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Document o f
The World Bank
FOR OFFICIAL USE ONLY
Report no. 4611 1-MG
PROJECT APPRAISAL DOCUMENT
ON A
PROPOSED GRANT FROM THE
GLOBAL ENVIRONMENT FACILITY TRUST FUND
IN THE AMOUNT OFUS$5.9 MILLION
TO THE
REPUBLIC OF MADAGASCAR
FOR AN
IRRIGATION AND WATERSHED MANAGEMENT PROJECT
September 30,2008
Agriculture and Rural Development
P u b l i c D i s c l o s u r e A u t h o r i z e d
P u b l i c D i s c l o s u r e A u t h o r i z e d
P u b l i c D i s c l o s u r e A u t h o r i z e d
c l o s u r e A u t h o r i z e d
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MADAGASCAR
Irrigation and Watershed Management Project
A SCAFDAPO
BVB V - P I
C A SDAIR
CD PcscDFB
N P C U
DRDR
D S I
DTA
FERHA
FMG
(F)WUAsGD PGEF
GELOSE
G o MIDA
C U R R E NC Y E Q U I V A L E N T S(Exchange Rate Effectiv e M a y 2008)
Currency Unit = Ar iary (MGA)
1 MGA = US$0,00047SDR = US$1.48620
US$ = SDR0.67286
FISCALYEAR
January 1 - December 3 1
ABBREVIATIONSAND ACRONYMS
Agricultural Service CenterAgence Franqaise de Dkve lopp emen tAgricultu ral Professional Organization
Bassin versant (Watershed Management)Bassin versqnt -Pkr imdtre i r r igu k (Watershed Management - r r igat ion
Scheme)Country Assistance Strategy
Di rec t i on de 1 Appui aux Investissements Ruraux (Directorate for RuralInvestment)Communal D evelopment PlanCom muna l Support CentreDirectorate for Finance and Budge t
National Program Coordination UnitDirec t ion Rkg iona le de Dkve loppement Rura l (Regional Directorate for
Rura l Development)Department o f nform ation Systems
Decentralized Territorial Autho ritiesFonds d Entretien de Rkseaux Hy dro A gricoles (Irrigation MaintenanceFund).
Malagasy Franc
(Federation of) Water Users AssociationsGross Domestic Product
Glob al Environmental Facil i tyGestion Locale Skcuriske (Community Management)
Government o f MadagascarInternational Development Association
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FOR OFFICIAL USE ONLY
PNJBV-PI
PMUPRSF
PSRPFUD
RDFBR D P
RPMU
S L MTT
U N C C DWB
WUA
W D PW M P
Programm e Na t ion al Bassins Versants - PdrimGtres [email protected] (NationalIrrig ati on and Watershed Management Program)Project Management UnitPoverty Reduction Strategy Frame workPoverty R educ tion Strategy PaperResearch-Development
Regional Directorate f or Finance and Budget
Regional Development PlanRegio nal Project Management Unit
Sustainable La nd Manageme ntTranobe n’ny Tantsaha -Chambers of AgricultureUn ited Nations Convention to Combat Desert if ication
W o r l d B a n kWater Users Association
Watershed Developme nt PlansWatershed Master Pla n
Vice President: Obiageli Kat ryn Ezkw esil iCountry Director : RuthKagia
Sector Manager: Kar en Mccon nell BrooksTask Team Leader: Zi va Razafintsalama
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MADAGASCARIrrigation and Watershed Management Project
TABLE OF CONTENTS
A. S TRA TE GIC CONTE X T AND RATIONALE .......................................................... 1
A 1 Cou ntry an d Sector Issues ........................................................................................... 1
el ig ib i l i ty................................................................................................................................ 3
A.3. Highe r leve l objectives to wh ich the project i s contributing ......................................... 4
A.2. Rationale for Ba nk involvement, relation to Coun try Assistance Strategy and GEF
B. PROJECT DESCRIPTION .......................................................................................... 5
B 1 Lend ing Instrument..................................................................................................... 5
B.2. Program Objectives a nd Phases .................................................................................. 5
B.3. Project Developme nt Objectives and Ke y Indicators ................................................. - 6
B.4. Project Components .................................................................................................. - 7
B.5. Lessons Learned and Integrated int o the Project Concept .......................................... 11
B.6. Altern atives considered and Reasons for R ejectio n ................................................... 13
C .l . Partnership Arrangements......................................................................................... 14
C.2. In stitu tion al and Operational Arrangements ............................................................. - 1 4(2.3. Mo ni tor in g and Evaluation of Outcomes/Results ...................................................... 16
C.4. Sustainability and Replicability ................................................................................. 17
C.5. Critical r isks and Possible Co ntrove rsial Aspects ...................................................... 17
C.6. Cre dit conditi ons and covenants ................................................................................ 18
C . I M P L E M E N T A T I O N .............................................................................................. 14
D. PROJECT BRIEF SUMMARY.................................................................................. 19
D 1 Economic and Financial analysis .............................................................................. 19
D.2. Technical .................................................................................................................. 20
D.3. Fiduciary .................................................................................................................. 21
D.4. Social analysis .......................................................................................................... 22
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Annex 3: Results Framework and Monitoring and Evaluation ........................................ 38
Annex 4: Detailed Project Description.............................................................................. 45
Annex 5: Project Costs........................................................................................................ 59
Annex 6: Institutional and Implementation Arrangements ............................................. 60
Annex 7: Financial Management and Disbursement Arrangements ............................... 73
Annex 8: Procurement Arrangements............................................................................... 83
Annex 9: Economic and Financial Analysis ...................................................................... 89
Annex 10: Safeguard Policies Issues................................................................................ 107
Annex 11: Project Preparation and Supervision.............................................................. 114
Annex 12: Documents in the Project File........................................................................ 116
Annex 13: Incremental Cost Analysis.............................................................................. 117
Annex 14: Technical Annex Land Degradation in Madagascar..................................... 131
Annex 15: APL Triggers ................................................................................................... 144
Annex 16: Statement of Loans and Credits...................................................................... 146
Annex 17: Country at a Glance ........................................................................................ 148
Annex 18: MAP ................................................................................................................ 150
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MADAGASCAR
Irriga tion and Watershed Management Project
L O C A L C O M M U N I T IE S
Total:
GEF Pro jec t Br ie f
Afr ic a Reg iona l Of f ice
AFTAR
04.24 00.16 04.4
33.55 06.75 40.3
Date : September 30,2008 Tea m Leader: Z iv a Razafintsalama
Country Director: Ruth Kag ia Sectors: Ir rig at io n and drainage (5O%);Agro-
Sector DirectodManager: Inger Andersed industry (30%);Crops (20%)
Kar en Mc conn ell Brooks Themes: Other ru ra l development (P); OtherProject ID: PO74086 trade and integ ration (S)
Le ndi ng nstrument: A daptable Program Lo an Environm ental screening category: Full
Assessment
Gl ob al Supplemental ID: PO88887 Team Leader: Zi va Razafintsalama
Lend ing Instrument: Specific Investment Lo an Sectors: Irr iga tion and drainage (50%); Agro-
Focal Area: Lan d Degradation industry (30%); Crop s (20%)Supplement Fully Blended?: N o Themes: Ru ra l marke ts (P); Other trade and
integration (S)
[ ] L o a n [I redit [ X I Grant [ ] Guarantee [ 3 Other:
Glo bal Environment Fa ci l i ty (US$m): 5.90Fo r Loans/Credits/Others:
Total Ba nk financing (US$m.): 30.00 (approved in Novem ber 2006)
Proposed terms:
Borrower:
Government o f Madagascar: Ministry o f Economy, Finance and BudgetB.P. 61
Antananarivo 10 1Madagascar
Tel: 261 20 22 382 86Fax: 261 20 22 34530
Responsible Agency:
Ministry of Agriculture, Lives tock and Fisheries
B.P. 301
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Project implementation period: January 30,2009 - December 3 1,2012
Expec ted effectiveness date: January 30, 200 9
Expected closing date Decem ber 3 1,20 12
[ ]Yes [XINOoe s th e project depart fro m the CA S in content or other s ignific ant respects?
Re$ PA D A.3
Does the project require any exceptions f ro m Ba nk policies?
Re$ PAD D. 7
I s approval for any po l icy exception sought from the Board?
Does the project include any crit ical r isks rate d “substantial” or “high”?
Re$ PAD C.5
Does the project meet the R egional criteria f or readiness for implemen tation?
Re$ PAD D. 7
Project development obiective Ref: PA D B.2, Technical Annex 3
[ ]Yes [XINO
[ ]Yes [XINO
[ ]Yes [XINO
[XIYes [ ] N o
Hav e these been approved by Ba nk management? [ ]Yes [ IN0
The developmknt objeci ive o f he proje ct s o sustainably increase agricultural productivity infour high pote ntial watershed areas and thei r associated irrig atio n schemes.
Glob al Environment object ive Ref: PA D B.2, Technical Annex 3
The global environmen& obje ct i ie o f he project i s to improve the environme ntal sustainability
o f and management practices in ou r targe ted watersheds areas.
Project description [one-sentence summay o each component] Re$ PA D B.3.a, Technical
Annex 4The GEF project i s fully complementary with the IDA -f inan ced project that was approved in
November 2006 and that has three technical components covering major strategic orientations:(i) evelopment of Commercial Agriculture, (ii)rr igat ion Development and (iii) atershed
Development. The fourth component i s Program Management. In accordance with the ‘growth
poles’ approach, the project proposes four similar sub-projects in the four regions concerned
(Annex 1).
The GEF project w i l l focus on tw o o f the three technic al components that are financed under theIDA operation - development o f commerc ial agriculture and watershed development.
Development o f Comm ercial Agriculture aims at imp rovi ng access to markets and support ing
the development o f commercial agriculture value chains respecting principles o f sustainable lan dmanagement and pro vid ing demand-based support to private investment. Watershed
Developm ent aims at sustainably managing watersheds inc lud ing irrigated agriculture,
preserving the natural heritage, bene fit ing fro m th e product ion potent ial o f he natu ral resources
and contribut ing to im proved living conditions and incomes o f the rur al populat ion. The Project
Management component aims at managing and using resources in accordance with the project’s
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Grant efiectiveness:
NoneCovenants appl icable to project implementation:
ensure that operational modalit ies o f management and replenishment o f FERHA (Fonds
d’Entretien de RCseaux Hy dr o Agricoles) be defined by November 30, 2008; after
consulting with the B ank and
ensure that: (i) draft law to harmonize the irrigatio n related legal framework, inc ludingbut no t limited t o L a w 90-016 and subsequent implementation texts with the provisions
o f he Program be prepared by November 30, 2008; and (ii)he relevant implementation
textsbe
adoptedby September
30, 2009, after consultingwith th e
Bank.
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A. STRATEGIC CONTEXT AND RATIONALE
A.l. Country and Sector Issues
1. Background. Madagascar i s one o f the poorest countries in the world, with per capita
income o f about USD 32 0 per year (2007). The economy i s basically rural, with agriculture as
one o f the m ai n engines o f economic development. Th e poor represent about 69 percent o f the
total population, whic h i s 77 percent o f he rura l populat ion.
2. The ne w government in place since 2002 has moved to restore public services and
macroeconomic stability after the contested elections o f 2001. GD P g row th rebounded to 9.8
percent in 2003 f ro m a 12.7 percent plunge a year before and continued to gro w at an average
rate o f about 5 percent per year between 2004 and 2006. Econom ic gro wth in 2007 o f 6 .3
percent was dri ven by strong secondary sector growth but agricultural gr ow th was disappointing.
The country was hit by six tropical storms/cyclones in the f i rs t four months o f 2007 leading to
exceptional rains in most parts o f he country, while a drought continued to affect the south o f the
country. These storms contributed to heavy floo din g in populated and cultivated areas
throughout the country, inc lud ing the capital region, the northwest, west and southeast regions.
In 2008, there was another round o f cyclones that devastated farm, transport and tourist
infrastructure in key areas o f he country.
3. Poverty Reduction Strategy Framework The government has put in place the
Madagascar Ac tion Pla n (MAP), a development plan for 2007-12 that i s the second-generation
Poverty Reduction Strategy. The M A P envisages accelerated and better-coordinated reforms and
outlines the strategies and actions that will i gn i te rap id growth. “Rural development and a green
revolution” and “cherish the environment” are two o f he core eight commitments o f the M A P .
The specific objectives with respect to rur al development are (i)o increase agricultural value-
added (through, i nte r alias, Agri cul tura l Service Centers), (ii)iversify rura l act ivit ies (focusing
on support to producers’ organizations among other activities), (iii)aunch a sustainable greenrevolution through integrating environmental dimensions in agricultural activit ies and (iv)
promote m arket-oriented a ctivit ies through strengthening farmers’ organization and investment in
infrastructure. The M A P Commitment to “cherish the environment” focuses on reducing naturalresource degradatio n throu gh better la nd use practices. T h i s GEF project, in collaboration with
i t s equivalent IDA project, and their results indicators are closely aligned with these M A P
objectives.
4. As previous approaches to irr igation development have fa iled due to cont inued uplanddegradation mak ing investments in irrigation schemes unsustainable, the Government i s n o w
pursuing a more integrated and holistic approach with the National Program of Watershed
Management and Irrigation Improvement adopted in October 2006, where agricultural
develop ment takes in to account lan d management issues at the watershed scale. Addi tion ally , theproject i s in l ine with the new National Program for Ru ra l Development, among whose pi l l ars
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5. Agriculture, R i c e and Irrigation. Agriculture remains the foundation o f Madagascar’s
domestic economy. I t contributes about one third o f the to ta l GDP and 40 percent o f totalexports. Ab ou t three quarters o f the popu lation depend on agriculture fo r their l ivel ihood. About
one-half o f Madagascar’s la nd area i s cultivable, but l i t t le m ore than Spercent o f the land i s
currently under crops, with a large part o f the cultiv ated area under irriga tion (about 40 percent).Performance o f the sector has been disapp ointin g in recent years, despite the lib eraliz ation o f the
economy, the sharp devaluation o f the exchange rate and the privatiz ation o f state enterprises.The under-performance o f the agricultural sector i s a ma jor cause o f the deep poverty in ru ra lareas. Farming systems are s t i l l very tradit ional. Two-thirds o f al l rural households live at
subsistence level and yields are generally very lo w. W eak infrastructure hampers the transport o f
produce, whether for export or for the domestic market. Agricultural productivity i s also
hampered by the poor access to agricultural technology, inputs and other agricultural services.
Extension services are all but lacking. Only 1.5 percent o f Madagascar’s sm all farmers have
access to credit, and a mere 5 percent o f otal le nding goes to agriculture. Trad itional l and tenure
systems do no t give farmers sufficient security.
6. Rice represents nearly 7 0 percent o f agricultural production and accounts for 48 percent
o f otal calorie consumption. Rice prod uction has increased by 1.2 percent per annum since the
1980s but average paddy yield at the national leve l remains l o w (about 2.6 t/ha). Annu alproduction o f paddy rice has virtu all y stagnated over the past ten years, stabilizing between 2.3
and 3.0 m il l i o n ons. Area plan ted to paddy has increased by only 0.4 percent per year fro m 1970
to 2004; yields have increased by 0.7 percent per year, much slower than in other major r ice
producing countries. With an annual populat ion g rowt h o f 2.7 percent, product ion per person has
fal len from 275 kglperson in 1970 to 179 kglperson in 2004. Rice farming techniques are largely
traditional and use o f nputs i s the exception in many places. Fertil iz er use has rema ined stagnant
at 10 k g h a on average, as compared to 14 k g h a in sub-Saharan Africa, and 291 kgha in
Indonesia. The vast difference in prices between wet and dry season i s explained by the lack o f
fluidity in movement o f goods fro m prod uct ion areas to the markets due to a poor road
infrastructure and lac k o f management capacity o f storage facilit ies by farmers. On average, 28
percent o f he paddy product ion s mar kete d (750,000 t), but ric e sales are highly concentrated. In
2001, the top 10 percent o f rice farmers (by value o f sales) accounted for 73 perc ent o f totalnatio nal rice sales. These farmers sold o n average 2.2 tons pe r household. An estimated 48 percent
of ic e farmers did not sel l any r i ce in 2001,
7. Irr iga tio n occupies an important place in the agricultural sector, supplying water to more
than one mi ll io n hectares, or 40 percent o f cultivated lands (as compared to 6 percent o n averagein sub-Saharan Africa). I t i s estimated that 85 percent o f the active farming population are
direct ly o r indirect ly employed by the irr iga tio n sector. Since the 1950s, ir rig ati on has benefited
from public investment. However, the impact o f these efforts o n rura l incomes i s mixed, and
sustainability i s far fro m certain. The r ap id degradation o f infrastructures requires frequent
rehabilitation, and many schemes are caught in a v ic ious c i rc le o f poor yields, l o w capac it y o f
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degradation dynamics in the uplands and lowlands are often l in ke d and reinforcing each other.With the stagnation o f yields in the irrigated low lan d areas and demographic growth, farmers
extend their agricultural activit ies on the hillsides. Upper watershed land use i s often based o nextensive and unsustainable management practices, the mo st importan t be ing l ack o f erosion
control and lac k o f soi l fe rt i l i ty management on agricultural plots, slash and burn agriculture
(tavy), and the frequent burningo f pastures. La nd degradation i s also caused by deforestation fo r
agricultural purposes. These practices no t on ly contribute to the degradation and lo w prod uctivity
o f uplands but also impact lowland agriculture signif icant ly. Upland soi l erosion and water
surface run-off also causes sedimentation for downstream infrastructure, contributing to the
reduct ion o f cult ivated area under irr igation, local f lo odin g o f r ice paddies in the rainy season
and water shortages in th e dry season. The impact on the overall production landscape has
therefore seen such global costs as increased carbon emissions an d dec lini ng ecosystem services
such as water provis ioning and filtering, habitat fragmentation and destruction leading to loss o f
above and bel ow ground biodivers ity, and reduced carbon storage capacity. Clima te change i s
expected to exacerbate the trend. Recent ana lytical w o rk supported by the W or ld Ba nk suggests
that the signs o f climate change are becoming increasingly v isible through changes in climate
var iab ility a nd the exposure to cyclones.
9. The need to adopt an approach to agricultural intens ification that reaches beyond mere
rehabilitation o f infrastructure has been confirmed by the Economic and Sector Work“Madagascar - Rural and Environment Sector Review (2003)”. The l i s t o f constraints to
increasing productivity includes access to finance, inputs, markets and equipment, problems
associated with lan d degradation and sedimentation, and lac k o f maintenance o f irrigation
infrastructur e. Past experience thus strongly emphasizes the need to adopt an integrated approach
to agricultural intensification in Madagascar’s watersheds. The approach being adopted in the
IDNGEF project (i) ims to establish an appropriate incentive and financing framework for
efficient operation and maintenance o f irrigation infrastructure, as well as for the mit igat ion o f
damage caused by the freque nt hurricanes that affec t the country; but also (ii)ddresses a wide
range o f issues in agricultural development as well as soil and water conservation in upperwatersheds.
A.2.eligibility
Rationale for Ba nk involvement, relation to Country Assistance Strategy and GEF
10. The Government o f Madagascar requested W or ld Ban k (WB) and Global E nvironmental
Faci l i ty (GEF) funding for an Irr iga tion and Watershed M anagement Project to accelerate
economic growth in rur al areas, through an integrated effort aimed at increasing produ ctivity inhighpotential production zones (benefit ing fro m public irrigatio n systems). The WB has played a
unique role among the donor com munity in Madagascar, with the largest portfolio in terms o f
comm itments an d disbursements, and i s seen as the lead G o M partner for poverty reduction. The
IDA-f inanced part o f the project was approved in November 2006 and made effective in April
2007. Since that time, implementation has been getting o f f the ground slowly due to the
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have been supported by past investment operations. More recently, the Bank supported the
Government in he establishment o f the Fonds d ’Entre tien de Rbe aux H ydr o Agrico les (FERHA,
the Irr iga t ion Maintenance Fund).
12. The Cou ntry Assistance Strategy (CAS ) fo r Madagascar i s designed to support the
implementation o f Madagascar’ Act io n Plan (MAP) wh ich has the objective to reduce poverty by
h a l f in en years. The W o rl d Bank’s Country Assistance Strategy for FY 07 -11 supports the areas
o f the M A P that have the highest prior ity and those where the Ban k Group has a comparativeadvantage. The Country Assistance Strategy (CAS) continues the Bank Group’s focus on
removing bottlenecks to sustainable and shared growth, anchored in good governance, withcorresponding improvements in welfare indicators. The specific sets o f results supported by the
Country Assistance Strategy are organized around two ma in p i lla rs. The f i rs t concentrates on
activities that will help remove constraints to investment and growth in rur al and urban areas.
The second brings together ac tivit ies geared toward im pro vin g th e scope and quality o f service
delivery. Madagascar i s eligible for GEF support. I t rat i f ie d the United Nations Convention to
Combat Desert i f icat ion (UNCC D) in 1997, the Convention on B iolog ical Diversity in 1996, theUnitedNations Frame work Convention on Climate Change in 1999, and i s a contracting party to
the Ramsar Convention o n Wetlands since 1999. G o M has also prepared and submitted a
UN CC D Nat iona l Ac t ion P lan in 2001, and a Natio nal Act i on Program for Climate Change
Adaptation in 2006.
A.3. Higher level objectives to which the project i s contributing
13. The proposed project constitutes a ke y element o f he Bank’s strategy in Madagascar, and
will contribute to achieving the priori ty objectives o f the M A P. In recognit ion o f the fact that
g rowth in Madagascar will be derived fro m the country’s unique natural resources and f ro m the
transformation o f t s natu ral products, and in accordance with the vision outlined in the MAP , the
project would contribute to developing a diversified and r ic h natural resource base that will
contribute to the creation o f products with high value added. Mo re specifically, the project aimsto turn around a vicious cycle o f lo w productivity, deferred maintenance and poor watermanagement into a virtuous cycle o f increased produ ctivity, full cost recovery and acceptable
O&M. I t wou ld thus contribute to creating favorable conditions for accelerated agricultural andru ra l g rowth in a number of clearly identifiedhigh potent ial rura l gro wth poles.
14. The proposed project w i l l be part o f the GEF-SIP, a priori ty program o f TerrAf i ica,
which was launched by N E P A D and focuses on region al partnership, knowledge generation and
dissemination, as we ll as investment developm ent and donor alignmen t. The project i s consistentwith the GEF Operational Program 15, concerning the m itig atio n and prevention o f land
degradation. I t will prom ote sustainable la nd management across the watersheds that create long -
term global environmental benefits within the context o f agricultural development, ecosystem
services creation and preservation, p rotec tion o f pr im ar y habitats, as well as rural l ivel ihoodimprovement. The operation will support both Strategic Objectives (SO) o f the focal area: (i)n
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in po llut ion and sedimentation o f international water bodies. The project will also directlycontribute to the execution o f the N ation al Action Program for Climate Change Adaptation,
NEP AD’s EA P (Action Plan for the Environment Init iat ive) and C AA D P (Comprehensive Afr i caAgricultu re Developmen t Program). In addition, U N D P and WB as TerrAfrica partners have
started exploring modalities to collaborate to support the development o f a national SLMInvestmentFramework.
B. PROJECT DESCRIPTION
B.1. Lending Instrument
15. The proposed GEF project i s part o f an overall program approach to watershedmanagement and irrigation development that includes IDA financing and other donor financing.
Th e GEF support for this operation comes in compleme nt to the already-approved first phase o f12 year IDA APL. An AP L w hich prov ides the G o M with the necessary fle xib ili ty to implement
the program in accordance with preferences and capacities o f users groups. I t also lays adequatefoundations for scaling up o f the project’s activities on the basis o f essons learned from earlier
phases. The first phase o f the IDA APL was approved in November 2006 and made effective in
April 2007.
16. The content o f he subsequent phases o f the IDA AP L are not yet known at this stage, andwill be determined by the lessons learned fr om the experience during the f i r s t phase. The three
phases provid e the Bank with the possibility to support the long-term GoM’s national Irrigationand Watershed Man agemen t program, while at the same time p rovi din g incentives for achievingthe program’s development objectives.
B.2. Program Objectives and Phases
17. Government’s National Irrigation and Watershed Management Program (PNBV-PI). The Government’s Nation al Irr iga tio n and Watershed Management Program (PN/BV-PI) i s
a central part o f the MAP and Government strategy for the development o f agriculture. The
global objective o f the P N/ BV -PI program, as formulated in the B V-P I Pol icy Let ter o f theGovernment i s to sustainably improve the living condit ions and incomes o rur a l populat ions in
irr iga tio n schemes and th eir surro und ing watersheds and the management o natu ral resources.
18. The PN /B V-P I covers al l medium - and large-scale irrigation schemes in the country, andwill include bot h newly prepared (includin g the proposed Irriga tio n and Watershed Management
project) as well as on-going operations that wi l l gradually be retro-fitted into the nationalprogram and i t s institutional framework. The PN/BV-PI w i l l be supported by a l l interested
donors. The French Development Agency (AFD), the Afr ican Development Bank (AfDB), theEuropean Union, US AID , the F ood and Agriculture Organization (FAO), International Fund fo r
Agricultural Development (IFAD), Kreditanstalt fiir Wiederaufbau (KfW), Organization o f the
Petroleum Exp ortin g Countries (OPEC), the Japanese Internation al Deve lopm ent Agenc y (JICA )
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added for inclus ion in the Program’s future phases will be selected o n the basis o f experience o f
the f i r s t phase. Overall, the six sites will require the rehabilitation o f about 66,000 ha o f r r igated
perimeters and the management o f about 200,000 ha o f watersheds. The object ive o f the Programi s to sustainably improve the l iving condit ions and incomes o rur a l popu la t ions in s ix main
irrigation sites and their surrounding watersheds, and the management o natural resources.
T h i s i s the same as the Government’s PN/BV-PI but appli ed to six sites. I t s global environmental
objective i s to improve the environmental sustainabil i ty o land management practices in four
targeted watersheds.
20. The focus o f GEF support under the Program will be to promote the sustainable
development o f the watersheds’ resource base through an integrated watershed management
(WSM) approach with innovative, long-term approaches to deal with complex natural resources
management issues (such as fir e use, deforestation, and unsustainable far ming practices). Withthat, GEF w i l l support the development goals o f local communities and secure global
environmental benefits. GEF will also emphasize capacity strengthening in sustainable land
management, and i den tify successful processes and outcomes and disseminate lessons learned inorder to strengthen the Nat ion al Program and facilitate i t s scaling up. Annex 3 shows both the
Program’s expected fina l imp act and the milestones and outcomes wh ic h will be used to monitordevelopment and imp leme ntatio n progress.
B.3. Project Development Objectives and Ke y Indicators.
2 1. In he context o f he broader A P L objectives described above, the development objective
o f the Project (the f i r s t Phase o f the Program) i s to establish a viable basis for i r r igated
agriculture and natural resources management in four main i rr igation si tes and their
surrounding watersheds: (i)ndapa (Sava Region), (ii) arovoay (Boeny Region), (iii)tasy
Region, and (iv) Lac Alaotra (Alaotra Mangoro Region). A detai led descript ion o f the project
zones i s ncluded in Annex 1 and Annex 16.
22.
sustainability o f and management practices in our targeted watersheds.
The global environmental objective o f the p ro jec t i s to improve the environmental
23.
fol low ing targets:
Triggers. Triggers fo r mo vin g to the second phase o f the A P L include at ta inment o f he
Watershed Master Plans (WMP, including Scheme Development Plans (SDP) and
Watershed Development Plans (WDP)) and associated Performance Contracts executed
satisfactorily’ ;
0 an acceptable institutional mechanism for the funding o f non-transferable irrigatio n
infrastructure (FERHA) established and operational;
0 private sector investments in agriculture increased as eviden ced by disbursements under
the matchin g grant mechanism;
0 Ag ricu ltur al Service Centers (ASCs) established and operation al in the four p rojec t sites;
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rapi d kick -o ff o f growth, inclu ding relat ively easy access by road, and better access to finance,
inputs, marke ts and equipment. A mor e reliab le access to water puts a high premium on the us e
o f product ivi ty enhancing inputs, provides more flexibility, diversity, reliability, quality andproduct uniformi ty to sat isfy the requirements o f markets, and enables farmers to capture highe r
seasonal prices . In addition, the sites are similar in the sense that institutional issues such as a
clarif ica tion o f roles and responsibilit ies throug h ir rig atio n management transfer represents a
high prior i ty fo r imp rovin g performance o f rr igated agriculture.
26. The f i r s t phase covers about 21,780 ha o f rrigatio n schemes (out o f a total o f 66,000 ha
for the sites to be included in the IDA-fundedA P L in six sites). Dir ect beneficiaries include
about 30,000 smallholder households produ cing irriga ted and rainfed crops, and farmers’ groups
and private operators pr ov idi ng services, selling products and perfo rming various functions in hevalue chain. The four sites meet a number o f condit ions for ra pid growth, including relat ively
easy access to markets for outputs and inputs and good agricultural development potential.
Howev er, the y are also sufferin g fro m severe institution al weaknesses fo r the management o f he
irrigation perimeters and significant upstream watershed degradation. Correcting these
weaknesses in support o f fast and sustainable developm ent wil l be one o f the ma in ob jectives o f
the project, thus buildinga strong base fo r the subsequent phases o f he Prog ram.
27. Project total cost i s estimated at US$40.3 million, to be financed by: (i)DA: US$30.0m il l i on (74 percent o f total cost); (ii) EF: US$5.9 m il li o n (15 percent); and beneficiaries:
US$4.4 mi l l ion (1 1 percent). The expected project outcomes include (i) issemination o f
innovative technologies and equipment to 30,000 beneficiary households through extension,
capacity strengthening and targeted cost sharing, (ii)mpro ved management o f about 21,780 h a
o f irrigation infrastructure through investments in rehabilitation, training and institutional
reforms, (iii)0 percent increase o f and area under sustainable lan d management and 15 percent
imp rov ed vegetation cover as a percentage o f the baseline in targeted watershed areas (iv)
impro ved management o f about 8 sub-watersheds through capacity strengthening and investment
in watershed infrastructure and sustainable watershed management, and (v) increasedgovernment support for sustainable agricultural intensification in irrigated and rainfed areas
throu gh increased pub lic expenditures.
B.4. Project Components
28. The IDA -fin an ce d project comprises three technical components co vering m ajo r strategicorientations: (i) evelopment o f Commercial Agriculture, (ii)rr iga t ion Development and (iii)
Watershed Development. The fo urth component i s Program Management. In accordance with the
‘growth poles’ approach, the project proposes four similar sub-projects in the four regions
concerned (Annex 1). A more detailed description o f he components and activit ies i s attached in
Annex 4. The GEF funding i s mainly directed towards tw o technical components: (i)he
development o f commercial agriculture, and (ii)atershed development, as we ll as the progr am
management component. Inf orm ati on on GEF funded activit ies within the components can be
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Component 1 Development o f Commercial Agriculture
(US$12.46 mi l l ion , inc lud ing an IDA contr ibut ion o US$7.45 mil l ion, a GEF contr ibut ion o
US$2.50 mill io n, and a beneficiaries ’ contr ibution o US$2.51 mil l ion)
29. The objective for this component i s to lay the foundations for improved market access
and sustainable intensiJication and diversiJication o irr igated and rainfed ag r icu l tur al systems
in the pro ject ’s watersheds.
30. The ‘Development o Comm ercial Ag r icu l ture ’ comp onent includes the projec t area as a
whole: bo th irr igated and upland or tanety areas. I t s specific objective will be achieved through
an approach focused on market-driven demand, agricultural technology development and
dissemination, private sector init ia tive a nd vertical integration o f supply chains, as well as
promot ion o f partnerships amon g stakeholders (i nclud ing p ublic -priv ate partnerships, PPP). The
component aims at improving, al l along the targeted supply chains:
Access to market and mar keting systems in order to reduce costs and increase f ar m gate
prices
Added value through diversif icat ion into higher added value products and agro-
processing
Capacities o f armers, farmers groups an d professio nal organizations
integrating SLM principals, inputs, and credit
0
0
0
0 Agricultural productivity through better access to extension, improved technology
37. T h e component includes tw o sub components: one involving activit ies that largely
depend on public/ collective initiative; the other one depending essentially o n deman d fro m
stakeholders:
(i) Support to ag r icu l tura l services. (’USS7. I 4 mil l ion, including an IDA contr ibut ion oUS$5.15 mil l ion, a GEF contr ibut ion o US$1.97 mil l ion, and a beneficiar ies’
contr ibution o US$O.02 mil l ion)
The sub-component aims at improving access to markets and supports the
development o f commercial agriculture value chains, through innovative
technologies for sustainable production, storage and processing, and a stronger
enabling environment at the site level . The project i s funding services, work,
equipment, tr ain ing and operational costs. Ac tivi ties can be adjusted to sp ecific needs
o f each site, and include the follo win g (a) support to the development o f dynamic
market-driven supply chains, pa rticular ly by creating a nd strengthening l inks between
producers and markets, (b) building up o f farmers capacities and strengthening
professional organizations, as well as establishing Agricultural Service Centers(ASC), and (c) dissem ination o f technologies fo r sustainable agricultu ralintensification and diversification in lowlands and uplands, including support and
advisory services fo r the implementation o f agro-ecological and agroforestry
techniques in the upper parts o f he watersheds. These services have already begun as
part o f the IDA project that has been effective since April 2007 and are being
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(ii)Support to pri va te investment. (US$5.32 m illion, includ ing an I D A contributio n o
US82.3 million, a GEF contribution o US$0.53 mil l ion, and a beneficiaries’
contribution o US$2.49 million )Th is sub-component i s providing demand-based support to private investment by
operators, farmers and farmer groups at all levels o f he agricultural activity. The sub-
projects funded under this sub-component are essentially private in nature and are
initiated u pon request by a farmer, a farmer grou p or a priva te sector operator. Th ey
are initiated by the latter, with f inancial support from the project i f government
considers them a priority and wants to promote them. Project support i s being
provided to p rior i ty ne w investments through a cost sharing mechanism according to
a pre-established positivehegative l is t . Private operators have been selected to be
responsible for implementing the sub-projects and related activit ies according toprocedures approved by the project. Sub-projects include investment in collective
storage, market research and supply chain development, technical and managerial
advisory services, new technology demonstration and dissemination (inc luding agro-
ecological cultivation techniques), support to seed production, private distribution
networks for inputs and equipment and microfinance institutions, and support to
contract farming and integrated sub-projects initiated by commercial or agro-industrial partners and in vo lvin g small scale producers. Th e proje ct i s taking a gender
sensitive approach and specifically supports vulnerable groups in their demands. Inaddition to investment in infrastructur e and equipment, sub-projects inclu de studies
and market tests and research, extension and advisory services, applied research,
training, and study tours. IDA i s f inancing act ivi t ies l in ked to the product ion o f big
com me rcial crops, such as rice, off-season vegetable crops, and others, whereas GEF
funding w i l l be directed towards i) ropping systems that apply agro-ecological
principles, ii) ruit tree cultiva tion as part o f agroforestry system developments, iii)
l ivestock product ion and with i t support sustainable fodder production, and the
integrat ion o f l ivestock and cropping systems, an d iv) f ire-less upland cropping
system as alternativ e to the slash-and-burn practices o f cultivation.
38. These GEF activit ies w i l l contribute to achieving the SIP Result 1 and Result 3 (Seeannexes 3 & 4 for more details). The financing modalit ies are described in further detail inAnnex 4. Implementation responsibilities are detailed in Annex 6 . Eligibility criteria for activit ies
funded under this component include the willingness to cov er part o f he associated costs and to
commit to develop and implement a capacity strengthening plan. More detailed in format ion o fGEF funded activit ies can be found in Annexes 4 and 15.
Component 2: Watershed Development
(US$4.33 m il l ion, including I D A funding o US$I. 2 mil l ion; GEF contribut ion o US$2.42
million, and beneficiaries’ contribution o US$O.09 million )
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sedimentation; (ii)ncrease the prod uctivity and sustainability o f agricultural produc tion based on
agroeco logical and agrofores try technologies; and (iii)trengthen the management o f natural
resources to improve the environment and living conditions. The GEF f inancing here w o u ldconcentrate o n nvestments with long-term environmental impacts, and support to SLM groups.
41. The project i s f inancing the fol low ing sub-components:
(i) Planning and capacity bui lding for sustainable management o watersheds, (US4.33 m il l ion, including I D A funding o US$1.82 million; GEF contribution o
US$2.42 million, and beneficiaries contrib ution o US$O.09 mill ion) includin g (a)preparation, as par t o f Watershed M aster Plans, o f Watershed Development Plans
in the four project areas; (b) preparat ion o f part icipatory plans fo r managingapproximately eight sub-watersheds (each o f about 10-500h2);c) support to
comm unication and negotiation platforms, (d) training and capacity strengthening
o f SLM groups; (e) support to impro vem ent o f an d tenure security; and (0 the
establishment o f an integrated SL M knowledge and information system. IDA
funding has contributed to the development o f Watershed Master Plans and i s
supporting lan d tenure security through the installation o f nter-comm unal ‘Land
Tenure Windows’. GEF funding w i l l address longer-term environmental and lan d
degradation issues through a participatory and integrated approach. The focus willbe o n technical assistance, train ing and capac ity strengthening f or sustainable la nd
use alternatives, support to enviro nmen tal commun ication, a nd the establishment
o f a national SLM database.
Sustaina ble investments in watersheds, (US$I .20 mi ll ion, inc lud ing I D A unding
o US$0.57 mil l ion; GEF contribut ion o US$O..54 million, and beneficiaries
contribut ion o US$O.09 mill ion) inc lud ing (a) determining, thro ugh partic ipato ry
negotiations, l oc al strategies fo r con trol ling erosion, arr esting gullies and reducing
the sediment loa d o f r iver runoff .The
projectwill
finance investments in strategicanti-erosio n works (through, amon g others, bio log ica l methods and technologies);
an d (b) interventions on communally owned la nd to improve plant cover,
reforestation and pastures through strengthened technologies and managementtransfer o f na tural resources. IDA i s in charge o f (a) above and GEF will provide
i t s support to (b).
Eligibility criteria for support under this component include the severity o f l a n d
(ii)
42.degradation, an d the willingness o f stakeholders to cover part o f he associated investment costs.
43 . An MOU, one per Project Area, has been signed by MAEP through the Nat ional
Im ga tio n and Watershed Program and the Ministry o f Environment, Water, Forests and Tourism
(MinEnvEFT) through the Third Environm ent Pr ogram (EP3) to ensure adequate integration in
al l project areas, o f he project. The MOU specifies in detail the activities that will be financed by
each program. These activities will contribute to achiev ing SIP Results 1, 2 and 3 (see Annexes
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upscal ing o the project at the nat ional level. This component finances the following sub-
components:
(i)Management o the project (US$I.89 mil l ion, including IDA funding o US$1.51mil l ion; and a GEF contr ibut ion o US$0.38 mil l ion), inc lud ing (a) provis ion o f
technical assistance, train ing, o fice equipment and vehicles, min or o@ce upg rad ing
works, audit ing and evaluation studies, and incremental operating costs in support
o f project management; (b) overall project planning, quality oversight, procurement,
financial management, and mo nito rin g o f proje ct activit ies; and (c) outsourcing o f
quality oversight through independent financial and technical audits, and evaluation
o f proje ct activities. P rojec t management encompasses a ll fo ur target watersheds as
well as national level coordination. GEF funding will contribute to this sub-component by rein forc ing the technical assistance already being provid ed.
(ii) Support to nat ional pol ic ies, (US$0.48 mil l ion, inc luding IDA unding o US$0.36mil l ion; and a GEF contr ibut ion o US$O.12 mil l ion) inclu ding (a) provision o f
technical assistance, studies, training, information campaigns, exchange visi ts an d
workshops fo r the development o f majo r national policies, regulations, and plans
considered crit ica l to the Government’s Nation al Irr iga tion and WatershedManagement Program; (b) provision o f support to emerging professional grou ps, in
particular the Platforme Consultative de Riz and the Associat ion Malgache deProducteurs de Semences; and (e) provisio n o support to prepare a mu lt i -partner
SLM investment development framework, in collab oration wi th UNDP. IDA i s
financing (a) and (b) above and GEF will finance (c).
(iii) oni tor ing and evaluat ion. (US$2.06 mil l ion, including IDA funding o US$1.58mil l ion; and a G EF contr ibution o US$0.48 mil l ion). T h i s involves data collection
and reporting on key performance output and impa ct indicators, includ ing targeted
data collection, surveys, participatory assessments and mid-term and f ina l
evaluations. GEF funding will contribute to the project mon itorin g and evaluat ionsystem by financing the satellite images and their interpretation to monitor, among
others, the glo bal and environmental ind icators.
45. The scope o f this sub-component wo ul d be national. The impro ved policies are expected
to benefit al l key operators and producers inv olv ed in the sub-sector. The GEF funded activit ies
will contribute to achieving the SIP Result4. Fo r mo re details see Annexes 4 an d 15.
B.5. Lessons Learned and Integrated into the Project Concept
46. The design o f the project i s based on lessons drawn fro m evaluations2 o f programs and
projects in the irrig atio n sub-sector that were oft en unsuccessful. De spite significa nt investm ents
in the rehabilitation o f irrigation infrastructure, there has been l i t t le diversification to higher
valued added crops, and sus tainability has been questionable because o f la ck o f maintenance.
Some o f the reasons for the failure identif ie d by the different studies are lack o f market access
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stakeholder capacity; la nd tenure constraints; non-respect o f com mitm ents by users an dGovernment; and indiscipline and impunity.
47. The conditions o f success identif ie d by these same studies include the followin g:
(i) An integrated approach that contributes to increased productivity and incomes inirrigation schemes and surrounding watersheds, safeguards natural resources in
watersheds, improves the provision o f agricultural extension and inputs, and actively
supports emergence o f a private sector.
A conducive economic environment including a price pol icy fo r products and inputs,
market access in t e rms o f road infrastructure and information; prom otion o f the
private and associative sectors for marketing o f products and supply o f nputs; access
to appropriate and effici ent a gricu ltural services; and access to ru ra l finance.
An unambiguous institution al fram ewor k with clear responsibilities in accordancewith polic ies such as decentra lization and legisla tion (land, water an d forestry codes)
for farmers and their associations; communes, inter-communes and regions;
decentralized Gover nment services; and agencies and privat e operators.
An approach that emphasizes capacity strengthening o f al l stakeholders to help themplay their respective roles an d respons ibilities.
A participatoy approach, coordinated decisions and respect for commitments,
including stakeholders with established and acknowledged rights and obligations,
adequate resources and capacities, who fully participate in decision-making;
incentives an d mechanisms in place to encourage approp riate beha vior an d respect for
commitments made; and interfaces f or cooperation and dialogue in accordance with
decentralization po licies.
(ii)
(iii)
(iv)
(v)
Experience with implementation o date
48. Since the launc h o f the IDA project in April 2007, the Implementation Status Report
(ISR) rat ings o f the project fro m the start have been "satisfactory" fo r bo th Impl eme ntatio n
Progress (IP) and Project Develop ment O bjective (PDO). T he commitment from the Governmentan d the M A E P s ta f f to launch the project and to w ork with the other development actors in the
project sites has beennoted. There i s a high leve l o f expectationwithin the country o n the project
and a lo t o f goodwi l l to see i t become a success. The project i s designed to be fully aligned with
the existin g structures and institu tion al entities in the four sites through wor ki ng with the regions,the decentralized M A E P staff and the relevant lo ca l management committees.
49. The project implemen tation structure i s in place as the Steering Com mitte e at the natio nalleve l and the regional steering committees (CORES) are already operational. Howe ver, these s t i l l
need strengtheningas regards planning, execution, coordination, communication and M&E. At
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project activit ies, especially with respect to the crit ical watershed master plans wh ich are being
finalized. As foreseen under the Project, the capacity o f he MA E P s ta f f has to be built to plan,
execute a nd coordinate a complicated project such as the Irr iga tion and Watershed Develop mentProject. The project i s recruiting strategic partners for each site to support the DRDR in
implementing f ie ld activit ies.
B.6. Alternatives considered and Reasons for Rejection
5 1. A number o f alternatives were considered and rejected in project design:
Develop the program as a Sectoral Investment Loan (SIL). However, i t was f e l t
that the investment part o f the project requires a flexible implementationmechanism with an appropriate incen tive framewo rk that ca n respond to different
preferences an d capacities o f stakeholders.
Spli t t ing the project into three separate projects - (i)n agricultural product ivi ty
project focusing on irrigation and agricultural services; (ii) commun ity based
natural resource management project focusing on watershed management and
decentralization; and (iii) land refor m project focusing o n implementat ion o f herecent economic and sector work findings. However, i t was felt that this design
wo ul d fai l to capture evident synergies and create implem enta tion gaps.
Putt ing in place a sector-wide mult i -donor approach similar to the Th ird
Env i ronmental Program . However, discussion with other donors suggested that
more flexible donor collaboration, possibly in preparation for close collabo ration
thereafter, was more appropriate.
Expanded ocus on complementary rur al development act iv i t ies l ike ru ra l j n a n ce
reform, a nd land administratio n. However, i t was felt that this wo uld exacerbate
projec t complexity and create impleme ntation risks.
Reduction in the geographic scope o the project to three areas. However, thiswould n ot min im ize complexity and wo uld be at odds with the government’s
scaling up objective; and
Designing the project to respond to the government’s nascent decentralization
program, transforming the project into a multi-sectoral, rather than agricultural
operation. I t was felt that the policy, institutions and disbursement mechanisms
associated with decentralization were no t yet sufficie ntly clear and mature.
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C. IMPLEMENTATION
C.1. Partnership Arrangements
52. Th e project i s a blendedoperation between GEF and IDA. I t contributes to the Nation alIrrigation a nd Watershed Management Program, for w hi ch the G o M has prepared a pol icy letter(see Annex 18). The Nation al Program i s also supported by Agence Franqaise de Developpem ent(AFD) and other donors (see An nex 2).
53. In each o f he fou r project areas, the project works with regio nal partners. These includ e
P L A E in Marovoay, WWF in Andapa and Durell in Lac Alaotra for watershed activities; andBAMEX and CT H T K T H A for marketing and business promotion activit ies.
54. The project benefits from the Memorandum o f Understanding signed between the
National Irrigation and Watershed Management Program and the multi-donor Third
Environmental Program to ensure coherence and synergies between activities in the lo wer andupper watersheds.
55. The conceptual de sign o f the ASC s and “guichets fonciers” has been elaborated in closecollaboration with FAO, EU and AFD. The EU i s provid ing signif icant support to M A E P in the
establishment and capacity strengthening o f ASCs.
56. This project i s part o f the Strategic Investment Program for Sustainable Land
Management in Sub-Saharan Africa (SIP) program, the goal o f wh ich i s to support sub-Saharancountries in imp rov ing natural resource-based livelihoods by reducing land degradation, in l i ne
with MDGs 1 an d 7 . T h i s will particularly enhance the opportunity o f mutual learning viaregional kn owledge sharing, by exchanging targeted analytical work, and by harmonizing, i f
advantageous, M&E approaches. In that context the two global environmental indicators o f theproject (increased vegetation cover and increased area under SLM), are among the keyperformance indicators o f SIP. Th is will create complementary inf orm ati on and be o f d irec t
benefit to b oth programs. Emphasis o n mutu al learning via regional knowledge sharing will be
through drawing linkages with the recently completed Wor ld Bank supported M ed ium SizedProject Inst i tut ional Strengthening and Resource Mobi l izat ion for Mainstreaming Integrated
Land and Water Management Approaches into Development Programs in Afr ica; the UNDP-
GEF funded Stab i liz ing Rura l Popula t ions through the Ident if i ca tion o Systems for Sustainable
Management and Loca l Governance o Lands in Southern Madagascar, an d the UNEP regional
project Addressing Land-based Activi ties in the Western Ind ian Ocean.
C.2. Institutional and Operational Arrangements
57. The project i s being implemented under the responsibi l i ty o f the Ministry o f Agriculture,
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Ministry o f F inance and Budget, Ministry o f National Education and Scient i fic
Research, Ministry o f Economy, Industryand Trade - to ensure consistency o f project
actions with national policies;
0 the Chairperson o f the Permanent Steering Team o f the Rur al Developme nt Actio n
Plan,
0 the main professional organizations such as the Chamber of Agriculture and
associations/forum nvolved in he m ai n value chains such as the (( Rice Platform D.
59. The National Steering Committee i s supported by a technical secretariat under the
responsibil i ty o f the National Program Coordinat ion Unit a t M AEP. I t i s responsible for (i)annual programming o f project act ivi ties and approval o f the w or k p lan and budget, (ii)monitoring implementation and results, in particular the analysis and approval o f activity reports
and financial and operational audits, and (iii)ecommending co rrective measures that m ay be
necessary. TheNa tion al Steering Comm ittee meets twice a year.
60. Regional Monito ring Committees have been established in each o f he four p roject areas.
They are chaired by the Head o f he Re gion and made up o f members o f GTDR3.The Regional
Moni tor ing Committee i s supported by the GTDR’s Tec hnic al Secretariat, a nd i s responsible for(i)nsuring consistency o f project actions with bo th national strategy and policy, and regional
development priorit ies and programs; (ii) reparing and validating detailed work plans and
budgets at the regional level; (ii)eviewing project progress and performance, and the
implemen tation o f corrective measures i f necessary. The Region al Mo ni to rin g Committee meets
twice a year.
6 1.
Unit (NPCU) at MA EP , as follows:
Th e overall coordination o f the project i s ensured by the Natio nal Program Coordinat ion
0 The National Program Coordinat ion Unit i s responsible for project coordination at
national level;
0 The Regional Director for Rural Development (DRDR) i s responsible for project
coordination and project investments in heir respective region s.
0 To help them in these tasks, the project has financed the recruitment o f an international
technical assistant for operations at the national level, and (ii)our national technicalassistants, as advisors to the Reg ional Direc tor for R ur al Dev elop men t for operations at
the site level.
0 The N P C U a nd DRDR have selected fro m within their respective units one staff member
wh o provides support fo r coordina tion and project monitoring.
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o f he DRDRDepartment o f Finance and Budget (RDFB). The pr ojec t has recruited a specialized
national financial management and procurement agency that provides technical f inancial
management assistance to M AE P’ s Finance Direc tor. Th e project has also recruited, for each o fthe four sites, a regional Ch ie f accountant, w ho w orks closely with the DRDR and who i s in
charge o f financial management. T h i s person works closely with MAEP’s Department o fAdm inistratio n and Finance and reports to the national financial management and procurement
agency.
63. MAEP’s Directorate o f Finance and Budget i s responsible for: (i)onsolidat ion o f wo rk
program s and budgets; (ii)aintenance o f records and accounts for a ll transactions made at thecentral level; (iii)imely preparat ion o f quarterly In teri m Financial Reports (IFRs), consolidated
project financial statements and other required reports; and (iv) cash management andreplenishment applications for the Designated Account. The Regional Department o f Finance
an d Budget at each o f the four sites manages disbursements from the ”Regional Accounts”,
maintain records and accounts for all transactions related to the regions, and prepares financial
and other basic inform ation o n project managementlmonitoring as required by the M A E P
Financial Directorate.
64. Procurement i s ensured, at central level, by the Person Responsible for PublicProcurement (PRMP) o f M A E P and, at regional level, by relevant units o f the DRDR. The
project has recruited (i) national financ ial management and procurement agency that pro vides
technical assistance to the PRPM, and (ii)t the l eve l o f each region, an additional staff, under
contract to the national agency, which i s full t ime in charge o f project procurement. This staff
work closely with the PRMP and benefit f rom the project support in procurement technical
assistance at the natio nal lev el.
65 . Tec hnic al assistance. Recruitme nt o f technical assistance (TA) has already been done
under two separate contracts (one for financial and procurement management, and one for
operational assistance) with specialized f i r m s . The international “Operations” TA i s in charge o f(i) dvis ing the NPCU and DRDRs on operational strategy, project implementation andmonitoring; and (ii) raining and operat ional support to MAEP staff involved in project
implementation. Four national “Operations” TAs are posted at the l e ve l o f DRDRs to advise and
support them in project im plementation and ensure coord ination o f all project components at the
regional level. Nation al consultants in f inancial management and in procurement are responsible
for financial management and procurement and for pr ovi din g technical support to DRDR staff.The four financial and four procurement consultants at the regional level are responsible for
financial management and procurement at the regional level. They have been recruited under one
contract with the national le ve l financial management and procurement specialist, and report tothe natio nal specialists.
C.3. Monitoring and Evaluationof Outcomes/Results
66. Monitor ing and Evaluat ion (M&E) i s the responsibi l ity o f MAEP ’s Department o f
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impact indicators, at mid-termand at completion . The pr oject has already established a baseline
as o f mid-2007. T he results framew ork i s presented in Annex 3.
R i s k s
Operational
C.4. Sustainability and Replicability
Risk rating Risk Mitigatio n Measures
67 . Sustainability o f proje ct investments will be achieved in he fol l owi ng manner:
(i) In linking so il and water management in upstream watersheds to irrigation, theproject contributes both to more profitable rainfed agriculture, and more
sustainable and cost-effective irrigation management. In so doing, the project
seeks to set o f f a cycle o f increased productivity, higher inco me and improv ed
capacity to pay for irrigatio n services.
In v ie w o f the experience in Madagascar, p rio rity i s being given to capacity and
institutional strengthening. The project will not establish new institutions, but
builds o n GOM’s prio ritie s and on what has already been established. Inv estmen tsare being done on ly where conditions associated with institutional performance
and governance h ave been met.
Client demand, contribution in cash or in kind and ownership i s the determiningfactor in deciding to go ahead with investments in agriculture, irr iga tio n and
watersheds.
Past experience provides abundant confirmation that irrigation schemes that
depend on pumping are not sustainable. The project therefore selects irrigation
sites that depend on gravity fl ow only.
(ii)
(iii)
(iv)
68. Successful proje ct outcomes and lessons learned can be disseminated through the
Na tio nal Program and replicated to other regions. The fact that the proje ct i s work ing in four
distinct sites will allow for repl icat ion o f essons learned within each region, taking in to accountloc al specificit ies and conditions. I f successful, the project wil l also have a good potential for
transferability to other countries in the Afr ica region. Dissemination o f good practices and
successful approaches would be essential in facilitating the scaling-up process. A detailed
replica tion strategy wo uld be propose d after the mid-termevaluat ion o f he project.
C.5. Critical risks and Possible ControversialAspects
69. The potential r isks o f he pro ject are presented in he table below.
Table 1: Critical risks and mitigation measures
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PolicyG oM does not follo w a sound seed andfertilizer po licy based on private providers, aswe ll a favorable environment for privateagrobusiness development.
Country Level:
Audit may not be conducted in compliance with
international auditing standards due to: weakcapacity of the accoun ting profession in
Madagascar, and; ii)nadequate number o fsk illed and experienced auditors at the“Chambre des comptes” in particular.
!-Control Risk
Funds flowRisk o f non availabil i ty o f communitiesparticipation;
C.6.
70.
71.
0
a
72.
Credit conditions and covenants
Effectiveness conditions: No n e
Legal Covenants
Moderate
S
S
The Government will ensure that operational
higher grant money for activities wit hhigher public service values
The project invests in capacitystrengthening o f project participants
0
The implementation of the G oM fertilizerand seed policy i s a covenant under the
project.
The F M aspect o f his project has been
entrusted to a Financ ial ManagementAgency (FMA) acquainted w ith Bankprocedures, and the audit w il l be carried outby the international accounting firm
recruited under the ongoing Irrigat ion and
Watershed Management Project. The qualityo f the audit conductedso far i s satisfactory.
Com munity Contribu tion to Sub Projects
w i l l be in abor and in kind.Financialcontribution i s no t required.
moda l i t ies o f management and
replenishment o f FERHA be defined by November 30, 2008; after consult ing with the
Bank, and
The Government will also ensure (i)hat a draft law t o harmon ize the i rr igation related
lega l f ramework, inc lud ing butn o t l i m i t e d t o L a w 90-0 16 and subsequent implementation
texts with the provis ions o f the Program be prepared by November 30, 2008 and (ii)ha t
the relevant implementation texts be adopted by September 30, 2009, after consult ing
with the Bank.
Disbursement conditions: no wi thdrawal sha l l be made for any Sub-project Matching
Grant under Category 2, unless: (i) Sub-project Agreement has been signed between the
relevant Imp lemen ting Inst i tut ion and the Sub-project Beneficiary, in terms and conditions
satisfactory to the Wo r ld Bank;
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D. PROJECT BRIEF SUMMARY
D.1. Economic and Financial analysis
Summary o f Benefits and Costs:
73. Pr oje ct benefits. Fo r each watershed, tw o types o f benefits were identif ied: (i)dditional
agricultural product ion in irrigated perimeters and uplands or tanety areas and (ii)educed
situation and avoided cyclone damages to i rrigation infrastructure. The benefits were quantif ied
and valued using hypotheses on (i)elay and increment in generating additional agricultural
product ion in rriga ted areas (ma nly paddy ) a nd uplands (main ly cassava, maize, and tomatoes)
an d (ii)elay and increment in reducing siltation and damages, and (iii)ent values associated
with increased productivity and reduced O&M costs. T he results are presented in he table below.
The gross benefitvalue o f he project i s US$62 mil l ion.
74. Economic Analysis. For the purpose o f the economic analysis, the I r r igat ion and
Watershed Management Project has been divided in four watersheds that were assessed
separately: Marovoay, Itasy, Andapa and Lac Alaotra. For each watershed, the economic costs
have been regrouped in (i)nvestment costs (public commercial agriculture development,irrigated perimeters, watershed development, and project management); (ii) hysicalcontingencies, an d (iii)ncrem ental recurrent costs. The results are presented in the table below,
and detailed in Annex 9. The higher economic costs for Marovoay come from i t s i rr igat ioncomponent whi ch involves a larger area than in he other watersheds.
Table 2: Economic Costs per Watershed
Type o Costs, Present Value ($ ’ 000) Marovoay I tasy Andapa A lao tra Tota l
Commercial Agricultural Development 2,763 2,585 2,528 2,185 10,061Irrigated Perimeters 4,510 1,944 1,465 3,392 11,311Watershed Developm ent 2,714 1,279 2,463 885 7,342Project Management 1,529 1,529 1,529 1,529 6,116Phy sica l contingencies 1,095 566 507 946 3,113Recurre nt Costs 1,736 820 824 1,505 4,885
Total 14,347 8,722 9,316 10,442 42,827
75. The calculation o f the N e t Present Values (NPV) and Economic Rates o f Return (ERR)
for each watershed show (see table below) show that Marovoay i s by fa r the most economical lyvaluable watershed, with an estimated ERR o f 28 percent. As a whole, the project i s l i ke ly to
increase the welfare o f the country by about US$19 mill ion corresponding at an ERR o f 17
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Table3: Economic benefits, NPV and ERR per Watershed
Watershed BeneJts/Costs (Present Va lue, $ 000) Marovoay I tasy Andapa Lac Total
Well Irrigate d Areas Prod uction 25,833 6,675 3,846 5,503 41,857
Par tially Irri gat ed Areas Prod uctio n 2,121 3,072 3,081 1,419 9,694
Tanety Pro duction 1,536 4,079 2,150 266 7,876
Siltation Reduction in rr iga t ion systems 43 171 70 27 31 0
Avoi ded Cyclone Damages in rri ga tion systems 947 485 420 279 2,130
Project Cost (investment and recurrent) 12,611 7,903 8,492 8,937 42,827
Alao t ra
Net Present Value NPV 17,867 6,579 1,076 -1,441 19,041
Economic Rate of Return (ERR) 28% 20% 12% 7% 17%
Sensitivity analysis
76. The variables that mo st influe nce the project outcome include (i)he producer price o f
paddy; and (ii)he abi l i ty o f WUAs and the government to maintain irrigation infrastructure
beyond the project l i fe ( including whether a cyclone hits the structures). I f producer price fallsbelow 15 cents next year (compared t o 20 cents now) and stays at this level, the project will no t
be profitable. I fW A s do no t maintain productiv ity o n rrigate d areas more than 7 years after the
project or i f a cyclone hits Marovoa y's 16,000 hectares o f rrigated perimeters after four year o f
project implementat ion without being repaired, the project 's NPV drops to zero. The main
beneficiaries o f the proj ect (farmers) should therefore pay th e incremental recurrent costs to
ma inta in the infrastructur e as we ll as for insurance mechanisms.
D.2. Technical
77. Irr iga tio n investment operations have had a mi xe d experience in Madagascar. While
investments were generally justif ied in terms o f ncrease in production, sustainability has been
far from sure. The project focuses o n increased production and higher value, but in part icular o n
translating higher income into better maintenance o f infrastructure through capacity
strengtheningand im pro vin g governance o f hydraulic assets. In addition, the project invests in
upper watersheds to prom ote sustainable la nd use practices, w hi ch i s expected to deliver higher
product ion o f rainfed agriculture, while at the same time reducing sedimentation and thus
maintenance costs. Based on internatio nal experience, the project supports a demand-dr ivenapproach to extension services that are, u ltima tely, to be provided by priva te service providers o n
a co mmerc ial basis. Establishment o f Agric ulture Service Centers i s being supported by the
project as a pla tfor m to bring ogether supply and demand for extension services.
78. Watersheds fo rm integrated spatial management units with irrigatio n schemes. Failure to
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D.3. Fiduciary
79. Procurement: The third Country Procurement Assessment Revie w (CPAR) for
Madagascar was conducted in November 2002, fo l lowe d by a workshop in June 2003 for the
val idation o f a jo in t CP AW CF AA action p lan to ensure rap id implementation o f procurement
reforms. K e y elements o f these reforms are: (i)evision o f he draft procurement code to ensure
transparency, simplify procedures, a nd com ply with intern ation al standards, (ii)stablishment o f
effective procurement institutions to ensure that the new regulations will be adequately applied,
and to provide su fficient oversight and control; and (iii)dequate train ing and capacity building
to ensure the sustainability o f the procurement reforms. A new procure ment code was enacted in
July 2004 and regulations are in application. The World Bank ascertained that the deficientfeatures identified in he 2003 C PA R have beenprop erly addressed.
80. A remaining area o f concern i s the Government’s cumbersome and overl y bureaucratic
approval process f or contract signing, wh ic h causes unnecessary delays. In addition, insufficient
procurement planning contributes to delays in project implementat ion whic h results in slow
disbursement. To mitigate the risk o f delays, proper prerequisites for the use o f Ban k standard
bidding documents, in cludin g evaluation reports for N atio na l Compe titive Bidding procedures
(NCB) have been agreed up on with Government during negotiations.
81. A Procurement Capacity Assessment of the MA EP , inc lud ing training needs and
arrangements, was co nducted as part o f the project preparation. On the basis o f the i n i t ia lassessment, a n action p la n was drafted to address areas where M A E P needs to be strengthened.
T h i s includes (i) specific section o n procurement in the Project Implementation Plan (ii)
improved filing organization o f procurement-related documents (inc luding in the regional
offices); (iii)rocurement training sessions for project staff; (iv) the recruitment o f technical
assistance to help MAEP handle the project procurement load, and (v) the f inancing o f
independent procure ment and tec hnical audits o n a regular basis.
82. F inan c ia l management: The overal l conclusion o f this revi ew carried out during the pre-
appraisal mission i s that the DFB ( through PNBV PI) and RDFB continue to m aintain a sound
financial management system in l ine with the requirements o f the OP/BP 10.02. The financial
management risk i s assessed as being moderate. The GEF-f inanced project will us e the sameChart o f accounts and the current models o f IFRs that have been used for ID A-f in anc ed project.
The models o f FRsare presented in the exist ing accounting manual o f procedures.
83. To mit igate r isks raised by the weak capacity o f the acco unting profession and the
Auditor General Office (Chambre des Comptes) the audit o f the projec t financial statements,
including GEF grant, has been entrusted to an international auditing firm recruited under the
ongoing Ir rig ati on and Watershed Management Project supported so fa r by IDA f inancing. The
terms o f reference o f the audit have already been reviewed by the financial management
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D.4. Social analysis
84. T h e large rice pro ducin g irrigation schemes constructed over the last fifty years haveattracted migrants fr om other parts o f the country. Some o f the farmers wh o have landed in theirrigation schemes also often also have landed in the watersheds surrounding the irrigation
schemes. Other farmers have only landed in the surrounding watersheds. Degradation o fagricultural production systems in the irrigation schemes and in the watersheds has led to
reduced agricultural production and consequently to increased poverty. Degradation in the
watersheds, in particular, has been dramatic and ma y over time lead to abandonment o f he land.The project aims to sustainably increase agricultural production, diversification and revenues inthe four sites. Agro-ecological agricultural practices, which have the potent ial to tr iple
agricultural production, are being promoted in the watersheds to increase farmers’ income, butalso to reduce or stabilize man-made erosion, increase soil ferti l i ty, impro ve vegetation cover,
and reduce bush f ires. T he project i s also expected to c ontribute to increased land security in bo th
produ ction irrig ated and watershed systems.
85. The project i s examining carefully the position o f sharecroppers in he irrig atio n schemes,
where share croppin g i s most common. I t aims to ensure that the capacity o f the priva te operators
i s no t strengthened at the expense o f smallholders, ma rgin aliz ing vulnerable groups.
86. The project i s working towards strengthening WUAs in order t o imp rove the managementand maintenance o f the irriga tion schemes. I t wi l l also establish or strengthen communicationand consultation platforms in each watersheds (which will include WUA representatives) to
imp rov e the management o f natural resources and develop sustainable agric ultura l systems. I t s
expected that these activities w i l l have a positive environmental and social impact on the
sustainable use o f the natural resource base and reduce siltation on the downstream irr igat io n
schemes, which in turn wo uld have a positive impact o n poverty reduct ion in both production
systems.
D.5. Environm ental analysis
87 . Madagascar i s a mountainous country with a relat ively low populat ion density. The
country has abundant land and water resources, wh ich are only partly developed, and biodiver sity
resources o f global significanc e. Madagascar has a high natu ral erosion rate, as a consequence o f
i t s soi l types and heavy rain fall, often exacerbated by cyclone s and heavy rains. T h i s high natural
erosion rate has been exacerbated by deforestation o f erosion prone fragile soils, frequent bush
f ires (many o f whic h li nk ed to livestock grazing) and unsustainable agricultural practices in th e
watersheds, wh ich made most o f the watershed soils infertile and marginal for agricultural andlivestock production. Th is pattern o f severe land degradation has lead over the years to reduced
agricultural pr oduc tion and increased poverty. Th i s , together with increased land scarcity in the
four high pot ent ial sites, has increased the pressure o n the watersheds an d has lead to increased
deforesta tion and pressure o n the globa lly importan t biodivers ity resources in the watersheds in
three project sites: Marojejy National Park, the South Anjanaharibe Special Reserve, and the
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poverty. The impact o f the degraded environment on the agricultural productio n systems i s
significant. T h i s situation was made worse by the absence o f adequate maintenance o f the
schemes
88. The p rojec t seeks to reverse this trend by rehabilitating and im pro vin g the management o f
the existing irrigation schemes, as well as by stabilizing or reversing land degradation in thewatersheds throug h the promot ion o f mo re sustainable agro-eco logical practices. These imp rov ed
practices should, over time, reduce soil erosion and sedimentation in the downstream schemes.
Over the short term, i t i s expected that these improved practices will significantly increase
agricultural product ion o f traditional and new crops in the watershed areas, and thereby help
reduce poverty. One o f the requirements for increased production will be the integrat ion o f
agriculture and livestoc k (such as use o f dung as fertil izer and organic soil conditioner). I t s alsoexpected that inte nsifie d agricultur al practices will reduce or stabilize agricultural expansion and
thus reduce the pressure o n the remaining highbiodiv ersity resources in the watersheds.
89. The project i s expected to ha ve mostly beneficial environmental and social impacts, as
demonstrated by GoM’s Regional Environmental and Social Assessment (RESA). The ma in
positive environmental impact will be the improvement o f environmental services o f the
watersheds through the adoption o f agro-ecological product ion systems and better management
o f pastures, wh ic h will stabilize o r reduce eros ion rates.
90 . Intensified agricultural pro ductio n ma y require increased use o f chemical fertil izers and
pesticides. G o M has thus prepared a Pest and Pesticide Man agem ent Pla n (PPMP) to m itiga te the
health and environmental impacts o f ncreased pesticide use. I t s at present not clear i f armers
will be able to afford and maintain the financing o f ncreased inputs.
9 1. Irr iga tion schemes in Madagascar are the m ai n sources o f waterborne diseases, such asmalaria an d urinary and intes tinal bilharz ia and diarrhea. The four selected project sites are no
exception. The Environm ental and Social Management Plan (ESMP) wh ic h already exists,includes measures to reduce these diseases in order n ot to im pair the product ion capacity o f the
farmers and improve their quali ty o f i fe.
92 . The major potential environmental risk posed by the project would be the potential
attract ion o f an inf lux o f migrants f ro m other areas o f Madagascar should the project be
successful in ncreasing agricultural produ ction in the watersheds. These migrants w ou ld increase
the already high pressure o n lan d in the four project watershed areas, which cou ld lead to further
deforesta tion o f the sites, increased us e o f steep hills for agriculture production, and further
clear ing o f reed lands in Lac A laotra for r ice production. La nd zoning, transfer o f landmanagement to exis ting soc ial groups, an d empo werme nt o f farmers and farmer’s groups to
manage these lands will therefore be o f undamental importance during project implementation.
D.6. Safegua rd Policies
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integrated into project design. However, increased us e o f fertilizers and pesticides m ay have
negative impacts on the Lac Alaotra Ramsar site, Lac Itasy, the mangrove habitats in the
Maravoa y area and the Lo ko ho River in Andapa. In man y areas, ri ve r and lake water i s also used
fo r drinkingpurposes.
95. The fol low ing W or ld B ank Safeguard Policies were tr iggered:
Table 4: Safeguard Policies Trigge red by the Project
Safeguard Policies Triggered by the Project Yes No
Environmental Assessment (OP/BP/GP 4.01)Natural Habita ts (OP/BP 4.04)
Pest Management (OP 4.09)
Cultural Property (OPN 11.03, being revised as OP 4.11)
Involuntary Resettlement (OP/BP 4.12)Indigenous Peoples (OP 4.10)
Forests (OP/BP 4.36)
Safety o f Dams (OP/BP 4.37)
Projects in DisputedAreas (OP/BP/GP 7.60)'Projects on International Waterways (OP/BP/GP 7.50)
96. Environ mental Assessment, Na tu ra l Ha bit at and Forests. As part o f preparat ion of he
IDA project, the Government prepared a Regional Environmental and Social Assessment(RESA) which has been disclose d at the project sites, at the national level, and in the Infoshop inWashington prior to appraisal. Agro-ecological production systems and improved pasture
management will be promoted in degraded and deforested soils in the watersheds. Sites where
large amounts o f sediments originate and w hic h affect the downstream irrig ation schemes will be
given priori ty. By preparing and implementing a land use zoning plan and transferring themanagement o f land in the watersheds to communities i t i s expected that land use will change
fr om an open access situatio n to a regulated access natural resource, w here m igran ts cannot any
longer sett le f reely. Intensif icat ion o f the watershed agric ultura l systems and a change to high er
productive and less erosion prone agro-ecological practices i t also expected to reduce thepressure on the globa lly im portant biodive rsity resources in the upper watersheds. This approach
satisfies the Enviro nme ntal Assessment Safeguard Pol icy O P/BP 4.0 1, Natura l Habita t Safeguard
Policy OP/BP 4.04 and the Forests Safeguard Polic y OP /BP 4.36.
97. The project also finances sub-projects, such as check dams, anti-erosion structures, small
irrigation dams, markets or other structures. These sub-projects are screened for environmental
and social impacts by the Technical Secretariat o f the Ma tch ing Grant Mechanism (to b e
financed under the project), that will also iden tify i f a Resettlement Ac tio n Plan (RAP) and/or a
small Environm ental Assessment study wil l be needed as part o f he feasib ility analysis.
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pesticides used for malaria control in the project areas. The PPMP w i l l also promote thedevelopm ent and establishment o f ntegrated Pest Manage ment Practices (IPM).
99 . Involuntary Resettlement. G o M has also met the requirements o f the Bank’sInvoluntary Resettlement Safeguard Policy (OP/BP 4.12) by preparing and disclosing aResettlement Policy Framework (RPF). I t i s expected that any potential resettlement, landacqu isition or loss o f access to trad itiona l natura l resources will occur at a lim ite d scale. Should
this happen, a Resettlement Action Plan (RAP) will be prepared to ensure that people are fully
compensated (at replacement costs) and will no t be worse o f f than before the project intervened.Sub-projects will be screened to id ent ify wh ether a RAP will be requ ired (see also Environm ental
Assessment, above).
100. Safety of Dams. The Safety o f Dams Safeguard Polic y i s not triggered. The project will
rehabilitate a scheme that i s served by an irr igat ion reservoir. At the same time the safety o f thedam (less tha n<Imeter) w i l l be inspected and if needed brou ght up to international dam safety
standards.
101, Analysis of alternatives. Feasible alternatives are (i)o no t implement the project; or (ii)to implement i t with out a watershed management component. The “no project” alternative wo uldal low further deterioration o f he irrig atio n schemes and the watersheds with consequent negative
impacts on poverty, agricultural production, and glo bally significant biodiversity sites. Thealternative “without watershed management” w ou ld leave the irrig atio n systems exposed to largesediment loads, wh ich wo uld endanger and potentially undermine the investments.
102. Public consultation. Public consultations have been carried out on the Terms o f
Reference o f the Regio nal Environ ment al and Social Assessment, o n the draft report, as we l l asduring the preparation o f the RPF. T h i s i s in conformity with the requirements o f OP 4.01 andOP 4.12.
103. Borrower Capacity and Implementation and Monitoring of the ESMP. TheBorrower’s capacity to supervise and monitor the implementation o f the Environmental and
Social Managemen t Plan (ESMP) i s bei ng strengthened. One o f the Technical Assistants hiredunder the project i s qualif ied in environme ntal and social management and i s already in charge o f
the adequate implementation and monitoring o f he ESMP. Depe nding on the need, some o f he
ESMP activit ies will be implemented by contracted service providers.
104. Disclosure. The Regional Environmental and Social Assessment, the Pest and Pesticide
Management Plan and the Resettlement Policy Framework have been disclosed at the fourpro ject sites, in Antananarivo, and in the Infoshop in Washington p rio r to appraisal.
D.7. Policy Exceptions and Readiness
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Annex 1: National, Sectoral and Progra m Context
Madagascar: Irriga tion and Watershed Management Project
A. National and Sectoral Contex t
1. Th e Island o f Madagascar covers a total area o f 588.841 km2.The population, estimated
at 16.4 m il l i o n nhabitants in 2003, i s increasing at an annual rate o f about 2.8 percent. N early 78
percent o f the populat ion l ives in the rural area. The country i s characterized by majo r
biodiversity and considerable c ultural and socio-economic diversity. The economy i s essentially
rural-based and agriculture remains the m ai n engine o f economic development. Per capita
income i s US$290. Poverty affects 68.7 percent o f the total populatio n and 73.5 percent o f therura l populat ion.
Poverty Reduction Strategic Fram ew ork
2. The government has put in place the Madagascar Ac tio n Pla n (MAP), a development pla n
for 2007-12 that i s th e second-generation Poverty Re duction Strategy. The M A P envisages
accelerated and better-coord inated reform s and outlines the strategies and actions that will ign i te
rapid growth. “Rural development and a green revolution’’ and “cherish the environment” aretwo o f the core eight commitments o f the MAP. The specific objectives with respect to rural
development are (i)o increase agricultural value-added (through, inter alias, Agricultural
Service Centers), (ii) iversify rur al activit ies (focusing o n support to producers’ organizationsamong other activities), (iii)aunch a sustainable green revolut ion through integrat ing
environmental dimensions in agricultural activit ies and (iv) promote market-oriented activit ies
through strengthening farmers‘ organization and investment in infrastructure. The M A P
Commitment to “cherish the environment” focuses on reducing natural resource degradation
through better lan d use practices.
3. MA P’S goal i s also to ensure that the country develops in response to the challenges o f
globalization and in accordance with the national vision “Madagascar Nafurellement’’ defined
by the President in November 2004. I t states that Madagascar will be a newly industrialized
country with maximized competitiveness by 2020. Th e core o f growth will be derived from the
country’s unique natural resources and fr om the transformation o f t s natural products. The vision
aims to develop a diversified and ri c h natu ral resource base (agriculture, livestock, fisheries, and
mining) that will contribute to the creation o f products with high value added such as essential
oils, agri-business, pharmaceuticals, and mining products. A broader impact o f growth and a
progressive redistribution o f t s benefits will help reduce pove rty substantially. Madagascar will
be known worldwide f or the beauty o f i ts rich and well-protected biodiversity and i t s
environment will be cherished and protected and used in a wise and responsible wa y to enhance
development. The Malagasy people, both in rural and urban areas, w i l l be healthy and well-
educated, will be active participants in the development process and will be gainful ly employed
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watershed scale. Additionally, the project i s in l i ne with the new National Program for Ru ral
Development, among whose pillars are the impro ved management a nd use o f natural resources
an d the protection o f natural production factors and ecosystem functions. T he operation will also
dovetail with the im plementation of the Third Environmental Program, with which a MOU has
been established. I t s activit ies also fit together with the Nat ional Forestry La w w hich seeks to
prote ct watersheds, promote reforestation, comb at wild fires, and protect natural habitats andbiodiversity. Furthermore, the 'project (i)irectly contributes to the implementation o f the
U N CC D Nat ional Act io n Plan, and (ii)ddresses priorit ies under the National Biodiversity
Strategy and Act ion Plan and UNFC CC N A P and NA PA .
Agriculture, rice, and irrigation
5. Rice represents nearly 70 percent o f agricultural production and accounts fo r 48 percent
o f otal calorie consumption. Rice production has only increased by 1.2 percen t per annum sincethe 1980s and average paddy yield at the national level i s s t i ll l o w (about 2.4 t/ha). Ann ual
production o f paddy rice has virtually stagnated for about ten years, stabilizing between 2.3 and
3.0 m il li o n ons. Area planted to paddy has increased by onl y 0.44 percent per year fro m 1970 to
2004; yields have increased by 0.71 percent per year, m uc h slower than in other major r ice
producing countries. With population gro wth o f 2.7 percent per year, p roduc tion per person has
fal len from 275 kglperson in 1970 to on ly 179 kglperson in 2004. R ice far ming techniques are
largely traditional and use o f inputs i s the exception in many places. E.g., fertilizer use hasremained stagnant at 10 k g h a on average, as compared to 14 k o a n sub-Saharan Africa, and
2 91 k g h a in Indonesia. Vast differences in prices between wet and dry season are explaine d by
the lack o f fluidity in movement o f goods from product ion areas t o the markets due to a lac k o f
road infrastructure and la ck management capacity o f storage facilit ies by farmers. On average, 28percent o f the paddy product ion i s marketed (750,000 t). Rice sales are highly concentrated. In
2001, the top 10 percent o f r ice farmers (by value o f sales) accounted for 73 percent o f total
natio nal ric e sales. These farmers s old o n average 2.2 tons/household. An estimated 48 percent o f
rice farmers did not sel l any rice in 2001.
6. I rr iga t ion occupies an important place in the agricultural sector, supplying water to mo re
than one mi ll io n hectares, or 40 percent o f cultivated lands (as compared to 6 percent o n average
in sub-Saharan Africa). Irrigated crops represent 15 percent o f GDP, whereas 7 0 percent o f
agricultural product ion and 88 percent o f r ice p roduct ion originate fro m irr igated agriculture. I t s
estimated that 85 percent o f the active farming popu lat ion are direct ly or indirect ly em ployed by
the irrigation sector. Since the 1950s, irrigatio n has benefited fro m pu bli c investment. However,the impact o f hese efforts on rura l incomes i s mixed, and sustainability i s far fr om certain. The
rapid degradation o f infrastructures requires frequent rehabilitation, and many schemes arecaught in a vicious circle o f poor yields, lo w capacity o f water users to pay fo r O&M, and rapid
degradation o f the schemes. Weak capacity to pay i s accompanied by lo w wil l ingness to pay,
reinforced by institutio nal weakness o f the WUA and a la ck o f support from loca l authorit ies.
Moreover, erosion o f watershed upstream i s weighing heavily o n cost o f maintenance o f
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agents, (v) unrealistic expectations about the volume o f public (human and financial) resourcesavailable.
Nat ura l resources, soil development and role of communes
8. One o f he basic problems o f he rural and agricultural sectors i s the rapid degradation of
natural resources, particularly watersheds. The stagnation o f yields in irrigation areas and
demographic grow th lead to an extension o f rain-fed crops on hill slopes (tanetyhavy), of ten by
removing the forest cover and by replacing i t with inappropriate farming practices. Un produ ctive
pastures are degraded by frequent passage o f bushfires. As a result, soils are increasingly
degraded and fragil ized, and even lo w levels o f run of f ead to high levels o f erosion that cause
damage to downstream assets, reduce the lowland area under irrigation through sedimentation,wet season flooding and dry season droughts. In addition, there are important implications in
terms o f biodiversity loss and decl ining buffering and regulatory ecological services. More
sustainable la nd management practices have demonstrated that i t i s possible to achieve the du al
object ive o f higher prod uctivity and reduced soil degradation and erosion.
9 . Communes and Regions are responsible for lan d use plann ing and play an important r olein providing land tenure security: the communes should therefore be at the centre o f al l natural
resources management and watershed development initiatives. The Communes have been
established to provide a number o f basic services to the populations (role o f public serviceprovider) and to act as the engine o f development on i t s terri tory. T o that end, the capacities o f
the Communes i s being strengthened in he fo l low ing areas: (i)nit iat ing development within the
Commune, including: (a) support for the elaborat ion and monitoring o f Commu nal Development
Plans (CDP), (b) f inancing o f investments; (ii)mpleme ntation o f their specific mandate,
including: (a) implemen tation o f responsibilit ies in the area o f education, health, water,
sanitation, and maintenance o f nfrastructu res that have been transferred to th em by the centralGovernment, (b) technical assistance in the area o f economic development and management o f
natur al resources, (c) la nd tenure pol ic y (land tenure counters), and (d) the integration o fintercomm unal priorit ies in the development pol icies o f he Commune4.
10. Tenure security through delivery o f ormal documents i s important because i t can lead to
better use o f land and i t facilitates impro ved fisca l resources. T raditional leasing arrangements,
currently outlawed in Madagascar, prov ide an en vironment that i s non-conducive for investmentsin product ivi ty.
11. Giv en the importance o f the responsibilit ies entrusted to communes and the l o w lev el o f
hum an and financi al resources at their disposal to meet these challenges, i t s indispensable to putin plac e a support mechanism. The Ministry o f Decentra lization and Lan d U s e Planning (MDAT)
has put in place a progra m fo r strengthening the capacities o f Communes in administrative and
financial management. T o that end, Di str ic t Support Centres (DSCs) are beingestablished in theregions. These DSCs are responsible for : (i)raining elected officers and staff o f the Communes
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Land tenure security
12. Madagascar has a high dema nd fo r la nd tenure security, as evidenced by the many
requests for land t i t le deeds (which the present system i s incapable o f meeting), and thedevelopment o f an info rm al local system o f “petits papiers” that i s highly solici ted to record
transactions.
13. Specifica lly, situations o f high tenure insecurity exist concerning those farmers
cult ivat ing land in former AMVR, ZAF, colo nizati on areas or indigen ous reserves that are often
the subject o f com petitiv e claims, and farmers wh o cultiv ate as sharecroppers or tenants. Eithe r
category i s widespread in the irrigation schemes in the intervention areas o f the project, as
evidenced by the diagnostic studies. The uno ffic ial nature o f hese rights weakens partic ularly thefunct ion ing o f WUAs an d O&M o f rr iga t ion schemes.
14. T o meet the high demand for l an d tenure security, the Govern men t rece ntly adopted a
Land Pol icy Letter, w h ich i s organized around 4 strategic orientations: (i)estructuring /modernizat ion o f land services; (ii)ecentralization o f lan d management; (iii)ev is ion o f land
regulations and (iv) capacity strengthening. T h i s po l icy i s being implemen ted under the National
Land Tenure Program that i s already supporting, o n p il ot basis, several decentralized la nd
management experiences with support fr om several donor agencies.
B. Lessons learned
15. Previous attempts to boost agricultural produ ction through investments in i rr igat ioninfrastructure have been unsuccessful, in particular with respect to the sustainability o f the
investments. Despite m odest increases in yi eld levels on those schemes that have bene fited from
investments, a weak institutional environment and high O&M costs have under mined capacity
and will ingness to pa y O&M charges. In addition, on ly 10 percent o f irrig ati on schemes have
benefited fro m investment, and modest yiel d increases have no t been visible in erms o f nationalaverages. The reasons for low yields and weak sustainability are notably: (i)ack o f marke t
opportun ities (isolation, unattractive prices); (ii)ac k o f access to advice and inputs; (iii)ailure
to take in to account watersheds upstream; (iv) l ack o f c la r it y in responsibilities and capacities o f
the different public, associative and private partners; (v) non-respect o f commitment by both
users an d the State; and (vi) indiscipl ine and impunity.
16. The ma jori ty o f Malagasy farmers only benefited marginal ly fr om the technologicaloptions proposed, and average yields are we ll b elo w the actual potential. Tr ad itio n and risk
aversion only partially expla in the failure o f agricultural intensification. Other factors can bementioned, such as: (i)eak capacity o f agricultural research to respond to request o f armers, aswell as their l o w leve l o f organization and part icipation in the development process; (ii)oor
extension services (in te rms o f access an d quality); (iii)and tenure ins ecurity a nd inequitable
sharing o f profi ts, part icularly by sharecroppers; and (iv) lo w tolerance o f potential technologies
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17. Th e conditions o f success include: (i)n integrated approach to irrigate d agriculture and
surrounding watersheds; (ii)onducive economic environment; (iii)lear responsibilities, in
conformity with Government polices and strategies (poverty reduction, decentralization,
agricultura l, environm ental and la nd polic y, etc.); (iv) fully responsible partners with adequate
capacities; (v) clear and unambiguous comm itments corresponding to the capacities o f each o f
the parties, contracted freely and kno win gly ; and (vi) mecha nisms to ensure respect o fcomm itments made that are applie d systematically.
18. The BV -P I ntegrated approach i s a “win-win” approach, w hi ch at the same tim e helps to
increase productivity and incomes in irri gati on schemes and surroundings watersheds, conserve
natural resources in watersheds, limit erosion o f slopes and sedimentation in irri gat ion schemes,
thereby reducing the need for maintenance and rehabilitation o f he latter.
19. An attractive economic environment implies: (i) pol icy on pr ices o f agr icu l tura l
products and inputs; (ii)ccess to markets in terms through roads, information, promotio n o fprivate sector and producers’ organizations for marketing (including storage) and supply o finputs; (iii)ccess to effi cie nt e xtension services well adapted to lo ca l needs; and (iv) access to
finance.
20. Clear inst i tut ional framewo rk: clear institutional responsibilities in i n e with Government
policies and regulations for producershsers and their associations, communes, inter-communesand regions, decentralized p ub lic services, specialized agencies and authorities (ANDEA, etc.),and priva te operators.
2 1. Par t ic ipatoy approach, concerted decisions and respect o commitments made: actors
with clear and acknowledged rights and obligations, and adequate resources and capacities,
participating fully indecision-making; incentives and mechanisms ensuring responsible
ownership and respect o f commitments made; interfaces for dialogue and communication; and
equitable access to resources, espec ially fo r the most vulnerable p opula tion groups.
22. Th e improvem ent o f irrigation infrastructure and the establishment o f sustainable
mechanisms for funding O&M will not be enough to increase rice production beyond about
3.5 tha, which i s s t i l l lo w compared to the technical potent ial. Prom otion o f intensif icat ion o f
rice production systems in IP S S W S R I ) , including in areas with poo r control over water, will
need to be undertaken. Moreover, the agro-ecological techniques o f seeding and plant ing o npermanent plant cover (SCV) developed by the Groupement Semis Dir ec t Mad agascar (GSDM),
supported by CIRAD, are opening new prospects for sustainable and profitable agriculture on
slopes. The environme ntal advantages o f S CV techniques include: (i) rosion control, soilconservation and regeneration o f soil fer til i ty at reduced cost; (ii)mprovement o f inf i lt rat ion,
efficient management o f water in the upper watersheds; (iii)ustainable improvem ent o f soilfer t i l i ty and product ivi ty in the upper watersheds; and (iv) indirect contrib ution to sequestration
o f carbon and reduction o f the greenhouse effect. Fina lly, agricultural diversification, includ ing
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consequently, strengthening dialogue and decision- making c apacity o f the peasant com mu nity
constitute the cornerstones o f sustainability.
C. National Irrigation and Watershed Management Program
24. The National Ir rigati on and Watershed Management Program i s part o f a program under
the PRSFRRSP that aims at reducing rural poverty through sustainable improvement in the
living condit ions and incomes o f rura l populat ions in irrigated perimeters and surrounding
watersheds, and efficie nt management o f natur al resources.
25. The Government has clearly defined i t s new medium-term vision o f the management o f
BV- PI, based o n nat ional pol icies o n rura l and agricultural development and the decentralizationpolicy, which i s at the centre o f i t s development and pov erty reduction strategy. Th is approach
requires: (i)lear responsibilities fo r each o f he actors in he management o f rrigatio n schemes
and surro unding watersheds (farmers, water users, professional associations, districts and inter-
communities, regions, central Government); (ii)f fect ive part icipat ion o f rur al populat ions indiagnosis o f problems and ident i f icat ion o f opt ions; (iii)o-management o f P I and BV by al l theactors concerned; and (iv) incentives and efficient mechanisms to ensure that all stakeholders
respect their commitments.
26. One o f the key object ives o f the f i rs t phase o f the PN/BV-PI, o f which the IDNGEFfunded project constitutes a major part, i s to put in place a clear and attractive institutional
environment as well as adequate capacities at all levels, with a view to attaining theGovernment’s vis ion and objectives. F or i t s implementation, the project will adopt a flexible
approach adapted to the real i ty in the f ie ld and evolut ion o f capacities o f he inst itutions, whic hwill be gra duall y strengthened with a view to their empowerment.
27. The project will engage in the development o f agricultural production, irrigatio ndevelopment and watershed management. IDA funding will focus on commercial agricultural
development, irrigation infrastructure development and management, and finance some critical
watershed interventions, that are direc tly li nk ed to the irriga tion schemes (e.g. treatment o f
specific ero sion spots etc.). GEF -SIP will contribute in developing and implementing innovative
agricultural approaches and activities directed towards sustainable land management, especially
in the upp er watershed areas, a nd the lake and marsh zones downstream o f the irrigatio n schemesas these areas are highly vulnerable to degradation. Natural resources management issues are
complex, need specific attention, and have to be addressed with a long-term vision, especially inview o f ncreased cl imate variabil i ty, in order to strive fo r an overall sustainable development o f
the watershed.
28 . T h i s blended operation i s a targeted investm ent under the GEF-SIP umbrella, a regional
strategic multi-donor program designed to scale up the area o f Af ric an cropland, rangeland, and
woodlan ds und er sustainable management. The SIP i s a pr ior i ty program of TerrAfrica, which
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D. Project Zones
Marovoay
29. The Maro voay plains i s a rice produ ction zone o f pri me national importance, situated inthe Boeny Region, about 80 km South-East o f Mahajanga. The Marovoay river i s a tributary o n
the right b a nk o f the Basse Betsiboka, in the upper delta o f the riv er. Subjected to quasi-complete
submersion during th e annual flooding o f he Betsiboka, the development o f he valley started in
the early 20th Century for off-season ric e pro duc tion (once the water- level has dropped). Later
extensions to the gravity systems included schemes supplied through pumping f rom the
Betsiboka. The scheme i s divided into 13 completely independent irrigation sectors, fe d fr om a
great number o f different sources. The system faces serious O&M challenges. The submersion o fschemes by waters from the river requires annual rehabilitation o f the irr igation infrastructure,
thus making O&M expensive and the overall economic pro fita bil ity uncertain. Fo r a total area o f
about 20,000 ha, an estimated area o f 12,000 h a was cultiva ted in 2004. Beneficiaries o f al l plots
developed during the successive programs were mainly immigrant populat ions from otherregions o f the country. The percentage o f sharecroppers i s today very high.
30. Until recently, the central Government was responsible for O&M o f the i rr igat ion
schemes and pumps. Presently, public funds for m aintenance o f structures considered as ‘ non
transferable’ are unreliable. Restruc turing int o WUAs and federations o f W A S as not resulted
in the establishment o f an adequately O&M . The Performance Contract signed with the
federation for the period 2001-2003 was not renewed and funds earmarked for 2004 were
reallocated.
3 1. The m ai n watershed serving the Maro voay irrigated perimeters i s that o f Riv er Betsiboka,
whose hydrology i s determined by phenomena occurr ing some hundreds o f km upstream. Sub-
watersheds o f River Marovoay and i t s tributaries supply a ma jo r par t o f he system: their sources
are main ly in the zone o f Ankarafantsika Na tional Park, where huma n activit ies are controlled.Final ly, al l around the plain, small lateral watersheds with mainly intermittent f lows do not
constitute a source o f irrigation water supply but have a major impact in terms of erosion,
sedimentation and destruction o f protection and distribution structures alongside irrigate dperimeters.
Itasy
32. Itasy Region, located around Lac Itasy, i s situated about 100 km to the West o f
Antananarivo. All irrigatio n schemes in Itasy (Grappe du Lac Itasy 1 980 ha, Ifa nj a 1900 ha,Mangabe 270 ha, Analavory 140 ha, Am pa ry 90 ha, Antanimen akely 80 ha - or a to tal o f
446 0 ha) are presently cla ss ifie d as autonomou s perimeters, as com ple x ‘non-transferable’
infrastructure i s absent. The re gion offers great potential for agricultural production, given the
natural fertil ity o f volcanic, basal and alluv ial soils and i t s favorable climate for agricultural
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34. Althou gh mos t o f hese schemes benefited fro m projects implemen ted fro m 1998 to 2000
(project PPI 2), they are currently facing serious problems due to a com bination of erosion o f he
upper watersheds and la ck o f maintenance o f the systems. In addition, storage infrastructure has
been silted up an d i s n o long er adequate, also giv en the change in the f l ow reg ime o f he rivers(increase in f lo od fl ow and reduction o f dry-weather flow). Hence, 30 - 50 percent o f the
perimeters are no longer adequately irrigated. Giv en (or as the ori gin of) these problems , W A S
have stopped collecti ng maintenance fees for several years, since a greater pa rt o f the users have
refused to pay as they are no longe r benefit ing from water control. Th e actions o f he W A S rel im ited to maintenance works carried out by interested users, i.e., in mo st cases, those o f the
downstream sectors o f he irrig ated perimeters.
Andapa
35. The Lokoho watershed at Andapa, situated in the Sava Region at about 100 k m s South
West o f Sambava, i s formed by three concentric landscapes: (i)he f i rs t covers a vast pl ain o f
crops, 18,000 ha, drained by 4 ma in rivers whose confluences form River Lokoho at the ex it o f
the basin; (ii)he second i s constituted by tanety, at the periphery o f ric e farms, m arked by a
diversity o f annual crops (m ainly rain-fed rice) o n cleared forest (tavy) or planted fa llow lands,
as well as coffee a nd vanil la crops; (iii)he third, at an altitude o f over 900 m s distinguishedby
a denser tree cover. The basin i s bordered in the North-East by Mar ojejy Na tional Park, in the
South-East by Anjananaribe South Special Natural Reserve, w hic h i s the only forest zone o f thebasin where tree cutting i s s t i l l authorized, thou gh regulated.
36. From 1962 - 1997, the Andapa ba sin has benefited fro m a development program fundedby EDF. The project com prised an infrastructure component, wh ich includ ed the road linking
Andapa and Sambava, drainage o f the basin, internal network o f access roads, development o f
the m ain waste water outfal l o f he basin and construct ion o f a pumping station. The agricultural
component focussed on development o f rice farms o n a total area o f 4,400 ha, introdu ction o f
double season rice cultivation, measures aimed at imp rov ing collectio n and marketing, and anextension and diversification program. In 1979, the public company "Andapa Mamokatra" took
over as the organization in charge o f the Andapa basin development project. The impact
evaluat ion o f the project in 1998 was severe, particularly: (i)ai lure o f pumping r r iga t ion o n the
Ankaibe perimeter (2,100 ha); (ii)ack o f maintenance o f structures o n a ll perimeters developed
by the project; (iii)he total disorganization o f the AWUs; (iv) failure o f ntensification attempts.
Lac Alaotra Sa ham alot o Irrigation Scheme
37. The Lac Ala otra watershed form s a vast depression o f around 1,750 km2,with an averagealtitude o f between 750 and 770 m, surrounded by eroded hills. The lake (a Ramsar site) i s
shallow and surrounded by swam py marshes. I t covers an area o f about 220 - 25 0 km2 free water
surface) and aroun d 550 km2with surroun ding marshes. The watershed serves about 80,000 h a o f
rice farms, o f wh ic h 30,000 ha are developed. The watersheds are subjected to strong man-made
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SO MA LA C ensured the maintenance o f the irr igation system, supervised rehabilitation works
carr ied out between 1984 and 1989, with notably the creation o f water users associations (1989-
1991). These efforts were accompanied by the implementation o f projects a iming to intensify
agriculture.
39. The watershed supplying Sahamaloto i rrig atio n scheme stretches over an area o f 356 km2.
The irr igation scheme has a developed area o f 6,400 ha, o f wh ic h 80 percent i s cultivated when
the rain fa ll con dition s are favorable. The area i s supplied by a storage dam constructed in 1957.
The in it ia l storage capacity o f 26 mi l l io n m3,was gradually reduced to about 13-14 m il l i on m3.
The scheme was fully rehabilitated in 1988-1989, inc lud ing the construction o f a new intake
tower, an increase in the volume o f storage water to 18 m il l i on m3.Emergency repair and
rehabilitation works were in i t iated in 1998-1999.
40. The 12 federated WUAs o f the irrigate d perimeter, with a total o f 1,800 members, are
physical ly part icipat ing in the constru ction o f secondary canals, thus contributing to the
maintenance costs o f the primary system and operational costs o f the off ice o f the federation.Contribut ion in cash for the maintenance costs at the charge o f the W A S secondary systems)
varies from one WUA to the other, but remains generally weak, with recovery rate rarelyexceeding 60 percent o f amounts voted.
E. Rehabilitation of hydro-agricultural Infrastructures in the Project Zones
41. The def in it ion o f a prio ri ty investment program demands that ranking cri teria be def ined
for determining priori ty interventions. The fol lowing three levels are defined. Level I
interventions consist o f hose works that wo uld resolve problems that are o f capital importance to
the entire area. The rehabilitation o f nfrastructures in this category helps to ensure: (i)ccess to
water resources by protecting the headwork and primary structures that are indispensable forsupplying the second system; (ii)ccess to cultivated la nd by rehabilitating cultivated schemes
during raining season lost through dysfunctional drainage; and (iii) rotect ion o f property, byprotecting the structures against floods o r a strategic structure. The non-intervention o f Lev el 1
blocks the funct ion ing o f the system. Hence, in most cases the interventions concern primary
infrastructure: con trol dam and diversion offtakes, supply channels, m ai n canals, m ai n drainagesystems, or f lo od protect ion dyke.
42. Level 2 interventions consist in structures that b lo ck access to water or access to la nd or
protect ion o f assets o f part o f the network: secondary or upstreaddownstream l inks. The non-
in tervent ion o f Le vel 2 makes i t impossible for part o f the users to cultivate or harvest. I t
concerns ma in ly secondary systems, sections o f the ma in canals or ad dition al structures o n them a in canal (floodgates, co ntr ol structures), secondary canals and secondary drainage systems.
43 . Level 3 interventions consist in structures that w ou ld boost ag ricultural produc tion either
by im pro vin g water con trol (irrigation and drainage), or increasing the cultiv able area. I t nvolves
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45. I t i s important not to focus solely on total amounts. Hence, the major budgetaryallocations presented in this table are as follo ws: (i)y adding the Sahamaloto perimeter at Lac
Alaotra, the total budget i s tripled, f rom US D 5.8 m i l l i on o USD 17.6 mil l ion ; (ii)or the three
pr ior ity intervention zones (Marovoay, Itasy and Andapa), 65 percent concerns prio rit y 1 works,27 percent priority 2, and 8 percent priority 3; (iii) n the other hand, for the Sahamalotoperimeter at Lac Alaotra, 71 percent concerns pr io rit y 3 works; 29 percent priority 2, and 0percent pr ior it y 1; (iv) for a ll possible intervention zones, 50 percent concerns priority 1 works,
28 percent pr io r ity 2, and 21 percent prio rity 3.
Alaotra
Sub-total 2
46. I t should also be noted that the pumping stations in some of the blocks in the Marovoay
scheme, and their primary system, whose rehabilitation falls under priority 1, accounts for 50
percent o f he total rehabilitation budget for the Marovo ay zone.
3 2930 5 423 7 277 12 855 25 55 5
47. T h e project will not to tally finance the rehabilitation o f works that the users should cater
for in the future. The contribution o f users will be equal to what they should pay in future forO&M o f these structures. In that regard, the envelope that the project will allocate to
rehabilitation works will be calculated by deducting the annual amounts users sho uld pay formanagement and maintenance in he future.
Site installations & miscellaneous @
Table 5: Cost o f rehabilitation works on hydro-agricultural irrigation schemes
1085 145 5 2 571 5 11 1
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Annex 2: M aj or Related Projects Financedby the Bank and / or Oth er Agencies
Madagascar: Irrigation and Watershed Management Project
Table 6: M aj or Related Projects Financed by the B an k and/or other agencies
World Bank
Other Agencies
Protection des Bassins Versants duLac Alaotra (BV-Lac
de ia Vallee-Marianaet PC 15Projet d’Appui a l a Diffusion deTechniques Ago-Ecologiques a
MadagascarProjet de RChabilitation du Perimktredu Bas MangokyProgramme de Lutte AntiCrosive(PLAE 11)DCveloppement Rural etAmtnagement des basins Versants
dans l e La c AlaotraProjet Haut Bassin du MandrareProjet de Promotion des RevenusRurauxProgramme d’Appui aux CollectivitCset Organisations Rurales pour l e
I Business and Market ExDansion
(BAMEX)Participatory Community-basedConservation in the Anjozorobe ForestCorridorWind and Hydro Energy MarketDevelopment
AFD
AFD
AFD
AfDB
German Cooperation
JICA
IFADIFAD
European Union
Swiss CooperationUSAIDUSAID
UNDP
UNEP
Active
+ctive
Active-ctive
ActiveIctive
Active
Active
Active
CEO approved
Proposed
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Annex 3: Results Framework and Monitoring and Evaluation
Madagascar: Ir rigatio n and Watershed Management Project
1. Performance indicators are lin ke d directly t o the CA S go al o f prom oting broad-basedsocial and economic growth, an d in particular (i)o reach an economic gr owth rate o f 8 - 10
percent per annum; (ii)o increase the l eve l o f investment to 20 percent; (iii)romote the
v i ta li t y o f the private sector so that it participates in an investment ra te o f 12 - 14 percent;(iv) to open up Madagascar’s economy to greater competition with a view to reducing costs
and improv ing quali ty; and (v) foster the wil l ingness o f he popu lation to participate.
2 . Overa l l monitor ing o f the project’s implementation, as well as assessing thedevelopment impact o f the project i s under the responsibil i ty o f the Department o f Statistics
and Information (DSI) under MAEP. I t i s supported by technical assistance. A specialized
project M&E / management informatio n system has been prepared and appro ved by the Bank,as wel l as the procedures for data collection and reporting. M&E s based on direct rep orting
by inst itut ions inv olve d in project implementation (MFI, MEF, ASC farmers and W A S ) ,
relevant data collected on a systematic basis for other purposes, participatory assessments,
user satisfaction surveys (e.g., in irrigation schemes), income surveys, and targeted data
collection (among others through satellite photos), as established in the project
implementation manual. DSI will commission two evaluations o f project output and impact
indicators, at mid -ter m and at comple tion. The proje ct has already established a baseline. The
output of the M&E will provid e sufficient evidence in linking periodic and annual mon itorin g
with subsequent annual pro ject p lannin g activit ies so that M&E data are interpre ted and used
as an instrument for project planning.
3. The project has established Regional Monitoring Committees in each o f the four
proje ct areas that are chaired by the Head o f the Region and made up o f members o f GTDR.
The Regional Monitor ing Committee i s supported by the GTDR’s Tec hnic al Secretariat, an di s responsible for (i)nsuring consistency o f project actions with project objectives and wo rk
plan, national strategy and policy, and regional development priorities and programs; (ii)
preparing and validating detailed wo rk plans and budgets at the re gional level; (ii)eviewing
project progress and performance, and the implementation o f corrective measures i f
necessary. The Regional Mo nito rin g Committee meets twice a year.
4. Similarly to what i s already being done fo r IDA funded activities, the M A E P will be
responsible for submitting to IDA semi-annual progress reports on the GEF activit ies under
the project. Progress reports will focus on (a) k ey performan ce outcome, output and inputindicators as indicated in the Results Framework; (b) progress in procurement; (c) progress in
implementation works; (d) progress on technical assistance and training; (e) status o f
disbursements from the credit; ( f ) progress on comm unity sensitization and mobilization, in particular
with respect to the Performance Contracts; (g) work plan for the next six months.
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MAEP will provide to IDA a project Implementat ion Complet ion Report (ICR). T he
completion report would include: original and revised project targets and actual
achievements; projec t impac t assessments focusing o n results; and performance o f project
management and IDA in fulfilling their respective obligations under the credit. The projectoutputs and outcomes relevant to SIP will be periodically shared with the SIP M&E
coordination desk, where data on portfolio progress wil l be synthesized, aggregated and
annually reported. The SIP M&E system will be used for investment and program
improvement, mutual learning, accountability purposes, progress reporting to GEF Council,
enhancing stakeholder participation, a nd consolidating A fri ca n leadership o n the SLMagenda. The projec t can also benefit from SIP M&E support tools,
A. Results Framework
"I-.. ~ -I. -
PrograWAPL. Objectives Outcome Indicators
Increascd average producti\ ty o fconditions and incomes o f rural
populations in six main irr igationsites and their s urrou ndingwatersheds, and the management o fnatural resources.
irrigated rice in the projectareas (M Tha ):
___.-aseline Endo f
Andapa 2.0 3.5
Maro vay 2.0 3.5
Lac Ala otra 3.5 5.0Itas y 3.0 4.5
* Increased average pro ductiv ity o f
rain fed rice in projec t areas(MTiha):
_ _ _ -aseline End o f
proiectAndapa 1.5 2.25
Mar ova y 1.5 2.25
Lac Alaot ra 1.5 2.25Itas y 1.5 2.25
non ric e area in rrigated schemes
as a percentage o f overallcultiva ted area over two seasonsincreased b y 25 percent
increase in area under product ionin irrigate d schemes during the dry
*
season incrcased by 25 percent
Project Development Objective
To establish the basis for-v;ablc Dissemination o f nnov ative
ProjectOutcome indicators-I_
irrigated agriculture and natural
resources management in four mainirrigatio n sites and their surrounding
technologies and equipment t o
30,000 households throug hextension, capacity strengthening
- ~ll.__lI" -
Use of ProgramOutcome
Informstion
Year 1 : establish baseline
Year 4 : con firm progress afterimplementation of project
activities, and adjustintervention strategy i f
required
Year 12 : measure projec t
impact
Report to SIP:- contributes to SIP PD OPhase 1 ndicator o f %
increased croplan d
productivi ty
Useof Praject Outcomeinfornrrtion
Year 1: establish baseline
Annually: confirm progress
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Improve the environmental
sustainability of and managementpractices in four targeted watersheds
~ l _ l _ - l .iotermediate Outcomes
Result 1: DeveloPmento fCommercial Agriculture
Intensification, marketing, anddiversification o f selectedagricultural value chains in project
target areas wi th increased
uti l izat ion of demand driven S L Mtechnologies
Result 2: Irrigation Development
Better management of argeted
irrigated schemes throug hinfrastructure rehabilitation,impr oved institutional framework,
and capacity bui lding o f Water UserAssociations.
Result 3: Watershed Development
Enhanced capacity o f stakeholders
in he four watersheds to manage
natural resources in sustainable
manner, accounting also for climate
varia bility and change
watershed infrastructure
Increased governm ent support foragricultural intensification in
irrigated and rainfe d areas through
increased pu blic expenditures. ~
Outcome Indicators
Increase in and area under
sustainable management as a
percentage o f baseline, in argeted
project intervention areas
Increase in vegetation cover as a
percentage o f baseline
l ".EntermediateOutcome Indicators
Five A SC established that are able to
deliver S L M advisory services to
land users
50 OPs, unions and federations o f
active producers havin g registered
w i t h A S C
5,000 HH trained in ago-ecological
cropping practices
40 percent increase o f commun itiesadopting S L M options in argeted
Match ing Grants fully disbursed
areas compa red to baseline
21,780 ha irrig ation area rehabilitated
30 W A S rained
100 percent o f operation and
maintenance funds covered b y
irrigatio n service fees collected
satisfactory executed
Four WD P and eight participatory
sub-watershed m anagement plans
developed and adopted
60 commu nity S L M groups trained
and supported
145 hotspot erosion controlinterventions realized
Five guichets fonciers operational
Integrated Management Inform ation
System for S L M established
60 percent change in S L M
Four Performance Contracts
FERHA established
4.2,4.3)
Year 1: establish baseline
Annual ly: confirm progressafter implementation o f
project activities, and adjustintervention strategy i f
requiredReport to SIP: Contributes toSIP Indicators of SIP L ong-
term Program Goal 3 and 4.
I_ .-Use o f Iotermediate
Outcome MonitoringResults 1-3 :
A P L 1 mon itor progress
indicators on an annualbasis
Endo f project :assess and adju st
component strategy if
required.
assess lessons forextending program at
national level
Report to SIP:Result 1 contributes to SIP
Indicators o f R 1 (1.I),R 3(3.1, 3.2, 3.3)
Result 3: Contributes to SIPIndicators o f IR 1 (1.l),R 2
(2.2), IR 3 (3.1, 3.2, 3.3)
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Nation al enabling environment more
conducive to SLM up-scaling.wo rk plans and reports (inclu dingM&E reports, expe nditure andaccounting reports)
Natio nal lev el multi-partner, multi-
sector SLM investment framework i s
established and un der
implementation
Effective oversight, monitorin g o f
project activities, p olicy guidance
and lessons learned.
(2.1, 2.2) an d IR 4 (4.3, 4.4,
4.5,4.6)
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1 Agricultural
b
b
-
b
*
~ .-
PerfomPerformance
Milestones 1(end o f first year)
Valu e chains
supported b yproject identified in
al l four sites
Training curr iculumin ago-ecological
technologies
preparedRegional partners
recruited
TOR and businessplans for ASCsprepared in al l sites
Match ing Grantoperational.
TA f or W U Amobil izat ion
recruitedScheme
Development Plans(as part o f WMP)
prepared in al l four
sites
Maintenance costs
study conducted in
al l four sites
FERHA study
completed
* S L M g r o u p sestablished
Watershed
Development Plan
(as part o f WM P)
study launched inal l four sites
Regional partnersrecruited
_ _ _ice Milestones and A
Performance
Milestones 2(ead o f second year)
5 A S C s
established in a llprojec t areas
3,000households
' trained in agro-
ecological
technologiesMatch ing Grant
disbursed 30percent
1 0 W U A sestablished a ndtrained in a l l
four sites
Recruitment TA
technical studies
Technicalstudies
completed in a l l
four sites
Inventory
transferableinfrastructurecompleted
framework
revised
Legal
WatershedDevelopment
Plan (as part o f
WMP) adopted
in al l four sites
Participatorysub-watershedmanagement
plans developed
in all fou r sites
Training
-I""
.(2 t a g e r sPerformance
Milestones 3(end of third year)
4.000
households
trained in agro-
ecologicaltechnologies
Match ing Grant
disbursed 60
percent
Performance
contracts signedin al l four sites
Recruitment o fcontractor forrehabilitation
recovery in
accordance w ith
PC
F E R H Aestablished
established andtrained in all
four sites
O & M f e e
2 0 W U A s
Participatory
sub-watershed
management
plans adopted
S L M g r o u p s
trained in allfour sitesaccording t o
curr iculum
erosion control
interventions
private sectorinvestments in
agricultureincreased as
evidenced bydisbursements
under thematching grant
mechanism;
established andoperational in
the four project
sites.
ASCs
Scheme
Development
Plans andPerformance
Contractsexecuted
satisfactorily.
Acceptableinstitutional
mechanism for
the funding o fnon-
transferable
irr igat ioninfrastructure
(FERHA)
established and
operational;
guichetsfonciers
established an doperational in
the four project
sites.WatershedDevelopmentPlans executed
satisfactorily
r
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Annex 4: Detaile d Project Description
Madagascar: Irrig ation and Watershed Management Project
1. The proposed GEF project i s part o f an overa l l program approach to watershedmanagement and irrigation development that includes IDA f inancing (already approved in
November 2006) and other donor financing. T h i s program approach i s described in detail
here, with specific reference to the joint IDA-GEF finan cing elements. The GEF projectincludes two technical components covering tw o strategic orientations: (i)evelopment o f
commercial agriculture, and (ii) atershed development. A third component i s related to
program management. In accordance with the “integrated ru ra l poles” approach, the project
proposes four similar subprojects in the four regions involved: Andapa, Marovoay , Itasy, andin the Lac Alaotra area, the Sahamaloto irrigation scheme (Annex 1). The GEF project i s
different to the already-approved IDA f inancing which covers an additional component -
irrigation development. GEF funding w i l l focus on sustainable agriculture based on
innovative techniques and approaches, soil conservation techniques and watersheddevelopment.
A. Project Objective, Outcomes and Components
2. The project development objective i s to establish the basis for viable irrigatedagriculture and natural resources management in four main irr igat ion sites and their
surroun ding watersheds: (i) ndapa (Sava Region), (ii) arovo ay (Boeny Region), (iii)tasy
Region, and (iv) Lac Alaotra ( Alaotra Ma ngoro Region).
3. The expected project results include (i)issemination o f nnovative technologies and
equipment to 30,000 beneficiary households through extension, capacity strengthening and
targeted cost sharing, (ii)mproved management o f about 21,780 ha o f irr igat ion
infrastructure through investments in rehabilitation, training and institutional reforms, (iii)impro ved management o f about 8 sub-watersheds through capacity strengthening and
investment in watershed infrastructure and sustainable watershed management, and (iv)
increased government support for sustainable agricultural intensification in i rr igated and
rain fed areas thro ugh increased pub lic expenditures.
4. The global environmental objective of the project i s to improve the environmental
sustainability o f land management practices in four targeted watersheds. The inte rim resul ts
are (i)0 percent increase in area o f la nd under sustainable management in targeted project
intervention areas (as a percentage o f baseline), and (ii)5 percent increase in vegetationcover (as a percentage of baseline)
5. The project concept i s based on the fol low ing principles: (i)lear responsibilities for
each o f the actors in the management o f irri gat ion schemes and surround ing watersheds
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6 . The GEF-SIP intervention will support the advance o f sustainable lan d management(SLM), especially in upper watershed areas that are highly vulnerable to degradation andwhere natural resources management issues are complex in order to develop viable
agricultural intensification in the lowlands and the uplands, to prevent encroachment intosensitive upper watershed areas, and to help stabilize deteriorating upland catchments. Inaddition, the operation will help leverage poli cy reforms and a lign stakeholders in order to
drive larger uptake o f SLM practices in he keywatersheds an d elsewhere in the country.
7. The four sites have been selected based o n their accessibility, ava ilab ility o f
agricultural services and potential for increased productivity through improved water
management. At the same time, public irrigation schemes are characterized by serious
institutional weaknesses, la ck o f clarity with respect to roles and responsibilities o f
stakeholders, and watershed degradation.
B. Project Components:
Component 1: Development o f Commercial Agriculture
(US$12.46 mill ion, includ ing an IDA contribution o US$7.45 mill ion, a GE F contribution o
US$2.50 millio n, and a beneficiaries’ c ontribution o US$2.51 mill ion)
8. T h e objective for this component i s to lay the foundations for impro ved marke t access
and sustainable intensification and divers ification o f irrigate d and rainfed agriculture in the
project’s watersheds.
9. The ‘Development o f Commercial Agriculture’ component involves the proje ct area as
a whole: irrigated schemes and upland or tanety areas. In upland areas, i t s part o f a coherent
framework which i s ‘Watershed Development’ proposed in subcomponent 3.2. I t s specificobjective will be achieved through an approach focusing on market-driven demand,
agricultural technology development and dissemination, init iative by private operators andvertical integ ration and coordination o f selected supply chains by prom oting partnerships
among actors, includingpub lic private partnerships (PPP).
10. The component aims at im proving, al l along the targeted supply chains:
0
0
Access to market and marketing systems in order to reduce costs and increasefarm gate prices;
Adde d value through dive rsification int o higher added value products andagro-processing;
Capacities o f armers, farmers groups and professional organizations;
Agricultural p roduct ivi ty through better access to extension, improvedtechnology integrating SLM principles, inputs, and credit.
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Table 8: targeted areas in terms of rice intensification and sustainable diversifica tion n ra in fedproduction (agro-ecological, etc.) and dry season (including priv ate irr igatio n)
Areas under seed multipl ication
Input Suppliers
Equipment Suppliers
Blacksmiths/mechanics
(Ycommune)
Agro-industrial and commercialonerators
/a: Rehabilitated phy sical areas (see RDC-IRAMstudy) x use intensity. RBME = r ice with good water control; MME= ice
with poor water control.
Ib : mgation infrastructure rehabilitation s focusing on Sahamaloto, but ac tivities to promote agricu ltural produ ction target a
larger area (8 communities), includin g Anony and a part o f Amparafaravola.
50 30 30 40
3 3 3 3
2 2 2 2
20 10 10 18
45 45 12 28
12.
Table 2:
Di re ct beneficiaries fr om the agricultur al develop ment component are presented in
Table 9: Dire ct beneficiaries fro m the agric ultura l development component
13. Intermediate results are (i)SCs established in each o f the four sites, (ii)ncrease by
50 o f the number o f POs, unions, and federations o f active producers who have registe red
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14. Cr i t ica l r isks include: (i)apacity among producers and their organizations to meet
technologies supply and to manage the support-guidance scheme ;(ii)he will among private
operators to invest directly in on g term contractual relations with agricultural producers; (iii)maintaining and strengthening inc entive policies fro m the State in favor o f agricultural private
sector; (iv) lo w rates o f adoption o f S L M echnologies due to lo w capacity in project sta ff and
communities; (v) high vul ner abil ity to c limati c extremes and associated impacts.
Sub-component 1.1:Supp ort to a gricu ltural services.
(US$7.14 mil l ion, including an IDA contr ibut ion o US$5.15 mil l ion, a GEF contr ibut ion o
US$1.97 mil l ion, and a beneficiar ies’ contr ibution o US$O.02 mil l ion)
15. The aim in this subcomponent i s to la y the foundations for the development o f
commercially oriented agricultural production by implementing innovative technologies for
sustainable produc tion, storage and processing o f agricultu ral products, by im pro vin g access
to markets, and by supporting the development o f comm ercial agricultural supply chains.Investments under this subcomponent are targeted at im pro vin g the enabling en vironment and
prov iding incentives (in addition to on-demand support to investment projects by privateinitiative to be fund ed under subcomponent 2). This includes the prom otion o f sustainable and
profitable agriculture on hillsides and in lowlands (for example throu gh agro-ecological and
agroforestry techniques). The project takes a gender sensitive approach and also specificallysupports vulnerable groups in their demands. The project finances the services, work,
equipment, training and operational costs o f such public investment and o f the activit ies
corresponding to the core pub lic responsibilit ies. Activit ies will be adjusted to specific needs
o n each site, and ma y include the fol lowing:
(a) Support to the development o comm ercial agr icul tura l supply chains. The proje ct has
already recruited or i s recruit ing for each site one or several professional service
providers for promoting market-driven supply chains. The project uses as much as
possible the exis ting schemes for su pporting the private sector and agribusiness wh ic hare already opera ting in Madagascar, such as the net wor k o f “business centers” set up
by the BAMEX project and/or interprofessional technical support centers, such as
C T H T and CT HA . Such service providers are responsible for the follo win g activit ies :(i) arket research and surveys for national and export markets, as well as thematic
studies in storing, processing, packaging, post-harvest treatment and quality
management, (ii) /D on im pro vin g technical it ineraries for production, conservation,
and valorization, (iii)elping elig ible operators prepare documents fo r submission o f
sub-projects to the matching grant mechanism and to the banking system, and (iv)developing partnership contracts between producers and operators for the marketing
and processing o f argeted products. GEF wil l not contribute to this activity.
Strengthening the capaci t ies o farmers and professional organizations, as we ll as the
establishment o f agric ultura l service centers (ASC). The project aims to build(b)
B V P I area, as w el l as operating costs fo r the platform . GEF will provid e targeted
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trai nin g o f farmers’ organizations, and facilitate farmers exchange visi ts to assure thatSLM princ iples are mainstreamed within the agricultural activities.
Strengthening the supply o technology or production and valorization o agriculturalproducts, in particular technologies geared at promoting intensification o f r ice
cultiva tion o n irrigation schemes, pr omo ting the adaptat ion o f agro-ecologicalcultiva tion techniques to sustainable rainfed produ ction systems and diversification o fproduct ion systems for targeted and priority supply chains, including livestock
production. The project supports: (i) ervice providers for adaptive research and
dissemination o f mpro ved technologies identif ie d as priorit ies by the partners, and (ii)
the strengthening o f capacities o f regional public services fo r seed quality and phyto-
and zoo-sanitary control. A distinction i s made bet ween (a) the more product ive landat the bottom o f the hillsides that lends itse lf mor e easily to inten sification compared
to some o f (b) the traditional agricultural upland systems that depend on slash-and-
bumpractices (tavy). These upland systems, fou nd in marg inal and remote areas o f theupper watersheds, are o ften based on deforestation, thus threaten biodiversity, degrade
soil product ivi ty quickly due to burning practices and short fallow periods, and
contribute to erosion. O fte n these farmin g practices do n ot al low farmers to achievesatisfactory incomes. However, it i s possible to develop sustainable agricultural
product ion systems that can be productive and profitable (e.g. through agroforestry,
agro-ecological and horticultural techniques). The im provem ent o f these systems willneed more t ime and effort than for the systems downstream, and needs intensive on -
farm technology development work in order to develop sustainable and profitable
farming practices. M os t o f GEF f inancing in this sub-component will be used under
this l i ne o f act ivi t ies. GEF will fund the service providers for adaptive research and
dissemination, and provide training and capacity strengthening no t on ly to farmers, but
also to the regional pu bli c technical services.
The project ’s main implementing body wil l be DRDR. Detai led implementat ion
(c)
16.
modalit ies for each activity group in subcomponent 1 are specified in the Table 3.
Subcomponent
Development o f sustainable a nd market-
driven supply chains
Capacity-building o f producers and
support to pr oducers organizations
Applied research and technolo gy
Implementation
Recruitment o f egional partners by DRDR
Recruitment o f service providers by ASC
Recruitment o f one or several service providers
dissemination (FOFIFA, TAFA, ON G, etc.), in a competitive
way and under contract with DRDR
a l l levels o f he supply chains. To this end, the project will finance, throu gh a matc hing grant,
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ind ivid ual o r collectiv e initiativ es and sub-projects as presented in Table 4.
Table 11: Individual o r collective initiatives and sub-projects
Support to marketin g
chains
Support to input, credit
and equipment
providers
Support to prod uctive
investment
Marke t surveys, supply chain analysis, development o fquality and certification management systems;
commercial/market trials
0 Infrastructu re for grouping, storage and post-harvesttreatment
Integrated projects fo r setting up contract-based agricu lture
systems to the ben efit o f small scale producers
0 Establishinglextending networks for distributing inputs
and equipment ;
0 Technical and management advisory services (for
example, technical and managerial capacity building for
seed producers).
0 Technical support and extension o f mi cr o financenetworks
Technical support for the development andimplementation o f ne w prod ucts (e.g., weather insurance)
0 Adaptive, agricu ltural, and ago -in dus tria l research
(varieties, technologies an d pro duc tion and proces sing
equipment) ;
Introduction, dissemination and on-farm development o f
new agric ultura l pro duc tion techniques (agroforestry a nd
ago -ec olog ica l techniques, etc.);Awareness raising and demonstration campaign (inputs,
equipment, etc.)
Rehabilitatioddevelopmento f quality seed production;
Reforestation and improv ement o f degraded soils.
0
0
18. The implem entation modalit ies o f he cost sharing mechanism for financial assistance
to private - indiv idua l or col lect ive - investments corresponding to the broad objectives o f he
BVPI project i s outlined in the implementation manual. The manual includes a l i s t o f
el ig ibl eh on eligible activities, selected on th e basis o f their potential contribution to
project/government objectives. Eligible activit ies clearly relate to agricultural produ ction and
management o f natural resources sub-projects that are presented by beneficiaries, and co-
and targeting the improvem ent o f upland agricultural systems that are based on fire use (e.g.
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taw
19. These activities will contribute to achieving the SIP result 1 (SLM applications o n theground are scaled up in the country-defined priority agro-ecological zones), and result 3
(commercial and advisory services for SLM are strengthened and readily available to land
users). The activit ies are rooted in the SIP components 1 and 3 (more specifically the
subcomponents 1.2, 1.3, 1.4, 1.5 and 3.2). In addition, IDA funds will specifically support the
SIP sub-component 3.3 and 3.4 and 3.5). M or e detailed inform ation o f GEF funded activit ies
can be found in he Incremental Cost Analysis (Anne x 15).
Component 2: Watershed Development.
(US$4.33 mil l ion, including IDA unding o US$I 82 mil l ion; GEF contr ibut ion o U S 2 . 4 2millio n, and beneficiaries contribu tion o US$O.09 mil l ion)
20. The object ive o f he component i s t o lay the oundations for sustainable management
o watersheds includin g irrigate d and rainfed agricu lture, the conservation o the natura l
heri tage, and improved product ivi ty o the na tu ra l resources.
2 1. A participatory and integrated approach to sustainable land management should
encourage loc al popu lation (male and female) to take respo nsib ility and engagein
the
sustainable management o f their natu ral resources. The component aims to contribute to (i)
the protection o f watersheds by reducing erosion and sedimentation; (ii)ncreased
produ ctivity and sustainability o f upland systems (including cropping, agroforestry, forestry,
and pastoral systems), (iii)mpro ved management o f natural resources to generate
environme ntal benefits, (iv) impro ved access to lan d and user rights.
22. Cri t ica l r isks include (i)armers may be hesitant to participate in activit ies outside
their o w n fields, as they fear not to directly ben efit from environmental improvements. Where
possible, on-site improvements that produce upland and low lan d benefits are promoted (w hic hare expected to be numerous due to advanced degradation status o f the land). In addition,
other incentive s such as support to la nd tenure se curity will be favored. Only in cases with a
distinct disconnect between upland and lowl and activities, the project may seek to pi lo t other
available and innovative incentive systems (e.g. payments for environmental services). T h e
project will remain f lexible with the response depending o n the analysis and the feasibility o f
implementing the various solutions; (ii)he handing over o f land rights to loca l communi ty
groups c ou ld be perceived by some as threat to free access to natural resources. The project
will establish and strengthen com mun icatio n and nego tiation platforms. By forming networks
o f community groups, loca l communit ies will be in a stronger pos ition to withstand outsideinterference; (iii)igh vulnerability to climatic extremes and associated impacts. The project
will draw on analytical activit ies o n mapping climate related vulnerabilit ies and also conduct
targeted risk screening for relevant activity lines to identify risk mitigating options, where
necessary. These include higher standards for irrigation and erosion control devices, and
and information system for S L M established, and (vi) 60 perce nt change in SLM applications
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adopted by land users, against baseline data. GEF will finance the par ticipa tory sub-watershed
management plans, the training o f and support to the 60 S L M groups that w i l l lead to the
adoption o f SLM applications, and the establishment o f an integrated knowledge andinform ation system for SLM.
24. GEF contribut ion will complement ID A funding by addressing longer-term
environmental and land degradation issues at the watershed level, that negatively impact
lowla nd and upland agricultural product ion systems as well as global environmental goods
and services. GEF funding will be used to address these l an d degradation issues throug h a
participatory and integrated approach to a broader operation and scale up SLM practices onthe ground. Building upo n recent knowledge acquired on cl imate r isks in the country, i t will
strengthen integrated land use planning, reinforce upstream and downstream linkages,
promote environmental sustainability in watershed development, build-up loca l capacity and
promote the use o f echnologies to im prove agriculture produ ctivity w hil e conserving natural
habitats. The ac tivities fund ed by GEF are described in detail in he subcomponents below .
Subcomponent 2.1: Support to Watershed Man agem ent(US$3.13 mil l ion, including IDA funding o US$1.25 mil l ion; and a GEF contr ibut ion o
US$1.88mil l ion)
25. The watersheds in the four project zones are very different in terms o f geography,
climate, biod ivers ity, popu latio n density, la nd use, prod uctiv e potential, ongo ing developme nt
programs, a vailab ility o f potential partners, etc. The fol low ing description o f the component
and the various activities i s an overa ll description. The project i s adopting a flexible approach
that allows mo di fyi ng activit ies according to needs, on-going programs and collaborationpotentials with partners who are already wo rki ng in the proje ct areas.
26. Planning o f watershed management i s done in three steps:
(i) T he f i rs t step i s preparing a watershed management plan for the watershed
areas ad’acent to the irrigation schemes in the in the four project zones (about40 0 km for Sahamaloto/Lac Alaotra, 500 km2 for Itasy, 1,000 km2 for
Andapa, and 500 km2 or Marovoy). The “large” irri gat ion schemes consist o f
groups, clusters or sectors o f schemes, each associated with a sub-watershed.
The WSM p lan will cover all th e sub-watersheds that are directly associated to
the irrigation schemes7.The second step involves the development o f participatory W S M plans for the
approximately eight sub watersheds associated with the irrigation schemes
covering an area o f between 10 km2 o about 500 km2.
2’
(ii)
participatory zo ning and plannin g o f subwatersheds, the supp ort to comm unication and
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negotiation platforms, the training o f S L M groups and technical staff, and the development o f
an integrated knowledge and inform ation system fo r SLM.
at the le ve l o f watersheds - the pro ject finances technical assistance to prepareone WSMplan for each of he four pro ject zones, w hic h includes :
(i) Zo ni ng and desc ription o f land use systems, ecosystems, settlements,institu tions and partners, includingclimate risks.
(ii) Strategic analysis o f erosion problems (as the m ai n source o f downstreamsedimentation) and o f natura l resource degradation;
(iii) specific and detailed analysis to identify responsibility for theimplemen tation o f project activities, wh ile taking into account existing
partners in he area(iv) Establishing a baseline for monitoring and evaluat ion o f component
results.
at the sub-basin le ve l - he project finances technical assistance to facilitate
preparation of :
(i) a part ic ipatory zoning o f sub-watersheds to determine the optim al la ndus e according to (a) topography along a gradient from downstream toupstream, (b) current land use and land rights, (c) diagnosis o f soil
fert i l i t y and so i l product ion potent ial, (d) locatio n and characteristics o fwater sources and streams, and (e) or ig in an d pathway s o f erosion, a nd
(ii)Part ic ipatory plans for sustainable sub-watershed development andmanagement.
Support to existing comm unication and negotiation platforms with the ai m to
(i) Involve stakeholders and partners (communes, farmer organizations,NGOs, etc.) in nform ation exchange and communic ation
(ii) Discuss, negotiate, and validate pa rticip atory WSM plans ;(iii) egotia te con flict settlement.
(iv) Support o f environmental platforms in the project areas
Train ing and capacity strengthening o f SLM groups, and o f ocal and regional
staff in, among others:
(i) Environm ental awareness raising campaigns fo r loc al communities.(ii) Tra inin g and/or strengthening o f farmer organizations in natu ral resource
management by pr ov id in g technica l assistance for instance for example,
fo r c attle herders or charcoal makers and the ir associations.
(iii) pecific training to loca l and regional staff (NGOs, technical government
services) in techniques that are required for the implementation o f thecomponent, such as participatory planning methods or agro-ecological
techniques.
Improvement o land tenure securi ty: The project contributes to the
inter ventio n area) in close consultation with the PNF. The pro ject also supports
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communit ies in obtaining community-based land rights (e.g. GELOSE) and
will provide for technical assistance to support the preparat ion o f natural
resources management plan s within the f ramework o f GELOSE.
Integrated Knowledge and Information System for SLM ; Th is activi ty aims at
capitalizing existing national and international SLM knowledge, at collecting
relevant informatio n on technical S L M options, and at establishing a nationaldatabase on SLM. The act ivi ty can draw on the capacity and framework
developed under TenAf r ica . T h i s activi ty will furthermore substantially
contribute to information d istr ibut ion and communicat ion under component 1and 3.
( f )
Subcomponent 2.2: Sustainable investment in watersheds(US$1.20 million, including IDA unding o US$0.57 million; GEF contribution o US$0.54mil lion, and benepciaries ’ contribution o US$O.09 million)
28 . Depending on the WSM plans that have been prepared, a menu o f nvestments eligible
fo r project support i s bei ng prepared, and specific cond itions (po sitive and negative l is t) will
be prepared, f ro m w hic h lo ca l populations may select investments they conside r appropriate
fo r their specific needs. In principle, investments with long-term environmental impacts, and
community based groups or associations will be el igible. Specif ic el igibi l i ty condit ionsinclude co-financing (in kind or in cash), institu tiona l capacity a mong groups, and the
confirmation o f social and technical val idity o f the proposals. Additional support will be
provided in a competitive way, i.e., depending o n the targets that stakeholders agree to se t fo r
themselves, and the leve l o f their achievement.
29.funded by IDA, and activit ies in (b) by GEF:
(a)
The project finances the fol l ow ing act ivit ies, o f which act ivi t ies in (a) i s
Strategic erosion control. Ero sio n “hot spots” are being ident i f ied throughstrategic an d participa tory analyses conducted under subcomponent 1. Through
negotiations, local strategies are being developed for controlling erosion,
arresting gullies and reducing the quantity o f sediments transported to
downstream irrigation areas. The project finances the establishment o fstrategic anti-erosion works includ ing through works, and biolog ical methods
and techniques. Works are being built favoring use o f local manpower. Inprinciple, W A S n irriga ted schemes should participate in planning o f erosion
contr ol measures and should pay pa rt o f costs. M an y o f these strategic anti-
erosion works will actual ly be part o f the irrigation investments. Examples are:
constru ction o f reten tion structures (fascines) in combinat ion with vegetative
interventions for halting gully and lavaka erosion; and rev egetation a ndprotecting river banks and planting o f anti-erosion hedges (vetiver, fodder
points for cattle, rotational grazing, and keeping cattle in stables for
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manure collection.
(ii) Awareness raising campaigns that address destructive traditional
practices such as fire use for pasture and agriculture, and providingsupport in developing technical alternatives with a participatoryapproach. (this will be complementary to activit ies conducted under
Environm ent P rogram (EP3))
(iii) eforestation and revegetation of degraded land, inc lud ing the restorationo f natural vegetation, support to c omm unity o r private reforestation
(iv) Provision o f support to protec t natural forests and i t s biodiversity, andnat ura l habitats such as marshes and lakes.
30. These activit ies will contribute to achieving SIP Result 1: SLM applications on theground are scaled up in country-defined prior ity ago-ec ologic al zones; Res ult 2: effective andinclusive dialogue and advocacy on SLM strategic priorities, enabling conditions, and
delivery mechanisms established and ongoing; and Result 3: commercial and advisoryservices fo r S L M are strengthened and readily available to lan d users. The ac tivit ies are also
rooted in the SIP Component 1 Supporting on-the-ground activit ies for sc aling up (1 2., 1.4.,
lS.), Component 2: Creating a conducive enabling environment for SLM and more
sp ec ificall y the sub-components (2.4., 2.6., 2.8.), an d Com pon ent 3: Strengthening
comm ercial and advisory services for SLM (3.1 .,3.2.).
Component 3: Program M anagem ent
(US$4.43 mil l ion, including IDA funding o US$3.45 mi l l i on ; GEF contr ibution US$O.98mi l l ion)
3 1. The object ive o f this component i s to manage and use resources in accordance with the
project’s objectives and procedures, a nd to put in place a pol ic y framework that i s favorable to
up-scaling o f he project at the national level.
32. Intermediate results include (i)l l f inancial and technical audit reports are unqualif ied,(ii)ational strategy on fertil izer supply and legal guidelines f or the ap plication o f ne w seed
legis lation adopted and implemented, (iii)rogram BV /P I ncorporated nto MAEP’s m edium
term expenditure framework, (iv) national multi-partner, multi-sector SLM investment
framework in the B V P I program context i s established a nd under implementation. GEF will
support projec t management and mo nit ori ng and evaluation to assure that the env ironmental
global objective i s we ll mainstreamed in the project, and will provid e support to establish and
implement the national SLM investment framework.
33. The GEF funded activit ies will contribute to achieving the SIP result 4: targetedknowledge generated and disseminated and monitoring established and strengthened at all
levels. They are also rooted in the SIP component 4 and more specifically in the
subcomponents 4.4. a nd 4.5.
Table 12: targets of component4
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At least five policies/studiescompleted and discussed withkey stakeholders
0 1 2 2 5
Sub-Component 3.1: Project Mana gemen t
(US$1.89 million, including IDA funding o US$1.51 million; and a GEF contribution o
US$O.38 million)
34. This sub-component supports the project management through the provision o ftechnical assistance, training, office equipment and vehicles, minor office upgrading works,
auditing and evaluation studies, and incremental operating costs in support o f project
management.
35. The sub-component comprises over all proje ct planning, quality oversight,
procurement, f inancial management, and m onitorin g o f project activit ies. I t includes quality
oversight through independent financial and technical audits, and evaluation o f project
activities. Finally, the sub-component allows the design and implementat ion o f acom mun icatio n strategy to disseminate core proje ct messages to ben eficiaries and partners o f
the project. GEF will contribute to the funding o f he technical assistance.
36.
coordination.Project management encompasses al l fo ur targeted watersheds as well as national level
Sub-Component 3.2: Policy Support
(US$0.48 million, including IDA funding o US$0.36 million; and a GEF contribution o
US$O.12 million)
37. This sub-component provides technical assistance, studies, training, information
campaigns, cross visi ts and workshops for the development o f major national policies,
regulations, and plans considered crit ical to the Government’s National Irrigation and
Natio nal lev el mult i-partner, mult i-sector SLM investment framework in the B V P Iprogram
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38. The sub-component also prov ides in it ia l technical assistance support to emerg ingprofessional groups, in particular the Platforme Consultative de Riz an d the Association
Ma lgac he de Producteurs de Semences.
39.
benefit a l l ke y distr ibutors and producers involv ed in he sub-sector.The scope o f this sub-component i s national. The impro ved policies are expected to
40. The two pro jects o f the Wo rld Bank and the UNDP under the GEF-SIP Madagascar
program will elaborate a Country S L M Investment Framework (CSIF) as a com mon output o f
the two operations. T h i s investment framework wil l be designed to cover a l l SLMinterventions in the country across sectors and multiple donors. These efforts will contribute
to scal ing up SLM to achieve the object ives o f the country’s U N C C D NAP, as we ll asNEPAD’s Comprehensive African Agriculture Development Program (CAADP) and
Environment Ac t ion Plan. GEF f inancing will focus o n the elaboration o f he CSIF.
Sub-Component 3.3: Monitoring an d Evaluation:(US$2.06 mil l ion, including IDA funding o US$1.58 mil l ion; and a GE F contr ibut ion o
US$O.48 mil l ion)
4 1. T h i s sub-component provides technical assistance and capacity strengthening to the
Department o f Statist ics and Inform ation (DSI) under M AEP t h a t will be responsible for
project M&E and assessment o f development impact. T h i s i s done o n the basis o f a
specialized project M&E / management information system, as well as procedures for data
col lect ion and report ing. In t s collec tion o f relevant data, DSI depends o n direct re porting by
inst i tut ions involved in project implementation (MFI, MEF, ASC farmers and W A S ) ,
systematic data collection for other purposes, participatory assessments, regular user
satisfaction surveys (e.g., in rrig atio n schemes), inc om e surveys, and targeted data col lec tion(among others through satellite photos), as established in the project implemen tation manual.
The data that will be co llected and monitor ed include those presented in Annex 3.
42. DSIwill comm ission tw o evaluations o f proje ct output and impact indicators, at mid-
t e rm and at completion. The output o f M&E would provide sufficient evidence in linking
periodic and annual monitoring with subsequent annual project planning activit ies so that
M&E data are interpreted and used as an instrument for project planning. In addition, theoutcome o f user satisfaction surveys will fo rm an input i n to the determination o f any merit
payments to consultants pro vid ing echnical assistance to the (F)W A S .
43. Regional Mo nito ring Committees will be established in each o f the four proje ct areas
that will be chaired by the H ea d o f the Region and made up o f members o f GTDR. The
44. GEF finding wil l contribute to the project monitoring and evaluation system by
financing the satellite images and their interpretation to moni tor the glob al and environm ental
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indicators in order to assess impact o f project activit ies o n la nd degradation, carbon
sequestration, biod ivers ity, habitat protection, and area under SLM. In addition, a comm unity-based monito ring system will be supported. GEF finds will further contribute to the technical
assistance to M&E, to technical audits and the project evaluation, and to the environmentalsafeguard mon itorin g.
Annex 5: ProjectCosts
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Madagascar: Irr igatio n and Watershed Management Project
NOTE: Th is annex presents the total fin ancin g fo r the IDA an d GEF parts o f he project
including the Irr igati on Development component wh ich s being funded only by IDA.
Loca l Foreign Total
$mi l l ion $mi l l ion $mi l l ionProject Cost By Component and/or Act ivi ty us us us
Component 1 Development o f Commercial 9.90 1.69
AgricultureComponent 2: Irr igati on Development
Component 3: Watershed Develop ment
Component 4: Program ManagementPPF
11.5911 78 2.08 13.863.41 1.17 4.582.58 1.15 3.730.59 0.59
Total Baseline Cost 27.67 6.09 34.35Physical Contingencies 1.38 0.37 1.75Price Contingencies 4.00 0.30 4.30
Total Project Costsa 33.64 6.76 40.40Interest duringconstruction
Front-end Fee
Total Financing Required 33.64 6.76 40.40
Totalommunit ie Borrowe
S rDA GEF
roject Cost By Component andFinancier
Component 1 Development o f 7.45 2.50 2.51 12.46Commercial AgricultureComponent 2: I r r igat ion 15.67 1.80 17.47Development
Development
Management
PPF 1.61 1.61
Component 3: Watershed 1.82 2.42 0.09 4.33
Component 4: Program 3.45 0.98 4.43
~~~~~
Total Financing Required 30 5.90 4.4 40.30
' Identif iable taxes and duties are US$4.68 mil l ion, and the total project cost, net o f axes i s US$35.72
Annex 6: Institutional and Implementation Arrangements
Madagascar: Irrigation and Watershed Management Project
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1. F or the purposes o f this document, the in stit utio nal and imp leme ntatio n arrangements
for the jo in t IDA-GEF project are presented. GEF f inancing will be focused only on the
development o f commercial agriculture and the watershed management components, as wellas the p rog ram management.
A. Project Implementation
2. The pro ject concept i s based on the fol low ing principles: (i)lear responsibilities for
each o f the actors in the management o f irrigat ion schemes and surro unding watersheds(farmers, water users, populations and their associations, C omm unes and Inter-communes,
Regions, centra l Government); (ii)f fective part icipat ion o f he populat ion in he diagnosis o f
problems and ident i f icat ion o f opt ions; (iii) o-management o f irrigation schemes and
watersheds by all the actors concerned; and (iv) adequate incentive systems and efficient
mechanisms to ensure that a ll respect their commitment.
3.
and Local.
The project i s implemented at four levels: National, Regional, Intercomm une/district
0
0
0
0
B.
Nat iona l . M A E P i s responsible for the overa ll implementation o f the project, in fullconsultation with the other Ministrie s at the national level that are invo lve d in order to
ensure that projec t activ ities are consistent with national policies.
Regional. The DRDR are responsible fo r the implem entation o f a large part of project
activities. The Region i s the opera tional lev el that ensures (i)oherence and plannin g
o f the project activities, and (ii)mplementat ion o f certain support or investment
activit ies (e.g., rehabilitation o f large irrigatio n schemes) at the l eve l o f the fourproject sites.
Intercommune/Distr ict. This i s the level responsible for the implem entation o f those
activit ies that require collaboration at the intercomm unal level (e.g., managem ent o f
watersheds and large irr iga tion schemes, ASC, guichetsfonciers).
Loca l : Main level for the implementat ion o f the project at the leve l o f grassrootcom mun ities and economic operators.
Implementation Arrangements
Steering Committee and Guidance
recommendations o f corrective measures that may be necessary t o ensure the efficient
carry ing out o f he Project and the achievement o f he objectives thereof; an d
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5 . The Regional Monitoring Committee (RMC) at the regional level, one per Project
Area, each composed by GTDR and headed by i t s respective He ad o f the Region; each suchRMC shall ensure consistency o f Project activit ies with both, the NIWMP and pol icy and
regional development p riorit ies and programs; and shall be responsible for: (A) validating
detailed wor k plans and budgets at the regional level; and (B) reviewing Proj ect progress and
performance, and formulatio n and implem entation o f corrective measures that ma y be
necessary in order to ensure the efficien t carrying out o f the Project and the achievement o f
the objectives thereof; and
Implementation of Project Activities
6. The overall coordination o f the pro ject i s ensured by the National Program
Coordination Unit (NPCU) at MA EP . The Director o f N P C U reports to the NSC, responsible
for oversight and approval o f annual reports and work plans. The o verall coord ination
involves:
N P C U ensures project ownership at national level;
Regional Director for Rural Development (DRDR) i s responsible for projectownership o f project investments in their respective areas.
To support the implementation o f these tasks, through the IDA funding, the project
has financed the recruitme nt (i)t national level, o f an international technical assistant
(operations), advisor to NPCU, and (ii)t regional level o f four nat ional technical
assistants (operations), advisors t o DRDR for implemen ting project investments.
F inal ly , NP CU and DRDR have selected in their respective units one s ta f f memberwh o provides support for coordination and project monitoring.
The N P C U i s also responsible for th e implementation o f project act ivi t ies at the
national level, including capacity building at Ministry level, support to national
polic ies and strategies, etc.
The project financia l management i s ensured at national le vel by the Department for
Adm inistratio n and Finance at MA E P and, at regional level, by the DRDR f inance director.
The project has recruited under the ongoing Irr iga tion and Watershed Management Projectsupported by IDA a national financial management and procurement agency that provides
technical financial management assistance to MAEP’s Finance Director. Tb e project has alsorecruited at each DRDR a national financial manager, w ho i s under contract with the DRDR
and who i s in full time charge o f financial management o f the project. T h i s person works
who i s full t ime in charge o f project procurement. This s ta f f works closely with PRMP andbenefits fro m th e project support in procurement TA.
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9 . Technical assistance. Recruitment o f TA - nternational (1) and nat ional (7 ) - has
been done under two separate contracts (one fo r fin ancia l and procurem ent management, andone fo r operation al assistance) with specialized f i rms. The International “Operations” TA i s incharge o f (i) dvising NPCU and their assistants and DRDRshheir assistants regarding
operational strategy, p roject im plementation and monito ring o f the project; (ii)raining and
providing operat ional support to MAEP staff involved in project implementation. T h e
Nation al “OperationsyyTAs wh o are recruited at the level o f DRDRs are in charge o f advisingand supporting DRDRs in project implementation in their respective areas and o f ensuring
coordination o f al l project components at regional level. National TAs in f inancial
management and in procurement are responsible for financial management and procurement
and for prov iding technical support to DRDR staff, The four financial and four procurement
consultants at regi on le ve l are responsible for financial management and procurement at the
regional level. They have been recruited under one contract with the national level financial
management and procu rement specialist, and wi l l repo rt to the nationa l specialist.
Implementationo f Project Components
Component 1: Development of Commercial Agriculture.
Sub-component 1.1 Support to agricultural services.
10.
activities are being imp lemented as follo ws:
The DRDR i s responsible for the implementation o f this component. The project
Support to the development o commercial agr icul tural supply chains. T h i s supportincludes identif ication and mobilization o f operators, strategic review o f market and
value chains opportunities an d constraints, identif ic ation and analysis o f productive
sub-projects and will be provided by regional partners rec ruited in each zone by the
DRDR. The priori t ies and wo rk p lan o f hese partners i s being def ined in consultation
with the ASC and loca l platforms, and approved by the GTDR who are responsible
fo r (i)dministration o f the matching grants; (ii)upport to eligible operators in the
prepara tion o f sub-project proposals; and (iii) trengthen capacities and provide
technical assistance to th e ASC. Remuneration o f the partners i s partly based on
performance.
0 Bu i ld in g the capaci t ies o farmers and strengthening o professional organizations, aswell as the establishment o f agric ultura l service centers (ASC ). These activit ies are
implemented under the responsibil i ty o f the ASC. The contractual sta f f o f the ASC
are recruited by the DRDR.
11. Support to private investment i s done through matching grants that are provid ed on a
demand-driven basis to individuals or groups. In each zone, matching grants operate as
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follows:
A list with eligible (positive and/or negative) activities i s prepared, based on thecontribution that these activities will make towards achieving the project's
objectives.
The GTDR appoints a Selection Committee at the regional level. The GTDR
approves the request for matching grants after analysis and following a
recommendation from the Selection Committee. An external review will be
conducted twic e a year.
A regionalpartner is recruited by the DRDR and has the fo llo wi ng responsibilit ies
(i)dentify and analyze market and value chains opportunities; (ii) wareness
raising and m obiliza tion o f private operators and potential investors; (iii)acilitate
the preparation o f sub-project proposals by individuals or groups; (iv) facilitate
the ir access to a financier; and (v) conduct a technical and financial analysis o f he
sub-projects tha t request a ma tch ing grant.
Specialized service providers wil l be recruited by the DRDR on an as-needed basisto conduct strategic market and value chain studies. These studies can be
conducted either by the demander or by a service provider fol l ow ing competit ive
bidding.
A network o regionalpartners at the regional level i s being compiled by the ASC.
The network, with the ASC, wil l s ign multi-year contracts that specify the
mod alities and the expected results.
12. Ma tch ing grants are being provid ed to activit ies that have been identif ied as pri ori ty
by the Gove rnmen t: investments, technologies and advice. Inputs and technologies will only,
and temporarily (one or tw o year for the same beneficiary), be supported i f hey are necessary
fo r the dissemina tion o f inno vativ e technologies (e.g. conservation, agro -ecologic al
technologies). The project will under n o circumstances finance inputs that are already widely
available and used by the producers and financed by mic ro f inance inst i tut ions.
13. Financial public support can be justified by the proport ion o f "public good" o f the
investment (roads, information, etc) and therefore by the assumption that leaving theseinvestments to the private sector would lead to under-investment from a public resourceal location po int o f v iew.
14. Finan cial public support can also be jus tif i ed for those beneficiaries that don't have the
% public good
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' Support to ma rketing
% G merit good ))
16. The beneficiary contribution i s pa id fully in cash, either from own means or through
credit, except for enviro nmen tal prote ction activitie s (forestation, revege tating farmers' f ieldsor reclamation o f degraded soils) by clear ly defin ed beneficiar ies (see com ponent 3), wherethe contribution can be in kind.
17.
operators' :
Eli gib le operators and activit ies. The project partia lly subsidizes the fo l lowing pr ivate
Professional agricultural and ago-in dustria l organizations;
Producers' organizations (crop, livestock, forestry, . .);
Rura l communit ies;Com mer cial agric ultura l operators and ago-processors;
ago-industrial companies ;
seed producers (associations and ind ividu als) ;
Distributors o f nputs and agricultu ral equipment;
M ic ro f inance networks.
18. El ig ib le activities are clear ly associated with agricultural product ion and with
management o f natural resources (a specific positive and negative l is t ) as presented in table13.
Table 13: eligible activities matching gra nt
Support to inn ovation
0
0
0
0
Market studies, value chain studies, development o f quality
management and certification, testing o f samples;
Adaptative agricultural and agro-industrial research (varieties,
technologies and produc tion and processing equipment);
Introduct iodtest o f new agricultural production techniques
(ex. ago-ec ological) ;
Awareness ra ising and demonstration (inputs ,equipments)
Development o f new micr o-fina nce products (e.g., weather
0
0
EstablishmenVextension o f input and equipment distribution
networks;
Integrated projects for the im plementation o f contract farming
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0
between private investors and smallho lder producers;
Forestat ion reclaiming o f degraded soils.
Funds under the Matching Grant are disbursed as indicated in f igure 1.
Figure 1: Matching Grant disbursements
1
Information
disseminationand request for
proposals
Completion and
delivery by theTechnical
Secretariat
Submission o f
Iproposals andselection by
proposals Technical
Secretariat
Disbursement o f
remainder o f thegrant (10%)
11
Implementationo f sub-
project and monitoring
by Technical Secretariatand Disbursement of
(20%)
10Disbursement o f first
part o f the grant
Externalperiodic
review
Preparation o f
detailed sub-projects
Component2: Irrigation Development
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19.
sub-components.
T h i s component i s implemented under the responsibil i ty o f the DRDR. There are two
20. Sub-Component 2.1: Management of Irrigation Schemes. Act iv i t ies in this sub-
component include (i)wareness raising and mobilization o f irrigation farmers and their
associations; (ii)articipatory diagnostic o f options for management and rehabilitation o f the
irrigation scheme (Scheme Development Plan or SDP); (iii)elect ion o f he preferred opt ion
for the mo bilizatio n and util ization o f water resources; and (iv) preparation o f a Performance
Contract between water users, Region, comm unities and M A E P . The DRDRhas recruited an
international consultant who, with support from a national consultant, i s implementing the
above activities in he four pr ojec t zones.
21. The rehabilitated irrigation schemes i s managed in accordance with the relevant
institutional framework (see table 14): (i) RDR i s responsible for the operation and
maintenance o f non-transferable irrigatio n infrastructure and for the m obiliza tion o f financialresources; (ii)F)WUAs are responsible for operation an d maintenance o f transferred
irrigation infrastructure, and for the mob ilization o f adequate financial resources among the
water users through O&M fees; (iii)he Communes are the owners o f transferred irr iga tion
infrastructure, andwill
be co-responsible,with the
WUA, for maintenance.They wil l
need toprovide adequate assistance to the (F)WUAs. They will also be responsible for the
maintenance o f roads within the schemes. However, the three stakeholders - Region,
Communes, WUA - will only be able to collect adequate funds progressively. This w i l lrequire: (i)ncreasing agricultural production and productivity, which will improve the
capacity to pay and (ii)mplementat ion o f effect ive mechanisms for th e mobi l izat ion o ffinancial resources (O&M charge, land tax, FERHA). Project resources will temporarily
provide financ ial incentives on a cost sharing basis. The Performance Contract will clearly
define the o bligations o f al l stakeholders.
22. Sub-component 2.2: Irrigation Investments. The DRDR i s responsible for the
implementation o f the i rr iga t ion rehabil itat ion works. In each region, spe cific activities c an be
outsourced to (i) national consultant for the technical studies and design o f the works,
includ ing supervision o f the works, and (ii) contractor for the construction works. A single
contract per reg ion i s signed with a consultant for the duration o f he project.
23. (F)WUAs s ign all contracts directly related to irrigation activit ies, and are co-
responsible for th e selection a nd evaluation o f consultants a nd contractors. They will need tos i g n o ff o n the complet ion o f he works and payments to contractors.
Component 3: Watershed Development
25.are responsible for the implementation o f activit ies under this sub-component:
Subcomponent 3.1: Support to Watershed Mana gemen t. The N PC U and the DRDR
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0 Each DRDR i s recru iting a regional partner responsible f or (i)he m obi l izat ion and
capacity strengthening o f the loc al and regional consultation platforms; and (ii)participatory plan ning and impleme ntation o f the sustainable development and
management o f he various catchments.
0 Land registration ofices are being established by the respective communes. The
DRDR and the communes are receiving technical assistance from the Nat ional Lan d
Tenure Program (NLTP). The communes are responsible fo r the activities and the
proper funct ioning o f their La nd Tenure Offices, and in part icular o f the recruitment o f
adequate s ta f f and financing.
26 . The f i rst activities that the project has already launched included an intensive
awareness raising and com munication campaign to inf or m the populations o f the watersheds,inclu ding irrigators, o f the project object ives and to m obil iz e them with respect to i t s
implementation.
27. Subcomponent 3.2: Investment in watersheds. The Watershed Development Plansinclude a number o f nvestments that will be implementedas follows :
(9
(ii)
(iii)
(iv>
Strategic anti-erosio n work s that have been identif ied as priority in the Watershed
Development Plans. They will be 100 percent financed by the project and
implemented by priva te contractors contracted by the DRDR. In as far as possible,
works will be implemented through lo cal labor to promote the appropriation by the
local population. The selection o f contractors and payments made under thecontracts w i l l be cert i f ied by the invo lved communities.
Establishment o f zones under collective land management (GELOSE).The service
provider under contract with th e DRDR will be responsible fo r the facilita tion o f
these activities. The DRDR will be responsible for satisfying the administrative
requirements and the registration at the Land Tenure Offices. Necessary
investments, as well as the running costs o f the Land Tenure Offices, wil l bef inanced through Component 1
Dissemination o f ago-ecological technologies that require distr ibut ion o f special
inputs and access to extensio n will be implemented through the regional partners
that will be recruited by DRDR. Alternatively, in the case o f adaptive research,activit ies will be implemented by service providers that are contracted by the
DRDR under component 1.
Appropriate prod uctive investments (forestation, revegetation o f and) that wi l l be
percent to the investment costs (in kind or cash), with the exception o f the strategic anti-
erosion works (see (i)bove) that will be fully paid for by the project.
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Component 4: Program Management
29. Sub-Component 4.1: Project Management. Respons ibility for the impleme ntation and
management o f the project i s assured by the N P C U a t the national level and the DRDR at the
leve l o f each o f he four project sites. The NP CU and the DRDR are in particular responsible
for (i)he preparation o f annual work plans and detailed budgets (at reg ional level, and
consolidated at the national level); (ii) onitoring o f mplementat ion progress in accordance
with the operations manual o f he project; (iii)reparation o f annual progress reviews that will
be presented to the Nation al Steering Comm ittee and to the Region al Mon ito rin g Committees;
an d (iv) conducting annual financial and technical audits. Specifically, the NPCU will be
responsible fo r the organization o f a bi-annual external technical audit o f pro jec t operations.
30.
o f strategic and technical support to the land tenure operations o f he project.
The N P C U will s i g n a MOUwith the National L and Tenure P rogram for the provision
3 1. Mon itoring and Evaluation. Mon itorin g and evaluat ion s being conducted under the
responsibi li ty o f the Director o f nfor mati on Systems (DISE) o f M A E P , w h o will be assisted
by the internationa l technical assistance located within the N PC U . In order to better integratemonitoring and physical investments, the project will adopt the Integrated Management
System (SIG) developed by the PSDR. Independent technical audits will be conducted by
service prov iders that will be qualif ie d annually, beginning in the second year o f the project.
T wo external impact evaluations will also be conducted: (i)t mid-term; and (ii)t the end o fthe project. T he analyses and recommendations o f these evaluation s serve to extend the
activities at the national level.
32. Mo nito r ing and evaluation consists o three separate but closely related systems:
(i) a system o f internal monitoring conducted by M A E P under the responsibi l i ty o f
D I SE in collaboration with N P C U staff at central and regional level so as to ensure
harmoniz ation and coherence in the monitoring o f he various programs implemented
by MA EP . However, this function can be delegated or outsourced to other entities
either for an entire component (e.g., PE3 for the Watershed component) or for all
activities at the reg ion al le vel (e.g., GTDR for each site);
(ii) system o f participatory eva luation at each o f he four sites (wh ich would al low for abetter appropriation and internalization by beneficiaries) by directly invo lv ing the
ma in beneficiaries (PO, (F)WUA, etc.) in the definition, collec tion and analysis o f
progress and impact indicators, and the identif ic ation o f corrective measures in the
event project objectives are no t being achieved.
region al monitoring and evaluation. These GTDR could be direct ly involv ed in the
mo nit ori ng and evaluation systems in each o f he site^)^.
33. Monitoring indicators. Overal l project monitoring i s based on indicators that will
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form part o f he Project Brief Docum ent (see Annex 3), and o n the implementat ion plan thatwas agreed during proje ct negotiations. Specific achievements under each o f he components
will be measured more in detail with the a id o f a series of more specific indicators. These
indicators are grouped in wo categories: (i)erforma nce indicators that measure the resources
[input indicators] that the project has allocated and the activities i t has implemented [outputs
indicators]; and (ii)mpact indicators that measure the results that the project has achieved
[outcome indicators] as well as i t s impacts. These different indicators will be defined before
proje ct negotiations.
34. Integrated M anagement System (SIC). The m onito ring system will be integrated in toan Integrated Management System (SIG) that not on ly allow s f or a close interconnection
between the implementation o f act ivit ies from ident i f icat ion to f in al del ivery, but also and inparticular for establishing a connection between technical and physical achievements and
disbursements. The SIG also includes a procurement module that integrates the project
procurement pla n and the status o f each o f he procurement activi t ies o f he project.
35 . Sub-Component 4.2: Policy Support. The N P C U o f M A E P i s responsible for the
impleme ntation o f activit ies that aim to define nationa l policies relevant for theagriculturaVrura1 sector. That i s the case for the def init ion o f the operational modalit ies o fmanagement and replenishment o f FERHA. The N P C U has competit ively recruited the
technica l assistance that i t needs, and i s orga nizin g necessary consultations with stakeholders
at the national level (e.g. Consultative Platform for Rice, Fertilizer Producers’ Association,
Malagasy Association o f Seed Producers).
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e .
e . e . .
e . . . e
e e . e . . . .
e . . . .
0b
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Annex 7: Financial Management and Disbursement Arrangements
Madagascar: Irrigation and Watershed Management Project
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Introduction
1. In accordance with Bank policy and procedures, the financial management
arrangements o f the DFB ( ie PNBVPI) and RDFB (within the Min is t ry o f Agr icu l ture,
Livestock and Fisheries) responsible for the FM aspect o f this Project (GEF and IDA
f inancing) have been assessed in order to determine whether they are acceptable to the Bank.
T h i s review i s rather an update since the FM system o f these entities has already been
assessed in the context of the ongoing Ir rig ati on and Watershed Management Project (IDA
f inancing). The mai n conclusion of our review i s that DFB and RDFB f inanc ial management
systems meet IDA requirements [see Paragraph D (Q ) o f he PAD ].
Summary Project Description
2. The proposed e nding instrument for this progr am wo uld be a three-phase, twelve year
A P L (mid F Y 0 7 - FY19). The f i r s t phase (APL1) i s expected to be completed over a four-
year period (mid F Y 0 7 -mid FY1l),oweve r, fo r consistency purposes with the GEF grant,
the Association proposes to amend the IDA f inancing and extend the C losing Date o f the
Agreement to December 31, 2012. APLl aims to assist the G o M to implement innovative
approaches in support o f sustainable investments in agricultural product ivi ty in both i r r igatedand raine d areas, and consists o f the following components which are described in more
details in the paragraph B 4 o f the P AD : i)Development o f Commercial Agriculture; ii)
I rr iga t ion Development; iii) atershed Development and; iv) Program Management. A more
detailed description o f the components and activit ies i s attached in Annex 4. In format ion onGEF funded activit ies within the components can be found in the Incremental Cost Analysis
(Annex 15). The funding instruments for A P L l are as fol lows: $ U S 3 0 m i l l i o n f ro m IDA,US D 5 .9 m i l l ion f rom GEF an d $ U S 4.5 mi l l ion f r om loca l communit ies.
3. T h i s project i s being implemented by the National Program Coordinat ion Unit(NPCU) at the national leve l and the Ru ral Developm ent Regional Directorates (DRDR) at
the regional level. The FM assessments have take n this in to consideration.
Country issues
4. The W o r ld Ba n k ’ s C F M C PAR , co m p le t e d in 2003, and some diagnostic works
carried out over the last three years by the Bank a nd other donors, ide nti f ied a range o f
weaknesses and issues hamper ing the performance o f Madagascar’s budget and expendituremanagement system. To address these issues, the government has developed in 2004, 2005,2006 and 2007 in conjunction with a l l key development partners, a pri ori ty ac tion pla n for
public finance reform .
increased number o f missions to be undertaken. As a result, significant delays have been
noted regarding the presentation o f the budget execution laws to the Parliament. To mitigater isks in public expenditure management, the World Bank, through the Governance and
Institutional Developm ent Program (PGDI), and a number o f donors continue to support
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Government’s public finance reforms reflected in t s annual prior i ty act ion plan.
6 . Regard ing the accounting profession, some posit ive developments have been note d
over the last three years. However, a number o f ocal accounting f i rms continue t o operate
bel ow the internation al standards. To improve the capacity and the competit iveness o f oca l
auditing f irms, the fo llo wi ng measures have been taken wh ile aud iting Bank/IDA financed
projects: i) bligatio n for loc al auditors to enter into partnership with international accounting
f i r m s ; ii) f fective part icipat ion o f the international accounting firm in audit f ieldwo rks and
submission o f audit report signed by the international audit f i rms. An accounting and auditingROSC i s presently underway to i de ntif y clearly bo th ssues and actions to be taken to
strengthen the capacity o f he accounting profession in Madagascar.
7. The us e o f coun try systems s t i l l remains r i sky for Madagascar due to some fidu ciary
weaknesses that require m uc h more time for their solving. To address this issue, and after
exchanges o f views with the borrower i t was agreed to (i)ntrust the FM aspects o f this
project to PN BV PI wh ich has experience from the ongoing IDA project (ii)se partially the
country system and (iii)stablish transitional financial management system arrangements
while the secto rhati onal f idu cia ry systems are being strengthened.
FM Risk Assessment and Mitigation
8.provides the measures to be taken to mitigate them:
The fo l lowing tab le ident i f ies the r isks that the project management may face, and
Risks
1- Inherent Risk
Country Level.
Audit may not be conductedin compliance withinternational auditingstandards due to: weakcapacity o f the accountingprofession n Madagascar,and; ii)nadequate number o fskilled and experienced
Risk
rating
S These issues are being addressedthrough the ongoing PFM reformssupported by IDA (through theGovernance and InstitutionalDevelopment Project) and otherdonors.The audit o f the project financialstatements will be carried out b y
Residual
Riskrating
M
system still remains risky due
to some fiduciary weaknesses
that require much more time
for their improvement.
support the GoM priority actionplan for public finance reforms in
the area o f public financial
management.
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Project Level
Communities may not have
capacity to implement
subprojects.
Overall Inherent Risk
2- Control Risk
BudgetNomajor risk
AccountingN o major risk
Internal Controls
Procedures described in the
PIM may not be followedproperly by communities and
grants may not be usedfor
purposes intended
(implementationo fsubprojects)
M
M
L
L
M
In the meantime, a FinancialManagement Agency has been
recruited to handle the FM aspect
o f this project and assist DFB and
RDFB in this area.
Organization o f training session(s)
for communities to strengthen their
capacity in FM area and ensure
proper application o f proceduresdescribed in he PIM.
Strengthening the capacity o fcommunities n managing
subprojects and funds.
Regular audit carried out by the
Internal Audit Department (IAD)
complemented by the annual audit
conducted by qualified external
auditors
Semi annual supervision missions
including review o f the use o ffunds will be carried out by IDA.
NO: T h i s
training
must be
done prior to
transfer offunds to
communities
NO(see
above)
NO:To be
indicated n
IA D annual
work
program
NO
L
M
L
L
L
Financialreporting
kind.No Financial contribution i s
required.
L L
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N o major risk
AuditingN o major risk
Overall Control Risk
OVERALL RISK RATING
Strengths, Weaknesses and Action P lan
L L
M L
M L
9.salient features:
The DFB (PNBVPI) and RDFB f inancial management i s strengthened by the fo l lowing
0
e
0
0
e
0
10.
Existence o f an organizational structure de fining clearly the l i nes o f responsibil i ties
and authority that exist, and are appropriate for planning, directing and controllingoperations;
existence of q ualif ied and s killed accounting staff very knowledgeable with Ba n kprocedures;
adequate internal control system including suitable authorization procedures,
appropriate segregation o f duties and responsibilities, reliab le budgeting system, and
adequate measures for safeguarding assets; MAEP also has an Internal Audit
Department in charge o f the internal audit functions
use o f an accoun ting system in compliance with genera lly accepted accoun tingstandards and IDA requirements, and prov idin g reliable and tim ely inform ation;
appropriate documentation o f he policie s and procedures applied by the project, covering
management o f inances, accounting, procurement and financial reporting;
use o f an integrated computerized system facilitating the management o f projectoperations and capable o f producin g in a timely manner a l l relevant info rma tion required
for managing and monitoring projec t activit ies, and appraising project’s overa ll progress
towards the achievement o f t s objectives.
With regard to weaknesses, n o m ajo r deficiencies have been noted so fa r in the projectfinan cial management system.
Institutional and Implementation arrangements (see Section C (K) an d Annex 6 of the
sector ministries (including MAEP) in the preparat ion o f their program budget in order to
impro ve the quality o f heir submissions. The accounting software already in place facilitates
significantly budgetary management.
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Accounting Policies and Procedures
12. The proje ct applies budge tary execution procedures actu ally in place within the
MAEP (ie: preparation o f expense comm itment fo rm by the DFB, ver i ficat ion o f this request
by the Expenditure Commitments Oversight Directorate, executio n o f the transactions by the
project, determination o f he exact amount to be paid upon reception o f ina l bills, preparation
o f payment order and payment after appropriate v erif icat ion o f he val idi ty o f he transactions)
and provides the Budget Directorate o f the Ministry o f F inance with mon thly statement o f
commitment and payment drawn under the project credit l ines.
13.
he DFB an d RDFB (DRDR- Department o f Financial & Budget) i s using an accounting
system in compliance with “generally accepted accoun ting standards”/PCOP (P lan
Comptable des Ope‘rations Publiques) an d IDA requirements. T h i s system operates on a
decentralized basis with the four regions concerned and uses standard book accounts
(journals, ledgers and tria l balances) to enter and summa rize transactions. Revenue i s
recorded when cash i s received, while expenses and related liabilities are recorded when
incurred, especially upon receipt o f goods, works and services. Ea ch RDFB maintainsseparate financi al records fo r a ll transactions under i t s responsibility and sends, o n a monthly
basis, the balance sheet to the DFB for consolidation. The DFB, at the central level, i s incharge o f t imely product ion of: monthly trial balances for the ACCT (Agence Comptable
Centrale du Tre‘sor),quarterly FMRs and annual fina ncial statements.
14. The existing Chart o f accounts and models o f IFRs already reflect resources from GEF
and components/activit ies to be financed under this grant. They allow the product ion of
financial reports in compliance with ID Np ro je ct equirements.
15. To ensure timely product ion o f f inancial information required for managing andmonitoring project activit ies, the DFB an d RDFB i s using a computerized system
implemented by a consultant. T o av oid doub le data capture, this system allows for extracting
eff icient ly al l required information fr om the Data Base O RA CL E presently in place and used
by the MAEP fo r recordin g commitments, “liquid ations” and settlement orders.
Internal Control and Internal Audit
16. The PN BV PI has a good internal control system: proper authorization o f ransactions,
adequate separation o f duties, reliable budgeting system, and adequate measures forsafeguarding assets. In addition a financial management manual i s available describing
17. T o ensure efficien t use o f credit and grant funds for the purposes intended and
consistent app licatio n o f procedures on procurement, finan cial management, disbursement,the M AE P In te rnal Audit Department plays th e role o f nternal auditors. They report directly
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to the Steering Comm ittee and make sure that al l issues identif ied during the internal aud it are
addressed qui ck ly to impro ve the projec t performance.
Flow o Funds and Disbursement arrangements
18. T h e f l o w o f funds f rom IDA, GEF and local Communit ies i s presented as fo llows :
World Bank
M A E P - Directorate o f
Finance and Budget @FB )- Designated account IDA (A)
M A E P - Directorate of
Finance and Budget @F B)- Designated account GEF1’
DRDRs- Department
of Finance and Budget
(RDFB):Regional BankAccount IDA (A)
I
DRDRs- Department
of Finance and Budget
(RDFB):
Regional BankAccount GEF (B)
Communities’ Bank Communities’ Bank
account for account forenvironmentalsubprojectsfinancing only
Contractors, suppliers o f goods and services
Disbursement rom ID A credit, G E F Gran t and Communities participation
Programs , Budgets, and Procurement Plans for IDA-funded activit ies; ii) eplenish
Regional Bank Account A managed by RDFB.
Designated Accoun t B to be managed by DFB: Denominated in US $, disbursements
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f rom the GEF grant w i l l be deposited on this account to i) inance 100 percent o f al lcategories o f expenditures agreed with IDA and indicated clearly in the Annua l Wor k
Programs, Budgets, and Procurement Plans for GEF-funded activit ies ii) eplenishRegional Ban k Account B managed by RDFB;
19. While disbursing proceeds from grant accounts, IDA may: i)eimburse the recipient
for expenditures paid from the recipient’s resources; ii) dvance grant proceeds into the
Designated accounts opened in a commercial bank acceptable to IDA; iii)make a direct
payment to a third party; iv) enter int o special commitments in writing to pay amounts to athird party in respect o f expenditures to be financed out o f the grant proceeds, u po n the
borrower’s request and under terms and conditions agreed by IDA and the recipient. The
accounting manu al o f procedures describes in details the application steps a nd requirements
for requesting a reimbursement, a direct payment f or third party, and applying f or a special
commitment.
20. To ensure prompt payment o f contractors/suppliers operating in the regions, the
borrower ma y open two regional b ank accounts in a loc al commercial bank to be managed by
each RD FB :
0 Regional Bank Account A : Denominated in loca l currency (MGA) , disbursements
from the Designated Account A (IDA Credit) will be deposited on this account to:
finance 100 percent o f al l categories o f expenditures agreed with IDA and indicated
clearly in the Annual Work Programs, Budgets, and Procurement Plans for IDA-
funded activit ies in he regions ,
0
Regional Bank Account B: Denominated in loca l currency (MGA) , disbursementsf rom the Designated Account B (GEF Grant) w i l l be deposited on this account to
finance 100 percent o f al l categories o f expenditures agreed with IDA and indicated
clearly in the Annual Work Programs, Budgets, and Procurement Plans for GEF-
funded activit ies in he regions;
2 1. The i nit ia l advance paid to each regional bank account wou ld represent funds covering
no more than 30 days estimated expenditures based upo n submission o f satisfactory budgetedwork plans. Subsequent payments will be based on SOEs submitted by RDFB after
appropriate authorization and approval by the DFB. Th e RDFB will submit at least monthlyexpenditure reports indi cat ing sources and uses o f funds an d justifying the use o f funds, an daccompanied by reco ncile d bank statements.
productive investment). The com mun ity account receiving fr om IDA will be used for
micro-projects with the purpose o f commercial agriculture only.
O r
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0 GEF to finance a ll aspects o f reestablishing vegetation cover t o reduce erosion to
improve the l and us e produ ctivity o f the upper watersheds and to support thecommunities in an im prove d management o f lands under secured lan d tenuremanagement. Eligible sub-projects include pasture management, reforestation and
revegetation, o f degraded land,, etc. T h e community account receiving funds f romGEF f inancing will be used for micro-project with the purpose o f lan d management,
so i l fer t i l i ty, and innovative technologies for environmentally-friendlyagriculture.
24. The transfer o f funds to these comm unity ba nk accounts wo ul d be made as follow s: i)
70 percent upon signature o f the contracthonvention between B V P I and Communities; ii) 0
percent based on physical progress (at least 50 percent o f the goods/services have been
deliveredrendered) after appropriate authorization and approval by DFB/RDFB; 10 percent
after fi nal reception. Com mun ity contribution to Sub-projects will be in abor or in kind.
25. The Designated Account w oul d be replenished on the basis o f documentary evidence
provided to IDA by DFB (see below paragraph “Designated account”) , justifying the
payments o f expenditures that are elig ible fo r financ ing under the credit.
26. All supporting documents will be retained by the project (DFB, RDFB) an d
communities, and made available for re view by periodic Ba nk supervision missions, internal
and external auditors. The accounting manual describes in details all procedural aspects
regarding finan cial management (payments, replenishment, accounting, repo rting and internalcontrols).
Disbursement Arrangements
27. Method o Disbursement: The DFB/PNBVPI wil l follow the transaction-based
disbursements procedures (trad itiona l mode) outlin ed in the Bank’s Disbursement Handbook.
28. M i n i m u m o Appl ication Size: The minimum application size for direct payments, tobe withdrawn direct ly fro m the Credit Ac count, and special comm itments i s 20 percent o f he
amount advanced to the related Designated Account.
29. Use o Statements o Expenditures (SOEs): Disbursements will be made againstStatement o f Expenditures (SOEs) certif ied by DFB for contracts and other expenditures not
requiring the Bank’s pri or review. All SOE supporting documentation will be kept by the
DF B/P NB VP I and made available for review by Ba nk supervision missions and internal and
for the designated account under the GEF grant shall be US$400,000. The DFB will be
responsible for preparing disbursement requests. The Designated Accounts will finance all
proje ct eligible expenditures infe rior to 20 percent o f the authorized allocation, andreplenishment applications wo uld be submitted at least o n a m on thly basis. Further deposits
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by IDA n to the Designated Accounts will be made against withdraw al applications supportedby appropr iate documents.
Financial Reporting
3 1,reports that s hould be prepared in compliance with intern ationa l accou nting standards:
To monitor project implementation, the D F B P N B V P I will produce the fol lowing
0 Ann ual fin anc ial statements comprising: i) ummary o f Sources and Uses o f Funds
(by components/project activit ie dcre dit category and show ing all sources o f funds); ii)
Project Balance Sheet; iii)he Accounting Policies Adopted and Explanatory Notes;
iv) a Manage ment Assertion.
0 Quarterly FMRs: The FMRs include financial reports (IFRs) , physical progress
reports and procurement reports to facilitate project m onitorin g. The FMRs should be
submitted to IDA within 45 days o f he end o f he report ing period (quarter).
32. The for m and content o f quarterly FMRs and annual financial statements has been
determined duringproje ct appraisal and already agreed during the negotiat ions o f he ongoing
Irr iga tio n and Watershed Management Project supported so fa r by IDA f inancing. Mode ls o f
these repor ts are presented in the project accounting manual o f procedures.
Information Systems
33. The Irr iga tion and Watershed Management Project (IW MP ) i s using an integratedfinancial management system capable o f recording and producing in a t imely manner al l
f inancial reports required for managing and moni tor ing project activit ies. T h i s computerized
system in particular facilitate: annual program ming o f activit ies and project resources, record-
kee pin g (general accounting and cost accounting), finan cial an d budgetarymanagement, fixed
assets management, procurem ent management, follo w-u p o n pro jec t implem enta tion progress,
preparation o f project financial statements and quarterly Finan cial Mo nit ori ng Reports asrequired by the BanMID A.
Auditing
34. The proje ct finan cial statements will be audited annually by an international private
accounting firm acceptable to IDA, in accordance with International Standards o f Auditing.
I 1
Audit Report Due Date
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1- Project specific finan cial statements Within six months after the end o f each
financial year.
I I I
(1) Goods, consultants’ services,and training
Supervision Plan
100%,640,000
35. A supervision miss ion w i l l be conducted twice a year to ensure that strong financial
management systems are maintained for the project throughout i t s l i fe . Our input to FMrat ing will be indicated in the Implementation Status and Results Report (ISR). Periodic
review will be also carried out when needed to ensure that expenditures incurred by the
project remain eligible for IDA funding.
Total
Table A. Allocatio n o Gran t Proceeds
5,900,000
I 1 A m o u n t o f t h e 1
FY
Category
9 1 10 I 11 I 12 I 13 I 0 1 0
Percentage o f Expenditures o eFinanced
Grant
Allocated
(expressed in
Annual I 0.6383 I 1.4425 I 1.9502 I 1.2090 0.6600 I 0.00 I 0.00
i (2) Sub-project Matc hing Grant I 2,260,000 I
Cumulative
100% o f amounts disbursed
I 0.6383 I 2.0808 I 4.0317 I 5.2407 I 5.9000 I 0.00 I 0.00
Annex 8: Procurement Arrangements
Madagascar: Irrigatio n and Watershed Ma nageme nt Project
A. General
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1. Procurement for the proposed project wo uld be carried out in accordance with the
W or ld Bank's "Guidelines: Procurement under IBRD Loans and IDA Credits" dated Ma y
2004, and revised in October 2006; and "Guidelines: Selection and I Employment o fConsultants by W or ld Ba nk Borrowers" dated M ay 2004 and revised in October 2006, and
the provisions stipulated in the Legal Agreement. The various items under different
expenditure categories are described in general below. F or each contract to be financed by
the Grant, the different procurement methods or consultant selection methods, estimatedcosts, prior review requirements, and time frame are agreed between the Bor row er and the
Bank in the Procurement Plan. The Procurement P lan will be updated at least annually o r as
required to reflect the actual project implem entation needs and improv ements in nstitutional
capacity.
2. Advertisement: A General Procurement No tice will be published in UNDevelopment
Business and Development Gateway Market (dgMarket) and will show al l Internat ionalCompetitive Bidding (ICB) for goods and works and major consulting service requirements.
Specific Procurement Notices will be issued in Developm ent Business and dg Market and atleast one newspaper with nationwide circulation fo r I C B contracts and before preparation o f
shortlists with respect to consulting contracts above US$200,000, in accordance with the
Guidelines
3.works related to activit ies undertakenwithin Matc hing Grants.
Procurement o f Works: Works procured under this project would include: small
4. Procurement o f Goods: Goods procured under this project woul d include equipmentfor the treatment and exploitation o f satellite pictures and software for geographic inform ationsystem. The procurement will be done using the Bank's SBD fo r a l l ICB and National SBD
agreed with or satisfactory to the Bank and with any special requirements specific to theProject. To the extent practicable, contracts sha ll be groupe d int o bid packages estimated to
cost the equivalent o f USD250, 000 or more and would be procured through International
Competitive Bidding (ICB) procedures. F or contract estimated to cost less than USD250,000,
equivalent per contract, procurement o f goods ma y be carried out through N ational
Competitive Bidding(NCB) procedures and purchase o f sma ll furniture estimated to cost less
than USD30,OOO will be conduc ted through prudent shoppin g procedures.
5 . Direct Contracting for goods may be used in exceptional cases, such as for the
extension o f an existing contract, standardization, proprietary items, spare parts for existing
Selection (QCBS) method, using the Bank’s Standard Request for Proposals. Selection based
on consultants’ qualif ications (CQS) can be used for the recruitment o f training institutions
and for assignments that meet criteria set ou t in para 3.7 o f the Consultant Guidelines. S ingle
source selec tion ( S S S ) can be used to contract f i rms for assignment that meet criteria set ou t
in para 3.9 to 3.13 o f he Consultant Guidelines and for the purpose o f very sma ll assignments
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referred in para 3.10 o f the Consultant Guidelines, and for w hic h th e contract estimated costs
do n ot exceed USD100,OOO. Specialized adv isory services wou ld be procu red through
Ind ivi du al Consultants Selection (ICs), based o n the qua lif ications o f individ ual consultants
for the assignment in accordance with the provisions o f paragraphs 5.1 through 5.3 o f the
Consultant Guidelines.
ExpenditureCategory
7. Community participation n procurement: Commun ity part icipat ion in Procurement
wou ld be based on AFR Guidelines - Sim pli f ied Procurement and Disbursement Proceduresfor Community-Based Investment. This wo uld comprise a broad spectrum o f act ivi ties related
to watershed management and irrigation. Procurement i s described in the Project
Implementation Manual.
Contract ValueThreshold (US$)
Operating Costs wou ld not be f inancedby the Grant
Consultant Services -
8. Review by the Bank of Procurement Decisions .The thresholds for p rio r review by
Ba nk are specified in he procureme nt plans. Table 1 shows (i)he proposed thresholds for the
different procurement methods, and (ii)he proposed initially-agreed thresholds for priorreview by the Bank. The Bank will preview procurement arrangements proposed by the
Borrower for the items specified in he procurement plans for their co nform ity with the Grant
Agreement and the applicable Guidelines. Any procurement item not specif ied for prior
review m ay be subjected to a post-review o f he procure ment process.
100,000 o r mor e
Thresholds for Procur ement Methods and Pri or Review
Works (related to
Matching Grants
activities)
Goods 250,000 or more
50,000 or more and
less than 250,000
Less than 50,000
Procurement Method
shopping
I C B
N C B
Shopping
QC BS
Contracts Subject toPrior Review (US$)
N o pr ior review
All
All (US$0.8Mio)
B. Assessment o f the agency’s capacity to implement procurement
9. Procurement activit ies are carried out by the National Program Coordination Unit(NPCU) at national level and Directions Rkgionales du D6veloppement Rura l (DRDR) at
regional level. These units are MAEP departments and properly staffed; the procurement
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function under Unit6 de Gestion des marches Publics (UGMP) i s staffed by Procurement
Off icer and diverse ci vi l servants.
10. An assessment o f he capacity o f he Implementing Agency to implement procurement
actions for the project has been carried out o n October 2005 and rem ain val id The assessment
reviewed the organizational structure for implemen ting the project and the interaction between
the project’s staf f responsible for procurement and the Management’s relevant central unit f oradm inistr ation and finance.
11. The ke y issues and r isks concerning procurement fo r implementation o f the project
have been identif ie d and include the phasing o f activit ies to be undertaken and possible
emergin g o f emergency cases. The corrective measures w hi ch have be en agreed are the close
fo l low-up o f the agreed procurement plan and activ ity scheduling. A procurement action pla n
will be f ine tuned quarterly and the ma in procurement plan w i l l be up-dated accordingly.
12. The overall project risk for procurement i s Average.
C. Procurement Plan
13. The Borrower, at appraisal, developed a procurement pla n for the impleme ntation o f
IDA f inanced activit ies which provide the basis for the procurement methods. T h i s plan was
approve d on June 30, 2006 and i s available at the NP CU o ff ice . I t s also be available in the
project’s database and in the Bank’s external website. The P rocurement Plan will be updated
in agreement with the Project Team annually or as required to reflect the actual project
implemen tation needs and improvements in nstitutional capacity. The Procurement Plan for
GEF funded activities was also developed during project appraisal and finally approved onSeptember 09,200 8 by th e Bank.
D. Frequency o f Procurement Supervision
14. In addit ion to the prio r review supervision to be carried out fr om B an k offices, the
capacity assessment o f the Im pleme nting Agen cy has recommended annual supervision
missions to visit the field to carry out post review o f procure ment actions.
E. Details o f the Procurement Arrangements Involving International Competition
1. Goods, Works, and NonConsulting Services
Post)cost
(US$)
Date
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(a) ICB contracts estimated to cost above US$500,000 for works and US$250,000 for goods percontract and al l direct contracting w il l be subject to prior review b y the Bank.
(c) List o f other contract packages
1 2 3 4 5 6 7
Ref. Contract Estimated Procurement P- Domestic Review
(yedno) (Prior /No . (Description) Method Q Preference by Bank
cost
Post)(US$)
8
ExpectedBid-
Opening
Date
Component
GEF-GO1
9
4: Program management
Equ ipmen t 87,000 Shoppingfor treatmentand
exploitationo f satellite
Comments
GEF-
2 contracts
picturesSIG software 70,800 Shopping 2 contracts
1 2
Ref. No . Description of
Assignment
Component 1 Development o fGEF-A02 Agriculture
researches b y
FOFIFAServices
agriculturalGEF-A06 Annual
2. Consulting Services
3 4 5 6 7
Estimated Selection Review Expected Comments
Cost Method by Bank Proposals
(US$) (Prior / Submission
Post) Date
commercial agriculture
146,000 Sole source Prio r August 2008
FOFIFA €2
TAFA are
agencies332,000 Sole source Prio r No v. 2008 Gov research
(a) List o f consulting assignments wi th sho rt-list o f nternational firms and sole sourcing.
GEF-DO1
GEF-DO2
GEF-DO3
Preparation o f 80,000 IC s Prior July 2008 -
GDT
technical audit 102,000 QCBS Prior Oct.2011
Project 136,000 QCBS Prior Oct.201 1
evaluation
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(b) Cons ultancy services estimated to cost above US$ lOO,OOO per contract and single source
selection o f consultants (f irms) and o f ind ivi du al consultants assignments estimated to cost
above US$50,000 will be subject to pr io r review by the Bank .
(c) Short l is ts composed entirely o f nation al consultants: Short l i s ts o f consultants for services
estimated t o cost less than US$ lOO,OOO equivalent per contract ma y be composed enti rely o f
national consultants in accordance with the provisions o f paragraph 2.7 o f the ConsultantGuidel ines.
(d)List o f other c onsult ing assignments
1
Ref. No .
2 3 4 5 6 7
Description of Estimated Selection Review Expected CommentsAssignment Cost Method by Bank Proposals
(US$) (Prior / SubmissionPost) Date
I contracts
21,00077,700
Technical
IC s Post August 2008
QCBS Post July 2008 Mu ltip le
contracts
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50,000 QCBS Post July 2008 Mu ltip lecontracts
Annex 9: Economic and F inan cial Analysis
Madagascar: Irrigation and Watershed M anagem ent Project
A. The Irrigation and W atershed Management Project
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1. The Malagasy government i s preparing a new irr igat ion program based on a watershedapproach in order to increase agricultural productivity and farmer income in selected rural
areas. These two objectives should be reached through a mix o f software and hardwareinvestment in agricultural service improvement, irrigation scheme development and upperwatershed protection .
2. The W or ld B ank will support this program by financing, together with the GlobalEnvironment Facil i ty (GEF) and the private sector, direct investments in three areas: (i)
commercial agricultural development to better link farmers t o markets fo r inputs and creditsand introduce agricultural technology in irr igated areas and tanety, for a total o f US$12.9
m il li o n (baseline costs plus taxes); (ii)rrigation development in the lower watershed to
rehabilitate physical infrastructure (such as water intakes, dikes, canals, and drainage systems)
and financial for a total o f US$17.5 mil l ion ; and (iii)atershed manapementin the upp er watershed to promote more sustainable l and management f or a total o f US$5.2mil lio n. Fr om the poi nt o f view o f the economic analysis, these three components represent
one inte grate d package and cannot be treated separately. A fourth component will support theproject management for a total o f US$4.9 mil l ion, including the Project Preparation Fund.
3. Overall, the project will cost US$40.5 m il li o n (includin g physical and pricecontingencies), o f whic h 74 percent will come from IDA (US$30.0 million), 15 percent will
come from GEF (US$6.0 million), and 11 percent will come from the private sector (US$4.5mil l ion). GEF will support the watershed development (component 3), and the priv ate sector
will support the development o f comme rcial agriculture (component 1).
4. The project will target 30,500 hectares o f cultivated area in four watersheds with
potential for agricultural development: Marovoay, in the Northwest, and Lac Alaotra (theSahamalato scheme), in the Middle East, the two rice granaries in the country, and Itasy in he
mid-West an d Andapa in the North. The objective will be to sustainably and significantlyincrease ag ricultural produ ction in hese areas.
5 . The tota l irri ga ted area o f these fou r watersheds represents 71,800 hectares, a third o fwhich will be concerned by the projec t (2 1,800 hectares), also con stituting e ight percent o f he
irrigate d schemes area (300,000 hectares), and 2.25 percen t o f the co untry's tota l irrig ate darea" (1 m il li o n hectares). Some o f the irrigated perimeters, lik e Lac Alao tra and Marovay,
are over 1,000 hectares; others, like Itasy, are between 100 and 1,000 hectares; the rest, likeAndapa, are under 100 ha. All 21,800 hectares are already eq uipp ed with concrete irrigation
~ ~ ~~
loMain ly the Fonds d'Entretien et de Re habilitation Hydro -Agricole (FERHA) for the part o f he irriga tion nfrastructure that
infrastructure, but only 60 percent are considered irrigated areas; the other 40 percent, mostly
located downstrea m fro m the irrigat ed areas, are no t irrig ate d year-round.
6. T h e project will f inance the rehabil itat ion o f rr iga t ion nfrastructure in the 60 percent
o f the schemes that are well-irrigated , and wil l f inance the introduction o f agriculturaltechnologies (such as improved varieties) in the other 40 percent, w hic h should help raise
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product ivi ty w ithout im prov ing water control over the year. On the irriga ted area, the pro ject
will develop off-season cropping (mostly tomatoes and potatoes) on 4,700 o f t he 21,800
hectares o f rrig ate d perimeters targeted by the project, mostly in tasy a nd Andapa.
7. The project will also develop rainfed agricultural pro ductio n in the l owe r part o f the
four watersheds (the f i r s t hillsides or tanety surrounding the irrigation systems) on around
7,700 hectares, less than 10 percent o f the rainfed c ultivated area (45,000 ha), through the
introdu ction o f agroecological techniques such as til lage a nd zero plowing. The objective o f
developing agro-ecology i s to increase on-site productivity and decrease off-site siltation.Indeed, as the intervention will target the f i r s t hillsides arou nd the systems, i t s expected that
erosion contro l will ead to decreased siltation.
Marovay
Itasy
Andapa
LacAlaotra
Total
Table 15: Areas and Beneficiaries of the Project
3,670 2,400 200 2,000 18,120
2,060 3,600 3,000 2,400 25,915
2,150 1,500 1250 1,500 14,85 1
6,000 400 1,800 30,676250
13,880 7,900 4,700 7,700 89,562
Watershed Art
Ilr*
8. The project investment cost will be around $1,330 per hectare for the four-year period
o f project implementat ion, or about $330 per hectare per year. This represents an increase o f
almost 4.5 t imes the investment of the last 20 years, which was about $1,500 for that time
period, or about $75 per hectare per year (see section 2 o f this annex).
9. The project will take place in rur al areas where the vast m ajo rity o f households live
under the threshold o f absolute pove rty (less than US$1 a day). The project will bene fit about90,000 households or, with an average o f 5 .5 people per household, around ha lf a mi l l io n
people in a country that has a total population o f about 20 mi ll i on people.
10. The improvement in agricultural product ivi ty will likely contribute to poverty
B. Public Spending and Irr iga tion P roductivity in Madagascar
11. A W o r l d B a n k ESW (P096045) entitled Madagascar: The impact o pub lic spendingon perimeters produ ctivity, 1985-2004, has looke d carefully at the impact o f public spendingon irr igat ion system product ivi ty during the last twenty years, a period that started with a
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major regulatory shift - he l iberal izat ion o f the rice sector - accompanied by an abrupt
transfer of the operation and maintenance (O&M) o f the medium-sized and large irrigation
systems (irr igate d areas eq uipped with infrastructure meant to improve water management andthus intensify production) from the State and State-owned enterprises to Water UserAssociations ( W A S ) .
12. A sample o f 108 irrigation schemes that were given help to organize O&M,representing a n area o f 123,500 hectares and 400 W A S , eceived US$190 mi l l ion, or ha l f o f
publ ic s ending, through 25 irrig ation projects (includ ing 2 extension projects) financed by 11donors . These irrig ation schemes represent around 60 percent o f he ir rigated areas o f more
than 50 hectares that were endowe d with concrete infrastructure at the beginning o f he period
and represent around 11 percent o f Madagascar's total irr igated lands (believed t o cover
around 1 m il l i on hectares). The beneficiaries were the about 100,000 water users, or aro und
600,000 people, and about 60 percent o f the $190 m il l i on was invested in hardware forirrigation infrastructure, while the other 40 percent was invested in software, m os tly for
capacity building o f W A S nd, less importantly, for promoting agricultural technologies,
such as chem ical fertilizers, imp rov ed seeds, off-season crops, early ri ce transplanting, and thesystem o f r ice intensif icat ion (SRI) that was inve nted in Madagascar.
13. Overa ll, the investments resulted in increased system prod~ct iv i ty '~ ,rom 1.5 at the
beginn ing o f the p eriod studied to 2.4 tons o f paddy equivalent per hectare, a 60 percent
increase and a significant achievement in view o f Madagascar's reputation for stagnant
productivity (the FA0 f igures) and irrigation projec t failure. In these systems, paddy yield15
increased fro m 2.2 to 2.7 tons o f paddy equivalent per hectare, contributing to 50 percent o f
the productivity increase, while the other 50 percent came from the increase in croppingintensity16, w hi ch grew f rom 0.6 to 0.8.
14. The latter improvem ent i s a direct consequence o f nvestment in the hardware (better
infrastructure improves areas under irrigation) wh ile the former i s believed to be the indirect
and combined result of nvestment in he hardware and in prom oting agricultural technologies
(better infrastructure allows better water control, which encourages the adop tion o f new
methods that have a direct effect o n yield).
15. T h i s overal l improvement in paddy productivity, when compared with the
counterfactual s ituation - the situation withou t the investments o f the past twenty years,
including the ones devoted to repair cyclone damage - shows that without investments inirrigation infrastructure and in building the capacity o f W A S , he 123,500 hectares o f
irrigated perimeters wou ld have produced, at the end o f the studied period, 140,000 tons o f
paddy less than in the alternative situation. The difference between the two scenarios
I?
translates in to economic b enefits fo r the cou ntry that represent a N e t Present Valu e (NPV) o f
US$200 m il li o n at a 10 percent discount rate or an Economic Rate o Return (ERR) o f 18.5
percent.
16. Therefore, overall, the don or investments in the irrigatio n sector during the past twenty
years, while seen as a failure, in reality have significantly improved country welfare, and,
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given what i s known o f the relationship between paddy prod uctivity increases and poverty
alleviation they have contributed to pove rty alleviation in ur al areas as we ll.
17. However, tw o factors helped limit the impact o f these twenty years o f investment inthe irrigation sector to th e low er bound o f what was possible: cyclone damages and the
somewhat poor functio ning o f the W A S . Bo th kept cropping intensity improvement at a
lower leve l than wha t was expected. Indeed, 20 percent o f the hardware investment during the
last twenty years was diverted fr om in iti al objectives to repair c yclone damages. The
financing c ou ld have been used to expand the irrigated area and thus the cropping intensity.Moreover, W A S ave been losing, o n average, 5 percent o f the i rrig ate d area each yearbecause o f a lo w O & M fee recovery rate. Therefore, an important part o f he investment was
used, in fact, t o rehabilitate the forme r investment.
18. In addition, paddy yiel d improvem ent could also have been more important i f compare
with green rev olu tion technologies achievement in other co untry such as Indon esia that share
the same natural conditions than Madagascar and reached 4 tons per hectare. In the
Madagascar case, tiny extension projects combined with relat ively low producer prices
(compared to fertil izer prices) could give a reasonable explanation o f that relatively l o wimprovement.
C. Basis o f the Watershed Management Project Economic Analysis
19. The econom ic analysis i s carried ou t separately fo r each o f the fou r watersheds
selected by the project because the in i t ia l condit ions of the irrigation systems and upperwatersheds are different along with the amount and balance between the three components
that will be applied to each o f he watersheds. The results are added to provid e the economic
analysis for the whole p roject.20. The type and magnitude o f the expected incremental economic benefits o f he project
depend on what w ou ld have been the situation in the absence o f he projec t and on what the
project will affect. Thus, the counterfactual situation i s described and defended be low b efore
the different categories o f expected benefits f ro m the proje ct are presented.
Counterfactual Situa tion (baseline)
21. The baseline describes the evolu tion o f paddy productivity in irrigated areas and
uplands (tanety) in the four watersheds in the absence o f the project. As far as paddyproduct ivi ty i s concerned, the economic analysis builds on the database assembled during the
ESW, extracts cropping intensity, the paddy yield an d the un-irrigated production, and
simulates their progression over the next 25 years i f n o investment in the rehabil itat ion o f
Watershed
Marovay
Irrig ate d Partially- Off-season Tanety To tal Paddy
Areas irrigated Irrig ate d (tons) production
(tons) Areas (tons) (tons) (tons)9,151 3,584 300 11,887 12,735
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Itasy
Andapa
5,952 6,801 6970 9,389 12,752
4,914 1,929 1090 7,820 6,843
22 . In the four areas targeted by the project, paddy production in irrigated areas i s
currently at around 53,000 tons per year, or 2 percent o f the estimated current national padd y
production (around 2.8 m il l i on tons). Mo re than two-thirds o f the paddy product ion comes
fro m w ell-irriga ted areas, located upstream fr om the irr iga tio n systems, as mentione d in the
introduction, and one-third o f the paddy production comes from partially-irrigated areas,
located downstream from the irrigation systems. Alm os t 38 percent o f the paddy product ion
comes from the Sahamaloto perimeter located in the Aalotra watershed, which covers only
around 28 percen t o f the irr igate d areas concerned by the project. In addit ion to this paddyproduct ion, w hic h comes from the 21,800 hectares o f rrigatio n systems that w i l l be targeted
by the project, around 44,000 tons per year are produced o n the 7,700 hectares o f tanety
located in the low lan d parts o f the watersheds and the 1,075 hectares o f irrigate d perimeters
that are cultiva ted off-season and that wil l targeted by the project. These so-called tanety and
off-season irrigate d productions are composed o f 45 percen t cassava, 13 percent sugarcane, 12percen t tomatoes, 10 percent maize and 6 percent rainfe d rice. Th e remaining 14 percent are
sweat potatoes, potatoes, bananas, peas and groundnuts.
Table 17: Productivity and Cropping intensity at the beginning of the project
Lac Alaotra
Total
19,567 904 240 6,579 20,471
39,583 14,504 8,600 35,675 52,801
25. Off-season irrigated produ ctivity i s at a weighted average o f 8 tons per hectare, 10 tons
per hectare fo r Itas y and 5 tons per hectare in he 3 other watersheds.
26. In he absence o f he project, paddy produc tivity in partially-irrigated areas i s i ke ly to
decline as w el l as the productivity o f uplands, the former because o f decl ining water controlon w ell-irrigated upstream areas and the latter because o f soil erosion and the related loss o f
nutrients. Off-season irrigated produc tivity and areas are lik el y to rem ain the same.
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27. The analysis undertak en in: The impact ofpublic spending on perimeters productivity,
1985-2004 shows that, during the last twenty years, when any irr iga tio n scheme does notreceive investment in hardware and does not face any external shock, i t on average loses
around 5 percent o f t s irrigate d area (cropping intensity) per year. The analysis also shows
that this loss o f 5 percent o f rr igated area per year i s quite homogeneous a ll over the co untry
over the studied period. Therefore, i f there i s no investment in the irrigation systems, 5
percent o f well- irriga ted areas o f hese schemes will be transformed each year i nt o partially-irriga ted areas and w i l l therefore show a produc tivity loss o f around 1 ton per hectare pe r year.
As far as tanety are concerned, in Madagascar, other analyses show that soil erosion i s
important and results in a produ ctivity loss that can be estimated rou ghly at 5 percent per year.
28. The firs t analysis shows also that around 50 percent o f the 123,500 hectares of
irrigatio n systems studied were fo und to b e sensitive to c yclonic floods during the last twentyyears. The capital cost o f these floods was US$ 23 m il li o n for an area o f 65,000 hectares, or
US$350 p er hectare for the whole pe rio d and US$17.5 per hectare per year. The amount was
thus not used to direct ly improve produc t ivi ty but to ensure that these 65,000 hectares wouldcontinue to be irrigated. As a result, they wo ul d have a mu ch lower produc tivity than current
levels‘7.
29. With a l l o f this inform ation about the irrigated areas and the di mi nu tion o f uplands
product ivi ty without investment in the irrigation and watershed management project, the
progression o f production in the counterfactual situation can be reconstructed for the project’s
period it se lf as we ll as for the next 21 years so that the analysis w oul d cover a total o f 25
years (2007-203 1). The evolut ion i s shown below in igure 3.
Figure 3: “No Investment” Mode l of the Irrigation Systems and Tanety’s Produ ction Evo lution
,000 Tonnes per year100
I
80
60
30. Wi tho ut the irrigatio n and watershed management project, the paddy produ ction o f he
irrigated areas that would have been concerned by the project w oul d decrease fro m around
54,000 tons per year at the beginni ng o f the perio d to 43,000 tons by the end o f the period
(without taking in to account the impact o f cyclonic damages o n product ivity), or a loss o f 21
percent. At the same time, the tanety prod uctio n wou ld decrease fr om 35,000 tons to 11,000tons, or a loss o f 69 percent. The loss in paddy produ ction alone i s equivalent to the m il le d
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r ice consumption o f 12,000 households for an entire year.
Origins and Order o Magnitude o Economic Benejts Associated with the Project
31. The approach to estimating the economic benefits o f the irrigation and watershedmanagement project i s mostly traditional. Most o f he investment aims to prov ide the software
and hardware infrastructure necessary to generate increased agricultural development,
enabling the four watersheds to support greater productivity both in rrigate d areas (well, badand off-season) and in owla nds (tanety) around irriga tion systems.
32. Thus, the economic benefits o f the project are based o n projected agricultural
produ ction increases in the four watersheds, compared with agricultural product ion in thesituation without the project. This additional agricultural production will come f rom of
additional paddy from well- and partially-irrigated areas, potatoes and tomatoes that are
cultivated off-season in irriga ted areas, and fr om u plands where crops such as cassava and
maize are cultivated.
33. Paddy produ ctivity will increase in well-irrigated areas as a result o f investment inirrigatio n infrastructure (software and hardware). The pr oduc tivity increase will be main ly
driven by cropping intensity improvement, and marginally by paddy yield improvement.
Meas ured for a 20-year p erio d and an area o f 100,000 hectares (see section 2 o f this analysis),
the product ivi ty gain was around 0.9 ton per hectare. With this project, one can expect an
additional 1 ton per hectare (therefore an average productivity o f 4 tons per hectare in the
areas concerned by the project; see table 3) one year after investment in i rr igat ion
infrastructu re because the project will focus on the rehabilitation of the upstream parts o f the
irrigatio n systems.
34. In partially-irrigated areas, paddy productivity w i l l increase as a resu lt o f the
introduction o f agricultural technologies adapted to l o w water contr ol situations (mainly using
the rice variety called Sebota) co mbined with extensio n services and better access to credit.
As a result, paddy y ie ld will increase significantly withou t i mp ro vi ng water management in
these areas. Current experiments in the Lac A laotra watershed show very pro mi sin g results.
With this project, the expected gain wil l be 1 ton pe r hectare one year after the introduct ion o f
the technology, mea ning an average o f 3 tons per hectare compared to 2 tons p ar hectare (see
table 3).
35. Off-season, the area cul tivate d will increase by a factor o f mor e than 4, fro m 1,075
hectares up to 4,700 hectares, and pro duc tivi ty will reach 10 tons by the end o f the project inAndapa and Alaotra, and will reach 15 tons per hectare in Itasy.
siltation vary greatly f orm one region to another; therefore, the magnitude o f he benefit will
on ly be estimated through order o f magnitude. As a hypothesis, so il erosion will be reducedby 5 tons per hectare 3 years after techniques have bee n introduced, wh ic h means that 0.45tons o f sediment will not have to be removed form the irri gat ed areas, at US $2.50 per ton, or
around US $1 pe r hectare.
38. Addit ional benefits will come from soil erosion control and natural resource
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management (pasture and forests) in the upper parts o f the watershed concerned by the
project. This may help, in the me diu m term, to m itigate cyclone damage to ir rig ati on
infrastructure. Fo r the last 20 years, the capital costs have been estimated at US$17.50 per
hectare o f irr igation schemes. By hypothesis, with this project, one can expect to reduce
capital cost in the irri gat ion schemes that are concerned by the project by an amount o f US$5
per hectare the f i r s t year after project completion, increasing by an additional U S$ 1 each year.
39. Consequently, the major categories o f ncremental economic benefit fro m the projectw i l l be (i)ddit ional paddy product ion coming f ro m improvement in cropping intensity inwell-irrigated areas and in yield l inked to in t roduction o f new varieties in partially-irrigated
areas, (ii)ther additional crop product ion coming fr om a reduct ion in nutrient depletion, and
(iii)ower O &M costs com ing fr om a reduct ion in siltation and in cyclone damages.
Table 18: Categories and order of magnitude o f expected incremental benefits
Category
Paddy Productivity
Paddy productivity
Off-season irrigate d
Other Crops
product ivi ty
O&M reduction
Avo ided
infrastructure
damages repair
Location Origin Increment
well- irr igated Ma inl y cropping 1 tonhalyear after
schemes intensity rehabilitation
part ial ly-irr igated yield 1 ton/ha/year afterschemes introduction
Well-irrigated Area and yield 5 tons per hectare after 3
schemes years
tanety yi el d 2 tons/ha/year after 3 years
al l irrigate d areas Av oid ed tanety $ l/ha/year starting after 3
erosion years after technolog y
introduct ion
al l areas Av oid ed cyclone avoided $5 per hectare after
damages 7 years
40. I f here i s a substantial production increase due to the project, there might be some
D. Economic Costs
42. The watershed project’s econo mic costs are composed of : (i)he full base costs o f hepublic investment18 withou t taxeslg (fr om COSTAE3- see Annex 5 and project f i les for more
details) in agricultural development (component l),ii)he full cost o f nvestment in rr igat ion
development without taxes (component 2); (iii)he full base costs o f investment in thewatershed develop ment with out taxes (component 3); (iv) the full base-costs o f project
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management withou t taxes (component 4); (v) phy sical contingencies that represent real costs
and, un lik e price contingencies, are included in proje ct economic costszo, and (vi) incrementalrecurren t costs.
43 . Adverse environmental effects ma y represent major economic costs. As mentioned in
Annex 10 o f this PAD , the project has been classified as Category A. Negative externalities
associated with irrigation infrastructure investments are believed to be f ixed because they
consist o f rehabil i tation o f ci vi l works. However, as stated in Annex10, the success o f theproject in the watersheds that are concerned by the project might present a majorenvironmental risk. Poor migrants fr om other parts o f Madagascar might f lock to the
watersheds t o demand their share o f ncreased agricultural productivity, the expected outcome
o f this project, and therefore am pl ify s oi l degradation and deforestation. T he costs o f the
project’s environmental and social prevention needed to address this mig rat ion have beenintegrated into the various project components, as stated in Annex 10. Moreover, f rom a
country perspective, this pressure might be assimilated by a transfer from the departing
watersheds to the watersheds that are g oing t o be targeted by the project and therefore being
neutral. Therefore, these prevention costs will be used as a pro xy fo r the negative social and
environ mental externalities.
44. Incre men tal recurre nt costs are recurrent costs spe cifica lly generated by the project at
completion. In this project, incremental recurrent costs are: (i)dditional maintenance costs
associated with investment in public infrastructure to support marketing chains
subcomponent 12, support to pr ivat e investment; (ii)dditio nal maintenance costs associated
with irrigatio n infrastructure rehabilitation in subcom ponent 22(b), rehabi l i tat ion o i r r iga t ion
infrastructure; (iii) dditional maintenance costs associated with erosion control (mainly
retention structure and hedge works) in subcomponent 32(a), strategic erosion control ; an dadditional natural resource management costs associated with pasture management and
reforestation in subcomp onent 32(b), reestablishment o vegetation cov er.
45. In all four situations, the incremental recurrent costs have been estimated, by
hypothesis, at 5 percent o f the total cost o f nvestment for 4 years without taxes. In table 4below , they appear as a 21 year sum, in he last column.
46. The economic costs o f projec t objective achievement are summarized for the four
watersheds in table 4 below, which also shows the contribution o f each o f the major costcategories to the calculated aggregate present value o f the project economic cost. The detailed
calculation s for each o f the 4 watersheds are presented in Appendix 9.1. Th e calculations
assume a real discount rate o f 10 percent, a total l i f e o f public investment o f 25 years, and use
Table 19: Project investment and recurrent costs (US$millions),all watersheds
1 Type of investment I PV 1 2007 I 2008 I 2009 I 2010 12011-2031 I
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47 . In total, the present value o f the irrigation and watershed management project’s
economic costs will be US$32 m i l l io n o f which US$27.6 m i l l io n represent investment costsand US$4.4 m ill io n represent recurrent costs. The bulk o f the cost resides in commercial
agricultural development and irrigatio n systems investments, whi ch account for 72 percent o fthe project economic cost’s present value. Investments in watershed management will
represent onl y 13 percen t o f he project economic cost’s present value, w hile costs of projectmanagement and physica l contingencies will represent 15 percent.
48. Alaotr a and Maro vay will represent respec tively 32 and 25 percent, wh ile Andap a and
Itasy each represent 21 percent o f the total economic cost o f the project (see table 5 below).
The difference lies in component 2. T h i s component’s economic cost wil l be 2 times more
important for Alaotra than for Itasy. In Alaotra, the high cost i s explained by the importance
o f he c iv i l works invo lved in the rehabilitation o f the dam.
Table 20: Economic Costs per Watershed
Type o f Costs, PV ($thousand) Marovay Itasy Andapa Alaotra Total
Commercial AgriculturalDevelopment 2,308 2,312 2,312 2,312 9,245
Irrig atio n Systems 3,390 2,8 15 2,138 5,799 14,142
Watershed Development 1,171 1,018 980 903 4,072
Project Management 836 882 882 882 3,482Physicalcontingencies 323 313 250 488 1,374
Total 8,027 7,340 6,563 10,385 31,979
Recurrent Costs 1,119 703 692 1,887 4,401
49. Recurre nt costs will be a signif icant part o f the project econom ic cost’s present value:14 percent, representing a yearly f lo w o f US$0.75 mill ion, immediately after project
completion. The bulk o f he recurrent costs will be generated by the incr ementa l maintenance
o f the rehabilitated irrigatio n infrastructures (8 1 percent), foll ow ed by the incrementalmaintenance o f eros ion wo rks and management o f orest and pasture (12 percent).
50. The Lac A laotra and Marova y watersheds will account for 68 percent o f the recurrent
cost o f the project. The discussion about who will finance the recurrent costs and how i s
yields linked to the introduct ion o f new variet ies in partially-irrigated areas; (ii)dditional
product ion of other crops coming fro m the development o f off-season irr iga t ion product ion
and from a reduction in nutrient dep letion on tanety; and (iii)ower O&M costs com ing fro m
a reduction in siltation and in cyclone damages.
52. Fo r each o f these three categories, the amount o f economic benefits that will bebrought by the proje ct depends o f he unit rent or cost re ducti on associated with each category
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o f benefits and their importance, as w el l as their pace o f appearance in conjunction with
proje ct investment.
0 Incremental Agr icultu ral Product ion
53. Ag ricu ltur al rent associated with additional crop production i s the difference between
the producer price and the cost o f production under the ne w conditions. Fo r paddy, the unit
rents are taken at $82 per to n in well-irrigated areas and at US$ 81 per ton in partially-irrigatedareas, with a paddy producer price at 20 cents (US$) per kg. Fo r the other crops, the unit rent
i s a combina tion o f agricultural rent associated with cassava, tomatoes, beans and rai nf ed rice;it i s taken at US$70 per t on in irrigate d areas and US$71 per tons in tanety, reflecting the
proport ion o f crops that are going to be gr own with the project in each o f he four watersheds.
54. The pace o f production grow th i s given by the pace o f investment during the project.
For example, the pace o f paddy product ion grow th in well-irrigated areas i s g iven by the
distr ibut ion o f nvestment o f component 2 in each watershed: The p rod uct ion increase i s the
proportion o f i r r igat ion systems that have their infrastructure rehabilitated times the
produ ctivity increase that i s associated with infrastructure rehabilitation (+1 to n per hectare).
/
Figure4: Paddy Production With and Without Project
56. The cumulated difference o f product ion in the situation with th e project compared to
the situation withou t the project i s 105,000 tons during the 4 years o f project implementation,55,000 tons o f whic h are paddy, the equivalent o f the annual consumption o f 355,000 people
or around 65,000 households.
Reduction in O M osts associated with reduced siltation and avoided cyclone
damages
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57. The hypotheses regarding the benefits link ed to reduced erosion and reduced flo od in
irrigation systems are very conservative. The f i rst benefits appear proportionally to tanety
areas that benefit f ro m the introduction o f agro-ecology techniques and stay stable over time.
The second, as ment ioned earlier, appear begin ning in year 8. The f i rs t benefit i s US$12.5 per
hectare o f tanety c ultivated with agro-ecology techniques, one year after their introduction,
being stable over time. The second i s US$5 per hectare for irrigation systems after 7 years,
then gro wing at US$1 per year to reflect the growing vegetation in the upper watershed andtheir better abili ty to absorb water and avoid floods in he downstream part o f he watersheds.
Table 21: Compositionof Gross Benefits, A ll Watersheds (2006 US$thousands)
58. The ma in economic benefits o f he irrigatio n and watershed management project will
come fr om the paddy product ion grow th in bo th well- and partially-irrigated areas: This will
represent 49 percent o f the total benefit, under the conservative hypothesis that productiv ity
won’t increase under the inf luence o f he project after project complet ion. The in t roduct ion o f
ago-e colog y techniques on tanety and in irrigated areas to grow off-season crops will
constitute 47 percent o f the benefit o f the project, bringing the total from additional
agricultural produc tion to 96 percent o f he benefit o f he project. The benefits associated with
O&M reduct ion will represent the rem ainin g 4 percent o f he project’s benefit.
59. Benefi ts might also be regrouped more o r less by component: the increase in paddy
production and off-season cropping in well- irr igated areas coming mainly from water
F. Results o f the Cost-Benefit Analysis
60. Because o f the weakness o f the available data, the cost-ben efit estimates presented
below are necessarily imprecise and should be considered only in terms o f order o f
magnitude, especially for recurrent costs, but also for benefits derived from agricultural
production o n tanety along with reduced cyclones damages. For the latter, the estimates arerea lly conservative given the absence o f data.
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6 1. Using conservative estimates fo r the unit rent, the pace, an d the quan tity o f benefits, as
table 3 shows, the investment i s ike ly to increase the welfare o f he country by about US$9.5
mil l io n, corresponding to an economic rate o f return (ERR) o f 14 percent, and is, therefore,
justified f rom this p o int o f view.
Table 22: Summary of Costs and Benefits, Present Values as of 2006 ($ thousand)
62. At watershed level, these calculations show differences a mon g watersheds (see tab le 8
below and detailed tables in appendix 9.1 at the end o f this annex). Itasy shows greater ERR
than the project as a whole (20 percent), wh ile M aro va y and Andapa show rates o f return o f
13 percent, respectively, and Lac Ala otra a n 8 percent whic h i s lower than the ERR for the
pro jec t as a whole.
63 . In the example o f Marovay, the relat ively lo w ERR i s attr ibuted to investment in
agricultural development that concerns a relatively small area o f off-season irr iga tio n
comp ared to the other watersheds (as show n in table 8 by the small PV o f the third benefit)
an d by a relatively important investment in the irrigation development. Therefore, thiswatershed yields relatively less benefits than the other watersheds.
64 . In he example o f Lac Alaotra, the l o w ERR i s explained by the relat ive importance o finvestment in irrigatio n infrastructure compared to the irrigated area that i s concerned by the
investment. I t i s also the result o f conservative hypotheses regard ing the im prove ment o f
paddy product ivi ty.
Table 23: Comparison of costs and benefits between the four watersheds
Watershed Benefits/Costs PV, Marovay Itasy
Thousand $) AndapaPaddy Production in Well-irrigated
Areas $3,968 $2,391 $2,235
Lac
Alaotra
$7,382
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Paddy Production in Partially-irrigated Areas
Off-season irrigate d crops
$1,207 $1,810 $754 $20 1
$428 $6,422 $2,676 $535
65. The variables that influence the fl ow o f project benefits the mos t are likely to be (i)he
evolut ion o f the paddy producer price, (ii)he eff iciency o f the W A S n maintaining therehabilitated canals, especially in Lac Alaotra, and (iii)he l ik el iho od o f cyclone damages
combined with the existence or non-existence o f a disaster-risk f ina nci ng mecha nism that will
immediately repair cyclone damages.
66. The benefi ts have been calculated with a paddy producer price at 21 cents per kg.
Duringmost o f he last twenty years, the producer price stayed rela tive ly constant at 10 cents
per kg. During the last two years, however, the producer price increased drastically, to more
than 20 cents, ind uci ng changes in farmer b ehavior tha t have started to rega in interest in rice
production. There i s a risk that the pric e will shrink again. I f he producer price fal ls be low 17cents per kg next year (compared to 20 cents per kg now) and stays at this level, the projectwill not be profitable.
67. The inabil i ty o f W A S o maintain the irrig ati on nfrastructure was one o f he reasons
why i rr igat ion projects were not able to maintain product ivi ty gains long after irr igat ioninfrastructure was rehabilitated: W A S ere lo sing o n average 5 percent o f the irrigate d area
o f systems every year after the investment was made. As far as cyclone damages are
concerned, the relative ly impo rtant physic al contingencies should be sufficient during project
implementation to repair cyclone damages to infrastructure. After the project, repairs will
depend on th e FERHA or any disaster risk f inancing that could be set up during project
implementation.
68. I f W A S o n ot maintain product ivi ty o n well-irr igated areas for more than 7 years
Other Crops Product ion o n Tanety
Siltation Reduction in r r igat ion
systems
Avoid ed Cyclon e Damages in
I r r igat ion systems
Project Cost (investment and
recurrent)
Net Present Value ( ERR)
$3,546 $2,828 $2,246 $499
$170 $204 $127 $153
$282 $263 $170 $298
$8,027 $7,340 $6,563 $10,385
(13%) (20%) (13%) (8%)
1,574 6,578 1,645 -1,4317
70. The project’s outcome wil l greatly depend on the sustainable fina ncin g mechanisms
that will be put in place to increase the recovery rate o f the O &M fee, to cope with cyclone
damages and, to some extent, to pay the lower and upper watershed farmers for theenvironm ental services they will provide i f they maintain natural resources, and control
erosion.
G. Financial Analysis/Fiscal Impact
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7 1. The ma in winners in the irrigatio n and watershed management investment will be the
loc al rura l populations (around 90,000 households mos tly living under the absolute poverty
l ine) o f the four watersheds (Marovay, Itasy, Andapa and Lac Alaotra), especially farmers
producing paddy with good water control. Ne t benefits for farmers will be around US$22.6
mi l l ion ( the sum o f the four benefi ts accruing from additional agricultural production, less
what i s giv en to communes and to traders), or 51 percent o f he present value o f the project’s
benefits. The other net gainers o f he proje ct are the traders in agricultural products that will
receive US$11.8 mi llio n, o r 26 percent o f he present value o f the project’s benefits.
72. Un de r the conservative hypothesis that there will not be any additional fisc al revenuesgenerated from the project other than the US$8.5 million in taxes generated by the project
investment plus the taxes alon g the value chain between paddy producers and consumers, the
government i s the main oser in this simple analysis because i t does invest the bulk o f he $28
mi l l i on o f he pro ject cost (part o f which i s supported by the beneficiaries) and receive a fiscal
compensation o f only $8.5 m il l ion , or 19 percent o f the total benefits, in return for i t s
investment (1 1 percent for communes through additional production, and 8 percent to the
central g overnm ent throug h taxes associated with the project’s investment).
73. W A Swill gain US$1.7 m il l i on from the reduced costs o f si l tat ion and from some
prevention o f cyclone damages, but wil l also bear most o f the project recurrent costs. An
addi t ional US$4.4 mi l l ion o f recurrent costs wil l come both from irr igat ion rehabil i tat ion
maintenance an d natura l resource management in the up per watershed. Therefore, they will
lose US$2.7 mi l l io n from the project. T h i s cost, which will happen mostly after projectcompletion, will represent a f lo w o f around US$0.75 m il l i on a year, or an additional US$33
per hectare o f well- and partially-irrigated areas where the project will intervene. Therefore, inorder for the project to be sustainable, there will be the need to transfer US$33 p er hectare
from irrigated agriculture farmers to WUAs so that the W A S an pay for the additionalmaintenance cost. Given that the farmer will gain around US$50 per addit ional ton o f paddy
and around US$35 per addi tional ton o f other crops produced, this op tio n sounds feasible.
74. The exist ing lo w rates o f O&M recovery and the relative failure o f past projects to
improve i t mean that this project should work on institutional arrangement, involving, for
example, the communes, and putting in place enforcement mechanisms to make sure that this
transfer will happen. Taxes at the commune le ve l are one possibility.
75. Cyclone damages o n irrigatio n infrastructures are another type o f recurrent cost that
needs to b e financed by project for sustainability reasons. Part o f he project’s benefit will be a
H. Conclusions
76. In sum, the analysis shows that the expected incremental economic rents, based on
several assumptions about the counterfactua l pace o f rrig atio n infrastructure degradation, soi l
erosion, an d cyc lonic damages, o n the one hand, and the additio nal agric ultura l produc tion, on
the other hand, are robust enough to justify the proposed investments by the Malagasygovernment, even i f the numbers themselves are not very high. However, assumptions on
addi tional agric ultura l pro duc tion are conservative, as well as the incremental benefit
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associated with them. Moreove r, some benefits o f new production , such as rent, w hi ch will be
generated alon g the value chains betwee n producers an d consumers, have n ot bee n take n int oaccount in this analysis.
77. Th e ma in beneficiaries will be the about 500,000 people that will see their income
grow through gains in agricultural product ivi ty. However, in order to make these gains
sustainable, the project will have to put in place transfer mechanisms from these farmers(particularly those who wo rk in he irrigation systems) to W A S nd to the FERHA in orderto fund infrastructure maintenance and to in sure them against cyclone damages. In addit ion to
this f i rs t transfer, i t i s also possible to envisage payment for environmental services from
W A S o farmers to help prevent soil erosion in the low er and upper parts o f he watersheds.
G.
e
e
e
e
e
e
References
Wor ld Bank. 2005. Madagascar: The impact o f public spending on rrigated
perimeters prod uctivity (1985-2004).The W or ld Bank: Washington, D.C.Brand (J.) M a rch 2006. SynthBse des etudes de preparation par site d’intervention.Processed.
W o r ld Ba n k Inst i tute. 200 1. Economic Analysis o f nvestment Operations. Analyt ic al
tools and practica l applications. WBI development studies. Th e W o r ld Ba n k:Washington, D.C.
Minten B. and Barret C. 2005. Agricultu ral technology, produ ctivity, pove rty and foodsecurity in Madagascar. Processed.
IRAM. Janvier 2006. Renforc ement des capacites des parties prenantes dans l e pro jetbasins versants perim btres irrigues . Processed.
Horns. DCcembre 2005. Etude de prepara tion du pro jet basins versants-pkrimetresirriguks. Etude des filikre s. Processed.
Annex 9.1: Project Economic Costs, Economic Benefits and NPV per Watershed
Table 24: Marovoay Watershed, Project Economic Costs (US$ thousands)
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Total 8,027 I 1,623 1 2,091 I 2,956 1 2,171 I 3,410
Table 25: Itasy watershed, Project Economic Costs (US$ thousands)
Recurrent Costs 1.119 I 0 1 0 1 0 1 0 1 3.410
Table 26: Andapa watershed, Project Economic Costs (US$ thousands)
Total
Table 27: Alaotra Watershed, Project Economic Costs(US$ thousands)
7,340 I 1,508 I 1,991 I 2,871 I 2,144 I 2,498
Recurrent Costs 703 I 0 1 0 1 0 1 0 1 2.498
Table 28 : Marovay, Summary o f costs and benefits, NP V as of 2006 (US$ thousands)
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Av oid ed cyclone damages
Project Cost (investment and recurrent)
Ne t benefits (ERR=20%)
Table 29 : Itasy, Summary of costs and benefits, NPV as of 2006 (US$ thousands)
263 0 0 0 0 1,375
7,340 1,508 1,991 2,871 2,144 2,498
6,578 -1,508 -1,943 -2,504 -1,211 46,307
Table 30: Andapa, Summary o f costs and benefits, NPV as of 2006 (US$ thousands)
Table 31: Alaotra, Summary o f costs and benefits, NP V as of 2006 (US$ thousands)
Annex 10: Safe gua rd Policies Issues
Madagascar: Irrig ation and Watershed Management Project
Enviro nme ntal Assessment Category and Safegua rd Policies triggere d
1, The Madagascar Irr ig at io n and Watershed Manage ment Project has been classifie d as
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a "Category A" operation under the World Bank environmental screening proceduresspecified in OP 4.01. The package o f safeguard documents prepared fo r the proj ect comprises
three primary reports: (i)he Regional Environmental and Social Assessment (RESA)containing and En vironment and Social Management Plan (ESMP); (ii)he Pest and PesticideManag ement Plan (PPMP), and; (iii)he Resettlement Policy F ramew ork (RPF). The RESA,
PPMP a nd RPF address the W or ld Ban k Safeguard Policies that are triggered by the project.The proposed activities for management and mitigation of the Project impacts are in
compliance with the following World Bank Safeguard Policies: Environmental Assessment
Policy OP/BP 4.01, Natural Habitat Policy OP/BP 4.04, Forests Policy OP/BP 4.36,
Invo lun tary Resettlement OP/BP 4.12, a nd Pest Manag ement OP/BP 4.09.
Analysis o f alternatives
2. La nd degradation in Madagascar has been extensive and dramatic. I t has led to a
significant reduction in agricultural productivity, exacerbation o f rampant natural erosion by
human caused erosion and widespread poverty o f the rura l population. The no-projectalternative w i l l lead to a deterioration o f the existing situation, expansion o f the area o f lo wagricultural productivity leading to the destruction o f globally important biodiversity
resources (e.g. Ma ro je jy Na tio na l Park, the South Anjanaharibe Special Reserve, and the
Makira Conservation Site all located in the upper watersheds around the Andapa irrigation
scheme; the Ankarafantsika Natio nal Park located in the upper Mara voay watershed; and theLac A laotra Ramsar site) and will lead over time to abandonment o f man y ru ra l areas.
3. The present project addresses in an integrated manner the land degradation in fourma jor irrigatio n schemes and their associated watersheds and reduces the pressure on glo ba llyimportant biodiversity resources. The present project design has as objective to increase
agricultural production in an environmentally and socially sustainable manner, stop the
expansion o f the agricultural area in the project sites through intensification and to reducerural poverty, w hich s expected to lead to a reduced rura l to urban migration.
Enviro nme ntal and Social Impacts
4. The environmental and social impacts o f the project are mostly positive.Enviro nmen tal and social management measures are almost fully integrated int o the design o fthe various p roject components. The promo tion o f agro-ecological produ ction techniques are
unsustainable levels and exacerbate human induced erosion and i t might also increase
deforestation in the globa lly impo rtant biodiversity sites in the upper watersheds and increase
the clearance o f reed marshes for rice pro ductio n in the Lac Alao tra Ramsar site. Transfer o f
the management o f hese sub-watersheds to lo cal farmer organizations will need to provide a
social fencing system to preven t the entry o f migrants fr om elsewhere.
6. Intensif ication o f agricultural product ion normally goes hand in hand with increased
use o f chemical fertil izers and pesticides. To manage the health and environm ental impacts o f
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increased pesticide use, the borrower has prepared a Pest and Pesticide Management Plan
(PPMP). T h i s PP MP envisages strengthening the capacity o f the Plant Prote ction Service on
the Regional level (DRDRs) to increase the oversight and control o f pesticide use and
improve awareness among farmers and pesticide distributors. The PPMP also envisages
strengthening the development and implem entation o f Integrated Pest Management (IPM )
practices. Agro-ecological practices require more inputs: herbicides and fertilizers. Thequestion i s can farmers afford this? These agro-ecological practices reduce the r isks fo r
farmers during droughts. This makes the farmers less vulnerable to clim ate varia bility.
Environmental and Social Management Plan (ESMP)
7. Environmental and social management measures and their costs have been integrated
into the various project components. An overview o f these environmental and social
management measuresi s
presented inthe table
below.
Contractor EMP
8. The contractors who will be awarded the contracts for the rehabil itat ion o f the
irrigatio n schemes need to prepare their ow n Environm ental Management Plans (ContractorEMPs). These EMP s need to spec ify ho w the contractors will handle occupational health and
safety issues, in compliance with IFC Occupational Health and Safety Guidelines, during
construction and ho w hydrocarbons (waste oils), solid and liquid wastes wi l l be handled,
where their workers will be housed, training and means to prevent HIV/Aids infect ions oftheir workers and loc al communities. The contractors should have a license to establish and
operate the quarries and a fter use should rehabilitate these quarries t o acceptable in terna tiona lstandards. The establishment, operation and reha bilitatio n o f he quarries sh ould be negotiatedwith the local communities.
Agro-industries
9. The project will prom ote the use o f agro-industries, such as ric e mills and related
processes, biodiesel production from Jatropha seeds, oil palm and groundnuts industries
(crushing, o i l refini ng, soap and me al production), cashew nut processing, fruit ju ice and pulp
processing plants (citrus, mangoes and litchis). These agro-industries are essential for
ru U
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0
t i lY
2c80
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0
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ru0
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a
8
33
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M
63 r
Resettlement Issues
10. In order to protect the r ights o f vulnerable groups and farmers who might lose
land o r in come or lose access to other natural resources a Resettlement Po licy Fram ework
(RPF) has been prepared by the borrower. I f certain project activities requireresettlement, land acq uisition o r certain pe ople lose incom e o r access to n atural resources
a Resettlement Acti on P lan (RAP) wil l be prepared in compliance with the Wo r ld Bank
Poli cy o n Involuntary Resettlement (OP 4.12) to ensure that these peo ple don’t beco me
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poorer then they were before the project intervened. A Resettlement Act io n Pla n (RAP)
or a sm all Enviro nmen tal Assessment (EA) might be needed in case check dams, anti-
erosion structures, mini dams, markets or other infrastru cture will be built. The Technical
Secretariat o f the Ma tch ing Grant Mechanism, to b e financed under the project, wil l
screen sub-projects and identify i f a RAP and/or a small EA study as part o f thefeasibil i ty w i l l be needed.
11. The project will loo k carefully int o the po sit ion o f share croppers in the irr igation
schemes, where share cropping i s more common and in the watersheds where share
cropping i s less common. The project will take care that the capacity o f the private
operators i s no t strengthened at the expense o f the smallholders (marg inalizat ion o fvulne rable groups).
ESMP Implementation and Monitoring
12. The implementat ion and the monitor ing o f he ESMP wil l need to be carried out
per region. One o f the Technical Assistance attached to the DRDR and to be f inancedunder the project, needs to be qual i f ied in environmental and social management issues
and will be responsible for the implementation and monito ring o f he implementation o f
the ESMP .
Communication Plan
13. Com munic ation between the differe nt projec t components i s fundamental for an
adequate implementation o f the project and to build synergies. One o f the Technical
Assistance in the DRDR financed by the project needs to be responsible for the
communication between the components, but also for comm unication with other regions
and the national level and the media.
A n n e x 11: Project Preparat ion and Supervision
Madagascar: Irri gat ion and Watershed Ma nagement Project
Planned Actual
PC N review June 28,2004 June 28,2004
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Ini tia l P ID to PIC October 22, 2004 October 22,2004Ini t ia l ISDS to PIC August 25,2004 August 25,2004
Appra isal June 6,20 06 June 6,2006Nego tiation s September 13,2006 September 14,2006
Bo ard RV P approval November 14,2006Planned date o f effectiveness February 28,20 07
Planned date o f mid-term review Ma y 2009Planned closing date August 3 1,201 1
Key institu tions and persons responsible for p reparation o f he Project:Ministry o f Agriculture, Livestock and Fisheries, B run o Rakotomahefa, Rad0
Rakotondralambo
Bank s ta f f and consultants w ho worked o n the Project included:
Name Ti t le Unit
Ziv a Razafintsalama Team Task Leader, Sr. Rural AFTAR
Sofia BettencourtMohamed Arbi Ben-Achour
Soulemane Fofan aSuzanne Mo rri sGervais RakotoarimananaSylvain RambelosonLova N iaina RavaoariminoPaul Jean Fen0Eavan 0 Halloran
Christophe CrepinGilles Veui l lot
Erik a StygerRobert Robelus
Patrick Labaste
Development
Lea d Operations Of fice rSr. Social Scientist
Operations OfficerSr. Finance OfficerSr. Financ ial M anagement SpecialistSr. Procurement SpecialistProcurement AnalystEnvironmental SpecialistSr. Country Officer
Lead Environment SpecialistSr. Counsel
ConsultantConsultant
Lea d Agriculture Economist
AFTEN
AFTCS
AFTARL O A F CAFTFM
AFTPCAFTPCAFTEN
AFMMG
AFTEN
LEGAF
AFTEN
AFTAR
AFTAR
Bank funds expended to date o n Project preparation:
1. B an k resources: US$1,250,567
2. Trust funds: 03. To tal: US$1,250,567
Estimated Approva l and Supervision costs:1. Rem ain ing costs to approval: US$18.00 0
2. Estimated annua l supervision cost: US$35.000
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Annex 12: Documents in the Project F i le
Madagascar: Irrig atio n and Watershed Managem ent Project
Bank Reports
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Aide-memoire - April 2004 mission
Aide-memoire - July 2004 mission
Aide-memoire - June 2005 mi ssi on
Aide-memoire - Ma rch 2005 mission
Aide-memoire - November 2005 missionAide-memoire - June 2006 miss ion
Aide-memoire -November 2007 mission
Aide-memoire - February 2008 mission
Aide-memoire - June 2008 mission
Prep arat ion Studies - W o r k i n g P a p e rs
I rr iga t ion and Watershed Management Poli cy Letter
Document de t ravai l sur la Skcurisation Foncibre, v ersion provisoire, December 2005
Renforcement des capacitks des parties prenantes dans l e projet Bassins Versants
PCrimbtres Irriguks, July 2005
Etude des FiliBres, December 2005
La nd Titles, Investment, and Agric ultural Productivity in Madagascar, Octo ber 2005
Lan d and Property Rights Review, Draft
Synthesis o f he Preparatory Studies on Interve ntion Sites - Lac Aloatra
Synthesis o f he Preparatory Studies by Intervention Site - Andapa site
Synthesis o f he Preparatory Studies by Intervention Site - Itasy site
Synthesis o f the Preparatory Stud y by Intervention Site - Marovoay Site
Analyse Institutionelle et Juridique du Progra mme Bassins Versants PCrimetres
I r r i g uC s , October 2005
Cadre de Politiq ue de Rkinstallation -Marc h 2006
Evaluation Environnementale e t Sociale Rkgiona le - February 2006
Plan de G estio n des Pestes et des Pesticides - March 2006
Irrigat ion and Watershed Development Policy on July 12,2006
Annex 13: Incremen tal Cost Analysis
Madagasca r: Irriga tion and Watershed Management Project
1. T h i s section discusses the incremental costs eligible for GEF funding for the“Irriga tion and Waters hed Mana gemen t Project”, defin ed as the difference betwee n the GEF
alternative scenario an d the IDA baseline. Fo r each o f he four components o f he project, the
section will:
0 Identify the baseline,
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0 Describe what wo uld happen i f he baseline i s mplemented,
0 Indicate the costs o f the baseline,
0 Descr ibe the alternative scenario,
Descr ibe the expected benefits under the alternative scenario,
Report the cost o f he alternative and the increm ental cost.
2. The relations hip between the activit ies o f each component and the environmental
benefits generated i s synthesized in the below tables. The Incremental Cost Mat rix i s reported
at the end o f the section. As mo st o f the decisions, practices and technologies that the
beneficiaries o f the project w i l l adopt cannot yet be determined, the analysis favors a
qualitative approach.
Component 1: Development of Comm ercial Agriculture
3 . The objective for this component s to la y the foundations fo r im prove d market access
and sustainable intensification and diversification o f rrigate d and rainfed agricultural systems
in the project’s watersheds.
(a) Baseline:
4. T h i s component will promote agricultural development in lo wl an d and upland areas.
The aim will be to imp rov e (a) access to mar ket and marke ting systems in order to reduce
costs an d increase fa rm gate prices, (b) added value through diversific ation int o higher added
value products and agro-processing, (c) capacities o f farmers (male and female), farmers
groups and profession al organizations, and (d) agricultural product ivi ty through better access
to extension, improved technology, inputs, and credit. T h e component includes two sub
components: one in vo lv ing activit ies that largely depend on public/collective initiative; the
other one dep ending essentially on demand fr om stakeholders.
@) Exp ected results und er the baseline scenario:
5. The results expected under this component will be the increase in number o f producer
organizations, unions, a nd federations o f active producers, the increase in he vo lume o f cred i t
6 . GEF funding will contribute to assuring that intensification and diversification o fagricultural product ion will be based on sustainable la nd management principles . These are
based on improved organic matter management through improved rotations, cover crops,
impro ved fallows, agroforestry technologies and divers ified and loc ally adapted varieties and
crops. T h i s w i l l lead to improved above-ground and below-ground carbon sequestration,
increase o f agrobiodiversity within the cropping systems and reduce pressure on natural
habitats, and thus secure imp ortan t global enviro nme ntal benefits. The GEF grant will be usedfo r capacity strengthening o f echnicians, and farmers in agroecological techniques and SLMprinciples, and by supporting adaptive research and dissemination o f mpro ved technologies.
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For more details o n activities see Ann ex 4. S pecial attention wil l be paid to upland systemsthat are based on slash-and-bum ag riculture (tavy), wh ic h causes deforestation, threats to
biodiversity, carbon loss and soil fer t i l i ty loss. The improvement will need more t ime andeffort then the systems downstream area that lend themselves better to agricultural
intensification.
7 . These activities w i l l contribute to achieving the SIP Result 1 SLM applications on the
ground are scaled up in country-defined priority ago-ecological zones, and Result 3:
Comm ercial and advisory services fo r S L M are strengthened and readily available to l an d
users. The activit ies are rooted in the SIP components 1 and 3 (more specifically the
subcomponents 1.2, 1.3, 1.4, 1.5 and 3.2). In addition, IDA funds will specifically support the
SIP sub-com ponent 3.3 and 3.4 a nd 3.5).
(e) Expected ocal and global benefits under the GEF alternative(OP15)
Activities
Technical
assistance,
t ra ining o ftechnicians an d
farmers, and on-farm research o f
agro-ecologicalproduct ion
techniques
Direct impact and local
environmental benefits
Improved loca l capacity
(technicians, exte nsio n agents and
farmers) in mpleme nting agro-ecological fa rming techniques
0 Improved agricultural product ion
based ono Technical improvement through
ago-e cologic al and agroforestry
techniques.
management and nutrient
recy cling through organic mattermanagement,
o Improved so i l fert i l i ty
o Improved protect ion o f soi ls
Global environmental
benefits
Increase in carbon
sequestration, so il carbon,
above-ground carbon(through cover cropping,
relay cropping,
agroforestry)Increase in agrobiodiversity
(through diversification)
and below-groun d
biodiversity (through
improved s oi l organic
matter status)Reduced environmental
degrada tion and pressure o n
integrated pest management
Divers if ication o f agricultural
produ ction system
Improved ecological resi lience o f
agricultural system, with improvedresistance to climate v ariability
Availa ble alternative farming
techniques to slash-and-burn
practices, through agro-ecological
and possible restorat ion o f
ecosystem integrity
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techniques, improved nutrient
cy clin g and targeted inputs,
agroforestry and horticultureReduct ion o f pressure o n forests,
and protects biodiv ersity
GEF Alternative costs: 12,460,000 USD (IDA, Beneficiaries and GEF)
( f ) Incremental cost: 2,500,000 U S D GEF. The incremental cost wil l f inance activit ies suchas the technica l assistance to the project, t rai ning o f technicians and farmers, and
adaptat ion o f ne w techniques thro ugh on-fa rm research.
Component 2: Irrigation Development
8. The object ive o f this component i s to lay the foundations for impro ved management,maintenance and sustainability o f irrig ati on services provis ion in four large-scale imgation
schemes through rehabilitation o f irrig ati on infrastructure, capacity strengthening o f
stakeholders and clarif icatio n o f roles and responsibilit ies, and establishment o f an
appropriate incentive framework.
(a) Baseline:
9 . The component will contribute to improving the quali ty o f irr iga t ion services and
operation and maintenance (O&M) o f the irrigation schemes. The project will finance the
rehabilitation o f irrigation and appurtenant infrastructure, including technical design studies,
implemen tation of works and their supervision. In addition, the project will fund theparticipatory preparation o f a Scheme Deve lopment Plan (SDP) and an annual Performance
Contract (PC), negotiated between (F) W A S , the Communes and Regions, and MA EP . The
project will also prov ide support to stakeholders during implementation o f the PC, including
capacity strengthening, development o f a strategy for mob ilization o f water users, annual
evaluation o f performance indicators a nd user satisfaction surveys.
(b) Expected results under the baseline scenario:
(c) Baseline cost: 17,470,000 U S D (15,670,000 USD IDA and 1,800,000 USDBeneficiaries)
(d) GEF alternative scenario (OP15):
11. IDA funding wi l l b e used for irrigation rehabilitation (infrastructure work) andcapacity strengthening o f water users associations fo r the management o f the i rr igat ion
schemes. There will be no addit ional GEF funding to this component. Aspects o f interests to
GEF, such as env ironm ental management in relation to agricultural improvement i s covered
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under component 1 and the environmental management at the watershed or landscape level
with global environmental impacts are found under component 3.
(e) Expected local and global benefits under the GEF alternative (OP15)
12. Environm ental benefits with signif icant impact on irr iga t ion schemes wil l be created
through GEF incremental funding under component 1, 3 an d 4. Reduced sedimentation o f
irrigation infrastructure (which reduced O&M costs) wil l be a result f rom overal l GEF
increment.
GEF Alternative costs: 17,470,000 U S D (15,670,000 USD IDA and 1,800,000 USDBeneficiaries)
( f ) Incr eme ntal cost: 0 U S D GEF
Component 3: Watershed Development
13.
o f watersheds inclu din g irrig ated and rainfe d agriculture, the conservat ion of he natural
heritage, a nd improv ed produc tivity o f he natural resources.
The object ive o f he component i s to .dy the foundation s for sustains .e management
(a) Baseline:
14.management o f watershed and b) investments f or watershed protection.
T h i s component will finance the a) plann ing and capacity building for the sustainable
15. The proje ct will finance technical assistance to prepare a watershed management pla n
for each o f the four project zones. I t wi l l include (i)oning and description o f land us e
systems, ecosystems, settlements, institutions and partners, (ii)trategic analysis o f erosion
problem s fo r d ownstre am sedim entation and natural resources degradation; (iii)specific and
detailed analysis to define pro ject activities, and (iv) establishing a baseline for monitoring
and evaluat ion o f component results. The project wil l also support land tenure security
through the installation o f ntercomm unal ‘Land Tenure Wind ow, that assist in recording non-
works favorin g biolo gical methods and techniques. Possible mechanical works will be built,
favorin g lo cal manpower.
@) Expected results under the baseline scenario:
17. Successful impleme ntation o f this component wil l resul t in four WatershedManagement Plans that will provid e a diagnosis o f natural resources and ide nti fy pathways o fintervention s fo r sustainable lan d and water management at the watershed lev el. In addition,
hot-spot erosion will be identified, strategies developed for their control and erosion control
works implemented preferably with the participa tion o f concerned stakeholders. Thro ugh
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im pro ve d lan d tenure security, farmers w i l l be more willing to invest into and protect their
lan d fr om degradation.
(c) Baseline cost: 1,9 10,000 USD (1,820,000 U S D IDA and 90,000 U S D Beneficiaries)
(d) GEF alternative scenario (OP15):
18. GEF contribution will complement IDA funding by addressing longer-term
environmental and land degradation issues at the watershed level, that negatively impact
lo wl an d and upland agricultural produc tion systems as we ll as global env ironmental goods
and services. M os t imp ortant degrading la nd uses are pasture management based on pe riodic
burning, extensive agricultural practices based on slashing (primary forest or fallowvegetation) and burning to produce food crops such as upland rice. Additional destructive
forest extraction practices concern logging, charcoal production, firewoo d collection, over-
ex tract ion o f N lT P, and hunting o f emurs and small mammals. These act ivit ies contribute t o
natural resource degradation, depletion o f vegetation cover and biodiversity. (See also An ne x
16 f or land degradation analysis). Often, these extensive la nd use practices d o n ot even a l low
farmers to achieve satisfactory incomes.
19. GEF funding will be used to address these land degradation issues through aparticipatory and integrated approach, and will provid e technical assistance to develop lan d
use alternatives that should encourage loc al popula tion to take re sponsibility and engage in
the sustainable management o f their na tural resources. The approach will include under sub-
component 3.1: a) establishing a part ic ipato ly zon ing with the stakeholders at the sub-
watershed level to determine optim al la nd use according to topography, current lan d use and
land rights, diagnosis o f soil fe rtil ity and s oil prod uction potential, location and characteristics
o f water sources and streams, and the orig in and pathways o f erosion; b) environmentalawareness rais ing campaigns; c) tr ain ing an d capacity strengthening in alternative sustainable
NRM practices according to stakeholders’ needs; d) provision o f support to environmentaland other communication and negotiation platforms that influence natural resources
management at the watershed level, an d e) the establishment o f an Integrated Know ledge and
inclusive dialogue and advocacy o n S L M strategic priorit ies, enabling conditions, and
deliv ery mechanisms established and ongoing; and resu l t 3 : comm ercial and advisory services
fo r SLM are strengthened and rea dily a vailable to la nd users. These activ ities are also rooted
in the SIP Component 1: Supporting on-the-ground activities for scaling up (1.2, 1.4, 1.5),
Component 2: Creating a conducive enabling environment for S L M and more specif ical ly the
sub-components (2.4, 2.6, 2.8.), and Component 3: Strengthening comm ercial and advisoryservices for SLM (3.1, 3.2).
Expected local and global benefits under the GEF alternative(OP15)
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Direct impact and local
environmental benefits
Global environmental
benefits
Activities
Increased awareness o fstakeholders on
environmental issues at
the watershed leve l and
improved capacity o f
stakeholders forenvironmentally
sensitive decision-
mak ing and planning that
impacts environmental
conditions at the
watershed le ve l
positively, and at the
same time provides loca l
stakeholders with
environm ental services
that impro ve land
product ivi ty and livingconditions
1.2. Participato ry watershedmanagement plan s
1 3 . support to
environmental
commu nication platforms
D In format ion exchange
SLM tc)
Improved nformation
a Improved capacity o fstakeholders to integratethe creation o f global
environm ental benefits
in to their activities. T h i s
will result in he design
and implementation o f
participatory watershed
management plans
where the creation o fglobal environmental
benefits at the
watershed le ve l will beconsciously integrated
(such as soil (carbon)
protection, biodiversity
conservation, wa ter
resources protection ,increased carbons
sequestration throug h
exihanges favorscoordination and
collaboration and allows
for strategic decision
mak ing by variousstakeholders to address
global environmental
1.4. Awareness campaigns,
training a nd capacity
strengtheningo n
environme ntal issues
environmental and rura l
development activit ies
Improved knowledge
and capacity in regards
to la nd degradation
impacts as w el l as
exis ting alternatives by
o Rural populat ion
o Loc al and regional
sta f f (technical
Increased knowledge
and awareness o n globa lenvironm ental issues at
the loca l and regional
level will al low for
strategic decis ion
mak ing by various
stakeholders (rural
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1 5. Support to o f
commun ity based land
tenure secu rity
1.6 Integrated Knowledge
and Information System or
SLM.
services, NGOs)N ew ly created or
reinforced NRM farmers
groups or associationswith improved capacity
Secured com munity lan d
rights wi ll provide
incentives for improved
NRM practicesEstablish ed management
plans provid e
communities guidelines
on volumes for
extraction, management
practices, and info rm o n
long-term product ivi ty o f
resourcesStimulates
environmental
stewardship o f
communities
Will mproveproduct ivi ty and
pro f i tab i l i ty o f NR use.
Collect ion and dif fus ion
o f nternat ional andnational knowledge w i l lal low for an in formed
development,
environment, private
sector etc) to engage in
S L M act iv it ies thatcreate globa lenvironmental benefits
(carbon sequestration,
increase in agro-
biodiversity)
Ma inta in ecosystem’s
integrity through
sustainable extr actio n
and harvest o f productsfro m natural habitats
Protect biodiv ersity by
mainta ining habitats
Avo ided deforestation
due to community land
rights (avoided carbon
loss)
Increased availa bility o f
knowledge and awarnesso n SLM issues and
options at the local,
2.2. Revegetat ion o f
com mun al lan d (pastures,
reforestation, protectio n o f
natu ral forests)
scaling up at the
landscape level, and
beyon d at the national
leve l
Pla nted fodd er grasses
and imp roved pasture
management w i l lcontribute to
o mpro ved cattle
nutr i t ion and
environme ntal benefits
Impro ved above andbelo w ground carbonsequestration (fodd er
grasses, re fore statio n)Avo ided carbon loss
(pasture fires,
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product ivity, whic h
enables im prove d crop
and l ivestock
integrationo regenerat ion o f
vegetation
o reduce d sheet erosion
Reforestation will
contribute to impro vedo Fuelwood and
construction wo od
supplyo Erosion controlRegenerat ion o f natural
vegetation will
o provide multiple
products for extraction
(fuelwood, medicinalplants, wild f rui ts and
other foo d plants)
o reintroduce nativebiodiversity within
produ ction landscape
Protect ion o f natural
habitats will contribute
too Biodiversity
conservat ion o f many
endemic and
endangered species
regu latory services and
o Protect ecosystem
deforestation, reduc ed
forest product extraction)
Regenerat ion o f nat ive
vegetation increasesabove and below gro und
biodiversity
Reduc ed pressure o nprim ary forests, leads to
improved protect ion o fo biodiversity
o mportant
environmental
regu latory services suchas wate r source
protection (Marovoay)
farm, dissemination o f mproved technologies, part icipatory mo nitori ng o f development
processes.
Component 4: Project M anagement
21, The objective o f this component i s to manage and use resources in accordance withthe project’s objectives and procedures, and to put in place a pol icy framework that i s
favorable to upscaling o f he project at the national level.
22. Baseline: Management o f he project, including (a) provision o f techn ical assistance,
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tra ining, of ice equipment and vehicles, minor of ice upgrading works, audi t ing and
evaluation studies, and incremental operating costs in support o f project management, (b)
overall project planning, quality oversight, procurement, financial management, and
mo nit ori ng o f project activities; and (c) outsourcing o f quality oversight through independentfinancial and technical audits, and evaluation o f project activit ies. Project management will
encompass all four target watersheds as well as national level coordination. Projectmoni tor ing will be undertaken at internal and external levels. T h i s component will also
include support to nationa l policies.
(a) Expected scenario under the baseline scenario: Successful implementation o f thiscomponent will result in efficient implementation arrangements, effective oversight,
monitoring and evaluat ion o f project activities.
(b) Baseline cost: 3,450,000 U S D (IDA)
(c) GEF alternativ e scenario (OP15)
23. GEF funding will contribute to the project monitoring and evaluation system by
f inancing the satellite images and their interpretation to mon ito r the global an d environmental
indicators in order to assess imp act o f project activit ies o n land degradation, carbon
sequestration, biodiver sity, habitat protection , an d area under SLM. GEF will also contribute
to the costs o f echnica l assistance to M&E and the project implemen tation team, and the f ina l
evaluat ion o f the project. On the policy support side, GEF will co-finance with other donors
the development o f he Country Strategic Investment Fram ewor k for SLM.
24. The activit ies will contribute to achieving the SIP result 4: targeted knowledge
generated and disseminated and mo ni to rin g established and strengthened at a l l levels. They
are also rooted in the SIP component 4 and more spec ifically in the subcomponents 4.4. and
4.5.
Expected local and global benefits under the GEF alternative (OP15)
indicators, and provision o fsupport to pro jectimplemen tation team
causes, processes and
dynam ics associatedwith lan d degradation
environmental
information system an d
environmental
indicators
knowledge will be
Improved
State-of-the-Art
the projectIn fo rm g lobal
community, pol ic y
makers, research, and
development
communit ies on projectoutcome.
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Nat ional leve l multi-
partner, multi-sector SLM
investment framework inthe BVPIprogram context
i s establishedand under
implementation
available at local evel
Al ignment o f donors
and stakeholders at
local, region al andnational leve l will be
possible in regards o f
S L M approaches and
SLM interventions.
Scaling up SLM will
allow achieving
U N C C D N A P andN EPAD ’s C A AD P an d
E A P
(d) GEF Alternative costs: 4,430,000 U S D (GEF + IDA)
(e) Incremental cost: 980,000 USD GEF Incremental costs will cover the reinforcement o f
the M&E system with GI S and the participatory mon ito rin g at the loca l level.
Incremental Cost Matrix
25 . The incremental costs are calculated as the difference between the GEF alternative
scenario an d the IDA baseline scenario. The results are repo rted in the matr ix be low. As most
o f the decisions, prac tices and technologies that th e beneficiaries o f the project will adopt
cannot yet be determined, the analysis favors a qualitative approach.
Component 1
Development o f
CommercialAgriculture
Category
Baseline
Estimated
Expenditures
(US $1
9,960,000
Local Benefit
Increase in producerorganizations,
increased creditallocation, improved
agriculturalproduction through
increased inp ut use
Global Benefit
~
Global environmentalbenefits are minor,
and may results from
reduced pressure onforests or marshesthanks t o agricultural
intensification
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W i t h GEF
Alternative
WM)
12,460,000
(fertilizer, seeds,
pesticides),improved agro-
processing and
marketing o fproducts
Improved oca l
capacity(technicians,extension agents and
farmers) in
implementing agro-
ecological farming
techniques
Improved
avai lab il i ty o f a widerange o f agro-
ecological
technologies at fa rm
level
Increased
agriculturalproductivi ty thanks
to agro-ecological
and agroforestrytechniques
(including improved
rotations)
Improved erosion
control on upland
fields thanks t ovegetative measures
especially in areas
w i th s t i l l high forestcover such as Andapa
Significant globalenvironmental
benefits through:
Increase in carbonsequestration (soi l
carbon, above-ground
carbon: covercropping, relaycropping,
agroforestry)
Increase in agro-
biodiversi ty andbelow-ground
biodiversity (through
impro ved soil organic
matter status)
Reducedenvironmentaldegradation and
pressure on na tural
habitats foragricultural fields
(deforestation) due to
satisfactory and
increased agricultural
production onexisting fields;
result ing in
Reduced carbon
Component2
Irrigation
Development
Category
Baseline
Estimated
Expenditures
(U S $)
17,470,000
Local Benefit
Rehabilitated
irrigationinfrastructure and
well organized andfully functional waterusers associations
Global Benefit
Global
environmentalbenefits minor aspeople mayconcentrate ocultivate lowland sand abandon
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Component3
WatershedDevelopment
With GEF
Alternative( S W
Category
Baseline
17,470,000
Estimated
Expenditures
(US $)
1,9 10,000
Significant
environmentalbenefits on irrigationschemes will be
created hrough GEF
incremental fundingunder component 1,3and 4.Reducedsedimentation o firrigation
infrastructureReducing O&M
Improving
costs
irrigation water
Local Benefit
Reducedsedimentationthrough strategicerosion control
WS M master planimprovesknowledge base onresources and loca ldevelopment goalsand needs
degrading upland
Global Benefit
Some global benefits:
Improved knowledge anddecision making onsustainable managemento f natural resources andbiodiversity protection
Reduced and degradation(upland soil loss througherosion, lowlandagricultural surface loss
W i t h GEF
Alternative
( S W
4,330,000 Improvedcoordination and
collaborationbetween
environmental and
rural developmentstakeholders and/ororganizations
Improved local
capacity toencounter land
Significant global
benefits:
Improved nformation,
knowledge and decision-
making on globalenvironmental benefitsthrough loca l actions.
Protect globa lly
significant ecosystems(forests, wetlands, lakes)
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2,420,000 .
degradation wi thalternative lan d us e
Securedcommuni ty landrights
Management plans
for sustainable us e
and extraction o f
NR
Improved
landscape
product iv i ty o f
communal land:pastures,
reforestation plots
and protect ion o f
natural habitats
Improved
productivi ty in
fragile upper
watersheds o fprivate agricultural
land hrough agro-
ecologicaltechniques.
Ma inta in ecosystems'
functional integrity (e.g.
protect ion o f watersources) through habita t
preservation
Protect glob allysignificant endemic
biodiversi ty withi n natural
habitats.
A vo id deforestation,
burningo f pastures,fallow vegetation, over-extraction o f forest
products and thus avoid
carbon loss
Improve carbon
sequestration in soils andabove-ground throu gh
agro-ecological
techniques, agroforestry,
reforestation andregeneration o f natural
vegetation
Project Basel ine
Management
Estimated
Expenditures
(U S $)
3,450,000
Local Benefit
M&E system to
mo nitor basel ineactivities
Effect ive project
management
Global Benefit
Limitedknowledge
o f and degradation,and ecosystem
dynamics due to
l imited moni tor i ng o f
ecosystem a nd la nd
degradation processes
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TOTAL
Alternat ive
Basel ine 32,790,000
With GEF 38,690,00021Alternat ive
( S LM)
I ~ L M ’I Increment
5,900,000
4,430,000Comprehensive
mechanism
established fo r
mon i to r ing o f
NRM S L M a nd
land degradation
processes and
trends
Signif icant
contr ibut ion inquanti fying the
im p ac t o f S L M on
global environmental
benefits
Annex 14: Technical Annex La nd Degradation in Madagascar
Madagascar: Ir rig atio n and Watershed Management Project
La nd degradation in Madagascar
1. La nd degradation i s one o f the m ost serious and widespread problems for the
agricultural sector in Madagascar. The degradation dynamics in he uplands and lowlandsare often l inked and reinforcing each other. With the stagnation o f yields in the irrigated
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low lan d areas and demographic growth, farmers extend their ag ricultura l activities on the
hillsides. Upper watershed land use i s often based on extensive and unsustainable
management practices, the most important being lack o f eros ion control and lack o f
improved soil fertility management on agricultural plots, slash and bum agriculture ortavy, and the frequent burning o f pastures. La nd degradation i s also caused by
deforestation for agricultural purposes, with consequence o f ncreased carbo n emissions,
biodiv ersity loss and dec linin g regulatory ecological services. These practices not o nlycontribute to the degradation and lo w produc t ivi ty o f up lands but also impact lowland
agriculture significantly. Upland soil erosion and water surface run-off is causing
sedimentation fo r downstream infrastructure, contrib uting to the reductio n o f cultivate darea under irrigation, loca l f looding o f r ice paddies in the rainy season and water
shortages in the dry season
2. Despite Madagascar’s important assets in irrigation infrastructure, pastapproaches have failed to achieve great success in boosting yields and reducing poverty
in rural areas, mainly as they lacked an integrated approach. Today, yields f or irrigatedr ice s t i l l rem ain l o w (-2.lt/ha), and are even lowe r for non-irriga ted upla nd rice
(-1.Wha) and slash-and-burn uplan d rice (-0.8tha). Ne xt to poor maintenance o finfrastructure and poor water management, vulnerability towards extreme events such as
cyclone damages, environmental challenges, such as erosion and land degradation areparamount. The seriousness o f the lan d degradation pro blems and interconnectedness
between upland and lowland land use has been acknowledged by the recently createdNational Irrigation and Watershed Management Program (PNBV-PI), which i s par t o f
the PRSP. The project will be par t o f the Nation al Program that aims to combat rural
pover ty through sustainable improveme nt o f the living condit ions and incomes o f rural
populations in irrig atio n schemes and surrounding watersheds, and through the efficien t
and sustainable development o f natu ral resources.
3. The project wil l focus its intervention on four large-scale public irrigationschemes (out o f six in otal) that cover 33,000 h a (out o f 81,000ha in otal). The four sites
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* * *
* *
MM3
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0 0 0 . 0 0 0 0 0
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D
Site description an d lan d degradation at the four sites Marovo ay, La c Itasy, Andapa
and Alaotra
N o M W S
5. A s the four sites have different climatic and geographic conditions as well as
different land us e histories, a short description o f he four sites with the most importantissues o f and degradation is pro vide d hereafter.
Size o f W S R ice p la in N o N o
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1 (Sahamaloto)
13 (according
to irr igation
sections)
1 SubWS(Lokoho),
multitude o fM W S
4
(ha)
Total: 6,400 ha356 km2
Size o f
communes:
5750 km2 12,000 ha
Size o f
communes: 4,460 ha4280 km2
Total: 1040
km 2
20,000 ha
Alaotra
Marovoay
Andapa
Itasy
Alaotra
Marovoay
Andapa
Itasy
Climate
Tropical
temperatehighland climate
Sub-humid
tropica l climate
H o t humidtropical cl imate
Altitude
750m
20 m
470m
1220m
Annual
Rainfa l l (mm)
1100-1200
1540
> 2000 (1800-
2000 plain,2500 hil l tops)
Communes
8
10
12
12
Rainfa l l
days(number)
100- 150
90
240
--
population
107,900
175,000
150,100
227,700
Av annual
tem p "C (avmin-max)
20 (15 - 27)
28 (24.4 -29.3)
(19.1 - 25.1)
Marovoay
6. The Marovoay pl ain is a r ice product ion zone o f pr ime nat ional importance,
situated in the Boeny Region, about 80 km South-East o f Mahajanga. The riverMarovoay i s a tr ibutary on the right bank o f River Basse Betsiboka, in the upper delta o f
the river. Subjected to quasi-complete submersion during the annual f looding o f RiverBetsiboka, the development o f the valley started in the ea rly 20th Century for off-season
rice prod uction. Schemes supplied through pumping fr om Ri ver Betsiboka were added to
the gravity systems fed by run-of-the-river and storage dams. The scheme is divide d int o
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13 completely independent irrigati on sectors, f ed f ro m a numb er o f different sources. The
entire system i s facin g serious O&M challenges. Fo r a tot al area o f about 20.000 ha, an
estimated area o f 12.000 ha was cu ltivated in 2004. Beneficiaries o f al l plots developedduring the successive programs were main ly imm igra nt populations fro m other regions o f
the country. 90 percent o f he people o f 122,000 are immigrants. The ethnical diversity
implies a weak social cohesion, which i s l im i ted to the vil lage level. The percentage o f
sharecroppers is today very high. Until recently, G o M was responsible for O &M o f
irrigation schemes and pumps, but State funds for O&M o f even ‘non transferable’infras tructu re are nowadays uncertain. Establishment o f wate r users associations, unio ns
o f associations a nd federations has not resulted in the emergence o f an adequate
operational mechan ism f or sustainable O&M. The Performance Contract signed with theFWUA for the period 2001-2003 was not renewed and funds allocated for 2004 were
reallocated.
7. The m ai n watershed serving the Marovoay irr igation scheme is the Betsiboka
watershed, one o f he largest watersheds in Madagascar with an extension o f 40,000km2whose hydrology is determined hundreds o f ki lometers upstream. During the rainy
season, the irrigation scheme is submerged by the waters o f the river, depositing
sediments o n the ric e paddies. Whereas qu ality o f these sediments used to have a
fertilizing effect, the current sediment quality i s reported to be coarser and less fertile.The submersion o f perimeters as w el l as the high pumping costs requires annual
rehabi li tation o f the irrigation systems, thus making the maintenance expensive and theoverall economic pro fitab ility uncertain. The culti vatio n season can start once the water
has receded fr o m the plain. The m ai n cropping season corresponds to the dry season fr o m
April to October. Water availabil i ty for irr igation i s therefore critical and gets oftenscarce towards the end o f the cu ltivation cycle. Sub-watersheds o f the Marovoay River
and i t s tributaries supply a major part o f he irr igation system. Their sources are ma in ly
located in the zone o f he Ankarafantsika Nat iona l Park, a primary forest located on the
hillcrest. Finally, all around the plain, small lateral micro-watersheds with main ly
the end o f the ir riga tion season. This results in inundations o f r ice f ields after strongrains, and lack o f irr igation water towards the end o f the cropping season. As many o frice farmers ar e sharecroppers, they are hesitant to pay irrigation maintenance fees.
Agricultural services are weakly developed in the region. There i s only one cult ivation
cycle per year, which i s dominated by rice. The use o f fert il izer is insignif icant and riceyields are overall lo w (1 to 1.5tha). I mpr ove d techniques such S R I are weakly adopteddue to weak control o f water and badly le veled rice fields. O fte n earth dams are damagedby cattle grazing in the paddy fields and often not repaired. In most cases, the upland
population i s not the same as the low lan d ricp growers, thus their interest i s l im i ted toprev ent sedimentation. On the lower parts o f the hillside, the PLAE project works in 10
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out o f 12 communes around the Mar ovo ay plain, to inst all some erosion contro l works.The projec t takes a pa rticipato ry approach and efforts are slo wly translating in effective
results.
9. M a i n degradation factors in the uplands are f i r e use o n pastures, deforestation an d
slash-and-burn agriculture, i l l ic it cutt ing o f wood, and charcoal production. M os t o f the
erosion comes from the extended pasture areas that are pe riod ical ly burned. The fodder
qua lity o f hese grasslands i s very lo w and farmers burn the uplands fo r fresh regrowth.Through frequent burning, no woody species resist. The resistin g grasses gro w in tuffs
and have very ba d soil coverage. Thus, with each rain event sheet erosion at the large
scale i s happening. The Park Service ANGAP i s work ing with surrounding com munitiesand herders to diminish burning activities and to limit fire use to the early season fires.This has allowed to reduce fires to 300 ha in 2004 compared to 2 000 and 3000 h a in the
previous years. Further degradation is provoked through the deforestation and thetraditional slash-and-burn agriculture or tavy. Farmers cut primary forests to cultivate
upland rice. In addit ion, i l l ic it wo od cutt ing and charcoal production i s threatening theprimary forest. Since 2002 this forest is protected and known under ‘AnkarafantsikaNational Park’ covering 130,000 hectares. I t is one o f the last large forest remnants in
Northwestern Madagascar o fdry
dense forest. Over 92 percent o f he wo od y species areendemic. The par k i s r i ch in birds with 129 species (74 percent endemic), reptile s with 70species (87 percent endemic), and has 22 ma mm al species (74 pe rcent endemic).
Lac Itasy
10. The Itasy Region, with i t s Lac I tasy in the center, i s situated about 100 km to the
west o f Antananarivo. The irr igation schemes do n ot have complex infrastructure and
represent independent schemes: Grappe du Lac Itasy 1980 ha, I fan ja 1900 ha, Man gabe
270 ha, Anala vory 140 ha, A mp ary 90 ha, Antanim enak ely 80 ha - or a to ta l o f 4460 ha.
Fo ur sub-watersheds can be distinguished associated with the irrigation schemes: grappe
11. High soil ferti lity and established irrigati on infrastructure, attracted immigrants.
Popu lation density i s high in the region with 107 p e o p l e h 2 in average, reaching up to
200 p e o p l e h in the communes o f Ampa ry and Sarobaratra Ifjana. Consequently,
upland agriculture is very common and often extends over the entire hil ls ide on the
volcan ic soils.'
12. Ric e pr od uct ivi ty increased steadily fr o m 2,4 t/ha in 1998 to 3 ,l t/ha in 2003. This
i s due to im pro ved cul tura l techniques such as imp rove d weeding, SRI, improve d direct
seeding.
13. Theoretically tw o rice crops can be cultivated, the f i rs t extending from July /Aug
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to Nov/Dec, and the second fro m Dec/Feb to ApriVJune. Y ield s are between 2.5 t o 3 t/ha
but can reach up t o 6 tha under SRJ and good water management. With bad watermanagement yields can be as l o w as 0.5 to 1 t/ha. Mo st impor tant crops are rice, manioc,
mais, sweet potato, beans and potato. Fo o d crops make up 90 percent o f he production
compared to 10 percent o f cash crops. Rice occupies 33 percent o f he cultivate d surface,
ma is and beans each 17 percent an d potato 13 percent. Due to irregular water availabil i ty,
farmers adjust their cropp ing cycle accordingly, thus cropp ing can be encountered aroundthe entire year. Live stock produ ction i s most imp ortant and cattle i s used for f ieldwork,
transportation, and as a mon etary safety net.
14. Althoug h most o f hese schemes benefited fro m projects implemented fro m 1998
to 20 00 (project PPI 2), they are currently facing serious O & M problems o f he i rr igation
and drainage systems, due t o erosion o f watersheds and lack o f maintenance o f the
systems. Today, 30 - 50 percent o f he schemes are no lo nge r adequately i rrigate d. Given
these problems, the Water User Associations ( W A S ) have stopped collecting
maintenance fees fo r several years, since a greater par t o f he users refuse d to pay. The
actions o f the W A S re l im ite d to maintenance works carried out by interested users.
The p robl em o f water resources management i s common and a serious constraint for
lowland production. Inundat ion o f r ice fields happens periodically during strong and
heavy rainf all events. 1/3 o f the schemes are under inundation risk. On the other hand,
there i s as problem o f wate r shortage in the begin ning o f he rainy season, forcing farmersto wa it fo r the accumulation o f enough rainfall. This often delays planning which
negatively influences the yields. In addition, climate variability during the cropping
season with dry spells and inundations impacts yields negatively. Sedimentation o f the
irrig atio n scheme i s at the or igin o f water management problems. In fanja-Anosibe, fo rinstance, a large part o f he irri gat ion canals are bloc ked with 2 m o f sand o f a 1 2 km o f
canal (Ambohimandroso-Antsira) diminishing rrigate d area significan tly.
lavaka), deep slopes, l i t t l e vegetation cover and lack o f erosion control. Lav aka
formation, nex t to gully erosion and surface soil erosion are very common. This i s
enhance by frequent upland f i res that lea d to sparse vege tation cover. A bo ut one quarter
o f he 1andscapelWS present criti ca l zones o f degradation. L a nd slides and lavakas extend
over 1050ha. T he area under refore statio n stagnates and even regresses whe rereforestation plots are destroyed by f i re or overexploited for fuelwood use.
16. There is a small surface o f emaining primary forest left in the upper watershed o fAmbohimanana whi ch is a Tapia (Uapaca boieri) forest. But this forest is disappearing
progressively. M a n y o f the landless farmers, cultivatin g l ow lan d fields as sharecropper,don't produce sufficiently to cover the basic family needs. They look fore addit ional
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fields in the uplands, as one o f he options, and deforest the st il l available tapia forests. In
addition, people collect fire woo d and produce charcoal fr om the forest. With i t disappearsalso an economic opportunity for very lucrative wild silk production, as the wild silk
moth s native to these forests.
17. The other important natural habitat i s Lake Itasy. Sedimentation o f lake
diminishes its de pth and creates floati ng islands. Fishproduc tiv ity diminished from 25-35t/year earlier o n to 12-13 t/year today. T o what extend this i s due to si l tation or
overharvesting i s no t clear. Loca l ru les for fish extraction have been established and some
fisher associations were created. Their effectiveness in regulat ing f ish populat ion is notknown.
Andapa
18. The Lo koho watershed o f Andapa, is situated in the Sava Reg ion about 100 km
southwest o f Sambava. A vast agricultural pl ai n o f 18.000 ha i s drained by 4 rivers thatmerge into Lokoho River. The plain is surrounded by a concentric landscape with
adjacent agricultural fields that are either upland rice fields based on slash-and-burnpractices or agroforestry plots with vanil la and coffee as ma in crops. Above 900 m
altitude i s the primary forest zone that is very extensive and vast. T he ba sin s bordered inthe North-East by the Marojejy National Park, in the South-West by Anjananaribe
Special Na tur al Reserve, and in the South by the Ma ki ra Special Nat ura l Reserve.
19. Andapa has a ho t humid climate with a mean annual rainfal l o f over 2000m m
distributed over 24 0 days. M ea n temperature varies f ro m 18,8C in July to 24.8C inJanuary. This climate pattern al lows for double cropping o f ice.
20. Fr om 1962 - 1997, the Andapa basin benefited from a development program
received an unsatisfactory rating in 1998 during the evaluat ion o f the EDF project,
particularly: (i)ai lure of pumping i r r igat ion on the Ankai%e perimeter (2100 ha); (ii)
lack o f maintenance o f structures o n a ll perimeters developed by the project; (iii)he
weak capacit ies o f he W A S ; nd (iv) fai led intensif ication.
21. The lowlands have a high potential for agricultural production with relatively
good yields and with the possibil i ty to having two crops per year. Out o f 12,000 h a
plante d rice less then 2,000 are curren tly imgated. The surface cultivated in the pl ai n areestimated to b e During the rai ny season between 9,000 to 12,000 h a are cultiva ted with
yields o f 2 to 3.5 t/ha and in the win te r season betw een 1,000 to 2,000 h a are cropp ed
with y ields o f 1.5 t o 2.5 t/ha. Tavy upland r ice i s cul t ivated on 2000 to 3000 ha with
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average yields below Itha. Sedimentation seems not be as big o f a problem such as in
Itasy, Ala otra or M arovo ay. Nevertheless, the loss o f vegetation cover can provoke la nd
slides that can create large quantities o f sediments. In addition, steep riverb eds can sw ellvery fast during big ra in events and transport la rge amounts o f sediments, wh ic h resulted
in he currently silted-up ir riga tion structures. Th e pl ai n s irrigated throug h small streams
from small watersheds around the basin. This characteristic would support the idea to
encourage and prioriti ze sm all hydr olog ical infrastructure, w hi ch i s easier to manage for
the population, easier to ma intain and wh ich could have a signif icant impact o n people’slivelihoods.
22. The uplands are used throu gh mixed agroforestry systems that contribute to
stabil i ty in income through cash crops such as vanilla, coffee, clove, but also to
sustainable up land management. Mo re problematic for the en vironment i s the tavy system
that i s based on slashing an d burningeither primary forest or fallow land. Deforestation s
an important problem in the region, and is not ef ficie ntly enough stopped despite the
creation o f parks and reserves. One o f the reason i s that there are no efficient and forfarmers feasible alternatives o f uplan d rice cultivatio n available.
23. Maro ieiv National Park and Aniananaribe Special Natura l Reserve have beensupported from 1994 to 2004 by WWF with activities focusing on conservation,
environmen tal training, and ecotourism. F ro m 2000 to 2004 22 la nd rights could betransferred to local communities, all ow ing them to manage and extract products fr om the
natura l forests in the dis tr ict o f Andapa in the peripheral zone o f he protected areas. The
recently established M ak ir a Special Natur al Reserve, the largest reserve in Madagascar,
is receiving support from WCS (Wildl i fe Conservation Society). WCS supportscommunities in the peripheral zone throug h agricultural advise, provid es support fo r la nd
rights etc. Marojejy harbors a remarkably diverse set o f plants and animals, many o fwh ic h are endemic to the area. This i s due pr imar i ly to the wide range o f habi tats found
lemur species, 149 reptiles and amphibians, 35 palms, over 275 fer n species to g ive a fe wexamples, man y o f he species beingendemic to the re gio n and endangered.
Lac Alaotra S ah am alo to Irrigated Perimeter
24. The La c Ala otra watershed forms a vast depression o f around 1,750 km2,with an
average alt i tude o f between 750 and 7 70m , surrounded by eroded hil ls. The lake i sshallow and surrounded by swampy marshes. I t covers an area o f about 220 - 250 km2
(free water surface) an d arou nd 550 km2with surro und ing marshes. The watershed serves
about 80,000 ha o f rice farms, o f wh ic h 30,000 ha are developed. T he watersheds aresubject to strong population density. Deforestation, overgrazing (with bushfires) and
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increasing pressure f ro m ra in-fed crops have seriously degraded the fragile soils o f
slopes, already markedby
numerous lavaka. The effects aresilting-up
o f beds o f r iversand dams, degradation o f derivation and protection o f acil it ies. The climate is a tropical
temperate highland climate with a significant dry season from M a i to October. Me anannual temperature i s 20C, with average maxima o f 26 to 27C and a average m inim a o f
14-15C. Me an annual rain fal l is between 1100 and 1200 mm within 100-150 days.
25. The watershed supplying Sahamaloto irrigated p erimeter stretches over an area o f
356 km2.The irrig ated perimeter has a developed area o f 6,400 ha, o f wh ich 80 percent i s
cult ivated when the rainfall conditions are favorable. Average irrigated surface by
household i s 5.8ha, and on ly 13 percent o f households’ crop o n uplands and 26 percento n baiboho. Average rice yield s are estimated to b e 3.5 tiha. Th e area i s supplied by a
storage dam that was constructed in 1957. The in i t i a l s torage capaci ty o f 26 mi l l io n m3
was gradually reduced to about 13-14 million m3.The scheme was fully rehabilitated in
1988-1989, inclu ding the construction o f a new inta ke tower to increase the volume o f
storage water to 18 m il li o n m3.Emergency repair and reha bil i tation works were init iatedin 1998-1999, but some works could not be completed. The estimated sedimentation
which i s the major environmental threat for rice cultivation that enters yearly into the
retention d am i s 250,000 m3/year. M a i n erosion form s in the area are surface erosion,
gully erosion and lavakas that come from upland areas that are frequently burned for
pastures and have a sparse veget ation cover. The upper watershed i s weakly populated.
The zone o f r ice f ields i s located on the deltas o f he la ke between uplands an d marshes,
where also villages are located along the road, and where most o f human act ivi t ies i s
happening.
26. The ent i re watershed o f La c Ala otra has been designated as a RAMSAR site
(722,50Oha), with 19,971 ha o f lake surface and 23,000 ha o f marshes in 2003,formaliz ing the new regional and national commitment to conserving i t s biodiversity and
27. Alaotra has the largest wetlands in the cou ntry and i s also a center o f endemism.
Three species are endemic to Alaotra, a ll o f which are critically endangered: Alaotran
gentle lemur Hapalem ur griseus alaotrensis, Alaotra l i t t le grebe Tachyb aptus rufolavatus
and Madagascar pochard Aythya innotata. These two endemic bird species may already
be extinct. O f the 50 water bird species recorded at the lake, a fu rther 8 are Madagascar
endemics. Six fish species are Madagascar endemics. The endemic fauna is threatened
due to ma jor en vironmental changes includi ng habitat degradation, over-hunting, over-fishing, competit ion and predation by introduced fish species, siltation from erosion
causing an acidif ication o f the lake, pollution by hum an waste, fertilizers and pesticides
and invasion o f ntrod uced aquatic plants.
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Annex 15: APL Triggers
Madagascar: Irrigation and Watershed Managemen t Project
1.
targets:
Tr iggers for mo ving to the second phase o f he APL include attainment o f he fol lowin g
0 Watershed Master Plans (including Scheme Development Plans and Watershed
Development Plans) and associated Performance Contracts executed satisfactorily;
0 an acceptable institutio nal mechan ism for the funding o f non-transferable irr igation
infrastructure (FERHA) established and operational;
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0 private sector investments in agriculture increased as evidenced by disbursements
under the matching grant mechanism;
0 ASCs established a nd operational in he four project sites;
0 guichets fonciers established and operational in the four p roje ct sites.
2. I t s agreed that achieving these triggers im plie s the follo wing : Watershed Maste r Plans
(including Scheme Development Plans and Watershed Development Plans) and associated
Performance Con tracts executed satisfactorily:
3. W MP s (includ ing WD Ps and SDPs), prepared with full stakeholder involvement, as
evidenced by minutes o f meetings, records, a nd development options that were prepared andpresented to stakeholders.
4. WD P wo uld include land use zoning plans, identif ication o f rr igable and irr igated area, a
local land tenure plan, identification and establishment o f zones under collec tive la nd
management and iden tifica tion and establishment o f zones fo r management transfer tocommunities, identif ication o f strategic anti-erosion works, iden tifica tion o f possible agro-
ecological technologies that require support, identifica tion o f appropriate p roduct ive investments(forestation, revegetation o f and). I t wo ul d also include support options to communication and
negotiation platf orms o f stakeholders within watersheds, conditions reg arding the pa rticipatio n
of beneficiaries and the support that they wil l receive through the matching grant (nature o f the
interventions, capacity to pay). Satisfactory execution involves the implem entatio n o f the
activities that the projec t has committe d to.
5. SDPs would include a section presenting the vision o f stakeholders with respect to
irrigated agriculture, their objectives and the targets that they aim to achieve, constraints
associated with the function ing o f the irrig atio n scheme, as we ll as possible solutions, and
commitments regarding operation and maintenance. Execution o f the SDP involves the
implementat ion o f he PC wil l be allocated in accordance with the leve l o f amb ition expressed in
the targets, and based on the performance in previous years. Satisfactory execution wouldinclude full achievement o f commitments by a ll stakeholders.
An acceptable institutional mechanism for the funding o non-transferable irr iga tion
infrastructure (FERHA) established and operationa l:
7. Identification, adoption and imple menta tion o f appropriate and sustainable fina ncing and
replenishment mechanisms, recruitment o f staff, administrative and financiaVaccou ntingmeasures taken, and disbursements made.
Private sector investments in agriculture increased as evidenced by disbursementsunder th e matching gra nt mechanism
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8. Preparation o f a l i s t with eligible (positive and/or negative) activities, Regio nal SelectionCommittee appointed by GTDR, external rev iew conducted twice a year, and recruitment o f a
regional partner and specialized service providers. Satisfactory implementation implies fulldisbursement o f he match ing grant at the end o f he project.
ASCs established and operationa l in the our projec t sites:
9. Establishment o f ive A SC and platforms at distr ict level, pro vision and rehabil i tation o f
off ice space, purchase o f equipment, coverage o f operational expenses, recruitment o f staff, andcompi la t ion o f a networ k o f egion al partners at the regiona l level. Operationa l imp lies that there
i s a demand fo r the services pro vide d as evidenced by the number o f contracts between farmers
and service pro viders that the A S C has facilitated.
Guichets onciers established and operationa l in the our pro jec t sites
10. Establishment o f five “guichets fonciers” at district level, pro visio n and rehab ilitation o f
offic e space, purchase o f equipment, coverage o f operational expenses and recruitment o f staff.Operational implies that lan d i s being registered as evidenced by the annual progress in landregistration.
11. Triggers for m ovin g to the third phase o f he APL include indicatively:
Satisfactory management o f irriga tion schemes by W A S and watersheds by
sustainable land management groups with adequate support from Communes,
Regions and MAEPInc lus ion o f the nat ional I r r igat ion and Watershed Management Program into
MA EP ’s med ium term expenditure framework;
Annex 16: Statement o f Loans and Credits
Madagascar: Irrigation and Watershed Management Project
Difference betweenexpected and actual
disbursementsriginal Amount in US$ MillionsProject I D FY Purpose IBR D ID A SF GEF Cancel. Undisb. Orig. Frm. Rev’d
P103950 2008
PO74086 2007
PO95240 2007
P103606 2007
PO90615 2006
MG-Governance& Inst. Dev. I1 TA L
MG-Imgation & Watershed Project (FY07 )
M G -Pw r/Wtr Sect. Recovery and Restruct.
MG-Sust. Health System Dev. (FY07)
MG-MultiSec STYHIViAIDS Prev I1(FY06)
0.00
0.00
0.00
0.00
0.00
40.00 0.00
30.00 0.00
10.00 0.00
10.00 0.00
30.00 0.00
0.00 0.00
0.00 0.00
0.00 0.00
0.00 0.00
0.00 0.00
39.78
25.66
6.81
1.66
19.90
0.00 0.00
2.20 0.00
5.37 0.00
-1.16 0.00
12.09 0.00
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PO83351 2006
PO82806 2004
PO74448 2004
PO74235 2004
PO76245 2003
PO73689 2003
PO72160 2002
PO51922 2001
PO55166 2001
PO52186 1999PO01568 1998
MG-In teg Growth Poles
MG-Transp Infrastr Invest Prj (FY04)
MG-Gov & Inst Dev T AL (FY04)
MG-Env Prgm 3 (FY04)
MG-Mineral Res Gov SIL (FY03)
MG -Rural Transp APL 2 (FY03)
MG-Priv Sec Dev 2 (FY02)
MG-R ural Dev Supt S I L (FYO1)
MG-Com Dev Fund S I L (FYO1)
MG-Microfinance (FY99)MG-Com munity Nutrition I 1 (FY98)
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.000.00
129.80 0.00
150.00 0.00
30.00 0.00
40.00 0.00
32.00 0.00
80.00 0.00
23.80 0.00
89.05 0.00
110.00 0.00
16.40 0.0027.60 0.00
0.00 0.00
0.00 0.00
0.00 0.00
0.00 0.00
0.00 0.00
0.00 0.00
0.00 0.00
0.00 1.23
0.00 0.00
0.00 0.000.00 0.00
78.19
36.92
0.67
13.54
7.36
29.74
4.36
8.67
0.41
4.146.90
3.99 -5.09
12.90 12.90
-7.64 0.00
8.27 0.00
-4.00 0.00
15.91 16.87
-0.12 -3.95
-3.23 -3.23
-81.92 -31.92
-1.88 1.20-14.54 0.97.
Total: 0.00 848.65 0.00 0.00 1.23 284.71 - 53.76 - 12.25
M A D A G A S C A RSTAT EME NT OF IFC’s
Held and DisbursedPortfol io
InMi l l ions o f U S Dollars
Committed Disbursed
IFC
Partic. LoanY Approva l Company
1997 AEF G HM
1995 AEF Karibotel
BFV-SocGen
1991 BNI
2005 BNI
Loan Equity Quasi
0.46 0.00 0.00
0.19 0.00 0.00
6.37 0.00 0.00
0.00 2.09 0.00
6.37 0.00 0.00
IF C
0.00 0.46
0.00 0.19
0.00 0.00
0.00 0.00
0.00 0.00
Equity Quasi
0.00 0.00
0.00 0.00
0.00 0.00
2.09 0.00
0.00 0.00
Partic.
0.00
0.00
0.00
0.00
0.00
Approvals Pending Commitment
FY Approval Company Loan Equity Quasi Partic.
2001 Besalampy 0.02 0.00 0.00 0.00
2006 IDA-IFC PCG 0.01 0.00 0.00 0.00
Total pending commitment: 0.03 0.00 0.00 0.00
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Annex 17: Country at a Glance
Madagascar: Irrigation and Watershed Management Project
P O V E R T Y a n d S O C I A LSub-
Saharan Low-M adaga rcar Afr lca Incom e
2 0 0 7
GNlpercapita (Atlasmethod, US$) 320
ON1 (Atlas m ethod, US$ billlons) 6.3
Average annual growth, 2001.07
Population (4 2.6
Mo at recent e st imate ( la tea t year avai lable , 2 0 0 1 - 0 7 )
Poverty (% of populatio n below natlo nalpo vefty ine)Urban population (% of totalpopulation) 29
Population. m id-year (millions) 8 .7
Laborforce(%) 3.3
Life eqecta ncyat birth (pars) 59
600
952
782
2.5
2.6
3651
1298576
749
2.2
2.7
32
57
> e v e l opm e nt d i a m ond*
Life eqectancy
T
Gross
capita enrollmentprimary
1
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Infant mortality(per I000 live births) 72
Chlldmalnutritlon (%ofchildrenunder5) 37
Access lo an improvedwtersource(%ofpopulation) 47Literacy(%ofpopulation age S+J
Gross primaryenroilment (%of school-agepopulation) 0 9
Male 142
Female 07
K EY E C O N O M I C R A T I O S a n d L O N G - T E R M T R E N D S
1987 1997
GD P (US$ billions) 2.6 3.5
Gross capital formation1GDP Q. 1 P.6
Eq ort s of goods and services/GDP 16.6 219
Gross domestic savings1GDP 4.2 4.7
Gross national savingsIGDP 4.4 7.3
Current account baiancelGD P 4. 6 -5.5Interest payments1GDP 4.0 2.6
Total debt1GDP 143.0 115.6
Total debt servicelexports 50.3 26.7
Present value of debtlGDPPresent value of debtleq orts
94
27
5859
94
99
66
2 0 0 6
5.5
24.6
29.7
0.6
16.0
-6.70.4
26.4
4.0
11537.6
65
29
8661
94
QO
69
2 0 0 7
7.3
29.224.7
9.9
113
- 0 . 5
1987.97 1997. 07 200 8 200 7 2007-11
(average annual gro Mh)GD P 0.9 3.1 4.9 6.5 6.1
GDP per capita -2.0 0.2 2.1 3.7 6.1
Eq or ts of goods and services 4.3 14 23.6 4.2 26.1
Access to improvedwatersource
-Madagascar
Lo wincome group
Trade
Capitalformation
Domestic ,
+savings
I
1
Indebtedness
I -Madagascar
Lowincome m u D
S T R U C T U R E o f t he E C O N O M Y
( % o f GDP)AgricultureIndustry
Services
Household final consumption expenditureGenera gov't final consumption eqenditure
Imports of goods and services
M anufactunng
(average annual gro Mh)AgricultureIndustry
Manufacturing
1987 1997
36.2 315
0 . 7 0 . 4
114 11350.1 55.0
66.7 67.5
9.1 7.6
22.5 30.0
1987.97 1997-07
19 2 00 6 2 5
01 2 5
2 0 0 6
27 5
5 3
0 4
57 2
17 6
6 6
40 9
2 0 0 8
2 2
2 7
2 7
2 0 0 7
26.5
6 0P.6
58.4
60.5
9.8
44.0
2 0 0 7
2.4
4.6
4.6
Growth of capi ta l and GDP (% ).3 M 05 (YI 07
-GCF -GDP IGrowth of export. and Imports (YO)50
25
0
Madagascar
P R I C E S a n d G O V E R N M E N T F I N A N C E
D o m e s t i c p r i c e s(%change)Consumer prices
ImplicitGDP deflator
G o v e r n m e n t F l n a n ce(%of GDP, includes current grants)Current revenue
Current budget balanceOverall sumlus/deficit
T R A D E
(US$ mi/l ionsjTotal e.qorts (fob)
CoffeeVanillaManufactures
1987
8 .9
23.0
8 . 0
6.7
17
1967
32 9
34
69
65
1997
4 5
7 3
118
0 9
-5 6
1997
507
e4
0
346
2 0 0 6
0 .6
113
P.0
0.6-9.4
2 0 0 6
96 2
51
46
90 5
2 0 0 7
0 3
9 5
119
0 4
-9 6
2 0 0 7
1097
34
30
1061
E x p o r t a n d I m p o r t l e v e l s ( U S $ mlll.)' " T I3.000
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Total imports (cif)
FoodFuel and energyCapital goods
Evert price ndex 2OOO=WOj
import price ndex(2000=00j
Terms of trade (200O=WO)
B A L A N C E o f P A Y M E N T S
(US$ millions)Ekports of goods and servicesImports of goods and services
Resource balanceNet incomeNet current transfers
Current account balance
Financing tems (net)Changes in net reserves
M e m o :Reserves includinggold (US$ mili ionsj
Conve rsion rat e (DEC, io cal/US$)
40 9
52
55
0 2
94
89
0 6
1987
42 5
552
- a 7-149
141
-122
8 1
-6 9
25
20 . 6
E X T E R N A L D E B T a n d R E S O U R C E F L O W S1987
(US$ millions)Total debt outstandingand disbursed 3,666
IBRD 35
IDA 550
Total debt service 24 5
IBRD 4
IDA 6
Composition o f net resource flowsOfficial grants 66
Official creditors 27 3
Private creditors -15
3oreign direct investment (net nflows)Portfolio equity(net inflows) 0
World Bank programCommitments a8
Disbursements 93
Principal repayments 3
80 2
49
Il7
146
67
0 3
85
1997
77 4
1061
-266
-9 1
182
- 8 6
250-54
28 0
10 8 2
1997
4,099
3
12 P
2 0
4
8
566
2 8
1
14
0
777
0 0
14
1790
377
225
Il78 1
73
2 0 0 6
1646
2,256
-6 W
-60
214
-476
506
-32
532
2,142.3
2 0 0 0
1453
0
636
66
0
26
2,543
235
-3
230
0
0 6
l78
8
2.672
429
262
P 4
152
62
2007
1993
3,10
- {P O
-56
86
-966
1059
-71
602
1673 9
2 0 0 7
0
865
0
6
114
8 6
0
2,ow
l,ow
0I I1 02 03 04 06 OB 07
.Exports almports
C u r r e n t a c c o u n t b a l a n c e t o G D P ( YO )
G: 8 8
A . IBRD E - Bilateral
B . DA D . ther nultllaeral F . PrivateC-IM F G Short-terr
Annex 18: MAP
Madagascar: Irrigation and Watershed Management P roject
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MAP SECTION
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