Incremental Costs: Incremental costs are estimated to cover project expenditure on components that have global benefits. Project activities that will yield global benefits are eligible for GEF financing. To calculate the incremental costs of the project, an estimate of baseline expenditure was made to establish the current and planned amount of funding for biodiversity conversation at the three project sites and for national level planning, during the life of the project. The differences between the cost of the baseline scenario (US$ 1.0 million) and the cost of the GEF Alternative (US$ 9.8 million) is estimated at US$ 8.8 million. This represents the incremental cost for achieving global environmental benefits through strengthening policy and legal frameworks for protected area management, developing mechanisms for sustainable resource use in the buffer zones, and strengthening local and national capacity for conserving globally significant biodiversity. The GoR has committed to mobilizing US$ 2.4 million toward the GEF Alternative and the NFA will provide US$ 900,000; these will cover all recurrent and some incremental project costs. Consequently, the GEF grant contribution would be US$ 5.5 million.
For the purposes of the Incremental Cost Analysis, parallel co-financing has been estimated at $1.0 million, all of which is earmarked for baseline activities. Thus far, co-financing has been secured for carnivore conservation from the European Union LIFE program ($0.85m). Work on analyzing the effects of grazing on soil vegetation and forests will also be financed by the EU ($0.11). In addition, the WWF/World Bank Forestry Alliance is financing a pilot activity to demonstrate the benefits and means to establish independent certification of forest management ($0.04m). If successful, additional funds would be sought from other donors to apply the methodology to other forest management sites throughout the country.
Fiscal impact:Total government financing during the project implementation period is estimated to be US$2.4 million equivalent, which is less than 4% of MWFEP's annual budget and less than 1.5% of NFA's annual budget. Since the Government contribution is spread over a five year period, the annual fiscal impact will be even less. The project would not directly result in an increase in revenues to government. The project will result in increases of about US$0.2 million of annual expenditures for operations and maintenance for the Retezat National Park, Piatra Criaiului Park and Neamt Forest Park. These increases are minimized since the incremental staff positions for park management would represent staff transferred from other duties within the National Forest Administration. The parks would develop the capacity to generate and retain funds through introduction of visitors fees and other income earning activities that will help reduce pressure on the national budget. Tourism generated as a result of the project will also help increase Romania's tax base as a result of increased spending by consumers and foreign visitors.
The project is technically justified on the basis of the urgent need to address growing threats to Romania's rich biodiversity that result from changing incentives to exploit natural resources, and the absence of effective conservation management systems. Consequently, the project will establish functioning models of best practice for protected area management, and build the national capacity to replicate this experience and mainstream biodiversity conservation in forest management. Project rationale and components were developed in a participatory manner by MWFEP and NFA technical staff. All project activities are practical and will address the underlying causes of existing and envisaged threats to Romanian biodiversity. The project will augment the existing considerable capacity for conservative forest management with new skills needed to manage forest biodiversity in the changing socio-economic circumstances. Needed new skills include multi-stakeholder particapatory planning and management of natural resources and natural areas, site interpretation, awareness raising, biodiversity conservation and monitoring, and protected area management. Skills will be acquired from international experience through a combination of study tours, exchange programs, networking and on-the-job training. The project will promote linkages between Romanian institutions and sectors that have little tradition of collaboration, and will develop conservation methodologies appropriate for the changing Romanian social and economic conditions.
A social assessment and development of a participation plan were undertaken during project preparation, through consultation with a broad range of stakeholder groups using a number of different information gathering techniques including: formal and semi-formal interviews, group discussions and workshops, rapid rural appraisal and literature review (see Annex 11). Population density in the vicinity of the project sites varies from 77-119 people per square kilometer. Unemployment rates are generally high (9%-30%), which in some cases is resulting in increased pressure on natural resources. Important land use activities include sheep and cattle grazing, wood harvesting and processing, agriculture and tourism. The increasing number of sheep being brought by outsiders from other regions, to graze in pastures in the project sites, has resulted in a recent significant increase and pressure on local biodiversity and a decline in local incomes from livestock and dairy products.
At the national level, Governmental restructuring and reduction of subsidies are influencing socio-economic conditions to a large degree, including real wage declines and unemployment. At the level of the project demonstration sites, key rural development issues are unemployment, unsustainable use of resources, and lack of access to credit to support development of new income generating opportunities. Poor economic conditions and their implications for social welfare result in a lack of interest in conservation and protected area management on the part of stakeholders. Consequently, the project will support economic opportunities for key stakeholders that are linked with the objectives of the project. The project will establish mechanisms to support sustainable use of natural resources, including grazing and forest products, provide access to small grants to support conservation compatible activities, employ of local individuals, and will engage local NGOs and small commercial enterprises in protected area management activities.
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The entire project constitutes an environmental mitigation and management plan. It has been designed and will be implemented in a participatory manner, in order to have a positive environmental impact, through establishing effective systems to conserve the natural integrity and biodiversity of Romanian ecosystems in protected areas, associated landscapes and in production forests. The location of visitor centers and marked trails at project sites will be chosen so as to limit the existing environmental impact of visitors. Visitor centers will not be located inside the core protected areas, and their design, construction and management will be in accordance with World Bank environmental guidelines.
Participation in project identification and preparation: Major elements of the proposed project were identified as top priorities in the National Biodiversity Conservation Strategy and Action Plan, which was prepared in a participatory manner with the involvement of all key national institutions concerned with conservation in Romania. The project preparation was undertaken in consultation with major stakeholders at the local and national level and a broad range of NGOs. The Project Concept document was finalized in collaboration with Government counterparts and NGOs, who are continuing to actively pursue options for cofinancing and establish links between the proposed project and related national and international initiatives. In two of the proposed demonstration sites (Retezat and Bucegi-Piatra Craiului), the local NFA have established collaborative administrative structures for protected area management, which include the participation of local authorities, communities, NGOs and relevant national institutions.
Mechanisms for participation in project implementation: Project success will rely on the involvement and support of local and national stakeholders. Consequently, the establishment of mechanisms to support their participation is an integral feature of project design. Participation mechanisms are detailed in Annex 11. At the national level these include the project oversight committee, the national consultative board, and the five national working groups for protected area classification; protected area law; management planning guidelines; boundary analysis and internal zoning; and ecological adaptation of school curricula. At the local level participation mechanisms include the park management board and consultative boards; the communal grazing association; the working group for park friendly investment activities, and committees for implementation of the small grants program, including the inter-communal grazing committee.
a. Primary beneficiaries and other affected groups:
Primary beneficiaries and affected groups include the NFA and DNBC; local forest, agricultural and pastoral communities; tourists and other visitors to the parks; the private sector, including tour operators and forest harvesters, marketing agents for forest products; environmental NGOs, hunters' associations, local government and its implementing agencies (a full list of stakeholders is in Annex 11).
Non-government organizations consulted or who have participated in project design include:
Piatra Craiului-Bucegi: Association for the Protection of the Bear, the Wolf and the Lynx, Carpati Foundation, Dracula, Floarea Reginei (Edelweiss), Romanian Carpathian Society of Tourism, Romanian Mountain Guide Association, Romanian Wildlife Society;
Retezat: Committee for Romanian Village Development, Salvamont Retezat, UNESCO Pro Natura;
Neamt: ECOMONT, Hunters and Fishermen Association - Neamt, Association of Forest Owners, Dr. GH. Iacomi Ecotouristic Club, Friends of Nature Association, Salmo, Mountain Farmer Federation;
National: AidRom, Center for New Education for Children, National Club for Youth Tourism, Romanian Association for Environmental Journalist, Romanian Rural Foundation, EarthVoice - Romania;
International: World Learning, WWF, UNDP.
b. Other key stakeholders:
Governmental Agencies at each site: Chambers of Commerce, City Councils, Forestry Districts and territorial units, Directia Agricola Arges, Prefectures, Town Halls, local Universities;
at the national level: Commission of Natural Monuments of Romanian Academy, DDBRA, Danube Delta Institute, FAO, ICAS, ICIM, Institute of Geography, Ministry of Agriculture and Food, Ministry of Public Works and Territorial Planning, Ministry of Tourism, MWFEP - DEP, GDF, NFA, Parliament, Research Institute of Tourism, Speleological Institute, University of Bucharest;
Private sector entities: SC Apollo SA Deva, Pietrele Tourist Complex, Arcadia Tourism Office, Eurohouse Limited Co., Petrotour - Piatra Neamt, SC Comfor Barsan SNC Tirgul Neamt, Tipotrans, Maart's Co.