theoretical and Practical Conference on Issues and Challenges of Pasture Management’. Ulaanbaatar.

7 Data source is ResourceSTAT of FAOSTAT (http://faostat.fao.org/site/377/default.aspx).

8 In pasture management plans, winter camps, hay-making areas and the pasture-resting areas are defined and

allocated. Reserve pastures need to be defined before allocating land to the herder groups. They are managed by the local governments in consultation with the herder groups and the herder group associations.

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disaster, which resulted in livestock death on an unprecedented scale, highlighted the vulnerability of the herders to an extreme weather event. Enhancing the climate-resilience of herders is the only viable measure to mitigate another disaster caused by this recurrent climate event. 7. This JFPR grant will pilot a holistic approach to improving climate-resilient herding and livelihood assistance in the medium term that will encompass (i) developing strong governance and management of pasturelands by herders and otherwise contributing to an increase in herders’ climate resilience; (ii) building or rehabilitating water points to achieve a more balanced use of existing pasture resources; and (iii) promoting various forms of alternative and supplementary income generation for herders, and in particular the poorest herders. The project will be implemented in Buutsagaan, Dzag, and Khureemaral soums in Bayankhongor aimag in the Khangai region.9 The poverty incidence in the project soums, located in the aimag’s steppe region, is above average; 686 (34.2%) of the 2,004 households in the three soums are classified as extremely poor and poor. About 1,471 households (73.4%) are engaged in herding, and their poverty incidence is higher than the average of all households.10 The total land area of the project soums is 1,272,900 ha, about 96% of which is pastureland.11

4. Innovation and Knowledge Sharing 8. Holistic approach to climate-resilient herding. The climate vulnerability of herding in Mongolia cannot be addressed on a piecemeal basis. To enhance its climate-resilience, the project adopts a holistic approach, with the introduction of sustainable pasture management as the backbone. The project will help herders and local governments—especially soum land management officers and the newly established soum veterinary and livestock breeding units—develop their capacity to assist herder households in coping with and in mitigating pasture degradation. Although pasture access during winter and spring is important, livestock mortality depends substantially on pasture availability during summer. Livestock can insulate themselves from adverse weather if they gain weight through sufficient pasture intake during the summer. Good pasture is the lifeline of climate-resilient herding. It is also important to lessen the pressure on the degraded pasture through the promotion of diversified income generation. Income diversification will reduce herders’ reliance on livestock husbandry and indirectly shield herders’ livelihoods from adverse climate events. Successful herding also requires adequate access to water. The project will provide water points (mainly in pasture areas that are not in use due to the absence of water points), and training on water point management for herders and local governments. The project will promote the production of hay and fodder as supplementary feed for winter and/or spring pasture, enhance winter livestock shelters, and provide capacity development and financial assistance. 9. Governance for sustainable pasture management. Sustainable pasture management under the regime of open access to pasture has been regarded as particularly challenging. The project will promote soum-level pasture management planning based on the pasture management plans of herder groups in project soum. The pasture planning in each soum will be

9 Project soums are proposed based on a set of agreed criteria, such as (i) areas where neighboring soum

governments are willing to implement the project according to its design, especially pasture management; (ii) areas affected by the dzud during 2009–2010; (iii) access to major markets and buyers; (iv) prospect of pasture

improvement with project assistance within the project period; and (v) no involvement in donor-funded projects in the last 3 years.

10 The summary poverty reduction and social strategy is in Appendix 2.

11 Buutsagaan has a land area of 256,100 ha; Dzag, 432,800 ha; and Khureemaral, 584,000 ha.

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carried out by the herder groups and the HGO with the assistance of the respective soum government. The locations of water point construction and/or rehabilitation and fodder production areas will be reflected in each soum-wide pasture management plan. Initial agreements on pasture allocation among herder groups will be discussed in the HGO. The agreed pasture allocation will be reflected in the pasture use agreements between the herder groups and the respective soum governor, which will underpin the herder groups primary access to specific pasture areas. 10. Introduction of renewable energy. Mongolia has a tradition of diesel-powered engineering wells, stemming from (i) the long history of free use of this technology under negdels (pre-1990s livestock collective farms), (ii) their reliability (especially in winter), and (iii) the theft- and damage-proofing provided by the well housing. This well-established tradition has led to reluctance to test alternatives such as wind- and solar-powered pumps, especially after discouraging results from a limited number of tests performed on an early generation of renewable energy equipment. However, the successful use of renewable energy-powered pumps in the People’s Republic of China and Kazakhstan—where climatic and hydrogeological conditions are similar to those of Mongolia—suggests that renewed efforts to pilot and introduce recent-model renewable energy equipment would be justified. A solar-powered pump has been tested in the Dornogobi and Uvurkhangai aimags (the latter under the Water Point and Extension Station Establishment for Poor Herding Families Project). This type of technical innovation with positive environmental consequences will be promoted under the project.

5. Sustainability

11. Institutional development and capacity improvement for herders. The project places major emphasis on institutional development and capacity improvement for herders. During the past two decades, the current law of open access to pasture has caused a rapid increase in the number of herders and in the national herd size, while the economy has not generated sufficient alternative employment opportunities. Traditional voluntary coordination among herders has been proven unable to ensure pasture sustainability, and a coordination mechanism for pasture use among herders is needed. The project aims to assist herders in developing and using this coordination mechanism (i.e., herder groups and the HGO) themselves, based on the common understanding that there are ―no winners without cooperation.‖ Recent and ongoing livestock projects have demonstrated that managing pasture and sustaining nomadic herding under the current open access regime can only be achieved by addressing the absence of coordination. 12. Initiative of the executing agency. The increasing vulnerability of the herding sector also results from the collapse of government support. In line with the extension station establishment, and supported by the Water Point and Extension Station Establishment for Poor Herding Families Project, the government of Mongolia launched the first phase of the National Mongolian Livestock Program, 2010–2105 to enhance support to the herding sector.12 MOFALI is committed to (i) learning from the holistic approach that will be adopted by the project; and (ii) disseminating lessons, both in Bayankhongor aimag and more broadly, to further strengthen implementation of the National Mongolian Livestock Program.

12

To restore public services in supporting livestock husbandry and other agricultural activities, the veterinary and livestock breeding units were established under the National Mongolian Livestock Program in all soums in 2010. The program was ratified as a result of resolution of State Great Khural (citizens) of Mongolia, 20 May 2010 based on Law of Great Khural of Mongolia, Article 43 and clause 43.1—National Mongolian Livestock Program.

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13. Governments’ role in project implementation. In line with the government’s initiative, the project will strengthen existing local government capacity to ensure the sustainability of project outputs. The livestock policy implementation and coordination department of MOFALI will provide technical guidance for project implementation through the PMU. A PIU will be established in the Bayankhongor aimag agricultural department to implement project activities in the field, and coordinate with the PMU, soum governments, and other stakeholders in the aimag. The veterinary and livestock breeding unit and the land management officer in each soum will implement project activities in cooperation with PIU. Aimag and soum officials will receive capacity development assistance throughout the duration of the project. The MOFALI NAEC will cooperate with the project in training herders and local government officials through coordination with the ongoing JICA Enhancing the Extension System for Comprehensive Crop-Livestock Management project. The project aims to achieve sustainability by centralizing and strengthening the existing government structure. The cooperation with NAEC is expected to reinforce the cooperation of soum veterinary and livestock breeding units, which are administered by NAEC, with the project. To encourage replication of the project approach, nonproject soums in Bayankhongor aimag will be invited to participate in the aimag-level inception and concluding workshops and other technical training.

6. Participatory Approach 14. The field project activities will be implemented for and by the herders and local governments, and their active participation will be essential to the project’s success. Consultations with local stakeholders will be ongoing throughout project processing and implementation. The project is designed to include all herders to ensure effective soum-wide pasture management. To contact and involve the approximately 1,450 herder households scattered over 1,272,900 ha, project concept dissemination workshops will be held for herders and local government officials at aimag, soum, and bagh levels, as needed, at the inception stage of the project.13 15. The herder groups will be formed with assistance from the local governments and the PMU. In each project soum, demarcation of winter and/or spring pasture will be agreed among the herder groups in close consultation with the respective soum governments. Although this appears to constitute rigid zoning that excludes herders from outside the herder group’s winter and/or spring pasture area, traditional arbitration among herders and formal consultations among soum and aimag governments will still be practised when cooperation is required. Based on the pasture land demarcation, the herder groups will prepare pasture management plans with the help of their respective soum government and the PMU. The soum government will ensure that the herder group pasture management plans are consistent with the soum-level pasture management plan. 16. Selection of water points will also be based on a participatory approach. Initial proposals regarding water point sites will be made based on herder surveys and consultations with the soum governments. Based on an agreed set of criteria, candidate water point sites will be shortlisted for the subsequent hydrological studies, which will ensure the suitability and sustainability of the water point sites. Herder groups and the soum governments will closely monitor the construction of water points with technical assistance from the PMU. Once water points are provided to the herder groups, they will be collectively managed, according to the respective water use agreements.

13

As of May 2011, Buutsagaan had 462 households; Dzag, 362; and Khureemaral, 647.

15

17. Herder groups and soum government officials involved in project activities will contribute to participatory project monitoring and evaluation, particularly through regular monitoring and evaluation group workshops to gauge project progress and provide feedback on implementation. A communications strategy has been developed to ensure all stakeholders are kept aware of project developments and informed of financial management, planned activities, and progress in project implementation through leaflets, newsletters, mobile phone messaging, and local community meetings, with feedback from stakeholders contributing to an ongoing dialogue on project implementation.

Primary Beneficiaries and Other Affected Groups and Relevant Description

Other Key Stakeholders and Brief Description

Approximately 1,450 herder households in Buutsagaan, Dzag, and Khureemaral, and soums of Bayankhongor aimag

(i) MOFALI for project execution, overall coordination, and supervision;

(ii) Bayankhongor aimag government, particularly the department of agriculture and land management, for coordinating with MOFALI and among three project soums and facilitating project implementation and monitoring at the aimag level; and

(iii) Buutsagaan, Dzag, and Khureemaral soum governments, particularly veterinary and livestock breeding units and land management officers, for coordinating among baghs in respective soums and facilitating project implementation and monitoring at the soum level.

7. Coordination

18. MOFALI, the executing agency, was fully involved in the development of the project design and the selection of project soums. The Ministry of Nature, Environment and Tourism and the Institute of Meteorology and Hydrology—which as government agencies are charged with pasture monitoring—have been consulted. 19. The Asia Pacific Adaptation Network (APAN) will cooperate with the project by providing pasture satellite images of the project sites.14 APAN is the regional climate change adaptation network for Asia and the Pacific, established under the United Nations Environment Programme Global Climate Change Adaptation Network in October 2009 with the financial support of the Government of Japan. APAN has also been supported by Strengthening the Asia Pacific

14

The overall objective of APAN is to help build the climate resilience of vulnerable human systems, ecosystems, and economies through the mobilization of knowledge and technologies to support adaptation capacity development, policy setting, planning, and practices. APAN has established an extensive network among government institutes, academia, and civil society in Japan and other countries in Asia and the Pacific (e.g., the Ministry of the Environment, Japan; the Institute for Global Environmental Strategies; and Keio University). The concept of the JFPR project was shared with representatives of agencies concerned of the governments of Mongolia and Japan, and the APAN secretariat at the workshop on Integration of Climate Change Adaptation into Development Planning in Mongolia organized, by APAN in January 2011. An earlier draft of the proposed project was also shared with the APAN secretariat to ensure cooperation under the project.

16

Adaptation Network under ADB’s technical assistance for Strengthening the Asia Pacific Adaptation Network since May 2010.15 20. The Embassy of Japan was consulted throughout project processing, beginning with concept development.16 The mission also discussed the project with JICA’s Enhancing the Extension System for Comprehensive Crop-Livestock Management project, and agreed to cooperate with NAEC, which the JICA project has been assisting, on herders’ capacity development. 21. Other key agencies involved in ongoing or recently completed projects related to herders’ livelihoods and/or livestock and pasture management were consulted during project processing, including the Water Point and Extension Station Establishment for Poor Herding Families Project, the Green Gold Pastoral Ecosystem Management Program (Swiss Agency for Development and Cooperation), the Peri-urban Rangeland Project (Millennium Challenge Account of the Government of the United States), Sustainable Livelihoods Project II (especially regarding the pastoral risk management component) the Index Based Livestock Insurance Project (the World Bank), the Rural Poverty Reduction Programme (International Fund for Agricultural Development), the Food and Agriculture Organization of the United Nations, and the Animal Health and Livestock Marketing Project (European Union). The project will coordinate with the Peri-urban Rangeland Project and Sustainable Livelihood Project II because some herder groups were organized under those projects and prepared pasture management plans that they are currently implementing. The project is expected to benefit from lessons learned during the Water Point and Extension Station Establishment for Poor Herding Families Project and the Green Gold Pastoral Ecosystem Management Program, because approaches to pasture management through herder group formation will be adopted in the project. The project will also forge links with NGOs active in the area of alternative income generation in rural settings (e.g., World Vision and Mercy Corps). The project will establish linkages with other ongoing donor initiatives on pasture management policy development.

8. Visibility 22. The project will promote the visibility and local awareness of JFPR by (i) indicating in publications, and during training programs, seminars, and workshops that funding is provided by the Government of Japan; (ii) using the JFPR logo and Japan official development assistance logo in publications, banners, and any other materials used in seminars and training programs, goods, and works financed by the grant; (iii) referring to the financial contribution from the Government of Japan in press releases issued by ADB; (iv) ensuring that activities financed by the grant are well covered by local print and electronic media; and (v) posting information regarding cooperation with APAN on their website to disseminate lessons from the project through the APAN network.

9. Detailed Cost Table 23. The total cost of the project is estimated at $2,860,000 equivalent, including physical and price contingencies. The JFPR grant of $2,500,000 equivalent will finance 87% of the total

15

ADB. 2010. Technical Assistance for Strengthening the Asia Pacific Adaptation Network. Manila (TA 7535-REG). 16

The reconnaissance and fact-finding missions briefed H. Miyashita, First Secretary of the Embassy of Japan in Mongolia, on the project concept on 25 March 2011, and on the project processing progress in June and August 2011.

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project cost. The remaining $360,000 will be provided through in-kind, cash, and/or service contributions by the governments, herder groups, and communities. The summary cost estimate is in Appendix 3, with detailed cost estimates in Appendix 4. Appendix 5 describes the fund flow arrangements.

C. Link to ADB Strategy and ADB-Financed Operations

1. Link to ADB Strategy 24. The JFPR assistance will target livelihood improvement of herders, who are largely poor and vulnerable, by ensuring sustainable pasture management. The country partnership strategy for Mongolia 2012–2016 (CPS) identifies poverty reduction as a thrust of ADB’s assistance to Mongolia.17 In particular, the CPS acknowledges that herder households, households headed by women, and urban migrants are the major contributors to the high poverty incidence, which has resulted in widening inequality between urban and rural populations. The CPS also specifies environmental sustainability as one of the five thematic drivers of the development challenge, and stipulates ADB’s assistance in climate change adaptation and sustainable management of natural resources including pasture. This project is designed to fully support the objectives of the National Mongolian Livestock Program, which aims at developing ―a livestock sector that is adaptable to climate change and social development and create an environment where the sector is economically viable and competitive in the market economy to (i) provide a safe and healthy food supply to the population, (ii) deliver quality raw materials to processing industries, and (iii) increase exports.‖18

Document Document Number

Date of Last Discussion

Objectives

Mongolia: Country Partnership Strategy, 2012–2016

Sec. M21-12 April 2012 Assists Mongolia in adapting to the unavoidable impacts of climate change including emergency assistance; ―climate-proofing‖ projects; efficient utilization and sustainable management of water resources, grasslands, and forests; and protection of biodiversity.

Mongolia: Country Operations Business Plan, 2009–2012

October 2009 Designed to respond to challenges posed by Mongolia’s deteriorating economic environment, while consistent with the strategic thrusts of the current CPS. Notes insufficient coping mechanisms for an economic crisis in both urban and rural areas. Supports better natural resource management in line with climate change adaptation and mitigation.

Mongolia: Country Strategy and Program Update, 2007–2009

Sec. M78-06 August 2006 Supports the implementation of the two major pillars of the government’s strategy: (i) stable broad-based growth, and (ii) inclusive social development. The first pillar aims to contribute to agricultural and associated growth, and increase productivity in key industries.

Agriculture Sector Strategy Study

R122-04 July 2004 Reviews recent trends in agricultural production; agricultural resources (i.e., land, pasture, and water resources); and livelihoods of families that depend on agriculture.

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ADB. 2012. Country Partnership Strategy: Mongolia, 2012–2016. Manila. 18

Government of Mongolia. 2010. National Mongolian Livestock Program. Ulaanbaatar. p.3. http://www.mofa.gov.mn/mn/images/stories/busad/mmeng.pdf.

18

Document Document Number

Date of Last Discussion

Objectives

Assesses agriculture sector development priorities and identifies policy reforms. Establishes new water points and provides extension services identified in the strategy as a top investment priority for the sector.

2. Link to Specific ADB-Financed Operation

Project Name Water Point and Extension Station Establishment for Poor Herding

Families

Project Number JFPR 9124-MON

Date of Board Approval 30 July 2008

Grant Amount $2,000,000

3. Development Objective of the Specific ADB-Financed Operation

25. The impact of the Water Point and Extension Station Establishment for Poor Herding Families Project is improved livelihood approaches from sustainable herding practices in Uvurkhangai aimag. Outcomes of the project are (i) increased agricultural and livestock productivity attained through agricultural extension, (ii) enhanced value addition and improved marketing of outputs, and (iii) greater awareness of the rights and responsibilities of water and pasture users at the aimag level.

4. Project’s Main Components No. Component Name Brief Description

1. Water Point Planning and Extension Center Development

This component encompasses the development of new water points and water point rehabilitation. Water point development includes the studies necessary to ensure water availability, the environmental and social propriety of the water point sites, and the actual civil works involved in water point construction or rehabilitation.

2. Local Governance Capacity Building, Resource Use Planning, and Monitoring for Water Points and Adjacent Pastures

This component includes the participatory selection of water point sites and the establishment of strong herder management groups for the new water points and adjacent pastures. Each water point management group will develop and implement an integrated plan for pasture and water use through current government procedures.

3. Extension Station Establishment and Provision of Agricultural Extension and Social Services

This component develops demand-driven extension models based on herder management group development plans facilitated by the project. The project will help facilitate more effective delivery of state-sponsored agricultural extension by providing training, logistical support, and resources for development of new training materials and courses.

4. Project Management, Monitoring, Audit, and Evaluation

The PMU was established at the MOFALI to provide resources for carrying out the overall project, including supervision, management, monitoring, evaluation, policy discussion, information dissemination, and knowledge sharing.

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5. Rationale for Grant Funding versus ADB Lending 26. The key objective of the project is to assist herding families, who tend not to benefit from economic growth, in sustainable herd and grassland management. Livestock husbandry remains the dominant income source in rural areas where poverty is concentrated. Mongolian traditional herding has been transformed since the end of the socialist regime, and the government no longer provides extension support. Herders have been exposed to progressive pasture degradation, increasing frequency of extreme weather events, and volatile international markets since early 1990s. These challenges require herders to improve their capacity for survival, while consorted efforts among herders and local governments are imperative to manage pasture, which is crucial for sustainable herding. Failure in this effort will further impoverish poor herding families, aggravate pasture degradation, and gradually destroy the unique ecosystem. The grant assistance under the project is intended to create the foundation for a gradual transition of the target beneficiaries from grant-dependent to self-financing and creditworthy individuals or entities. Grant funds will be matched or complemented by the herders’ own financial contribution. At this stage of development in project soums, grant financing as a catalyst in the transition process is justified. D. Implementation of the Proposed Grant

1. Implementing Agency Project Management Unit under the Ministry of Food, Agriculture and Light Industry

27. The implementation arrangements will be similar to those adopted successfully under the related Water Point and Extension Station Establishment for Poor Herding Families Project. MOFALI will be the executing agency and responsible for the overall supervision of the project through the PMU, established under MOFALI in Ulaanbaatar. A project director will be appointed to manage the day-to-day project activities. A PIU will be established within the Bayankhongor aimag agricultural department, headed by a project coordinator, with up to two support staff and national technical specialists working in a consulting capacity to manage the day-to-day field activities. In each project soum, the land management officer and the veterinary and livestock breeding unit (comprising a veterinary specialist, a livestock breeding specialist, and an small and medium enterprises and crop production specialist) will implement project activities in cooperation with the PIU at the soum level. The implementation arrangements are in Appendix 6. 28. The PMU will be responsible for the procurement of goods and works using ADB’s Procurement Guidelines (2010, as amended from time to time). All consultants will be recruited and contracted by the executing agency in accordance with ADB’s Guidelines on the Use of Consultants (2010, as amended from time to time). Details on procurement and consultant services contracts to be financed by the grant are in the procurement plan in Appendix 7. The procurement plan will be reviewed and revised in the course of project implementation, as needed. The project will require the services of 10 national consultants for a total of 282 person-months for project implementation through the PMU and PIU. The outline terms of reference for consultants are in Appendix 8.

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2. Risks Affecting Grant Implementation Type of Risk Brief Description Measure to Mitigate the Risk

Political Aimag and soum government elections in 2012 temporarily disturb the continuity of local government cooperation for the project.

Ensure continuation of local government support by engaging key local government officials, who are expected to stay in their positions irrespective of the election outcome.

Climate Adverse climate events substantially affect pasture condition and increase livestock mortality during winter and spring. Adverse climate events force herders of adjacent aimags and/or soums to move into and undermine pasture management in project soums in the short term.

Ensure proper implementation of pasture management plans by herder groups as stipulated in the environmental mitigation and monitoring plan in the initial environmental examination report. Conduct capacity development related to enhancement of climate-resilience early in the project. Ensure close coordination between project and neighboring aimag and/or soums.

Economic and/or market

Low world price for livestock-based products (e.g., cashmere) undermines profitability of livestock husbandry. Appreciation of the togrog versus the dollar increases the cost of water point construction and/or rehabilitation. Increased production of the same types of products decreases local market prices.

Diversify income generation. Allocate adequate price contingency in the project cost estimates. Ensure coordination among herder groups on income-generating activities in each project soum.

Coordination Time required to increase herders’ understanding of group-based pasture management delays other project activities.

Three adjacent soums were selected as project soums to minimize the tasks required for inter-soum coordination. Nurture understanding of pasture management by herder groups early in the project. Help herders form and strengthen herder groups and the HGO in each project soum, and help herder groups develop official agreements on pasture use with the respective soum governor, to ensure herder groups secure user rights to their respective pasture areas.

3. Incremental ADB Costs

Component Incremental Bank Cost

Amount requested $0

Justification Not applicable

Type of work to be rendered by ADB Not applicable

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4. Monitoring and Evaluation Key Performance Indicator Reporting Mechanism Plan and Timetable for M&E

About 70% of the herder households in each project soum belong to herder groups, by year 3.

Semiannual project progress reports

Year 3

About 70% of the herder households in each project soum enter into pasture use agreements with their respective soum governor, by year 3.


Year 3

A soum-level pasture management plan is prepared for each project soum, by year 3.


Year 3

At least 30 water points are constructed and/or rehabilitated in the project soums, by year 3.


Year 3

50% of herder households in each project soum belong to herder groups directly and indirectly involved in supplementary income-generating activities, by year 4.

Consultant’s final report Year 4

5. Estimated Disbursement Schedule Fiscal Year Amount ($)

FY2012 171,256

FY2013 418,326

FY2014 766,532

FY2015 632,592

FY2016 511,294

Total Disbursements 2,500,000

APPENDIXES 1. Design and Monitoring Framework 2. Summary Poverty Reduction and Social Strategy 3. Summary Cost Estimates 4. Detailed Cost Estimates 5. Fund Flow Arrangements 6. Implementation Arrangements 7. Procurement Plan 8. Outline Terms of Reference for Consultants

22 Appendix 1

DESIGN AND MONITORING FRAMEWORK

Design Summary

Performance Targets and Indicators with Baselines

Data Sources and Reporting Mechanisms

Assumptions and Risks

Impact

Sustained rural livelihoods in Buutsagaan, Dzag, and Khureemaral soums (project soums) in Bayankhongor aimag

Poverty incidence in project soums reduced from 35% to about 25%, by year 7. Herd size in each project soum in year 7 does not exceed the 2009 level.

Aimag statistics

Assumption

Pasture carrying capacity in each project soum remains at the 2009 level. Risk Low world price of livestock-based products (e.g., cashmere) undermines profitability of livestock husbandry.

Outcome Climate-resilience of livestock husbandry sector improved in project soums

About 70% of pasture in each project soum under herder group pasture management, by year 4. About 70% of herder households in each project soum prepare winter fodder and/or hay, by year 4.

Relevant statistics from the project soum governments through semiannual project progress reports

Assumption Pasture can be restored within the project period. Risk Adverse climate events substantially impact pasture condition and increase winter and spring livestock mortality.

Outputs 1. Capacity for sustainable herding improved in project soums

By year 2: (i) a model winter livestock shelter is established in each project soum; and (ii) model fodder production is demonstrated in each project soum. By year 3: (i) about 70% of herder households in each project soum join herder groups; (ii) about 70% of herder households in each project soum establish pasture use agreements with their respective soum governors; and (iii) pasture management plan prepared for each project soum.

Relevant statistics from the project soum governments through semiannual project progress reports

Assumption Project aimag and soum governments take initiatives in implementing pasture management plans. Risks Time required to increase herders’ understanding of group-based pasture management delays other activities. Adverse climate events force herders of adjacent aimags and/or soums to move into and undermine pasture management in project soums in the short term.

2. Water points established and managed in project soums

By year 3: (i) at least 30 water points constructed and/or rehabilitated in the project soums; and (ii) all herder groups provided

Relevant statistics from the project soum governments through semiannual project progress reports Relevant statistics from

Assumption Groundwater extraction via water points does not exceed annual recharge.

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Design Summary

Performance Targets and Indicators with Baselines

Data Sources and Reporting Mechanisms

Assumptions and Risks

with new or rehabilitated water points enter into water use agreements with their respective soum governors.

the project soum governments through semiannual project progress reports

Risk Appreciation of the togrog versus the dollar increases cost of water point construction and/or rehabilitation.

3. Income generation diversified in project soums

By year 4: 50% of herder households in each project soum belong to herder groups directly and indirectly involved in supplementary income-generating activities

Consultant’s final report Risk Increased production of the same types of products decreases local market prices.

4. Effective project management established

Semiannual project progress and annual audit reports are submitted on time. Semiannual newsletter for project stakeholders is prepared and disseminated. Policy briefs on sustainable livestock and pasture management are prepared and disseminated.

Semiannual project progress and annual audit reports Newsletter Policy briefs

Risk Aimag and soum government elections temporarily disturb the continuity of local government cooperation for the project.

Activities with Milestones Inputs ($ million)

1.1 Review land use in project soums and identify pasture areas available for herder groups in months 4 and 5.

1.2 Conduct training on herder group formation and pasture management by month 6.

1.3 Assess preparedness and needs of herders and project soums, specifically against adverse climate events to identify the types of demonstration, based on the assessment by month 6.

1.4 Assist herders in forming herder groups and a herder group organization in each project soum in years 1–2.

1.5 Assist herder groups in preparing pasture management plans, and each project soum government in preparing a soum-wide pasture management plan in years 1–2.

1.6 Conduct training on livestock husbandry, hay and fodder preparation, and disseminate best practices, in years 1–2.

1.7 Establish pasture use agreements between herder groups and respective soum governors in years 1–3.

1.8 Establish a model winter livestock shelter and a model fodder production site in each project soum by year 2.

1.9 Procure equipment and materials for fodder production, animal feed preparation, and preparation of winter livestock shelters in year 2.

1.10 Assist herder groups and project soum governments in implementing pasture management plans in years 3–4.

1.11 Monitor the implementation of pasture management plans in cooperation with aimag and soum governments in years 3–4.

2.1 Conduct assessment herder groups’ needs for water point establishment and rehabilitation in year 1.

2.2 Conduct rapid hydrogeological surveys to identify potential water point locations in years 1–2 (May–October).

2.3 Prepare proposals for well construction and/or rehabilitation for government approval in years 1 and 2.

2.4 Conduct training on water management in years 1–3

Asian Development Bank (JFPR) 2.50 Government 0.30 Other 0.06 Total 2.86

24 Appendix 1

Activities with Milestones

2.5 Procure civil works for water point establishment and/or rehabilitation in years 2 and 3.

2.6 Monitor the implementation of the civil works contracts by herder groups and local governments in years 2 and 3.

2.7 Establish water use agreements between respective soum governors and herder groups in years 2 and 3.

2.8 Monitor water point utilization including water recharge and report as part of semiannual project progress reports in years 2–4.

3.1 Conduct a rapid appraisal of the market and existing income-generating activities in each project soum by year 1.

3.2 Conduct a rapid review of modalities for small grant utilization and determine a suitable modality by year 1.

3.3 Establish a business plan review panel in each project soum by year 1. 3.4 Assess herders’ needs and capacity, and based on the assessment, identify

types of demonstration projects by year 1. 3.5 Disseminate information of model income-generating activities to herders in

year 1. 3.6 Conduct training for herders on business planning and management, and

marketing in years 1–2. 3.7 Assist herder groups and/or herders in preparing business plans in years 1–

2. 3.8 Conduct capacity development for herders on different income-generating

activities and marketing in years 1–2. 3.9 Monitor business proposal implementation of herder groups and/or herders,

in years 2–4. 4.1 Recruit PMU consultants to establish a PMU in Ulaanbaatar in month 1. 4.2 Prepare a grant implementation manual and a project monitoring and

evaluation plan in month 2. 4.3 Recruit PIU consultants to establish a PIU in Bayankhongor in month 2. 4.4 Engage the project aimag and soum governments in project implementation

in month 2. 4.5 Hold project aimag-, soum-, and bagh-level inception workshops in months 3

and 4. 4.6 Confirm and collect baseline information by month 4. 4.7 Prepare and submit a semiannual project progress report by month 7, and

every 6 months thereafter. 4.8 Conduct an initial pasture and livestock survey by year 1 (mid-July–mid-

October, 1 month for field survey and 2 months for assessment and report preparation).

4.9 Submit the audited statement of expenditure by year 1.5 for 2012, and every year thereafter.

4.10 Undertake a midterm review in year 3. 4.11 Undertake a final review at the completion of the project. 4.12 Prepare and submit an implementation completion memorandum within 6

months after the completion of the project.

JFPR = Japan Fund for Poverty Reduction, PIU = project implementation unit, PMU = project management unit. Source: Asian Development Bank.

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SUMMARY POVERTY REDUCTION AND SOCIAL STRATEGY Country: Mongolia Project Title: Establishment of Climate-Resilient Rural Livelihoods

Lending/Financing Modality:

Others (JFPR project grant)

Department/ Division:

East Asia Department Environment, Natural Resources, and Agriculture Division

I. POVERTY ANALYSIS AND STRATEGY

A. Links to the National Poverty Reduction Strategy and Country Partnership Strategy

The JFPR assistance will target livelihood improvement of herder households, over 30% of which are poor, by ensuring sustainable pasture management. The CPS for Mongolia 2012–2016 continues poverty reduction as a thrust of ADB assistance to Mongolia.

a In particular, the CPS acknowledges that poverty incidence is particularly high

among herder households, households headed by women, and urban migrants, resulting in widening inequality between urban and rural populations. The CPS also specifies environmental sustainability as one of the five thematic drivers of the development challenge, and stipulates ADB’s assistance in climate change adaptation and sustainable management of natural resources, including pasture.

B. Poverty Analysis Targeting Classification: TI-H

1. Key issues. Households in rural Mongolia depend mostly on herding for their livelihoods. The government has

promoted increased herding as a strategy to reduce poverty and increase incomes, but the increase in livestock has exceeded the sustainable carrying capacity of the pasture land. The project will promote a holistic approach to sustainable herding and livelihood diversification in project soums (districts). Herding is the main occupation of about 75% of the households in the project soums. Based on the poverty indicator (gauged with respect to herd size), the incidence of poverty and extreme poverty is 32.5% in Buutsagaan, 31.2% in Dzag, and 40.6% in Khureemaral. Herder households in these project soums—and especially poor and extremely poor households—are solely dependent on herding for their livelihoods, but herding is highly susceptible to climate and economic shocks, and is becoming increasingly less sustainable with substantial increases in herd size since early 1990s. Sustainable pasture and herd management will improve the sustainability of overall herding activities, and the creation of alternative income activities will reduce the dependence of households on a single livelihood activity and source of income. 2. Design features. The project targets all herder households in three adjacent soums (Buutsagaan, Dzag, and Khureemaral) in Bayankhongor aimag (province). All herder households will be targeted for assistance. The project will facilitate cooperation from all herders, which will improve herding sustainability and the livelihoods of herders, particularly poor herders. Sustainable herding will comprise collective pasture management, water point management, hay preparation, and winter livestock shelter enhancement. The assistance will also provide herder groups and households with opportunities for alternative income-generating activities.

II. SOCIAL ANALYSIS AND STRATEGY

A. Findings of Social Analysis

Key issues. The primary beneficiaries will be the herder households in project soums. They will benefit from

sustainable livestock husbandry and alternative income generation. Herder households with small herd sizes, female members of herder households, and households headed by women will benefit mainly from the alternative income generation. All participating households will benefit from the herder group formation, capacity development for sustainable livestock husbandry, and the resulting improved pasture. The project will address the needs of beneficiaries through (i) capacity development on collaboration, cooperation, and management in herder group formation; (ii) improved technical and extension-related management of pastures, water points, and livestock; and (iii) business planning and skills in respective areas of alternative income generation. The project design includes implementation arrangements that make it possible to reach all herder households in the project soums, including those in remote areas, through the herder groups and other means.

B. Consultation and Participation

1. Provide a summary of the consultation and participation (C&P) process during project preparation.

During project preparation, stakeholders at all levels were consulted by ADB and by project preparation consultants and provided input to the project design. This includes herders and citizen representatives, local government organizations at the soum and aimag level, and national government agencies.

26 Appendix 2

26

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3 2. What level of C&P is envisaged during the project implementation and monitoring?

Information sharing Consultation Collaborative decision making Empowerment

3. Was a C&P plan prepared for project implementation? Yes No

Consultation and participation of herder groups in project decision making are key design features of the project. These modes of operation have also proven successful in other JFPR projects in Mongolia working on rural livelihoods (Water Point and Extension Station Establishment for Poor Herding Families Project,

b and Poverty

Reduction through Community-Based Natural Resource Managementc). Given the large distances and deficient

communication infrastructure, the most efficient approach is to leave project implementation to local herders as much as possible. Therefore, participation has been mainstreamed into the project design, including by (i) having the herder groups design, undertake and maintain pasture management activities; and (ii) involving the herder groups and households, and in particular women, in the design and implementation of the income-generating activities.

C. Gender and Development Gender Mainstreaming Category: Some gender benefits

1. Key issues. Households headed by women make up 14% of the approximately 1,450 households in the project soums. Mongolia has long had a reverse gender gap, in that more women than men had access to higher education,

but in rural areas both girls and boys have little access to formal education. Overall, poverty affects women and men equally at the household level, with the exception of households headed by women.

2. Key actions. Measures included in the design to promote gender equality and women’s empowerment—access to

and use of relevant services, resources, assets, or opportunities and participation in decision-making process:

Gender action plan Other actions or measures No action or measure

The project will improve sustainable livelihoods, both in herding and through the creation of alternative income-generating activities. Improved herding will affect households in general, as it will improve total household welfare. Alternative income-generating activities will mainly be designed—with the participation of female members of households and households headed by women—to fit the needs of women. Women will be involved less in pasture management and other herding-related activities, but more in dairy production, handicraft production, and other alternative activities; the details of these activities will be designed during project implementation, to meet women’s needs.

III. SOCIAL SAFEGUARD ISSUES AND OTHER SOCIAL RISKS

Issue

Significant/ Limited/

No Impact Strategy to Address Issue

Plan or Other Measures Included in

Design

Involuntary resettlement No Impact The project is not expected to result in any involuntary land acquisition or involuntary restriction of access to lands and other means of livelihood, because the project features are inherently consultative and voluntary. Herders will make decisions regarding management of pasture land; possible arbitration between herder groups and herders not belonging to herder groups will follow the Mongolian Law on Land, and be decided by soum governors. Wells will be constructed on pasture areas where herder groups have been given access permission by their respective soum governors, meaning individual herder households will not lose lands in their possession.

No action

Indigenous peoples No Impact No ethnic minority or indigenous peoples groups are present in Bayankhongor (the project aimag) that qualify as indigenous peoples under ADB’s Safeguard Policy Statement (2009). The population of the project soums in the aimag is composed of Khalkh (the majority group in Mongolia) or subgroups of Khalkh.

No action

Appendix 2 27

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2

27

Issue

Significant/ Limited/

No Impact Strategy to Address Issue

Plan or Other Measures Included in

Design

Labor

Employment opportunities

Labor retrenchment

Core labor standards

No Impact The project will work with herder households and herder groups to improve pasture management and create alternative livelihoods. No impact on formal employment is anticipated.

No action

Affordability Limited Households are, by government regulation, supposed to contribute 10% of the well construction and operation and maintenance costs. Delayed payments will be allowed in the case of poor households. The project will ensure access by poor households to the water points.

Action

Other risks and/or vulnerabilities

HIV/AIDS

Human trafficking

Others (conflict, political instability, etc.)

No Impact No action

IV. MONITORING AND EVALUATION

Are social indicators included in the design and monitoring framework to facilitate monitoring of gender and social development activities and/or social impacts during project implementation? Yes No

Impact: Poverty incidence in the project soums reduced to 25%, by year 7.

Outcome: Pasture under herder group pasture management increases to about 70% of the total pasture in each project soum, by year 4.

Outputs: About 70% of the herder households join herder groups in each project soum, by year 3.

In each project soum, 50% of herder households belong to herder groups directly and indirectly involved in supplementary income-generating activities, by year 4.

ADB = Asian Development Bank, CPS = country partnership strategy, JFPR = Japan Fund for Poverty Reduction. a ADB. 2012. Country Partnership Strategy: Mongolia, 2012–2016. Manila.

b ADB. 2008. Proposed Grant Assistance to Mongolia for Water Point and Extension Station Establishment for Poor

Herding Families. Manila (JFPR 9124-MON, for $2,000,000, approved on 30 July). c ADB. 2008. Proposed Grant Assistance to Mongolia for Poverty Reduction through Community-Based Natural

Resources Management. Manila (JFPR 9125-MON, for $2,000,000, approved on 5 August). Source: Asian Development Bank.

28

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3

SUMMARY COST ESTIMATES ($)

Item

Component A: Capacity for Sustainable

Herding Improved in

Project Soums

Component B: Water Points Established

and Managed in Project

Soums

Component C: Income

Generation Diversified in

Project Soums

Component D: Effective Project

Management Established

Total % of Total

1. Civil works 0 438,700 0 0 438,700 17.55

2. Equipment and supplies 370,000 0 201,400 88,720 660,120 26.40

3. Training, workshops, seminars, and public campaign

61,250 14,000 24,800 49,900 149,950 6.00

4. Consulting services 105,193 56,444 42,600 303,588 507,825 20.31

5. Small grants 0 0 295,000 0 295,000 11.80

6. Grant management 0 0 0 328,985 328,985 13.16

7. Contingencies 32,257 35,756 28,200 23,207 119,420 4.78

Subtotal JFPR Grant-Financed 568,700 544,900 592,000 794,400 2,500,000 100.00

Government contribution 0 154,000 0 144,400 298,400 Community's contribution 0 61,600 0 0 61,600 Total Estimated Costs 568,700 760,500 592,000 938,800 2,860,000

JFPR = Japan Fund for Poverty Reduction Source: Asian Development Bank estimates.

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DETAILED COST ESTIMATES

Code Supplies and Services Rendered Unit Quan-tities

Unit cost ($)

Total ($)

Contributions

JFPR Govern-

ment

Com-munity

Component A: Capacity for Sustainable Herding Improved in Project Soums

1.1 Civil Works

1.2 Equipment and Supplies

1.2.1

Machinery, equipment, and material for pasture and livestock management with transport

a, b

lump sum 3 100,000 300,000 300,000 0

0

1.2.2

Livestock laboratory diagnostic equipment and artificial insemination tools

a

lump sum 3 23,333 70,000 70,000 0

0

1.3 Training, Workshops, Seminars, and Public Campaignc

1.3.1 Herder group formation and pasture management lump sum 5 4,375 21,875 21,875 0

0

1.3.2 Animal husbandry (feeding, breeding, health, and shelter) lump sum 2 4,375 8,750 8,750 0

0

1.3.3 Hay and fodder preparation lump sum 2 4,375 8,750 8,750 0

0

1.3.4 Dissemination of best practices lump sum 2 4,375 8,750 8,750 0

0

1.3.5 In-country study tours lump sum 3 4,375 13,125 13,125 0

0

1.4 Consulting Services

1.4.1 Pasture management expert

1.4.1.1 Remuneration

person-month

32 1,300 41,600 41,600 0

0

1.4.1.2

Travel, accommodation and related costs (2 months in Ulaanbaatar and 16 months in soums)

lump sum 1 13,900 13,900 13,900 0

0

1.4.2 Livestock expert


person-month

24 1,300 31,200 31,200 0

0

1.4.2.2

Travel, accommodation and related costs (2 months in Ulaanbaatar and 12 months in soums)

lump sum 1 11,400 11,400 11,400 0

0

1.4.3 Geographical information system expert


person-month

4 1,300 5,200 5,200 0

0

1.4.3.2

Travel, accommodation and related costs (0.25 months in Ulaanbaatar and 2.25 months in soums)

lump sum 1 1,894 1,894 1,894 0

0

1.5 Small Grants

1.6 Grant Management

Subtotal (A) 536,444 536,444 0 0

303

0

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Unit cost ($)

Total ($)

Contributions

JFPR Govern-

ment

Com-munity

Component B: Water Points Established and Managed in Project Soums

2.1 Civil Works

2.1.1 Deep engineering wells with diesel-powered pumps (80 meters)a per well 21 19,600 411,600 411,600 0

0

2.1.2 Deep engineering wells with solar-powered pumps (80 meters)a per well 1 27,100 27,100 27,100 0

0

2.1.3 Deep wells with diesel-powered pumps (80 meters)—covernment and community contribution per well 11 19,600 215,600 0 154,000

61,600



2.3.1 Water point operation and maintenance (technical and financial aspects) lump sum 2 3,500 7,000 7,000 0

0

2.3.2 Water use for livestock husbandry lump sum 2 3,500 7,000 7,000 0

0


2.4.1 Studies, surveys

2.4.1.1 Hydrogeological survey (e.g., transportation costs) lump sum 2 2,000 4,000 4,000 0

0

2.4.1.2 Environmental assessments lump sum 4 2,500 10,000 10,000 0

0

2.4.2 Hydrogeologist

2.4.2.1 Remuneration person-month 20 1,300 26,000 26,000 0

0

2.4.2.2

Travel, accommodation and related costs (1.75 months in Ulaanbaatar and 10 months in soums) lump sum 1 9,662.5 9,662.5 9,662.5 0

0

2.4.3 Water engineer expert


0

2.4.3.2

Travel, accommodation and related costs (0.25 months in Ulaanbaatar and 1.75 months in soums) lump sum 1 1,581.25 1,581.25 1,581.25 0

0

2.5 Small Grants


Subtotal (B) 724,744 509,144 154,000 61,600

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Unit cost ($)

Total ($)

Contributions

JFPR Govern-

ment

Com-munity

Component C: Income Generation Diversified in Project Soums

3.1 Civil Works


3.2.1 Demonstration equipment and materialsa, b

per soum 3 66,300 198,900 198,900 0

0

3.2.2 Training manuals lump sum 5 500 2,500 2,500 0

0


3.3.1 Crop production and processing training 8 675 5,400 5,400 0

0

3.3.2 Business planning and management training 8 675 5,400 5,400 0

0

3.3.3 Long-term technical training for specific income-generating activities (training only) trainee 100 100 10,000 10,000 0

0

3.3.4 Short-term apprenticeship (staying with model herders and/or farmers for 1 week) trainee 80 50 4,000 4,000 0

0


3.4.1 Income generation expert


0

3.4.1.2

Travel, accommodation and related costs (1.75 months in Ulaanbaatar and 10 months in soums) lump sum 1 11,400 11,400 11,400 0

0

3.5 Small Grants

3.5.1 Small grants for Buutsagaan, Dzag, and Khureemarald lump sum 1 285,000 285,000 285,000 0

0

3.5.2 Transportation of materials for small grants lump sum 1 10,000 10,000 10,000 0

0


Subtotal (C) 563,800 563,800 0 0

323

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Unit cost ($)

Total ($)

Contributions

JFPR Govern-

ment

Com-munity

Component D: Effective Project Management Established

4.1 Civil Works


Project management unit, Ulaanbaatar

4.2.1 Office furniture lump sum 1 6,000 6,000 0 6,000

e 0

4.2.2 Computers and related equipment set 3 1,100 3,300 0 3,300

e 0

4.2.3 UPS

set 2 100 200 0 200

e 0

4.2.4 Computer software lump sum 1 1,000 1,000 1,000 0

0

4.2.5 Printer

set 1 450 450 0 450

e 0

4.2.6 Scanner set 1 100 100 0 100

e 0

4.2.7 Fax machine set 1 200 200 0 200

e 0

4.2.8 Projector and screen set 1 1,000 1,000 0 1,000

e 0

4.2.9 Copier

set 1 1,900 1,900 0 1,900

e 0

4.2.10 Supplies and stationery month 48 120 5,760 5,760 0

0

4.2.11 Other miscellaneous items lump sum 1 2,000 2,000 2,000 0

0

4.2.12 GPS

set 1 1,000 1,000 0 1,000

e 0

4.2.13 Pasture- and water-related data, maps and other information lump sum 1 7,000 7,000 7,000 0

0

4.2.14 Publication and videos for publicity lump sum 4 3,000 12,000 12,000 0

0

Project implementation unit, Bayankhongor Aimag

4.2.15 Office furniture set 1 7,000 7,000 5,000 2,000 e

0

4.2.16 Computers and related equipment set 7 1,100 7,700 7,700 0 0

4.2.17 Computer software lump sum 1 1,000 1,000 1,000 0 0

4.2.18 UPS

set 3 100 300 300 0 0

4.2.19 Printer

set 1 450 450 450 0 0

4.2.20 Scanner set 1 100 100 100 0 0

4.2.21 Fax machine set 1 200 200 200 0 0

4.2.22 Projector and screen set 1 1,000 1,000 1,000 0 0

4.2.23 Copier

set 1 2,000 2,000 2,000 0 0

4.2.24 G-mobile phone set set 1 300 300 300 0 0

4.2.25 Wireless internet modem set 3 200 600 600 0 0

4.2.26 Supplies and stationery month 48 250 12,000 12,000 0 0

4.2.27 Other miscellaneous items lump sum 1 2,000 2,000 2,000 0 0

4.2.28 GPS

set 1 1,000 1,000 1,000 0 0

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Unit cost ($)

Total ($)

Contributions

JFPR Govern-

ment

Com-munity

Soum veterinary and livestock breeding units

4.2.29 Motorcycle set 3 1,500 4,500 4,500 0 0

4.2.30 Computers and related equipment set 3 1,100 3,300 3,300 0 0

4.2.31 Computer software set 3 500 1,500 1,500 0 0

4.2.32 UPS

set 3 100 300 300 0 0

4.2.33 Printer

set 3 450 1,350 1,350 0 0

4.2.34 Scanner set 3 100 300 300 0 0

4.2.35 Fax machine set 3 200 600 600 0 0

4.2.36 Projector and screen set 3 1,000 3,000 3,000 0 0

4.2.37 Copier

set 3 2,000 6,000 6,000 0 0

4.2.38 Digital camera set 3 400 1,200 1,200 0 0

4.2.39 G-mobile phone set set 3 300 900 900 0 0

4.2.40 Wireless internet modem set 3 200 600 600 0 0

4.2.41 Supplies and stationery month 47 80 3,760 3,760 0 0


4.3.1 Aimag inception workshop workshop 1 3,700 3,700 3,700 0

0

4.3.2 Soum inception workshop workshop 3 1,500 4,500 4,500 0

0

4.3.3 Bagh inception workshop workshop 14 800 11,200 11,200 0

0

4.3.4 Aimag biannual stakeholder workshop workshop 2 3,700 7,400 7,400 0

0

4.3.5 Soum annual stakeholder workshop workshop 12 1,500 18,000 18,000 0

0

4.3.6 Aimag concluding workshop workshop 1 3,700 3,700 3,700 0

0

4.3.7

Project administration training to project implementation unit and soum

training 1 1,400 1,400 1,400 0

0


Project management unit Ulaanbaatar

4.4.1 Project director


person-month

48 2,000 96,000 96,000 0

0

4.4.1.2

Travel, accommodation and related costs (8 months in aimag and/or soums)

lump sum 1 6,000 6,000 6,000 0

0

4.4.2 Project implementation expert


person-month

36 1,500 54,000 54,000 0

0

4.4.2.2


lump sum 1 7,500 7,500 7,500 0

0

343

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Unit cost ($)

Total ($)

Contributions

JFPR Govern-

ment

Com-munity

4.4.3 Project administrator


person-month

45 1,500 67,500 67,500 0

0

4.4.3.2


lump sum 1 3,000 3,000 3,000 0

0


4.4.4 Project coordinator


person-month

45 1,300 58,500 58,500 0

0

4.4.4.2

Travel, accommodation and related costs (2 months in Ulaanbaatar and 11.5 months in soums)

lump sum 1 11,088 11,088 11,088 0

0

4.5 Small Grants


Project management unit, Ulaanbaatar

4.6.1 Rental car month 36 1,000 36,000 36,000 0

0

4.6.2 Fuel for rental car month 36 600 21,600 21,600 0

0

4.6.3 Other transportation month 48 200 9,600 9,600 0

0

4.6.4 Annual audit lump sum 4 5,000 20,000 20,000 0

0

4.6.5 Cleaner

person-month

48 150 7,200 7,200 0

0

4.6.6 Postage and communication (phone, internet) month 48 350 16,800 16,800 0

0

4.6.7 Repairs and maintenance month 48 60 2,880 2,880 0

0

4.6.8 Office rent (incl. electricity) month 48 1,500 72,000 0 72,000

e 0

4.6.9 Website establishment and updating lump sum 1 1,600 1,600 1,600 0

0

4.6.10 Miscellaneous operational cost month 48 60 2,880 2,880 0

0


4.6.11 Rental car month 47 1,500 70,500 70,500 0

0

4.6.12 Fuel for rental car month 47 800 37,600 37,600 0

0

4.6.13 Other transportation month 47 200 9,400 9,400 0

0

4.6.14 Project implementation unit assistant

person-month

42 500 21,000 21,000 0

0

4.6.15 Cleaner month 47 150 7,050 7,050 0

0


0


0

4.6.18 Office rent (incl. electricity) month 42 500 21,000 0 21,000

e 0


0

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Unit cost ($)

Total ($)

Contributions

JFPR Govern-

ment

Com-munity

Soum veterinary and livestock breeding units

4.6.20 Per diem for aimag day 180 25 4,500 4,500 0

0

4.6.21 Per diem for soum day 360 21 7,500 7,500 0

0

4.6.22 Fuel for motorcycles and vehicle month 47 540 25,380 25,380 0

0


0


0

4.6.25 Office rent (incl. electricity) month 47 750 35,250 0 35,250

e 0


0

Subtotal (D) 915,693 771,193 144,400 0

Subtotal (A–D) 2,740,580 2,380,580 298,400 61,600

Contingency (Maximum 10% of Total Japan Fund for Poverty Reduction Contribution) 119,420 119,420 0

0

Total Grant Costs 2,860,000 2,500,000 298,400 61,600

Note: Numbers may not sum precisely because of rounding. a Types of equipment will be determined based on consultation between the central, project aimag and soum governments and project herders, and should be to enhance climate-resilience of the livestock sector (e.g., fodder production, fodder storage facility).

b Equipment in 1.2.1 and 3.2.1 will remain with herder groups, equipment in 1.2.2 will remain with soum governments, and equipment in 2.1.1 and 2.1.2 will remain with well-recipient herder groups; however, equipment ownership remains with respective soum governments according to the relevant law.

c Each training is expected to cost approximately $25 per participant. Trainings under 1.3 will cover 170 participants per training, and 2.3 will cover 140 participants per training.

d The total amount will be divided into three project soums in proportion to their respective herder households. Once distributed to those soums, the fund will be allocated to herder groups based on their business proposals (the average proposal size will be $3,000–$5,000).

e Government contributions will be in kind.

GPS = global positioning system, JFPR = Japan Fund for Poverty Reduction, UPS = uninterruptible power supply. Source: Asian Development Bank estimates.

36 Appendix 5

FUND FLOW ARRANGEMENTS 1. The executing agency and implementing agency will adopt either of the following disbursement procedures for withdrawal of proceeds of the grant in accordance with the Asian Development Bank (ADB) Loan Disbursement Handbook (2007, as amended from time to time): (i) a direct payment procedure, wherein ADB, at the request of the government, pays a designated beneficiary directly; and (ii) an imprest fund procedure, wherein ADB disburses from the grant account for deposit to an imprest account at a commercial bank acceptable to ADB, to be used exclusively for ADB’s share of eligible expenditures. 2. For the imprest account procedure, ADB will channel the proceeds of this Japan Fund for Poverty Reduction (JFPR) grant to a JFPR imprest account, which will be opened and maintained by the executing agency through the project management unit (PMU) in Ulaanbaatar, at a bank endorsed by the executing agency and acceptable to ADB, to facilitate day-to-day local project expenditures. The executing agency will be kept informed by the PMU about all transactions and receive copies of all financial statements and audit reports, including an opinion on the use of the imprest fund and the statement of expenditures (SOE) procedures. The JFPR imprest account will be managed by the PMU on the basis of a cosignatory arrangement with the Ministry of Finance, initially based on the first 6-month activity plan and related budget, and afterwards, based on the approved annual work plan and budget. 3. The advance to the imprest account should not exceed the lesser of (i) 10% of the total JFPR grant, or (ii) the estimated expenditure for the next 6 months to be financed through the imprest account. The SOE procedure will be used to liquidate and replenish the imprest account. The SOE procedure will apply for individual payments not exceeding $10,000 to ensure speedy project implementation. Payments in excess of the SOE ceiling will be liquidated or replenished based on full supporting documentation. The withdrawal applications and SOE will be signed by authorized representatives of the executing agency. Direct payment and reimbursement procedures will be used for eligible project expenditures in case of contracts for a substantial amount. 4. The executing agency has the capacity to undertake the implementation work attached to the project, as they have performed well in the implementation of the Water Point and Extension Station Establishment for Poor Herding Families Project.1 Because the imprest fund and SOE procedure will be used, the executing agency will ensure that the PMU has sufficient financial management capability to establish adequate accounting procedures and controls for the efficient operation of the imprest fund. Interest earned on the imprest account, net of bank charges, can be used for the project, subject to ADB’s approval and within the approved total amount of the JFPR grant. Any unused interest should be returned to the JFPR account maintained at ADB upon project completion and before closing of JFPR account. 5. Detailed implementation arrangements—such as the flow, replenishment, and administrative procedures—will be detailed in the grant implementation manual and be established between ADB and the government through the letter of agreement. The schematic fund flow for the project is in Figure A4.


Herding Families. Manila (JFPR 9124-MON, for $2,000,000, approved on 30 July).

Appendix 5 37

Figure A4: Fund Flow Arrangements for JFPR Project

Asian

Development Bank

Grant Imprest Account maintained by the Project

Management Unit

Component A: Capacity for Sustainable

Herding Improved in Project Soums

Component B: Water Points

Established and Managed in

Project Soums

Contingencies

Component C: Income

Generation Diversified in

Project Soums

Component D: Effective Project

Management Established

(i) The grant imprest account is held by the executing agency and/or the project management unit, which is under the Ministry of Food, Agriculture and Light Industry; (ii) the imprest fund will further pay out small payments to national consultants, goods and/or equipment suppliers, small grants, and contractors; and (iii) direct payment for large payments from Asian Development Bank to civil work contractors and/or equipment suppliers.

38 Appendix 6

IMPLEMENTATION ARRANGEMENTS 1. A detailed grant implementation manual (GIM) will be prepared by the project management unit (PMU) in consultation with the Asian Development Bank (ADB) and agreed upon with the Ministry of Food, Agriculture and Light Industry (MOFALI) and the Ministry of Finance (MOF) before project inception. The GIM will further detail the implementation and procurement arrangements. A. Institutional Arrangements

1. Executing Agency 2. MOFALI will be the executing agency and will be responsible for overall project supervision and implementation.

2. Steering Committee 3. A steering committee chaired by MOFALI and including nominated representatives from the MOF, the Ministry of Nature, Environment and Tourism, and Bayankhongor aimag government will provide oversight and policy guidance for the project and make strategic decisions, including final approval of water point sites. Representatives from ADB and the Embassy of Japan will participate in the steering committee as observers.

3. Implementing Agency 4. The implementing agency will be the PMU, whose office will be established under MOFALI in Ulaanbaatar. The PMU will be headed by a project director who will be responsible for management of the day-to-day affairs of the project including regular planning, monitoring and reporting, and the supervision of office staff and financial administration. The project director will also be responsible for negotiating contractual arrangements with external organizations. The project director is expected to coordinate with other relevant development agencies in Ulaanbaatar and Bayankhongor in building productive relationships with all key stakeholders. 5. The PMU will establish a project implementation unit (PIU) in the Bayankhongor aimag agricultural department, to be staffed by a project coordinator, support staff, and PIU technical experts. The PIU will oversee day-to-day field activities under the supervision of the project director and in close coordination with the governments of Bayankhongor aimag and project soums. 6. In each project soum, the veterinary and livestock breeding unit (which comprises a veterinary specialist, a livestock breeding specialist, an small and medium enterprises and crop production specialist, and a land management officer) is responsible for undertaking project activities in cooperation with the PIU, under the immediate supervision of the project coordinator and the overall guidance of the project director. The veterinary and livestock breeding units were established under the National Mongolian Livestock Program in all soums in 2010 to strengthen soum government capacity to support the livestock husbandry section, which had been seriously weakened since the 1990s. The project will strengthen this newly established unit to better assist herders.

Appendix 6 39

B. Implementation Schedule 7. The project will be implemented over 4 years, tentatively beginning in June 2012. The executing agency will recruit a project director to establish the PMU. The executing agency and the PMU will establish the PIU and recruit the PIU consultants. The implementation schedule will be prepared during project inception. C. Procurement 8. The PMU will be responsible for procurement, which will be undertaken in accordance with ADB's Procurement Guidelines (2010, as amended from time to time). Goods and services estimated to cost the equivalent of less than $70,000, and works estimated to cost the equivalent of less than $100,000 will be procured using shopping procedures. Goods, services, and works costing less than $5,000 may be purchased directly from the supplier. In such cases, ADB should be satisfied that the price paid is reasonable. For shopping, ADB will review the award of contracts on a post-review basis. 9. Goods and services with an estimated value of less than $500,000 and works with an estimated value of less than $1,000,000 will be procured using national competitive bidding (NCB) procedures in accordance with the Public Procurement Law of Mongolia 2011, subject to modifications agreed with ADB. For NCB, the first-draft English language version of the procurement documents should be submitted for ADB’s prior review and approval regardless of the estimated contract amount. The ADB-approved procurement documents should then be used as a model for all NCB procurement financed by ADB for the project, and need not be subject to further review. ADB will review the bid evaluation reports and award of contracts on a post-review basis. International competitive bidding is not envisaged under this project. The executing agency has the capacity to undertake procurement for the project, as they have performed adequately in the implementation of the Water Point and Extension Station Establishment for Poor Herding Families1 and the Agriculture and Rural Development projects.2 In order to further strengthen the executing agency’s capacity on procurement and consultant recruitment, an ADB inception mission will provide training for the executing agency staff on procurement and consultant recruitment. The procurement plan is in Appendix 7. D. Consulting Services 10. The project will require the services of 10 national consultants for a total of 282 person-months for project implementation through the PMU and PIU. Those consultants will be recruited and contracted by the executing agency in accordance with ADB’s Guidelines on the Use of Consultants (2010, as amended from time to time) and the procurement plan, which will be revised as needed during project implementation. The outline terms of reference for consultants are in Appendix 8.


Herding Families. Manila (JFPR 9124-MON, for $2,000,000, approved on 30 July). 2 ADB. 2008. Report and Recommendation of the President to the Board of Directors: Proposed Asian Development

Fund Grant and Technical Assistance Grant to Mongolia for the Agriculture and Rural Development Project. Manila (Grant 0115-MON, for $14,720,000 for the grant and $2,000,000 for the technical assistance, approved on 29 September).

40 Appendix 6

E. Disbursement

11. The executing agency and implementing agency will adopt either of the following disbursement procedures for withdrawal of the proceeds of the grant in accordance with ADB’s Loan Disbursement Handbook (2007, as amended from time to time): (i) a direct payment procedure, wherein ADB, at the request of the government, pays a designated beneficiary directly; (ii) an imprest fund procedure, wherein ADB disburses from the grant account for deposit to an imprest account at a commercial bank acceptable to ADB, to be used exclusively for ADB’s share of eligible expenditures; and (iii) the statement of expenditure procedure, which may be used to reimburse eligible expenditures and to liquidate advances provided to the imprest account for payments that do not exceed $10,000 per individual payment. The total advances at any time are not to exceed the lesser of (i) the estimated expenditures for the next 6 months, or (ii) 10% of the Japan Fund for Poverty Reduction (JFPR) grant amount. The fund flow arrangements are in Appendix 5.

F. Reporting and Auditing

12. Semiannual project progress report. The PMU will prepare and submit semiannual project progress reports to ADB within 1 month of the end of every reporting period. The form and contents of the reports will be provided by ADB and included in the GIM. The reports should be circulated to the executing agency, MOF, and the Embassy of Japan in Mongolia.

13. Audited grant account. The PMU will maintain separate accounts for all project components financed by the JFPR, and have them audited by an independent auditor that has adequate knowledge of and experience with international accounting practices and is acceptable to ADB and MOFALI. The audited project accounts will be available within 6 months after the end of each fiscal year. The report should include certified copies of the audited accounts and financial statements and the report of the auditors relating to said statements, including the auditors’ opinion on the use of the JFPR funds, and the operation of any imprest account and the application of any statement of expenditure procedure authorized under the JFPR project.

14. Implementation completion memorandum. The project implementation completion memorandum should be prepared by the executing agency and submitted to ADB within 6 months after the grant closing date. The memorandum will document actual cumulative inputs, outputs and outcomes, and lessons learned through the grant implementation period.

G. Monitoring and Evaluation

15. A preliminary set of indicators for monitoring and evaluating the performance of the project will be agreed upon by MOFALI and ADB. At the beginning of project implementation, the PMU will confirm baseline values for social, environmental, and poverty reduction impact indicators. Performance targets and/or indicators in the design and monitoring framework will be used to monitor project progress, which will be reported as part of the project progress report during project implementation.

16. Contract awards, commitments, and disbursement projections. Consistent with the project schedule, disbursement of the JFPR resources will be spread over the implementation period. The disbursement projections for each year will be detailed in the inception report.

17. Grant reviews. ADB and the government will jointly carry out reviews of the project twice per year. The reviews will assess progress, identify issues and constraints, and determine necessary remedial actions and adjustments. A midterm review will be conducted in the third year of project implementation.

Appendix 7 41

PROCUREMENT PLAN

Table A7.1: Basic Data Project Name: Establishment of Climate-Resilient Rural Livelihoods Country: Mongolia Executing Agency: Ministry of Food, Agriculture

and Light Industry Grant Amount: $2.5 million Grant Number: 45145 Date of First Procurement Plan: 30 September 2011

Date of this Procurement Plan: 23 April 2012

A. Process Thresholds, Review and 18-Month Procurement Plan

1. Project Procurement Thresholds 1. Except as the Asian Development Bank (ADB) may otherwise agree, the following process thresholds shall apply to procurement of goods and works.

Table A7.2: Procurement of Goods and Works Method Threshold

NCB worksa Equal to or more than $100,000 and below

$1,000,000 NCB goods

a Equal to or more than $70,000 and below

$ 500,000 Shopping works

b Below $100,000

Shopping goodsb Below $70,000

NCB = national competitive bidding a NCB procedures are described in section D of this procurement plan.

b For the procurement of items below $5,000, the executing and implementing agencies may purchase the items

directly from suppliers, and in such cases, ADB should be satisfied that the price paid is reasonable.

2. ADB Prior or Post Review

2. Except as ADB may otherwise agree, the following prior- or post-review requirements apply to the various procurement and consultant recruitment methods used for the project.

Procurement Method Prior or Post Comments

Procurement of Goods and Works

NCB works NCB goods

Prior and post The first draft English language-version of the procurement documents should be submitted to ADB for prior review and approval regardless of the estimated contract amount. ADB-approved procurement documents should be used as a model for all NCB procurement financed by ADB for the project, and need not be subject to further review. ADB will review the bid evaluation report and award of contract on a post-review basis. Use of this method is subject to the provisions of the NCB Annex, ADB’s Procurement Guidelines (2010, as amended from time to time), paras. 3.3–3.4; and PAI 3.04.

Shopping for works Shopping for goods

Post For shopping (including direct contracting), ADB will normally review the award of contract on a post facto basis. Use of this method is subject to the provisions of the

42 Appendix 7

Procurement Method Prior or Post Comments

NCB Annex, ADB’s Procurement Guidelines, paras. 3.5; and PAI 3.04 C.4 and 5.

Recruitment of Individual Consultants

Individual Consultant Selection (ICS) Prior PMU and PIU consultants (all national) will be recruited individually.

ADB = Asian Development Bank, NCB = national competitive bidding, PAI = project administration instructions, PIU = project implementation unit, PMU = project management unit.

3. Consulting Services Contracts Estimated to Cost More Than $100,000 3. The following table lists consulting services contracts for which procurement activity is expected to commence within the next 18 months.

General Description Contract Value

Recruitment Method

Advertisement Date

(quarter/year)

International or National Assignment Comments

Nil

4. Goods and Works Contracts Estimated to Cost Less than $1 Million and Consulting Services Contracts Less than $100,000

4. The following table groups goods, works, and consulting services contracts for which procurement activity is expected to commence within the next 18 months.

General Description

Value of Contracts

(cumulative) ($) Number of Contracts

Procurement Method Comments

A. Civil Works 1. Engineering Wells 460,000 2 NCB B. Goods 1. Office equipment

and furniture 37,700 Multiple Shopping

2. Livestock laboratory

diagnostic and insemination equipment

70,000 1 NCB

3. Motorcycles 5,000 1 Shopping One unit for

each of three project soums

C. Consulting Services

1. PMU and PIU consultants (all national)

493,826 10 ICS The outline terms of reference for consultants are in Appendix 8.

NCB = national competitive bidding, PIU = project implementation unit, PMU = project management unit.

Appendix 7 43

B. Indicative List of Packages Required Under the Project 5. The following table provides an indicative list of all procurement (goods, works, and consulting services) over the life of the project.

General Description

Estimated Value

(cumulative) ($)

Estimated Number of Contracts

Procurement Method

Domestic Preference Applicable Comments

A. Civil Works 1. Engineering wells 460,000 2 NCB N/A B. Goods

1. Office equipment and furniture

39,000 Multiple Shopping

N/A

2. Livestock laboratory

diagnostic and insemination equipment

70,000 1 NCB

N/A

3. Motorcycles 4,650 1 Shopping N/A One unit of

each for three project soum

C. Consulting

Services

1. PMU and PIU

consultants (all national)

493,826 10 ICS N/A The outline terms of reference for consultants are in Appendix 8.

ICS = individual consultant selection, NCB = national competitive bidding, N/A = not applicable, PIU = project implementation unit, PMU = project management unit.

C. National Competitive Bidding 6. The procedures to be followed for national competitive bidding shall be those set forth in the Public Procurement Law of Mongolia of 1 December 2005, effective 1 February 2006, as amended on 6 February 2007, 16 July 2009, and 1 December 2011 (hereinafter referred to as PPLM), with the clarifications and modifications described in the following paragraphs required for compliance with the provisions of ADB's Procurement Guidelines.

(i) The Standard Bidding Documents of Mongolia for Goods and Works that have been approved by ADB as acceptable for ADB-financed projects, together with ADB's clarifications and modifications thereto, shall be used.

(ii) Government-owned enterprises in Mongolia shall be eligible for projects only if they can establish that they: (a) are legally and financially autonomous, (b) operate under the principles of commercial law, and (c) are not dependent agencies of the executing agency and/or the implementing agency.

(iii) If a bid security is required, the bid security shall be in any of the following forms at the bidder's option: (a) a bank guarantee, or (b) a cashier's or certified check.

44 Appendix 7

(iv) Bidders must be nationals of member countries of ADB, and offered goods and works must be produced in and supplied from member countries of ADB. Bidders or potential bidders shall not be required to register with the taxation and other registration authorities of the government as a condition or requirement of bidding or award, leaving these requirements after award and before signing of contract.

(v) Foreign bidders from eligible countries of ADB shall be allowed to participate in bidding under the same conditions as local bidders and without any domestic preference.

(vi) Prequalification shall not be required, except in the case of large or complex works, and with prior written concurrence of ADB.

(vii) Qualification criteria shall be clearly specified in the bidding documents, and all criteria so specified shall be used to determine whether a bidder is qualified. The evaluation of a bidder's qualifications shall only take into account the bidder's capacity and resources to perform the contract, in particular its experience and past performance on similar contracts, capabilities with respect to personnel, equipment and construction or manufacturing facilities, and financial position. The evaluation of the bidder's qualifications shall be conducted separately from the technical and commercial evaluation of the bid.

(viii) Evaluation and qualification criteria, and submission requirements, to be used in each bidding activity shall be clearly specified in the bidding documents. The evaluation of bids shall be done in strict adherence to the criteria specified in the bidding documents.

(ix) The invitation to bid and the bidding documents shall be prepared in the Mongolian language. If another language will be used, then such other language shall be English.

(x) Bidders shall be requested to extend the validity of their bids only under exceptional circumstances and the executing or implementing agency, as the case may be, shall communicate such request for extension to all bidders before the date of expiry of their bids. When the procurement is subject to ADB's prior review, the executing or implementing agency, as the case may be, shall obtain in a timely manner the prior written concurrence of ADB for the extension of the bid validity period.

(xi) All bids shall not be rejected or new bids invited without ADB's prior written concurrence. No bid shall be rejected merely on the basis of a comparison with the estimated cost or budget ceiling without ADB's prior written concurrence (with specific reference to Article 30 of the PPLM).

(xii) Negotiations with bidders shall not be undertaken before award of contract, except as provided in para. 2.63 of ADB's Procurement Guidelines, with specific reference to Article 30.2 of the PPLM. A bidder shall not be required, as a condition for award, to undertake obligations not specified in the bidding documents or otherwise to modify its bid as originally submitted.

(xiii) Bidding documents and contracts under national competitive bidding procedures financed by ADB shall include a provision requiring suppliers, contractors, and consultants to permit ADB to inspect their accounts and records relating to the bid submission and the performance of the contract by the supplier, contractor and/or consultant, as the case may be, and to have them audited by auditors appointed by ADB, if so required by ADB.

(xiv) At the same time that notification on award of contract is given to the successful bidder, the results of the bid evaluation shall be posted on a well-known freely accessible website (namely Mongolia's Ministry of Finance e-procurement website: www.e-procurement.mn) identifying the bid and lot numbers and

Appendix 7 45

providing information on the: (a) name of each bidder that submitted a bid; (b) bid prices as read out at bid opening; (c) names of bidders whose bids were rejected and the reasons for their rejection; and (d) name of the winning bidder, and the price it offered, as well as the duration and summary scope of the contract awarded. The executing agency or implementing agency, as the case may be, shall respond in writing to unsuccessful bidders who seek explanations on the grounds on which their bids were not selected.

46 Appendix 8

OUTLINE TERMS OF REFERENCE FOR CONSULTANTS 1. The overall consultant services inputs required by the project are in Table A8.

Table A8: Consulting Services Inputs

No. Position Base

Station Person-Months

Selection Method

A. Project Management Unit Consultants 1 Project director PMU 48 ICS

ICS ICS

2 Project implementation specialist PMU 36 3 Project administrator PMU 45 Subtotal (A) 129

B. Project Implementation Unit Consultants 1 Project coordinator PIU 45 ICS

ICS ICS ICS ICS ICS ICS

2 Pasture management expert PIU 32 3 Livestock expert PIU 24 4 Geographic information system expert PIU 4 5 Hydrogeologist PIU 20 6 Water engineer expert PIU 4 7 Income generation expert PIU 24 Subtotal (B) 153 Total Inputs 282

ICS = individual consultant selection, PIU = project implementation unit, PMU = project management unit. Source: Asian Development Bank estimates.

A. Project Management Unit Consultants 1. Project Director 2. The project director (national, 48 person-months, project management unit [PMU]-based with field assignments) will have a postgraduate degree in business administration, management, agricultural science, engineering, economics, and/or related field. The consultant is required to have at least 7 years of experience with donor-funded project(s) with extensive field operations, of which the consultant worked in a managerial capacity for at least 3 years. The consultant will also have experience in overseeing procurement and consultant recruitment in donor-funded project(s) for at least 3 years. Previous experience with Asian Development Bank (ADB) project(s) is highly preferred. The consultant will have an excellent command of both written and spoken English. 3. The consultant is expected to take leadership of the PMU and project implementation unit (PIU), ensuring that the outcome and outputs of the project are achieved in a timely manner. The consultant will be responsible for managing the day-to-day affairs of project implementation including planning, monitoring and reporting, and supervising PMU personnel and the project coordinator at the PIU. Specific duties will include:

(i) assist the executing agency in finalizing the grant implementation manual; (ii) prepare a detailed project implementation schedule and update as required; (iii) ensure timely establishment of the PIU under the Bayankhongor aimag

government, which includes the recruitment of a project coordinator and PIU

Appendix 8 47

technical experts according to ADB’s Guidelines on the Use of Consultants (2010, as amended from time to time);

(iv) establish cooperative relationships and agreements with the executing agency, the project aimag and the soums for the purpose of project implementation;

(v) ensure timely procurement of works, goods and services with the assistance of the project administrator according to ADB’s Procurement Guidelines (2010, as amended from time to time);

(vi) ensure timely grant utilization with the assistance of the project administrator according to ADB’s Loan Disbursement Handbook (2007, as amended from time to time);

(vii) ensure, with the assistance of the monitoring expert, timely establishment of the mechanism for project implementation monitoring, which includes collection and/or confirmation of baseline data for target indicators at project inception;

(viii) ensure that the committed counterpart funds are available on time; (ix) represent the project in building productive relationships with key stakeholders

such as the Embassy of Japan in Ulaanbaatar, other donors, and projects; (x) report to the Ministry of Food, Agriculture and Light Industry, the Ministry of

Finance, and ADB on project implementation progress in a timely manner; and (xi) assist ADB review missions.

2. Project Implementation Specialist

4. The project implementation specialist (national, 36 person-months, PMU-based with frequent field assignments) will have a postgraduate degree in business administration, public administration, agricultural science, engineering, economics, and/or a related field. The consultant will have at least 5 years of experience with donor-funded project(s) with extensive field operations, and will have worked in a similar capacity for at least 2 years. The consultant should have a good command of both written and spoken English. 5. Under the supervision of the project director, the consultant will be responsible for (i) ensuring project implementation towards the project targets specified in the design and monitoring framework, (ii) ensuring project implementation in compliance with ADB social and environmental policies, and (iii) ensuring effective monitoring of project activities. Specific duties will include:

(i) establish a mechanism for monitoring project implementation through which the PIU and project soum governments provide updated information based on the design and monitoring framework;

(ii) develop and update a monitoring plan for project implementation activities; (iii) assist the project director in preparing and updating the project implementation

schedule; (iv) lead the PIU in cooperation with project soum governments to carry out baseline

data confirmation and/or collection and updating during project implementation; (v) assist the PIU in preparing proposals for training, workshops, and publications in

line with the latest project implementation schedule; (vi) assist the project administrator in procurement, and especially in providing inputs

for technical procurement requirements; (vii) monitor project implementation progress regularly according to the monitoring

plan, and incorporate necessary measures in the project implementation schedule;

(viii) assist the PIU in implementing the environmental mitigation and monitoring plan; (ix) assist the project director in preparing project progress reports in a timely manner;

48 Appendix 8

(x) take minutes of workshops, meetings, and/or seminars, and draft memos and letters for PMU, as required; and

(xi) develop lessons learned and policy recommendations.

3. Project Administrator 6. The project administrator (national, 45 person-months, PMU-based with occasional field assignments) will have a postgraduate degree in business administration, accounting, public administration, and/or a related field. The consultant will have at least 5 years of experience with donor-funded project(s), during which the consultant will have worked in the equivalent capacity for at least 3 years. Proficient command of Microsoft Word and Excel is required. Previous experience with ADB and/or World Bank project(s) is highly preferred. The consultant should also have an excellent command of both written and spoken English. 7. Under the supervision of the project director, the consultant will provide administrative support to project activities at the PMU, including (i) efficient disbursement operations; (ii) procurement of works, goods, and services; (iii) recruitment of consultants; (iv) monitoring and controlling of contracts; and (v) ensuring all the above tasks are carried out in full compliance with relevant policies and guidelines of ADB and the government. Specific duties will include:

(i) assist the PMU in opening and maintaining a project imprest account according to ADB’s Loan Disbursement Guidelines;

(ii) establish and maintain an accounting management system for the PMU and assist the PIU in doing the same for itself;

(iii) provide information required for annual audits; (iv) ensure that the procurement plan is updated; (v) provide administrative support for procurement of works, goods, and services

according to the procurement plan and ADB’s Procurement Guidelines; (vi) provide administrative support for recruitment of consultants according to the

procurement plan and ADB’s Guidelines on the Use of Consultants; (vii) monitor contractor performance to ensure timely completion of contracts; (viii) document project activities related to procurement of goods and services and

recruitment of consultants and file these in a systematic and timely manner, together with all other relevant documents, for auditing and translating of relevant documents as needed;

(ix) assist the PMU in organizing training and workshops in cooperation with the PIU; (x) assist the project director in preparing project progress reports in a timely manner;

and (xi) establish and maintain a systematic filing system and asset management system

at the PMU in view of future transfer of the files and assets to the executing agency, and assist the PIU to do the same.

B. Project Implementation Unit Consultants

1. Project Coordinator 8. The project coordinator (national, 45 person-months, PIU-based with frequent field assignments) will have a postgraduate degree in business administration, management, agricultural science, engineering, economics, and/or a related field. The consultant will have at least 5 years of relevant experience, including 3 years of experience with donor-funded project(s) with extensive field operations. Working experience with aimag and soum

Appendix 8 49

governments is highly preferred. Previous experience with ADB project(s) is preferred. The consultant should have a good command of written and spoken English. 9. Under the supervision of the project director, the consultant will (i) lead the PIU in implementing project activities in the project aimag and soums, (ii) supervise PIU administrative assistant and technical experts, and (iii) report regularly to the project director on project implementation progress. Specific duties will include:

(i) establish and maintain a cooperative relationship with the project aimag and soum governments;

(ii) establish a communication and participation strategy to ensure participation of poor and female herders;

(iii) ensure timely formation of herder groups and herder group organizations; (iv) ensure timely implementation of training and workshops at the project aimag and

soums; (v) establish and maintain cooperative relationships with other relevant institutions,

including donors and other projects, as needed; (vi) ensure financial management of the PIU with the assistance of the administrative

assistant; (vii) assist the project director in updating the detailed implementation schedule as

required; (viii) assist the PMU in establishing a project implementation monitoring mechanism

that includes collection and/or confirmation of baseline data for target indicators at project inception;

(ix) cooperate with the PMU in monitoring project implementation progress and environmental safeguard compliance according to the monitoring plan;

(x) cooperate with other donor projects and nongovernment organizations in the project aimag and soums;

(xi) assist the project director in preparing project progress reports and a consultant’s final report at the end of the project; and

(xii) develop lessons learned and policy recommendations on climate-resilient herding.

2. Pasture Management Expert

10. The pasture management expert (national, 32 person-months, PIU-based with frequent field assignments) will have an undergraduate degree (postgraduate degree is preferred) in pasture management, animal husbandry, environmental science, agricultural science, and/or a related field. The consultant will have at least 5 years of experience with pasture management and/or nomadic husbandry. The consultant will be familiar with the current legal framework for pasture access and use. Previous experience with donor-funded project(s) is an advantage. The consultant will be required to travel frequently to the project soums. Basic command of English is an advantage. 11. Under the supervision of the project coordinator, the consultant together with the livestock expert will work closely with relevant departments (e.g., the agricultural department and the land management department) at the aimag level, and the veterinary and livestock breeding units and the land management officers at the soum level, to implement project activities, mainly under component A. Specific duties will include:

(i) ensure that the consultation and participation strategy is applied and poor and female herders are participating in project activities under components A and B;

50 Appendix 8

(ii) assist herders in forming herder groups and herder group organizations; (iii) cooperate with relevant aimag departments (e.g., the agricultural department and

the land management department) at the aimag level, and the veterinary and livestock husbandry units and the land management officers at the soum level to assist herder groups in developing pasture management plans;

(iv) review pasture use agreements developed under the Water Point and Extension Station Establishment for Poor Herding Families Project,1 and refine them as needed;

(v) cooperate with the veterinary and livestock husbandry units and the land management officers to assist herder groups in making pasture use agreements with respective soum governors;

(vi) assist the veterinary and livestock husbandry units and the land management officers in preparing a pasture management plan for each project soum;

(vii) identify the carrying capacity of pasture areas for herder groups and cooperate with the veterinary and livestock husbandry units and the land management officers to advise herder groups on the recommended carrying capacity;

(viii) monitor the implementation of pasture management plans by herder groups and the soums;

(ix) conduct and/or help in organizing training and workshops under components A and D;

(x) carry out environmental mitigation and monitoring related to pasture management;

(xi) cooperate with the income generation expert on component C within the area of the consultant’s expertise;

(xii) develop lessons learned and policy recommendations on pasture management; and

(xiii) provide relevant inputs for project progress reports and a consultant’s final report at the end of the project.

3. Livestock Expert

12. The livestock expert (national, 24 person-months, PIU-based with frequent field assignments) will have an undergraduate degree (postgraduate degree is preferred) in animal husbandry and veterinary, or a related field. The consultant will have at least 5 years of experience in capacity development in livestock husbandry and/or veterinary. The consultant will have working experience with aimag and/or soum governments. The consultant will be required to travel frequently to project soums. Basic command of English is an advantage. 13. Under the supervision of the project coordinator, the consultant together with the pasture management expert will work closely with the agricultural department at the aimag level, and the veterinary and livestock breeding units and private veterinary practitioners at the soum level to implement project activities, mainly under the component A. Specific duties will include:

(i) ensure that the consultation and participation strategy is applied, and poor and female herders are participating in project activities under components A and B;

(ii) assist herders in forming herder groups and herder group organizations; (iii) identify areas of training and/or demonstration for climate-resilient livestock

husbandry;


Herding Families. Manila (JFPR 9124-MON, for $2,000,000, approved on 30 July).

Appendix 8 51

(iv) cooperate with the veterinary and livestock breeding units and private veterinary practitioners to provide herders with services regarding livestock production, processing, preparation of fodder and animal feeds, and enhancement of winter livestock shelters;

(v) conduct and/or help in organizing training and workshops under components A and D;

(vi) cooperate with the income generation expert under component C within the area of the consultant’s expertise;

(vii) develop lessons learned and policy recommendations on climate-resilient livestock husbandry; and

(viii) provide relevant inputs for project progress reports and a consultant’s final report at the end of the project.

4. Geographic Information System Expert

14. The geographic information system (GIS) expert (national, 4 person-months, PIU-based with frequent field assignments) will have a postgraduate degree or equivalent academic training in geographic information systems. The consultant will have at least 3 years of experience in working as GIS expert on pasture and/or natural resources management. The consultant will be required to travel frequently to project soums. Basic command of English is an advantage. 15. Under the supervision of the project coordinator, the consultant together with the pasture management expert will work closely with relevant aimag departments (e.g., the agricultural department and the land management department) at the aimag level, and the veterinary and livestock breeding units and the land management officers at the soum level to implement project activities under component A. Specific duties of the consultant will include:

(i) assess existing GISs or information required for the establishment of GISs at the soum level;

(ii) assess the capacity of land management officers to maintain a GIS at the soum level;

(iii) assist the land management officers in collecting and/or updating and processing information required for a GIS at the soum level;

(iv) provide land management officers with GIS training based on (i) and (ii); and (v) advise the land management officers on using a GIS system to design future

land management planning (including for pasture land).

5. Hydrogeologist 16. The hydrogeologist (national, 20 person-months, PIU-based with frequent field assignments) will have an undergraduate degree (postgraduate degree is preferred) in hydrogeology and water resources management, and/or a related field. The consultant will have at least 5 years of experience in water surveys for well construction and/or rehabilitation. The consultant will have experience in working with aimag and/or soum governments. The consultant will be required to travel frequently to project soums. Basic command of English is an advantage. 17. Under the supervision of the project coordinator, the consultant together with the livestock expert will work closely with the agricultural department and the environmental department at the aimag level, and the veterinary and livestock breeding units, the land

52 Appendix 8

management officers, and the agriculture and environment inspector at the soum level to implement project activities, mainly under component B. Specific duties consultant will include:

(i) ensure the consultation and participation strategy is applied, and poor and female herders are participating in project activities under components A and B;

(ii) carry out and/or supervise a water survey to take stock of existing water points (i.e., wells and springs) and make a preliminary assessment of needs for project assistance for well rehabilitation and fencing for springs, and locations for potential water point construction in each project soum;

(iii) advise on suitable types of water points (i.e., shallow and deep wells) and locations for water point construction and/or rehabilitation based on herder groups’ needs;

(iv) prepare technical specifications for contracts for water point construction and/or rehabilitation;

(v) lead monitoring of implementation of the contracts in cooperation with herders; (vi) contribute hydrology-related inputs for environmental assessment of new water

point construction and/or rehabilitation, in particular, groundwater recharge of water points, water quality, and disposal of drilling and other waste;

(vii) advise herders on the use of water points and options for water point operation and maintenance, which include setting of appropriate water fees;

(viii) develop water use agreements based on those developed under the Water Point and Extension Station Establishment for Poor Herding Families Project;

(ix) assist herder groups in making water use agreements with respective project soum governors;

(x) conduct and/or help in organizing training and workshops under components B and D;

(xi) carry out environmental mitigation and monitoring for activities under component B;

(xii) develop lessons learned and policy recommendations on water point utilization; and

(xiii) provide relevant inputs for project progress reports and a consultant’s final report at the end of the project.

6. Water Engineer Expert

18. The water engineering expert (national, 4 person-months, PIU-based with frequent field assignments) will have an undergraduate degree (postgraduate degree is preferred) in water engineering and/or related field. The consultant will have at least 5 years of professional experience in designing different types of small-scale irrigation for crop, including fodder crop, and production. The consultant will have experience in working with aimag and soum governments, or relevant research institute. The consultant will be required to travel frequently to project soums. Basic command of English is an advantage. 19. Under the supervision of the project coordinator, the consultant will work closely with the agricultural department at the aimag level, and the veterinary and livestock breeding units at the soum level to implement project activities under component A. The consultant will cooperate with the pasture management expert and, as needed, the income generation expert. Specific duties will include:

(i) assess needs of small-scale irrigation for crop production; (ii) identify locations suitable for small-scale irrigation for crop production; (iii) design small-scale irrigation systems, and specify required works and goods;

Appendix 8 53

(iv) provide herders and relevant soum government officials with capacity building on monitoring of the construction of small-scale irrigation systems; and

(v) provide relevant inputs for project progress reports and a consultant’s final report at the end of the project.

7. Income Generation Expert

20. The income generation expert (national, 24 person-months, PIU-based with frequent field assignments) will have an undergraduate degree (postgraduate degree is preferred) in economics, marketing, management, business administration, and/or a related field. The consultant will have at least 5 years of working experience with herders in alternative income-generating activities (e.g., value addition to livestock-based primary products, crop production, household-, small-scale agricultural processing or manufacturing). The consultant should have experience working with herders. The consultant will be required to frequently travel to project soums. Basic command of English is an advantage. 21. Under the supervision of the project coordinator, the consultant will work closely with the agricultural department and the chamber of commerce and industry at the aimag level, and the veterinary and livestock breeding units at the soum level to implement project activities under component C. The consultant will also cooperate with the pasture management expert and livestock expert in areas where their expertise is required. Specific duties will include:

(i) ensure that the consultation and participation strategy is applied, and that poor and female herders are participating in project activities under component C;

(ii) identify the financial needs of herders and small entrepreneurs, taking into consideration existing financial support from central and local governments and other projects;

(iii) propose options for appropriate modalities for small grant utilization; (iv) identify potential income-generating activities for herders for each project soum

by reviewing existing income-generating activities and business opportunities; (v) advise the veterinary and livestock breeding units with respect to providing

services in the area of micro, small and medium enterprises development; (vi) cooperate with the veterinary and livestock breeding units to assist herders in

developing business plans and organizing product marketing; (vii) cooperate with the veterinary and livestock breeding units in conducting need

assessments for training and/or demonstration on different income-generating activities;

(viii) prepare and update a database of business plans supported by the project; (ix) monitor the implementation of business plans and provide advice as needed; (x) carry out environmental mitigation and monitoring activities under component C; (xi) conduct and/or help in organizing training and workshops under component C; (xii) develop lessons learned and policy recommendations on diversification of

income generation; and (xiii) provide relevant inputs for project progress reports and a consultant’s final report

at the end of the project.

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