PROJECT INFORMATION DOCUMENT (PID)APPRAISAL STAGE

Report No.: AB6157Project Name Sustainable management of Nyika Transfrontier Conservation

Area projectRegion AFRICASector General agriculture, fishing and forestry sector (100%)Project ID P108879GEF Focal Area BiodiversityBorrower(s) GOVERNMENTS OF MALAWI AND ZAMBIA

M. Jack Chulu, Acting DG ZAWAPRIVATE BAG 1ZambiaTel: +260 211 278 555 Fax: +260 211 278 555drsaiwana@zawa.org.zmLeonard Sefu, DNPWPO BOX 30131MalawiTel: +265 1 771 111 Fax: +265 1 773 379RKABWAZA@SNDP.ORG.MW

Implementing AgencyHumphrey Nzima, Peace Park FoundationPO BOX 30131MalawiTel: +265 1 755 528 Fax: +265 1 759 832nzimatfca@malawi.net

Environment Category [ ] A [X] B [ ] C [ ] FI [ ] TBD (to be determined)Date PID Prepared November 25, 2010Date of Appraisal Authorization

December 13, 2010

Date of Board Approval April 15, 2011

A. Country and Sector Background

1. The Nyika Transfrontier Conservation Area (TFCA) saddles over Malawi and Zambia territories. It harbors natural ecosystems and biodiversity that are unique to the world but also to the two countries. It also plays a major watershed function as uplands of large sections of Lake Malawi and of the Luangwa River. The Nyika pictures rolling hills covered with grassland in a misty ambiance that provides tourists with a peaceful or sporting visit that is significantly different from the usual wildlife African experience. The Nyika is however affected by various forces which threaten its biological diversity and natural resources as well as curtails the sustainable and equitable development of its stakeholder communities. The next paragraphs identify some of the issues and the context through which they currently impact the Nyika. Subsequent chapters describe the Governments proposal to address some of these issues and how the World Bank, through a GEF grant, intends to assist.

Rural Development, in spite of abundant resources, does not successfully dent rural poverty2. In 2009, Malawi’s Human Poverty Index (HPI-1) scored 28% (90th rank among 135 countries while Zambia scored 35% (110th rank among 135 countries)1). In both countries rural poverty is significantly higher than urban poverty. Such high poverty, and its underlying human development indicator, creates a context whereby communities have little alternative but transform natural ecosystems for energy, farm land and food. This is worsened in Malawi by high rural population densities and little economic alternative at the country level. The Nyika Districts, Rumphi in Malawi and Chama in Zambia, are among the poorest areas in their respective countries. In 2006, 79% of the population in Zambia’s Eastern Province lived under the poverty level, classifying this region as the second poorest in Zambia (after Western Province).2

3. Malawi’s agriculture, the foundation of the country’s economy, contributes to about 90 % of national employment, 83 % of foreign exchange and 35 % of the GDP3. The sector is highly dependent on a few cash and export crops such as tobacco, tea, sugar and coffee. The sector is divided into two production systems, commercial estates and large smallholder mixed subsistence farmers characterized by a low input and low output system. Zambia is endowed with natural resources that are required to stimulate agricultural and rural development (good climate, abundant arable land, labor, and abundant water resources). 85 % of the population’s employment is related to the agricultural sector.

4. The percentage of population living under the poverty line in Zambia is 68 and in Malawi 65. In both countries, rural areas continue to be affected by high poverty. Both governments have recognized that a cross-sectoral and integrated rural development approach including biodiversity conservation and promotion of eco-tourism through their protected area network is an opportunity to enhance rural livelihood strategies and options.

Natural resources based tourism 5. The biodiversity rich and spectacularly scenic 3,000 km2 large Nyika National Park is Malawi’s largest National Park and has the potential to attract significant revenues from nature-based tourism (enriching existing eco-tourism circuits in the country and neighboring Zambia). Importantly, the area is a significant catchment area (Nyika meaning “where the water comes from”). Zambia’s tourism sector is regarded as one of the three main pillars for economic growth of the country and focuses on the development and expansion of the Northern Tourism Circuit which includes the Nyika National Park in the Eastern Province.

6. Malawi  has a mainly rural population of 13 million people with high incidence of poverty, both factors resulting in significant human pressure on natural resources. The conservation of the country’s natural resource base is therefore an important factor that contributes to achieving sustainable national economic growth. The challenge is to achieve cost-effective conservation while enhancing livelihoods particularly of adjacent communities around protected areas. Malawi’s Growth and Development Strategy (MGDS) 2006-2011 aims to reduce poverty through sustained economic growth and infrastructure development. In the strategy, the Government prioritized six areas to foster its economic growth base including 1 UNDP Human Development Report 20092 Central Statistical Office, Living Conditions Monitoring Survey 20063 CIA World Factbook 2009 estimates

agriculture and food security, integrated rural development, irrigation and water development, and transport infrastructure development.

7. Zambia is endowed with favorable climate, arable and plentiful land and rich natural resources conducive to a vibrant agriculture sector. About 85 % of the population’s employment is related to the agricultural sector. Most agricultural producers are asset-poor smallholders, who use simple technologies and cultivation practices to produce rain-fed maize, groundnuts, roots, and tubers, mostly for their own consumption. Reasons for the low productivity levels are: 1) poor access of most smallholders to markets; 2) lack of public infrastructure, especially roads, 3) misdirection of public resources into poorly targeted subsidies, and 4) weak capacity to manage risks, particularly those resulting from insecure land tenure and climate change. Low productivity and low return to labor and land lead to chronically low farm income for smallholders. Zambia’s Fifth National Development Plan (2005/2010) and its Vision 2030 focuses on broad-based wealth and job creation for its citizens.

Tourism – An emerging growth sector largely based on nature products8. In Malawi, tourism has been identified as one potential new economic growth sector. In 2009, tourism contributed directly and indirectly to about 7 % to Malawi’s GDP and 5 % of employment (WTTC, 2009). Tourism in Malawi thrives on natural resources and major resource attractions include water bodies, protected areas, mountains and cultural heritage. It is recognized that tourism growth is not necessarily benefitting the poorer population.

9. Malawi’s geographic position between established tourism destinations such as Tanzania, Zambia and Mozambique is a potential advantage to tap into existing tourism streams. Besides the attractive Lake Malawi, the country possesses other currently less developed areas of interest for tourism products such as in the north the highland Nyika National Park with the adjacent lowland marshland Vwaza Wildlife Reserve. The 2500 meter high Nyika Plateau contains leopard, roan, eland and elephant as well as Africa’s richest orchid communities and a number of endemic plant and bird species.  

10. In Zambia, a Bank supported report on the Economic and Poverty Impact of Nature Based Tourism in 2007 demonstrated that the economic impact of nature based tourism is higher than previously perceived. According to the study results, nature-based tourism accounts to about 3.1 % of the GDP and 10 % of the formal employment. The challenge is to increase the opportunities for local communities to participate in the tourism economy (shared growth).

11. Zambia’s government also focuses on diversifying its economy in expanding its agriculture and tourism sectors (as additional pillars to the copper mining industry). The country’s environmental challenges are high deforestation rates (around 250,000 ha/ year), loss of biodiversity as well as air, water and soil pollution. The country has 19 National Parks and 34 Game Management Areas covering 33 % of the country of which 5 % has been developed for tourism. Medium and long term financial sustainability is a critical issue for national parks that needs to be addressed through delegation of management functions, better commercial management and externally generated financial support. Noteworthy, the protected area network in Zambia includes 432 Forest Reserves (national and local).

Biodiversity and Watershed – Nyika ranks top in both countries for both functions12. The Nyika TFCA is centred on the Nyika Plateau, a high undulating montane grassland plateau that rises over 2000 m above the bushveld and wetlands of the Vwaza Marsh. The Nyika Plateau has been classified as one of Africa's Centers of Plant Diversity (WWF & IUCN 1994) as well as one of “Global 200” WWF Priority regions for conservation, namely the Rift Valley Lakes, Zambezi-Miombo. Both the Nyika national parks of Malawi and Zambia have been classified as Important Bird Areas (IBA). The Nyika National Park Malawi has the highest number of large mammals and the highest concentration of roan antelopes in Africa. It supports the world’s largest breeding population of blue swallow (Hirundo atrocaerulea) and is an area of high plant biodiversity with about 215 Orchid species. The Vwaza Marsh Wildlife Reserve is listed as IBA due to its biome-restricted birds.

13. The Nyika Plateau is further a major water catchment and sponge area for both Lake Malawi and the Luangwa River. The Chire/Luwumba, a major tributary of the Luangwa rises on the Zambian Nyika, and four rivers that are responsible for providing water to a large part of the Northern region of Malawi also rise on the Nyika.

Protected Areas – First class wildlife products managed with difficulties14. Malawi has 5 National Parks and 4 Wildlife Reserves. In spite of its high rural population density, Malawi has been able to maintain its significant network of protected areas, some of which, like Liwonde National Park, are spectacular wildlife products. However, wildlife is now absent outside protected areas. In recent year, the country has allocated a significantly higher budget to the Department of National Parks and Wildlife (DNPW). However, this budget remains insufficient to manage the parks effectively. As a consequence, DNPW has established partnerships with organizations better endowed and capacitated. Two parks, under such scheme have shown major wildlife recovery. The National Parks and Wildlife Act 2004 provides for collaborative management schemes with rural communities as managers of wildlife on customary land and for partnerships with all interested parties to effectively manage wildlife resources both inside and outside protected areas.

15. Zambia has 19 National Parks and 34 Game Management Areas covering 33 % of the country. Some parks have a long history of quality management, such as the South Luangwa National Park and are now well branded in the international market. Other parks, like the Kafue National Park, are rapidly developing by attracting partnerships with NGOs and private investor. Still, the Zambia Wildlife Authority (ZAWA) is insufficiently staffed and receives insufficient budget to manage all its protected areas and to oversee and guide some well established partnerships for management of some protected areas. The wildlife of Liuwa Plain or Kasanka NP has both largely recovered as a consequence of such partnerships. The Game Management Areas and Forest Reserves lack a policy that provides sufficient incentive to communities to actively implement and contribute to set objectives. A policy debate is underway to modify this by establishing various forms of protected areas managed in partnership with community organizations.

16. In both countries, medium and long term financial sustainability is an issue for national parks and wildlife that needs to be addressed through delegation of management functions, better commercial management and externally generated financial support.

Transfrontier Conservation Area4 - Ecosystems management across political boundaries17. Based on unsatisfactory experiences with management of protected areas located along country borders, the establishment of TFCAs is growing worldwide. In some cases, it can create a political climate and management conditions that facilitates cross-border coordination leading to better biodiversity management and opens additional opportunities for livelihood improvements.

18. In Africa, the SADC member states including the governments of Malawi and Zambia demonstrated their commitment to the conservation of biodiversity by signing of the TFCA related Protocol on Wildlife Conservation and Law Enforcement in 1999 and ratifying at the end of 2003.5

19. The first step toward establishing the Nyika TFCA was taken by the respective Malawian and Zambian Ministers of Tourism and Environment on August 13, 2004 when they signed a Memorandum of Understanding to establish the Malawi-Zambia Transfrontier Conservation Areas. The proposed TFCAs have been endorsed by the Joint Permanent Commission of Cooperation (JPCC).. The proposed Nyika TFCA has been prioritized by the two governments. The MoU mandated the two current management authorities responsible for the parks, the Department of National Parks and Wildlife of Malawi (DNPW) and the Zambia Wildlife Authority (ZAWA) to develop the NYIKA TFCA and manage jointly the included protected areas.

20. The Nyika TFCA covers a total of 19,281 km2 split into 4,182 km2 on the Malawian and 15,099 km2 on the Zambian side consolidates areas under differing conservation regimes.6 The TFCA includes the Nyika National Park and Vwaza Marsh Wildlife Reserve in Malawi and the Nyika National Park, Lundazi, Mitengi and Mikuti Forest Reserves and Musalangu Game Management Area in Zambia. The two countries intend to formally establish the TFCA through an international treaty.

21. The draft bilateral Treaty and the implementation protocol developed by the two governments over the past years refer to the establishment of an autonomous agency, the Nyika Implementation Agency (NIA), to implement the Governments’ strategy for the Nyika TFCA.

Positive context for community livelihoods and buy in22. Already, in the periphery of the TFCA protected areas, two projects are making successful foray into supporting community livelihoods in relation to natural resources management and agriculture. One is the Norway-funded WCS-implemented US$1.45m Community Market for Conservation (COMACO) in Zambia and one is the USAID-funded Total Land Care-implemented US$3.5m Kulera-Biodiversity in Malawi (see more details in 4 TFCA: Zone where formal protected areas and other multiple use areas fall under a common management objective of sustainable development of several countries. It is a politically-grounded instrument to foster biodiversity conservation, livelihood improvements and cross-border coordination. SADC Protocol defines the TFCA as the area or component of a large ecological region that straddles the boundaries of two or more countries encompassing one or more protected areas as well as multiple resource use area.5 The article 4 (f) of this Protocol commits the SADC member states to “promote the conservation of the shared wildlife resources through the establishment of transfrontier conservation areas.6 Nyika NP Malawi 3,200km2, Nyika NP Zambia 106 km2, Lundazi FR (Zambia) 839 km2, Mitengi FR (Zambia 186 km2, Mikuti FR (Zambia 388 km2), Vwaza Marsh WR (Malawi) 982 km2, Musalangu GMA (Zambia) 13,579 km2.

Annex III, F.). Currently the bulk of conservation-related benefits to households come in the form of food security and livelihood benefits primarily from crop diversification and conservation farming as a result of the COMACO program. COMACO’s 2008 mid-term evaluation survey suggests a possible increase of household cash income to as much as an average of 600 USD per household per year. In Malawi the KULERA project began to focus on conservation farming and crop diversification as well as the identification of buyers and markets. It started in 2009 and its results have not yet been assessed.

23. Over the Nyika Project period, the economic impacts of COMACO and Kulera Biodiversity, in their respective communities are expected to be much greater than present Project impact. COMACO intends to reach and improve the livelihood and trading capacity of 7,500 farmers while the Kulera Biodiversity Project will target 45,000 households (225,000 people) living in rural communities in the border zone of selected protected areas: The Nyika-Vwaza complex, Mkuwazi Forest Reserve, and Nkhotakota WR. Around half of these areas lie in the Nyika TFCA Project area.

24. The presence of these two substantial operations around the Nyika TFCA, enables the GEF and Norway (only Malawi) to focus on the other threats to protected areas such as poor management, inadequate infrastructure and unsustainable financing. Still, the approach for the Chama Nature Park in Zambia is very closely anchored in the previous success of COMACO which has helped mobilize the communities and the district stakeholders toward a protected area management where the livelihood dimension is built in from the start.

B. Objectives

25. The combined Project’s Development Objective (PDO) and Global Environmental Objective (GEO) of the Project is to establish more effective transfrontier management of biodiversity in the Nyika Transfrontier Conservation Area.

26. The outcome indicators of the project include:

27. Abundance index of 2 indicator mammals (elephant, kudu for Chama block, elephant, buffalo for Vwaza block and eland, zebra for Nyika block) trend is > 0.

28. Area with signs of illegal land use inside the protected areas of the Nyika TFCA remains = 0 for Nyika & Wvaza & to be verified for Chama Nature Park after boundaries are completed

29. Score of Management Effectiveness: 38 to 64 for Nyika block, 44 to 66 for Vwaza block, 11 to 59 for Chama block.

C. Rationale for Bank Involvement

30. The project responds to GEF Biodiversity Strategic Objective (SO) #1 “Catalyzing Sustainability of Protected Areas” as it contributes to the national priorities of the Government of Malawi and Zambia to create a new transboundary PA system through expansion and consolidation of the current Nyika National Parks and defined protected areas. The project supports interventions that address the three aspects of protected area management in order to catalyze the long-term sustainability of the system including a) setting up a sustainable cross-

boundary financing mechanism to cover recurrent costs of the Nyika Foundation and the protected areas, b) coverage of ecologically viable ecosystems and habitats, c) building institutional and systemic cross-boundary capacity to manage the TFCA to achieve commonly set and agreed objectives. The establishment of the Nyika TFCA is seen as a fully integrated protected area management scheme within the context of broader and country-wide differing landscapes, threats and biodiversity value of Malawi and Zambia.

31. The project is further fully aligned with the GEF Strategic Program (SP) # 3 “Strengthening Terrestrial Protected Area Networks” as it includes in-situ conservation of sites containing globally relevant biodiversity and training and capacity-building/strengthening of governmental and other stakeholders for conservation of the TFCA.

32. The project is also aligned with the GEF Strategic Program (SP) # 1 “Sustainable Financing of Protected Area Systems at the National Level”, as it includes the institutional and financial set-up of a sustainable financial mechanismThe Bank has been a major funder of biodiversity conservation using GEF funds for protected areas and for conservation and sustainable use in the production landscape. A substantial number of the Bank’s biodiversity projects provide financing to transboundary protected area projects and conservation trust funds in Central Asia, Africa (e.g. Mozambique, South Africa), Latin and Central America and Eastern Europe.

33. The proposed project is aligned with poverty reduction strategies of the governments of Malawi and Zambia, the National Biodiversity Action Plans (NBSAP) which refer to the concept of TFCA and participation of local communities, the Bank’s Country Assistance Strategy (CAS) and the Bank’s and GEF’s commitment to address global environmental issues such as enhanced ecosystem management, biodiversity conservation, water catchment protection and enhanced carbon sequestration. The project complements efforts from other donors and international non-governmental organizations which are supporting related activities (eg. Norway Malawi and Norway Zambia, PPF, USAID, WWF, WCS, Nyika-Vwaza Trust) in both countries.

34. In Malawi, the Bank has a leading role in agriculture and food security as well as in private sector development. The CAS (2007-2010) focuses on the achievement of four outcomes including: (i) Improved smallholder agricultural productivity amd (ii) improved infrastructure and investment climate. The Project is anchored in the CAS as a watershed protection operation to benefit downstream farmers.

35. In Zambia, the Bank in close cooperation with Norway has provided support to Zambia’s Wildlife Policy and Act as well as to the revision of the country’s Tourism and Hospitality Act. Related projects include the SEED project, the Kafue NP project and the GEF Lavushi Manda (LMNP) project. An ESW on the country’s competitiveness in the copper, cattle and tourism sector is launched recently.

D. Description

36. This Project supports transboundary biodiversity conservation through planning, institution building, fundraising and capacity building for protected area management. It is implemented with the following 4 components (see annex II for detailed Project description):

Component 1: Institutional and Planning Framework Component 2: Sustainable Financing Component 3: Protected Areas Management

Project components

Component 1: Institutional and Planning Framework (Total US$1.90m - GEF Zambia US$0.63m, GEF Malawi US$0.71m, Norway US$ 0.30m, PPF $0.23m, GoM US$5,000)

37. The objective of this component is to establish and operationalize the governance and planning functions for the Nyika TFCA by financing the design of TFCA-wide planning instruments and assisting with the establishment and capacity building of the implementation agencies.

38. The intermediate outcome of this component is measured by one indicator: Number of transfrontier planning instruments adopted by the Ministerial Committee.

39. The component has two subcomponents: (A) Project management & (B) Strategic planning. The activities proposed under Subcomponent A include: (1) The procurement and financial management technical assistants as well as short TA on planning, monitoring and evaluation to support teams of the implementation agencies, (2) the vehicles, office and field equipment of the implementation teams in both countries, (3) the capacity building for the implementation teams in both countries through hiring of trainers, training courses, planning and consultation workshops, and (4) the annual external audits of all funds. The activities proposed under Subcomponent B include (1) the feasibility study of the Nyika Implementing Agency, (2) the transboundary integrated district planning for the Chama District in Zambia and the Rumphi District in Malawi, (3) the review and up-date of the Nyika TFCA Management and Tourism Plans, and (4) the diagnostic of national legal barriers for full TFCA operationalization.

Component 2: Sustainable Financing (Total US$0.27m - GEF Zambia US$0.10m, GEF Malawi US$0.17m)

40. The objective of this component is to develop mechanisms for financial sustainability of TFCA management through the institutions responsible for the long term management and financing of the Nyika TFCA.

41. The intermediate outcome of this component is measured by two indicators: (1) Funds raised and revenues collected by both countries in addition to the GEF/Norway grants reach more than $1million for raised funds and more than US$0.2 million annually for commercial revenues; and (2) Financial Sustainability Score Card for TFCA (mandatory as per GEF but baseline to be established by MTR)

42. The activities under component 2 include: (1) a feasibility study for the NIA including a business plan, fund raising strategy, and an investment strategy, (2) a broker tasked with advertising concessions to attract private investors for tourism, logging or hunting concessions,

and (3) promotion material for fund raising, investment promotion, partnership seeking as well as events, trips, workshops, etc.

Component 3: Protected Areas Management(Total US$8.93m - GEF Zambia US1.81m, GEF Malawi US$1.40m, Norway US$ 3.88m, GoM US$ 1.37m, GoZ US$ 0.47m)

43. The objective is to improve management effectiveness of the agglomerated three Nyika TFCA management “blocks”: the Nyika, the Vwaza and the Chama blocks.7 As well as assure that the Project, by increasing the protection of the block does not generate poverty but rather provides alternative livelihoods to poachers and other illegal resource users

44. The intermediate outcome of this component is measured by two indicators: (1) % area covered by patrols: 45 to 70 for Nyika block, 70 to 95 for Vwaza block, 0 to 100 for Chama block, (2) Trend in number of signs of illegal activities per patrol-day decreases in all 3 blocks.

45. The management of the Nyika and Vwaza blocks will be done jointly by ZAWA and/or DNPW. The management of the third block, the proposed Chama Nature Park in Zambia, will be supported by a joint venture ZAWA/ZFD/NGO Partner/Community association. The activities proposed in each block include: (1) Capacity building for planning, management and reporting, (2) infrastructure development and maintenance such as staff houses, offices, workshops, airstrips, water crossing structures, tracks, fences and firebreaks, (3) Habitat management and resource protection and monitoring including patrol operations, and (4) research and monitoring such as data collection, aerial surveys and research programs, (5) implementation of an action plan to be designed on a case by case basis using the Process Framework to ensure that the Project provides livelihood alternative to poachers and other illegal users of resources, and (6) establishment of two tourism camps in Chama Nature Park as well as training and mentoring of its employees issued from the community including illegal users of resources.

E. Financing

Source: ($m.)BORROWER/RECIPIENT 1.85Global Environment Facility (GEF) 4.82NORWAY: Ministry of Foreign Affairs 4.2Peace Park Foundation/s 0.23

Total **Expressionis faulty **

7 Although the initial project concept envisaged covering the entire TFCA which includes Musalangu GMA (over 17,000 km2), the Musalangu GMA is only partly included in the final project design since (i) GEF funds are insufficient to cover more than the three blocks mentioned,. Notably, the proposed “Chama nature park” is carved out of the GMA/Lundazi Forest which will contribute to mainstreaming biodiversity into production systems while also contributing to the livelihoods of communities. The project will however finance the development the Musalangu GMA management plan.

F. Implementation

TFCA legal architecture46. Both countries have signed an MoU in 2004. It is expected that both countries will sign a Treaty and an Implementation Protocol in the next few years. The current draft of the Treaty defines:

the Ministerial Committee (MC) which approves the TFCAs’ Joint Management Plan (JMP), the Technical Advisory Committees mobilized as needed to advice on transfrontier issues, and the Local Advisory Boards (LAB) which include traditional, administrative and political representatives to provide guidance on land tenure and land use as well as other local and political issues.

Project execution47. The Project is coordinated and implemented by the country line Ministries’ respective implementing agencies (DNPW, ZFD and ZAWA). In the event that the NIA would be established during the life of the project, the countries would have the choice to transfer the Nyika TFCA coordination to the NIA. This will not impact on the achievement of the project's PDO. The transfer of responsibilities to NIA will depend on (1) the two countries having fully completed the political dialog on the Nyika TFCA and on the role of the NIA, (2) the NIA being registered and its Board having approved the by-laws, the M&E Manual, the Administration Manual and completed the selection of staff for its Executive Secretariat, (3) the NIA having been appraised by the World Bank as being sustainable by design and as having sufficient staff, funds and capacity to handle Project funds.

48. The two countries will establish a Joint Steering Committee (JSC) with equal membership from each country. The JSC will physically meet once a year. Other meeting will be organized using advanced communication technology. The JSC will review and approve the Annual Work Plan and Budget (each October) as well as the Annual Report (each March).

49. Project activities funded through Malawi are implemented by the DNPW Provincial Office in Mzuzu. Project activities funded through Zambia are jointly implemented by the existing ZAWA and ZFD staff in Chipata. They will be supported by two Technical Assistants to support functions that have been identified by the Bank’s fiduciary staff as risky and in need of support, namely Procurement & Financial Management.

50. Each protected area block will be managed by its designated agencies. During the course of the Project each executing agency is encouraged to establish public-private-partnerships (PPP) for the management of protected areas blocks, of tourism or logging concessions or for infrastructure development, research and community development. Partnerships can originate from communities, NGOs and the private sector.

51. The proposed pilot Chama Nature Park, which is located in the Lundazi National Forest, will remain under the responsibility of the Zambia Forest Department (ZFD). ZFD will delegate the management of the area proposed for the nature park to a consortium constituted of itself, ZAWA, a NGO Partner and a Chama District stakeholder’s association.

52. Vwaza Marsh Wildlife Reserve & Bambanda-Zaro Sanctuary will be managed by DNPW with assistance from a team of wildlife police officers from ZAWA.

53. Nyika National Park Malawi, Nyika National Park Zambia and Mitenge National Forest Zambia will be co-managed by DNPW-ZAWA teams, possibly assisted by ZFD staff, like the Bambanda-Zaro Sanctuary. During Project implementation, the three institutions will design an arrangement whereby a clear leadership for the whole block is designed and implemented.

54. After following internal procedures, the three agencies will prepare in September of each year an Annual Work Program and Budget which they will together consolidate into a Project-wide Annual Work Program and Budget (AWPB). They will also report Quarterly to the JSC and the Bank and produce and disseminate a comprehensive Annual Report. The AWPB is subject to the approval of the JSC and no objection from the Bank.

G. Sustainability

55. The Project has been designed with a particular focus on long term sustainability. The key elements of sustainability include:

Financial sustainability56. One of the biggest challenges for conservation worldwide and protected area management is assuring a permanent flow of funds to sustain operation and maintain results. . Financial sustainability of the Project outcomes will rest on five pillars: (1) Continuous and same-level, albeit low, funding by the two Governments, (2) commercial revenues from tourism, hunting and logging concessions, (3) fund raising both to private charities and benefactors but also to regular cooperating partners supporting Zambia and Malawi, (4) partnerships with organization which have technical and fundraising capacity and can alleviate the financial burden, and (5) design and possibly establishment an endowment or sinking fund to secure first core NIA funding (when and if it is established) and increasingly funding the financial gap of operations towards the end of the Project. The Project targets to have at least one functional partnership (the Chama Nature Park), to ensure that all executing agency staff remain funded by Government, that commercial revenue reach about US$200,000 per year which would cover the cost of patrols in the two blocks not under partnership and raise US$1million to operations within the TFCA. This target is not unrealistic when compared to the funds obtained from GEF, Norway, USAID and various NGOs for the upcoming 5 years.

Environmental Sustainability57. The core Project objective relates to improving the environment and reversing its degradation. Sustaining this will depend on funds raised, capacity built and incentive for better resources stewardship by communities. To help with the above, the Project has several strategies. The main one is to help both countries institution increase the development level of the three parks, build management and resource protection capacity, leverage investment, stimulate research and partnerships To assist with community support, the two main districts will undergo, together, an Integrated District Development Planning process using strategic environment assessment as the key approach. The plan issued from this process will be synchronized with the TFCA development plan to harmonize development goals and activities. Sustainability also depends on the success of partner’s project in creating the incentive

framework for stakeholder communities to modify behavior and adopt new farming technologies such as conservation farming and for district planners to implement district plans that account for environment plans.

Institutional sustainability58. The Project is implemented by three existing Government institutions which may have their difficulties but constitute the main state apparel for forest and biodiversity management in each country. Other institutional partners have demonstrated that their support and commitment to Nyika is steady: The Peace Park Foundation who has orchestrated and supported the process leading to current results, the COMACO which is an increasingly successful Zambian enterprise and the Nyika-Vwaza Trust which has been able to maintain its supports throughout the past 10 years. Possibly, during the Project period, the Project may be transferred to a “Nyika Implementation Agency”. This would be after it is appraised for various criteria including sustainability.

Replicability – Other TFCAs are awaiting Nyika results59. The approach taken is pioneering in terms of designing a single institution to ultimately will manage the TFCA. There are few examples of transfrontier organizations that take such an active role in the coordination of field actors. Replicability will largely depend on whether it is successful or fails. Success will largely depend on the political commitment to make it happen. The design is relatively straight forward and should be exportable to other areas of both countries and to other countries. There are other TFCAs in southern Africa which are observing the development of the Nyika. So far, none have taken such steps. But, all are searching for a model that works.

60. The first and logical candidate for the Project’s replication would be the second Malawi/Zambia TFCA: the Kasungu/Lukusuzi TFCA. This TFCA is created under the same Treaty as the Nyika. The long-term “big picture” scenario also assumes that the Lundazi FR could provide a protected area link between the Nyika TFCA and the Kasungu/Lukusuzi TFCA.

61. To enable replicability of the Project approach for the Nyika TFCA, it will be essential to not only monitor activities and outcome but also watch for unintended consequences and carry out in depth evaluations (see also the section on M&E).

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

62. The following lessons learned from other Bank and non-Bank supported TFCA projects in Sub-Saharan African countries in particular from the two phases of the Bank/GEF Mozambique TFCA and Tourism Development Project, the Bank/GEF Maloti-Drakensberg TFCA Project in South Africa and Lesotho, the Malawi Mulanje Mountain Conservation Trust, the Malawi Environmental Endowment Trust (MEET), the Uganda Bwindi Trust Fund, the Bank/GEF regional Lake Victoria Project, the Bank/GEF regional Lake Malawi Project8 WWF Beyond Boundaries: Transboundary NRM in SSA (2001), and AWF “Impacts of Transboundary Protected Areas on local Communities” (2003) have guided the Project design. Specific attention has also been drawn to the lessons learned from more than eight years of support from GTZ/KfW

8 See also the Bank review of Transboundary Reserves and implementation of the Ecosystem approach, 2000.

to the Malawi Nyika National Park and its 5 km (Malawi Border Zone Development Project, closed in 2004).

63. The main lessons are:

Transboundary Natural Resources Management64. A review of cases has shown the following key elements to success (1) defined and recognized joint sharing of cross-border threats and/or mutual benefits of collaboration by participating countries, (2) a bottom-up approach of participating buy-in and ownership of the process at the local level where the resources are managed is followed, (3) regular monitoring and evaluation of the effectiveness of the collaboration and adaption, (4) TFCA increases the efficiency of PA management to be worthwhile, (5) visible synergism (avoiding/reducing duplication of effort, creating economies of scale, enhancing economic opportunities such as increased tourism), and (6) greater collaboration across sectors to enhance TFCA effectiveness. Nonetheless TFCA requires additional investments of resources and time and funding for TFCA is therefore incremental.

65. The Project design is fully aligned with these principles.

Institutional development66. The complexity, politics and time-consuming processes for creating, staffing and operationalizing new institutional structures is often under-estimated.. The envisaged creation of the Nyika Implementation Agency (NIA) is not an exception. The initial steps of its establishment have been slowed by political questioning, by lack of funds, by lack of experiences, etc. Still, cognizant of this the Project has adapted its ambitions.

67. Some preparatory work for the establishment of the NIA has been carried out during the preparation phase but it has not been cleared by the two Governments. Much remains to be done including a new feasibility study. There are discussions on its role, its staffing, its legal basis and its operational modalities. The institutional set-up of the NIA would account for lessons learned. The simple design of the Project responds to the currently weak capacity of the Nyika TFCA executing agencies and uncertainties related to the final set-up of the NIA: (1) a flexible arrangement, (2) a limited geographical scope to three management blocks and not the entire Nyika TFCA, (3) a strong capacity building program for officers and staff to bring planning, procurement, contract management and financial function to a suitable level, and (4) a focus on protected areas.

Communal participation and collaborative management:68. The participation of local stakeholders in planning and investment processes would contribute to anchor the TFCA into district development but also supplement the incentive framework sought by KULERA and COMACO to decreases the threats to habitat and wildlife. In theory, this would also lead to lower management and protection costs.

69. Complementary to the Project’s activities to address community livelihood in the Nyika TFCA surrounding areas, the Project preparation team from PPF have developed a Process Framework which outlines the principles of community participation and mitigation of loss livelihoods.

70. The design and management of the proposed new Chama Nature Park will spearhead a Public-Community-Private-Partnership arrangements involving NGO Partner (private sector), a community association, and the Government (ZAWA and ZFD).

Knowledge for Conservation71. Many protected areas in less rich countries of the world are managed using ad hoc knowledge and incomplete data. In such context, decision making is rarely optimal making rare conservation finance less effective than it could. Good information and good data has proven to help decision making as well as help with documenting facts when reporting on biodiversity on the national or international scene. To this effect, in continuation of the work started with the Museum in early2000’s, Norway will build on this experience to establish a long overdue proper research center on the Nyika. This center will not only be a forum where Zambian and Malawi institution can establish research program, but given the high biodiversity and endemism of the Nyika, it is also expected to attract world class research institutions which would be generating both knowledge, revenues and employment.

Sustainable financing72. One of the greatest challenges of TFCA and PA managers is the availability of funds for recurrent costs. Lessons from the past indicate that generating such funds for commercial concessions or fund raising is difficult, sometimes unsustainable and often insufficient. As a consequence, financial sustainability requires diversification of sources including annual budget allocation by Government, retention of commercial revenues. Dedicated trust funds can help overcome shortage of funds and buffer non-steady flow of resources. Noteworthy, the experience from all over the world has shown that trust funds administrative costs are often high due to the need to employ extra staff to provide technical assistance and capacity building.

73. The potentially high administrative costs of independent “single-purpose” foundations such as the NIA, will be considered by the two countries when studying options for the design of the NIA. In addition, ZAWA and DNPW will continue funding all the park management staff, various partnerships are and will be established, fund raising and commercial development are built as essential dimensions of the Project.

I. Safeguard Policies (including public consultation)

74. The Project is rated as a Category B project because the environmental and social impacts are expected to be minimal, site-specific and manageable to an accepted level. All parallel cofinanciers—Embassy of Norway in Malawi and Peace Park Foundation--are committed to comply with World Bank Safeguards.

75. The following WB safeguard policies have been triggered with all Project activities, irrespective of their funding, subjected to compliance:

OP/BP 4.01 Environmental Assessment OP/BP 4.04 Natural Habitats OP/BP 4.36 Forests OP/BP 4.12 Involuntary Resettlement,

76. This Environmental and Social Management Framework (ESMF) defines the criteria and procedures for mitigating potential environmental and social impacts due to Project activities (see table 7 below). In meeting this compliance, the ESMF lays out a forward looking, transparent and fully participatory process through which Project stakeholders and beneficiaries can address and minimize potentially negative impacts the Project may have.

77. The Project will implement the guidelines contained in this framework to promote a participatory process of community involvement, as well as other relevant stakeholders, to support an accurate assessment of such impact before the Project activities commence. The ESMF provides a management framework for how the Project will ensure compliance with defined national and World Bank safeguard policies to avoid undesirable Project impact as well as a required process for monitoring the effectiveness of these safeguards.

78. The ESMF proposes procedures that are not unduly complicated or time-consuming. This concern relates to the larger purpose of the Project, which is to maintain a clear and committed focus on building district, community and stakeholder commitment to the needs of improved environmental management and social welfare within the TFCA. This ESMF is therefore a methodology designed to streamline appropriate steps that enhance environmental and social planning and impacts in the TFCA: Participatory and technical environmental and social assessments for each activity.

79. Most especially, the ESMF seeks to incorporate underlying principles of land and natural resource management, as well as lessons and experiences from work currently in practice in the Project area that will enhance the level of cooperation among community stakeholders to support improved protected area management.

80. The ESMF is completed by two additional tools:

The Process Framework is a “sister” document to the ESMF that the Nyika TFCA Project will use to provide a clear process by which communities affected by the TFCA participate in the design, implementation, and monitoring of relevant Project activities and potential benefits accrued from such activities. The PF also recognizes the existence of existing projects which although not part of the Nyika Project may help reinforce its success by establishing a context whereby closer collaboration with community partners and stronger community buy-in are possible. The ESMF and PF work together as framework papers to ensure a clear pathway of guidelines and participatory procedures that will promote positive environmental and social impact by the Project.

The Resettlement Policy Framework (RPF): The RPF is activated because there are several families that live within the area currently proposed for the Chama Nature Park and in case, after the Integrated District Development Plan is completed, and through implementation of the PF, there is a clear consensus that the there is no option but to displace one or several households. If this becomes the case, the RPF outlines the detailed steps that must be followed to prepare a Resettlement Action Plan (RAP). A RAP would be prepared only after the GoZ or GoM have provided the proof that they have secured sufficient financing to fully implement it. Irrespective of the funding, any RAP to be carried out within the boundary of

the Nyika TFCA, and irrespectively of the source of financing, will require clearance by the World Bank.

81. In each country, the M&E Officer will be the focal point for safeguard compliance and monitoring. Also, in each country, the ZAWA and DNPW extension officers will be tasked to coordinate implementation of the Process Framework.

82. To facilitate outreach, it is envisaged that the Project will rely on, and strengthen when necessary as part of the Process Framework implementation, existing community structures. In both countries these are numerous and based on a wide network of Community Based Organizations such as Community Resource Board, for GMA or the Chama Stakeholder Association, both in Zambia. In Malawi, the direct participation by local communities in protected area management is through natural resources committees (NRCs). An umbrella organization known as the Nyika-Vwaza Association for Natural Resource Management and Rural Development oversees the work of the NRCs and forms a unified link with DNPW.

J. List of Factual Technical Documents

Name DateEnvironment and Social Management Framework (draft) 11/2010Resettlement Policy Framework (draft) 10/2010Process Framework (draft) 10/2010Project Concept Note (PCN) and Minutes of PCN Review Meeting 02/26/2008Project Identification Form (PIF) 02/2008Project Preparation Grant (PPG) 06/2008Aide Memoire Identification Mission 09/2007Aide Memoire Preparation Mission 06/2008Aide Memoire Preappraisal Mission 02/2010Draft Treaty between the Governments of the Republic of Malawi and the Government o the Republic of Zambia on the Development of the Malawi-Zambia TFCAs

2009

Baseline Socio-Economic Survey of communities living alongside the borders Nyika National Park and Vwaza Marsh Wildlife Reserve Malawi

2009

Identification and creation of a community park in Lundazi National Forest of Chama District, COMACO and Chama District

08/2009

Nyika TFCA M&E Manual (draft) 11/2010Nyika TFCA Joint Management Plan, PPF 06/2007Nyika TFCA Draft Tourism Development Plan 11/2006Nyika TFCA Capacity Building Paper 09/2007Profile of the Nyika Foundation (draft) 02/2010ZAMBIAProtected Area Planning in Zambia, ZAWA 11/2008Zambia Wildlife Act 1998Tourism Policy for ZambiaPolicy for National Parks and Wildlife in Zambia 04/1998Fifth National Development Plan Zambia 2006-2010

Synthesis of completed METT for Pas managed by ZAWA 2007NBSAP ZambiaNational Policy on Environment Zambia 05/2005Business Audit COMACO 2009Annual report on COMACO Phase Two: Expansion across Luangwa Valley 02/2010Project document: Reclassification and Effective Management of the national PA systemFinancial Costs for different expenditure scenarios for the effective management of PA managed by ZAWA

02/2009

North Luangwa Ecosystem Management Project MTR report 02/2008MALAWIBiological Diversity in Malawi, WESM 01/2005Wildlife Policy, DNPW Malawi 10/2000National Parks and Wildlife Amendment Act, DNPW 2004Cross-Sector Approach to CBNRM and Biodiversity Protection in Malawi 2007ToRs for Malawi Tourism Sector: Economic Analysis 01/2010Aide-memoire WB Tourism Sector Mission Malawi 08/2009Malawi Tourism ESW: Determining Economic Process, Concept Note and Minutes of the Review Meeting, WB

11/2009

Collaborative Management Agreement between DNPW and Nyika Vwaza Association for Natural Resources and Rural DevelopmentMoU between Government of the Republic of Malawi and PPF on Collaboration in the Facilitation, Establishment and Development of TFCA involving the Government of the Republic of MalawiConservation Finance, WWF 01/2007Rapid Review of Conservation Trust Funds, CFA 05/2008Transboundary Reserves, World Bank Implementation of the Ecosystem Approach 04/2000Impacts of Transboundary Protected Areas on Local Communities in Three Southern African Initiatives, AWF

09/2003

1. Contact pointContact: Jean-Michel G. PavyTitle: Sr Environmental Spec.Tel: 5338+3232 / 260-21-125-2811Fax: Email: Jpavy@worldbank.orgLocation: Lusaka, Zambia (IBRD)

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