PROJECT INFORMATION DOCUMENT (PID)APPRAISAL STAGE

Report No.: AB3675Project Name Pastoral Community Development ProjectRegion AFRICASector General agriculture, fishing and forestry sector (20%);General

education sector (20%);Animal production (20%);Other social services (20%);General water, sanitation and flood protection sector (20%)

Project ID P108932Borrower(s) FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIAImplementing Agency

Ministry of Federal AffairsP.O. Box 5608Addis AbabaEthiopiaTel: 251-1-154858 Fax: 251-1-511200mofa@telecom.net.et

Environment Category [ ] A [X] B [ ] C [ ] FI [ ] TBD (to be determined)Date PID Prepared April 3, 2008Date of Appraisal Authorization

March 28, 2008

Date of Board Approval May 29, 2008

1. Country and Sector Background

Ethiopia’s Development Strategy: Ethiopia is currently implementing its second poverty reduction strategy (PRS), known as the Plan for Accelerated and Sustained Development to End Poverty (PASDEP). The PASDEP shows a strong vertical coordination of sectoral strategies with the overall government strategy and is well integrated with the budget through the Macroeconomic and Fiscal Framework (MEFF) and the government/donor Joint Budget and Aid Review (JBAR). The PASDEP’s strategic vision is one of rapid and sustained growth primarily through scaled up development assistance and large domestic investments targeted at eliminating the poverty traps that have hindered the development of the country. While building upon the first PRS (SDPRP, the Sustainable Development and Poverty Reduction Program), the PASDEP contains several new elements, including an explicit link with the Millennium Development Goals, as well as a new focus on growth. The PASDEP also includes a specific section on development issues and approaches in pastoral areas of Ethiopia.

Pastoralism in Ethiopia: In Ethiopia, pastoralism is extensively practiced in the Afar and Somali National Regional States (Regions), in the Borana Zone of the Oromya national Regional state, and in the South Omo zone of the Southern Nations, Nationalities and Peoples (SNNPR) national Regional state. Pastoralists are also found in areas of Tigray, Beneshangul and Gambella Regions. These lowlands encompass at least 12 million people, over 500,000 km2 (61 percent of the surface area of Ethiopia) and over eleven million animals. People living in the lowland areas of Ethiopia comprise (i) the comparatively wealthy who hold substantial livestock assets, (ii) a larger number of poor people who have small herds and flocks, and those who, to a greater or

lesser extent, depend upon cropping or sale of their labor ("agro-pastoralists"), and (iii) a significant number who are gradually abandoning pastoral livelihoods due to loss of assets and degradation of grazing, and who are settling on the outskirts of villages and towns or migrating to cities. Although climatic conditions and hardships are similar for most pastoral areas, the people inhabiting these areas differ in their social structure, herd composition, coping strategies and in the extent of their integration into the market economy.

In the past, pastoralist area development received relatively little attention from policy makers, and pastoral peoples were economically, socially, and politically marginalized in Ethiopia. Key development issues in these areas include: (i) land tenure security for grazing land and encroachment by sedentary populations as well as large scale development schemes, (ii) poor access to public services, (iii) a restrictive livestock marketing and export policy, (iv) poor access to social services, (iv) vulnerability to drought shocks, (v) environmental degradation, in particular of rangelands; and (vi) restrictions on movement and conflicts related to natural resource management (NRM) as well as regional competition. The relative severity of pastoralists’ socio-economic status prompted the Government of Ethiopia (GoE) to intensify its search for sustainable development strategies in these areas from 2002 onwards.

The GoE’s current vision for addressing development in pastoral areas is stipulated in the PASDEP. The section on “Pastoralist Livelihoods and Development” acknowledges the previous marginalization of pastoral populations and recognizes that pastoralist populations are among the poorest of the poor in Ethiopia. It proposes a range of adapted livelihoods and service delivery interventions to remedy this situation.

2. Objectives

The development objective of phase II of the Pastoral Community Development Project is to contribute to increasing (i) the resilience of Ethiopian pastoralists to external shocks and (ii) improving the livelihoods of targeted communities. Accordingly, the project is designed to:

(i) Increase pastoral community engagement in woreda processes and local development decision making;

(ii) Increase access to and effective delivery of social services;(iii) Enhance pastoralists’ access to support for savings and credit activities;(iv) Improve woreda authorities’ accountability and responsiveness to pastoralist

citizens;(v) Expand the pastoral early warning system;(vi) Enhance the responsiveness of the disaster contingency fund in a

decentralized manner;(vii) Prepare and implement regional disaster preparedness investment strategies;

and(viii) Improve access to information and awareness of pastoralist development

issues.

3. Rationale for Bank Involvement

The Bank is supporting the Government Program through a three-stage APL first initiated in 2003. The rationale for Bank involvement as defined for Phase 1 of the project remains valid and continues to provide a strong impetus for continued Bank involvement in the PCDP.

(i) First, the current Interim Country Assistance Strategy (ICAS) identifies good government, addressing vulnerability and growth as central pillars of Bank support to Ethiopia. The PCDP, identified in the ICAS, is the primary investment program in Ethiopia supporting these objectives in lowland areas of the country. The proposed Country Assistance Strategy (CAS) that is currently under preparation maintains this focus, with an additional emphasis on enhancing the scale and quality of service delivery.

(ii) Communities and local governments have demonstrated their desire for capacity to implement PCDP resources beyond initial expectations. Approximately 94% of Project resources have been disbursed twelve months ahead of the scheduled closing date of phase I of the Program. Further financing is required to consolidate the gains in existing target woredas (districts) as well as to expand access to financing to other pastoral communities and woredas which have expressed strong demand for access to PCDP resources.

(iii) The establishment of effective state support to pastoralist livelihoods and service delivery in the Ethiopian lowlands is a long-term process. The Government, Bank and IFAD partnership need to continue their engagement with the PCDP in order to realize the full potential of the Program.

(iv) Finally, Bank resources are required to fill a financing gap. The Bank’s financial contribution continues to be critical in leveraging financing from IFAD, and may be instrumental in helping the Government broaden the donor base for the PCDP in the coming years.

4. Description

Component 1: Sustainable Livelihoods Enhancement (US$ 67.9 million, including US$ 29.0 million from the World Bank, US$ 21.4 million from IFAD, US$ 9.2 million from Government and US$ 8.3 million from Beneficiaries)

This component will further strengthen decentralized and participatory planning at the community/ kebele (sub-district) and woreda levels, operating within the Regional government structure. Women and men in pastoral communities will identify, prioritize, design, and implement micro-projects that reflect their development priorities. Regions and communities will be supported by Project-financed Mobile Support Teams (MSTs), who will work with woreda administrations and their technical and social services support offices. The MSTs will employ Participatory Learning and Action (PLA) tools to facilitate participatory situation analysis and to help communities develop modest, local investment and livelihood development projects.

The experience in planning, implementing and evaluating these micro-projects will build up local capacities to develop integrated Community Action Plans (CAPs). Using simple micro-project application forms, communities will clearly define their objectives, and propose activities and budgets, while taking into consideration the environmental implications of their projects. Community capacity-building around community-based conflict management will also be emphasized, with training provided to a range of actors with a voice within their communities (including not only local officials (kebele, woreda), but also clan and ethnic leaders, leaders of customary institutions, pastoral associations and community-based organizations) to empower these actors and to help them develop the tools they need to be effective peace advocates within their communities and mitigate against inter-community resource conflicts.

Sub-Component A: Community Investment Fund (CIF): Proposed community investments will be forwarded to woredas for funding through the Community Investment Fund (CIF) sub-component. A Woreda Development Committee (WDC), comprising representatives of the woreda administration and community representatives will appraise and endorse CIF requests. In order to preserve the multi-sectoral nature of the Project and to respect the diverse priorities of the pastoral communities, giving particular attention to poorer subgroups and to women, investments covered under the CIF will not be limited to specific sectors, with the exception of a short negative list and income-generating activities. This component could finance micro-projects related to water supply, micro-scale irrigation, health care, education, rangeland management, etc. CIF proposals will be judged at the woreda level against transparent criteria known in advance to all stakeholders, and evaluated in accordance with technical standards of line ministries. The development plans, which will require at least a 15 percent community cash or in-kind contribution to demonstrate commitment, will be implemented directly by communities to build capacity, ensure correspondence of investments to needs, and guarantee accountability to the community.

Sub-Component B: Rural Livelihoods Fund (RLF): This sub-component will finance income generating activities identified by beneficiary community groups utilizing the approaches tested by Rural Savings and Credit Cooperatives (RUSACCOs), with appropriate modifications to respond to pastoral social and economic environments and characteristics. Capacity-building will be extended to existing IGA groups established in phase I of the Program and provided to new groups in selected woredas. Funding would be available on the basis of a revolving loan to new IGA groups. The existing IGAs in phase I will not be eligible for at least first round of financing of the PCDP II. However, the project will provide capacity building support to these groups to activate revolving of the initial grant within the groups received in the first phase of the Program. These groups could then provide savings and credit services in accordance with the legal cooperative system of the country.

PCDP II will also pilot the formation and establishment of new RUSACCOs and capacity-building of associated support services in beneficiary communities at woreda and regional levels as required. Implementation of formation and establishment of savings and credit cooperatives will be led by the federal cooperative promotion agency, regional cooperatives promotion bureaus and relevant woreda cooperative promotion desks. The PCDP will provide the necessary financial support and be responsible for IGA group formation, mobilization and supervision. As a first step, this sub-component will also finance the preparation of a Pastoral

Savings and Credit Cooperatives manual in collaboration with the Federal Cooperative Promotion Agency. The Project may also pilot support to pastoral Rural Savings and Credit Groups in areas where rural micro-finance institutions are present.

Component 2: Pastoral Risk Management (US$ 35.0 million including US$ 16.9 million from the World Bank, US$ 11.3 million from IFAD, US$ 6.8 million from Government).

Sub-Component A: Community-Based Early Warning and Response Program: A Community-based Early Warning and Response Program will build on and deepen an ongoing woreda and livelihoods zone based early warning process. The program will be managed by Early Warning and Response Department of MoARD under a Memorandum of Understanding with the Ministry of Federal Affairs. It will be implemented by regional DPPB/EWRD bureaus and woreda representatives with the support of partner NGOs, who will help to collect and analyze basic household welfare data for the early identification of the onset of disasters. In the medium term, using part-time data monitors at community levels, woredas will compile and analyze trends in household, environmental, economic and social (including conflict) conditions in discrete livelihoods areas. This data will flow to regional DPPBs and the federal EWRD/MoARD, on a regular basis, providing information to trigger early non-food responses to declines in the welfare of pastoralist communities.

The early warning system will provide the information to assign each participating woreda to one of five "disaster stages", with appropriate responses corresponding to each stage. Early response will be financed through a pilot Disaster Preparedness and Contingency Fund (DPCF), which will be held, proportionally, at regional level under a EWRD/DPPB management system. The DPCF will have separate “windows” for early response and disaster preparedness investment financing. The project will build sector capacity at woreda, zonal and regional levels to prepare DPCPs that identify both disaster mitigation and early response activities. Early response activities will be prepared in advance and held as 'shelf plans' for timely implementation at the appropriate disaster stage. Woreda Disaster Preparedness Investment Proposals (DPIPs) will be aggregated at zonal and regional level and, under the management of an empowered regional pastoral development office, integrated into a long-term disaster preparedness strategy and prioritized investment plan. DPCPs will be prepared with the support of qualified NGOs for all 132 lowland woredas during the first three years of Phase II. The plans will be developed in conjunction with the Productive Safety Nets Program planning process at the woreda level, with a particular focus on identifying vulnerable communities and households.

Sub-Component B: Disaster Preparedness Investment Program: A Disaster Preparedness Strategy and Investment Program (DPSIP) will identify community and woreda needs for long-term regional disaster preparedness and mitigation. These proposals will be aggregated at zonal and regional level and, under the management of the regional pastoral development office, integrated into a long-term disaster preparedness strategy and prioritized investment plan. PSNP catchment management proposals will be integrated into this plan to the extent possible. The disaster preparedness strategy will be approved by the regional PCDP/PSNP steering committee and implemented in accordance with available funding by the pastoral development office, supported by PCDP financial and procurement staff.

Under the DPCF, each region will receive DPSIP grants to finance strategic disaster preparedness investments. It is expected that these investments will include, inter alia, small feeder roads, improved water supply and catchment management, fodder banks, and range improvement. The Project will provide technical assistance and staff capacity building to support the development of the regional disaster preparedness strategies and prioritized investment plans and associated strategic investments. Additional funding for strategic disaster mitigation investment is also likely to be available through the EU Disaster Preparedness II program, other donor programs and, for more labor intensive disaster preparedness investments, through the PSNP.

Component 3: Knowledge Management and Participatory Learning (US$ 1.3 million including US$ 0.7 million from the World Bank, US$ 0.4 million from IFAD, US$ 0.2 million from Government)

Sub-Component A: Participatory Action Learning: Participatory Action Learning pilots will be undertaken in selected woredas to apply and further develop methodologies for demand-driven approaches to participatory knowledge generation and innovation development. This will start on a small scale with one Participatory Action Learning (PAL) facilitator per region working with pastoral communities to help them explore community-identified issues, with advisory support from other research and development partners. A small budget will be available for pastoral communities to support their PAL activities, and for researchers from regional institutions to respond to pastoral communities’ research priorities. Where appropriate, these activities will involve existing Farmers Research Groups.

Sub-Component B: Knowledge Management and Information Exchange: Knowledge management and information exchange/networking will be supported at federal and regional levels; including through the establishment of small resource units on pastoral research and development in Ethiopia and strengthening of the EPaDGoN network and similar fora at regional level. This sub-component will also support peace-building meetings and exchanges between communities by promoting dialogue around pastoral research and policy studies of interest to conflicting communities.

Sub-Component C: Policy Studies: A modest budget will be made available to the Ministry of Federal Affairs (MoFA) and the Regional Pastoral Development Commissions/ Bureaus to commission studies that they regard as necessary to inform policymaking for pastoral development issues.

Component 4: Project Management (US$ 9.5 million including US$ 4.2 million from the World Bank, US$ 2.8 million from IFAD, US$ 2.5 million from Government)

As during PCDP I, project coordination and central financial management will be carried out by the Federal Project Coordination Unit (FPCU), which is housed in the Ministry of Federal Affairs. The FPCU's will continue to be responsible for overall project management, annual planning, fiduciary management, liaison with stakeholder groups at federal level, project communication, overall project monitoring and evaluation, strategic staff capacity-building and

mobilization of technical backstopping. Given the decentralized structure of the PCDP, the project will be managed more substantially at the Regional and woreda levels. At Regional level, the Pastoral Bureaus will house the Regional Project Coordination Units (RPCUs), with chief responsibility for PCDP management and coordination of project activities, including the activities of the Mobile Support Teams (MSTs), who provide Project technical support at the local level.

The PRM component will be coordinated by the FPCU PRM coordinator and supported at regional level by RPCU PRM officers located in RPCUs. The early warning and response sub-component will be managed by the MoARD Early Warning and Response Department under a Memorandum of Understanding with the FPCU/MoFA. The disaster preparedness planning and investment program will be managed by regional PDO/Cs with the support of the FPCU/RPCU DRM officers.

5. FinancingSource: ($m.)BORROWER/RECIPIENT 10International Development Association (IDA) 50International Fund for Agriculture Development 35

Total 95

6. Implementation

Partnership Arrangements

The International Fund for Agriculture and Development (IFAD) will continue to co-finance phase II of the PCDP. IFAD has earmarked US$35 million for this purpose.

Institutions and implementation arrangements

Overall: As during PCDP I, overall project coordination, financial management, procurement and M&E will continue to be carried out by the Federal Project Coordination Unit (FPCU), which is housed in the Ministry of Federal Affairs. The FPCU will continue to be responsible for overall project management, annual planning, fiduciary management, liaison with federal stakeholder groups, project communication, overall project reporting, monitoring and evaluation, strategic staff capacity-building and mobilization of technical backstopping. Given the decentralized structure of the PCDP, several elements of the project will be managed at the Regional and woreda levels. At Regional level, the Pastoral Bureaus will house the Regional Project Coordination Units (RPCUs), with chief responsibility for PCDP management and coordination of project activities, including the activities of the Mobile Support Teams (MSTs), who provide Project technical support at the local level.

Project Oversight: Oversight and advice for phase II of the Project will be provided by the Federal Inter-Ministerial Board and the Parliamentary Standing Committee on Pastoral Development. These organs will review progress and workplans of the PCDP on a semi-annual basis. Similar inter-sectoral panels will be established at regional level.

Sustainable Livelihoods Enhancement Component: The concept of Community Driven Development (CDD) is central to the proposed program and communities themselves constitute the true implementing agencies for the PCDP. As such, communities will identify, appraise, implement, monitor, and evaluate micro-projects which are financed through the first component of the Project. They will also be closely involved, as part of the woreda prioritization process, in the design and implementation of disaster preparedness plans through the second component of the Project. In addition, they will participate in the monitoring and evaluation of local development activities through the third component.

The definition of "community" varies from Region to Region and also within Regions. This calls for a flexible approach to identifying social groupings with which the Project can work. Not only in South Omo but even in different parts of the Somali, Afar and Borana areas, the local institutions and social groupings may take different forms and name. Therefore, all community-based interventions will be informed by a thorough, participatory analysis of local and overlapping socio-economic structures in a project area. It is intended that a coalition of community groups, including traditional organizations and groups representing specific interests (women, youth, environment, culture, etc) will work together to set community development priorities and manage their implementation. A community's commitment to this process and its subsequent management of Project resources will be closely monitored, with incentives for good performance and sanctions for poor performance. Inter-community activities will also be promoted to encourage peace-building and inter-community conflict resolution, particularly around natural resource issues.

Regional and woreda administration: To the extent possible, the Project will seek to continue to strengthen existing government structures at Regional and woreda levels as appropriate. RPCUs will continue to report to existing regional institutions, i.e. the Pastoral Development Commission (Oromya); the Pastoral Development Coordination Office (Somali), the Pastoral and Rural Development Bureau (Afar), and the Food Security and Pastoral Development Office (SNNPR). The Project has established Regional Project Coordination Offices (RPCUs) within these offices. A new RPCU will be established in Gambella region. The role of the RPCUs will be at regional level to (i) manage Project fund flows and liaise with relevant Bureaus and the Federal level, (ii) oversee annual CIF planning; (ii) oversee the PRM component; (iv) oversee the KMPL component; (v) facilitate capacity-building activities at the community, and woreda levels to improve planning and provision of support services, (vi) monitoring and reporting, and (vii) provide technical assistance in procurement management at woreda and community levels.

The RPCUs are supported by Project-financed Mobile Support Teams (MSTs), which will provide capacity-building with the objective of filling existing capacity gaps at the local level to both communities and local governments. The role of the MSTs is to (i) provide initial orientation and ongoing training using a "learning-by-doing" approach and to introduce communities and woredas to the Project; (ii) facilitate communication between communities and formal government structures and (iii) assist woredas to appraise and approve community micro-projects; (iv) monitoring, and (v) assist with woreda funding mechanisms.

Pastoral Risk Management: The Pastoral Risk Management Early Warning and Response sub-component will be implemented by EWRD/MOARD under a Memorandum of Understanding signed with the MoFA. The EWRD/MoARD will undertake the day-to-day management of the project financed early warning and response activities including the preparation of DPCPs and collection of household economic data at woreda level and its processing and analysis at zonal, regional levels through DPPOs and DPPB offices respectively. NGOs are expected to play a key role in DPCP preparation and data collection. Disaster contingency funds will be managed by regional DPPBs on the authorization of regional fund governance committees.

The Disaster Preparedness and Investment Program (DPIP) sub-component will be coordinated by the regional Pastoral development Office/Commission, based on information collected from woreda DPCPs and a wider analysis of the natural resource base and its traditional use. Prioritized disaster preparedness investments will be financed and procured by the DPCP through the procurement procedures agreed with the Bank under PCDP II. The PCDP will support the implementation of the PRM component through the appointment of a PRM coordinator in the FPCU and PRM officers in each RPCU. The project PRM staff will work closely with the EWRD, PDO/Cs, regional DPPBs, and woreda DPPOs to support PRM implementation.

Knowledge Management and Participatory Learning The PAL sub-component will be coordinated by the Knowledge Management and Participatory Learning (KMPL) Officer in the FPCU in collaboration with the Communication Officer in each RPCU. The FPCU will be responsible for setting up the information unit at national level, whereas the RPCUs will be responsible for setting up the regional information units in the offices of the Pastoral Development Commissions/Bureaus or a regional pastoral forum. PCDP will provide IT expertise in to the information units at national and regional level. The website and national information unit with by managed by a webmaster/ documentation specialist responsible to the Knowledge Management and Participatory Learning Officer. The FPCU will also be responsible for facilitating operations of the EPaDGoN Secretariat. The responsibility of co-chairing the forum will revolve among the members. The RPCUs will be responsible for facilitating similar fora at their level.

Links with other IDA-financed projects The PCDP will seek to collaborate closely with a number of World Bank-supported Projects, including the following:

(i) PSNP: This project is currently piloting an expansion into pastoral areas. The PCDP would seek to cooperate closely with PSNP with a view to harmonizing the following key elements: (i) early warning systems, (ii) woreda development planning, (iii) contingency responses and (iv) approaches to social infrastructure investments;

(ii) FSP: This project is initiating in the highlands work with Rural Savings and Credit Cooperatives (RUSACCOs) which may provide opportunities for learning and cross-fertilization with the PCDP;

(iii) Protection of Basic Services (PBS): the PCDP would seek to build capacity of pastoral woredas to be able to draw upon Local Investment Grant (LIG)

resources in the medium-term, and would also seek to inform community participation approaches considered by this Project. PBS may also offer some examples of relevant social accountability approaches which PCDP could test in lowland areas; and

(iv) Water Sector Supply Project (WSSP): as this Project gradually expands its presence in pastoral areas, PCDP would seek to build upon the WSSP guidelines for water interventions in pastoral areas, and would also try to coordinate activities on the ground, with a view to calling upon the resources of WSSP in particular for larger and more complex water investments (e.g., boreholes).

7. Sustainability

Sustainable Livelihoods Enhancement: Institutional sustainability of the PCDP will depend primarily on capacity-building and community ownership. While PCDP development plans will be implemented with technical and financial assistance from external sources, decisions on the content of such plans will rest ultimately with communities responsible for implementation. Once communities acquire the knowledge, awareness, and necessary skills to design, implement and maintain micro-projects, sustainability of institutional objectives will be likely provided that financing is available. Local governments have demonstrated their support for participatory approaches in Phase I. Greater ownership by regional governments would appreciably improve the overall effectiveness and sustainability of the approach. To this end, PCDP II will seek to engage regional governments more systematically in annual planning and reviews, as well as co-financing.

Fiscal sustainability will depend on whether revenues continue to flow through channels established via the PCDP. Financing for local development in Ethiopia will continue to rely on central and donor sources for the foreseeable future, since the level of poverty is such that substantial local revenue generation is impossible in the majority of communities. The PCDP's financing flows are intended to "prime the pump" of fiscal decentralization through woredas. In this context linkages with the Local Investment Grant (LIG) activities planned under the next phase of the Protection of Basic Services (PBS) Project will be explored actively as this Project develops.

Adequate planning for operations and maintenance will be reinforced by conditions in the CIF and DPCF contracts committing communities to identify funding mechanisms and set aside funds for the future repair and maintenance of project financed capital investments as appropriate. Where relevant, woreda offices and regional sector bureaus will be required to commit resources for complementary services (e.g., teachers, books, etc.) for social infrastructure prior to the approval of such micro-projects.

Pastoral Risk Management: The PRM early warning and response sub-component will be implemented by the responsible federal and regional government departments under an MoU with the project. The DPIP will be implemented by the regional PDO/Cs. In both cases, the project will provide the necessary resources and capacity building to enhance the effectiveness of existing institutional arrangements. The early warning and response sub-component will adopt agreed government disaster monitoring and reporting procedures across all lowland woredas and

establish systems and software for data reporting and analysis. In the case of the disaster preparedness sub-component, the management and maintenance of disaster preparedness resources will be transferred to either local woreda administrations or communities depending on their type and location. Woreda budget planning will include funding for the operation and maintenance of project NRM investments under woreda management.

Knowledge Management and Participatory Learning: Institutional sustainability of the Knowledge Management and Participatory Learning activities will depend primarily on the quality of capacity building that can be provided. Once pastoral communities acquire the confidence, skills and linkages to formulate demands on research and extension services (both governmental and non-governmental), sustainability of institutional objectives will be likelier. Also the capacity building and experiential learning within research organizations working together with the PCDP, as well as exchange of relevant experiences with other projects and agencies via the EPaDGoN forum, should create support for and skills in a more demand-driven approach to generating knowledge and innovations suitable for pastoral areas.

The financial sustainability to support demand-driven research will depend on the progress made by the Project and like-minded actors in other institutions, linked through EPaDGoN, to convince policymakers to allocate at least a small part of its research funding to research activities determined by pastoral peoples. The strengthening of pastoral associations, achieved in part through their involvement in overseeing KMPL activities, should put them in a better position to demand relevant use of state funds for pastoral research and knowledge management.

Environmental sustainability should be enhanced through the incorporation of multiple sources of knowledge, including pastoralists’ own knowledge of their environment, in the development of appropriate technologies and institutions to manage natural resources in a more sustainable way. The participatory research should lead to sustainable strategies for addressing current environmental problems in pastoral areas, such as bush encroachment and weed invasion. The approach being taken brings a high probability that the results of the Participatory Action Learning and supportive adaptive research will be innovations that are relevant for pastoral areas, low-cost, and largely dependent on locally available resources and skills.

Responsibility for managing, maintaining and improving the resource units to be built up in Phase II of PCDP will be progressively assumed by appropriate State or civil-society organizations (CSOs) such as the Pastoral Development Commissions or pastoral associations. The mechanisms for this will be developed this second phase of the Program.

8. Lessons Learned from Past Operations in the Country/Sector

Sustainable Livelihoods Enhancement: This was the largest component of phase I of the PCDP, and a number of key lessons have been learned with respect in particular to Community Investment Fund (CIF) activities. Key lessons include the following:

(i) The importance of establishing annual budgets and workplans for beneficiary woredas and communities in advance;

(ii) The importance of effective sanctions for non-performing communities and woredas;

(iii) The need for thorough and sustained capacity-building of beneficiary communities as well as MSTs, MOTs and WDCs;

(iv) The importance of empowering communities with information and processes to enable them to truly lead local development processes and hold WDC’s and MOT’s accountable;

(v) The need to provide thorough procedures and systems to support IGAs if they are to be sustainable;

(vi) The importance of following through on community contributions as a measure to ensure genuine community ownership; and

(vii) The need to ensure effective linkages with relevant sector counterparts at woreda and regional levels.

Income-generating Activities (IGAs): As rural cooperatives and micro-finance institutions were and remain largely absent from pastoral areas, PCDP I supported IGAs for vulnerable groups through the Community Investment Fund. As a means of improving the prospects for sustainability of such investments in Phase II, new IGAs will be supported in accordance with the principles and procedures of Rural Savings and Credit Cooperatives (RUSACCOs) which have been established in the past few years. Prior to launching any new IGAs intensive capacity building assistance will be provided for group formation and for establishment of RUSACCOS in beneficiary communities. This effort would be coordinated with the ongoing Rural Financial Intermediation Programme (RUFIP) supported by IFAD and also build upon successful IGA interventions implemented by NGOs s in a number of pastoral woredas in Ethiopia. Women and vulnerable groups will continue to be favored in beneficiary selection for IGAs, and this activity will be implemented only in communities where no functioning support services of RUSACCOs are available. The effectiveness of this approach will be reassessed during the Mid-Term Review.

Water supply and sanitation: During PCDP I, the project largely focused on smaller projects such as hand-dug wells, spring development, birkas, hafir dams and ponds. The drilling of boreholes was under the negative list of PCDP-financed activities due to concerns associated with environment, cost and management. Given the importance of drinking water to pastoralist communities, for both humans and livestock, PCDP II plans to continue financing small schemes such as Hand Dug Wells and Shallow drilled wells fitted with Hand pumps, Spring Developments, Ponds, hafirs and Birkas. PCDP will create strong links with Regional Water Bureaus to benefit from the established capacity at the regional level. In view of the recent up scaling and expansion of the Water Supply and Sanitation Project (WSSP) into pastoral areas, and taking into account the high drilling cost, maintenance challenges and environmental risks associated with motorized boreholes, community and woreda requests for such investments would be referred to the WSSP. This arrangement will be reviewed during the mid-term review of the PCDP II.

Pastoralist Risk Management: The PCDP Phase I PRM did not achieve its development objectives fully for a number of reasons, leading to the following lessons learned below:

(i) Importance of clear operational procedures, implementation and partnership arrangements for all Project activities;

(ii) The need to develop and support a single national early warning and response system;

(iii) The importance of an integrated approach that addresses early warning, mitigation and early response in an integrated manner, and looking beyond short-term emergency responses focused on food;

(iv) The value of household economy analysis approaches based on livelihood zones; and(v) The need for strategic mitigation planning beyond woreda level.

Research and policy reform: During preparation for PCDP II, stakeholders in pastoral research and development in Ethiopia stressed that most research in or for pastoral areas is not community-driven, action-oriented and participatory. This is partly because there is a strong convention of top-down research and little experience with community-driven research in pastoral areas. PCDP needs to find ways to fill this gap by initiating and strengthening community-driven research. It was also ascertained that there is still a considerable gap between research and practice, resulting partly from the conventional research approach but also from a lack of communication, networking and dissemination of research outputs. Documentation on research results and project experiences related to pastoralism and agro-pastoralism is scattered and not widely known. Governmental and non-governmental development workers are not using research outputs because these are not readily available and/or are not in an understandable and usable form. PCDP has an important role to play in facilitating better networking and better access to useful information relevant for pastoral community development.

During PCDP I, the procedure for deciding on research to be commissioned by the Project was centralized at federal level. The research conducted provided some potentially useful information to guide policy and action, but regional stakeholders had little say in what research was conducted. Moreover, the results of the research were not widely disseminated and translated into action. As a project seeking to empower communities, PCDP should focus on involving pastoralists and local development-support organizations in forms of research that stimulate participatory innovation and adaptation to new problems and opportunities and that enhance community capacities to make demands on formal research and extension services.

Conflict Management: Conflict is one of the major risks to pastoral livelihoods. While community-level conflict management was not a theme addressed systematically during the project’s first phase, numerous stakeholders highlighted its importance as a cross-cutting issue affecting all project components. In particular, stakeholders identified community-level conflicts around natural resources, budget allocations, and livestock marketing and commodity trade as common in several project regions and as themes around which the project could support conflict management. In response, Phase II of the project will include activities related to peace-building and conflict resolution at the community-level across all components, including its research and policy work. As conflict dynamics in each of the project’s regions of intervention vary, these activities will be adapted to local needs and opportunities and will be implemented in close partnership with other agencies, given the strong presence of other stakeholders involved in peace-building initiatives.

Social Accountability: While PCDP I included efforts to improve participation of pastoral communities in PCDP project planning and implementation, and also made efforts towards engaging woreda and ministry line staff in PCDP processes, it stopped short of developing a structured effort to empower citizens to engage in woreda budgeting, and did not seek to develop

effective citizen monitoring and reporting on woreda services and functions. The multi-donor Protection of Basic Services (PBS) Program is currently piloting social accountability instruments and processes in about 100 woredas in Ethiopia. The PCDP II provides an opportunity to extend this effort while enabling a greater focus on developing social accountability measures appropriate for pastoralist contexts.

Project Management: In phase I of the Project, a relatively small number of PCDP staff accomplished a great deal in a challenging environment. Lessons for what is required for effective implementation of PCDP activities include the following:

(i) The importance of clear and detailed procedures for all project activities, and the regular dissemination of such procedures at all levels;

(ii) The need for a clear set and shared understanding of roles and responsibilities at all levels of the organization, as well as incentive and enforcement mechanisms for performance;

(iii) The value of partnerships with sectoral and regional stakeholders, as well as civil society actors;

(iv) The need for timely and effective M&E systems in order to effectively assess progress and impacts, and to facilitate informed management;

(v) The need for a communication strategy to ensure greater awareness of PCDP activities and accomplishments among partners;

(vi) The importance of ensuring strict adherence to financial management and procurement systems; and

(vii) The need for continuous staff training and for adequate allocation of resources to empower the FPCUs and RPCUs to provide high-quality support to beneficiary communities and woredas.

9. Safeguard Policies (including public consultation)

Safeguard Policies Triggered by the Project Yes NoEnvironmental Assessment (OP/BP 4.01) [X] [ ]Natural Habitats (OP/BP 4.04) [ ] [X]Pest Management (OP 4.09) [X] [ ]Physical Cultural Resources (OP/BP 4.11) [ ] [X]Involuntary Resettlement (OP/BP 4.12) [ ] [X]Indigenous Peoples (OP/BP 4.10) [ ] [X]Forests (OP/BP 4.36) [ ] [X]Safety of Dams (OP/BP 4.37) [ ] [X]Projects in Disputed Areas (OP/BP 7.60)* [ ] [X]Projects on International Waterways (OP/BP 7.50) [ ] [X]

10. List of Factual Technical Documents* By supporting the proposed project, the Bank does not intend to prejudice the final determination of the parties' claims on the disputed areas

Government Documents 1. MOFED: A Plan for Accelerated and Sustainable Development to End Poverty (2005/06 –

2009/10), September 2006.

2. MoFA: Beneficiary Assessment of the PCDP Community Investment Fund and Disaster Contingency and Planning Fund. 2007

3. MoFA: Implementation Assessment of the PCDP Community Investment Fund and Disaster Contingency and Planning Fund. 2007

4. MoFA: Pastoral Community Development Project Phase II Project Proposal (draft). February 2008

5. MoFA: Pastoral Policy Gap Analysis. 2006

6. MoFA: Assessment of the first Phase PCDP. 2008

7. MoFA: PCDP Quarterly Progress Reports from 2003 - 2008

World Bank Documents

8. PCDP, Project Appraisal Document for Pastoral Community Development Project APL I, April 2003.

9. PCDP, Midterm Review Report. August 2006

10. PCDP, Aide Memories and Back to office Reports of Supervision Missions, FY03 – FY08

11. Ethiopia: Protection of Basic Services, Joint Budget Review. 2007

12. Ethiopia: PCDP II Concept Note. January, 2008

13. Ethiopia: Project Appraisal Document for Productive Safety Net Program APL II. December 11, 2006.

14. Ethiopia: Guidelines for the Implementation of the Productive Safety Net Programme Pastoral Area Pilot, October 2007.

Others

15. Delsol, Herve. 2008. Preliminary thematic note on possible fields of intervention for a livestock/pastoral sector-based initiative. EC Rural Development and Food Security Section. PPT, 22 January 2008.

16. Pastoral Forum Ethiopia. 2008. Japanese Social Development Fund (JSDF) activity and financial progress report (1st July 2006 through 31st December 2007). Addis Ababa.

17. Somali Regional State Bureau of Capacity Building. 2007. Operations Manual: Effective investment at the local level: infrastructure provision for service delivery. Supported by UNCDF/UNDP. October 2007.

18. Action research on extension on Participatory Variety Selection under rain fed (Jigjiga) and irrigated (Gode, Adadle, Kelafo) conditions.

19. Vegetation dynamics, restoration and the perception of pastoralists in the rangeland of Shinile Zone, Somali Region.

20. The role of micro finance for pastoral household food security: the case of Dolo Ado Woreda, Somali Region.

21. Basic issues and plantation problems in the process of nursery establishment in Afar Region.

22. Community-based natural resource management in pastoral areas: the case of Hamer, Bena Tsemay, SNNP Region.

23. Impact of drought-related vaccination on livestock mortality in pastoralist areas of Ethiopia

24. Regional enhanced livelihoods in pastoral areas. Mandera Triangle baseline assessment. USAID, 2007

25. Impact of drought-related vaccination on livestock mortality in pastoralist areas of Ethiopia; Andy Catley1, Dawit Abebe1, Berhanu Admassu1, Gezu Bekele1, Bayou Abera2, Gezahegn Eshete3,Tesfaye Rufael4 and Tesfaye Haile, INSERT DATE

26. Community based animal health care in the Somali regions 0f Africa: A Review PARC/VAC, OAU/IBAR, Andy Catlin, 1999

27. Saving lives through livelihoods: critical gaps in the response to the drought in the Greater Horn of Africa; HPG Briefing Note, ODI, London May 2006

28. Delivering the agenda Addressing chronic under-development in Kenya’s arid lands, Oxfam 2006

29. Regional enhanced livelihoods in pastoral areas. Mandera Triangle baseline assessment. USAID, 2007

30. Linking livelihoods and protection: A preliminary analysis based on a review of the literature and agency practice Susanne Jaspars, Sorcha O’Callaghan and Elizabeth Stites HPG Working Paper December 2007

31. National policy for the sustainable development of the arid and semi arid lands of Kenya, office of the President, Special Programs, Kenya, April 2007.

11. Contact point

Contact: Ingo WiederhoferTitle: Sr Operations Off.Tel: 5358+320 / 251-1-176-020Fax: Email: iwiederhofer@worldbank.orgLocation: Addis Ababa, Ethiopia (IBRD)

12. For more information contact:The InfoShopThe World Bank1818 H Street, NWWashington, D.C. 20433Telephone: (202) 458-4500Fax: (202) 522-1500Email: pic@worldbank.orgWeb: http://www.worldbank.org/infoshop