project performance report 1998

PROJECT PERFORMANCE REPORT

(INCORPORATING THE PROJECT IMPLEMENTATION REVIEW)

1998

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TABLE OF CONTENTS

EXECUTIVE SUMMARY ........................................................................................................................... v

1 INTRODUCTION ........................................................................................................................... 1

2. GEF PORTFOLIO ANALYSIS ......................................................................................................... 3A. Overall GEF Portfolio .................................................................................................. 3B. Disbursements .............................................................................................................. 4C. Time from Allocation to Implementation ..................................................................... 6

3. 1998 PROJECT IMPLEMENTATION REVIEW ..................................................................................... 7A. Overview of Projects Covered in the Review .............................................................. 7B. Portfolio Highlights by Focal Area ............................................................................... 9

4. SUMMARY OF RECENT EVALUATION FINDINGS ............................................................................... 17A. Evaluation of Experience with Conservation Trust Funds ........................................... 17B. Evaluation of the Small Grants Programme ................................................................. 19C. UNDP Integrated Coastal Management Projects ......................................................... 22D. Evaluation of the Biodiversity Data Management (BDM)

Project ........................................................................................................................... 24E. World Bank Quality Assurance Group�s Review of Africa

Biodiversity Projects .................................................................................................... 26

5. CROSS-CUTTING ISSUES .............................................................................................................. 28A. Sustainability ................................................................................................................ 28B. Leveraging .................................................................................................................... 30C. Capacity Building ......................................................................................................... 33D. Project Leadership ........................................................................................................ 35E. Multi-Country Organizational Arrangements ............................................................... 35F. Indicators ...................................................................................................................... 37

6. SYNTHESIS OF PIR CONCLUSIONS AND RECOMMENDATIONS ............................................................ 38A. Flexible, Long-Term Approach .................................................................................... 38B. Indicators ...................................................................................................................... 39C. Leveraging .................................................................................................................... 39D. Topics for In-Depth Review for 1999 PIR.................................................................... 39E. Dissemination of PIR Findings ..................................................................................... 40F. The Role and Purpose of the PIR ................................................................................. 40

APPENDICES:A. List of Projects Included in the 1998 PIR .................................................................... 41B. Definition of Ratings Used in 1998 PIR ....................................................................... 45C. PIR Overview Reports of Implementing Agencies ....................................................... 46

1. United Nations Development Program (UNDP) ................................................ 462. United Nations Environment Program (UNEP) ................................................. 703. The World Bank ................................................................................................. 82

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EXECUTIVE SUMMARY

This GEF Project Performance Reportpresents the results of the 1998 Project Imple-mentation Review (PIR), and draws onadditional insights about the performance ofGEF�s programs from evaluations and otherstudies. This is a broader focus than in previousyears. The report provides an assessment ofimportant cross-cutting issues and lessonsidentified from implementation experience.

As of June 30, 1998, a total of 267 projectshad been allocated over US$1.9 billion of GEFfunding. Cumulative disbursements wereUS$612 million. Amounts disbursed for GEFprojects during FY1998 were US$133 million,down slightly from FY1997, and considerablyless than the US$336 million in new projectsapproved by the GEF Council during the year.In 1998, there was continued reduction in thetime between work program allocations, finalproject approval by GEF�s implementingagencies (IAs), and the beginning ofimplementation.

The PIR covered 119 projects, 25 of whichwere included for the first time in 1998. Twenty-eight percent of the PIR portfolio was rated�highly satisfactory� by the implementingagency, 59 percent was rated �satisfactory,� and13 percent was rated �unsatisfactory� or �highlyunsatisfactory.� Ratings improved on 15projects from 1997 to 1998; they declined for11 projects. The principal causes ofunsatisfactory performance were lower thanexpected implementation capacity by executingagencies; participative approaches taking moretime than expected; changes in marketconditions, especially related to climate changeprojects; reductions in government counterpartand other contributions; lack of governmentcommitment to project activities; andprocurement delays.

Although there are exceptions, mostproject reports submitted for the 1998 PIR didnot have satisfactory indicators to measure andmonitor achievement of their intendedoutcomes and impacts. The PIR reports reflecta general lack of clarity in determininglinkages between project goals, objectives,and outputs. Project monitoring systems focusmore on processes (e.g., procurement) andproduction of outputs than on results. Theneed for greater attention to project indicatorsis a clear message from the 1998 review.

The conclusion that stands out moststrikingly from the reports and discussions thatmade up the 1998 PIR is the need for anapproach to addressing global environ-mental problems that is longer term andmore flexible than current projectinstruments. Whether the challenge isconserving biodiversity, reducing the emissionof greenhouse gases, or slowing thedegradation of international waters,experience indicates that being able to makea commitment of support over a longer timeperiod and adapt to changed circumstancesand opportunities are often prerequisites toachieving and sustaining global environmentalresults. In many cases, this requires a phasedapproach that sets out firm benchmarks andprovides assurance of support over ten yearsor longer if these benchmarks are met. Projectproposals should identify clear objectives andperformance indicators, but devote less effortto mapping out detailed implementation plans.Instead, project managers should be givenflexibility to select and modify the activitiesand tactics needed to achieve these objectives,based on monitoring and evaluation systemsthat incorporate regular review of performanceinformation.

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A major implication of making a longerterm commitment to address many of thechallenges GEF and its partners face is thatGEF will need a more strategic focus on theissues, problems, and places to which it is ableto provide sustained support. With a changeto a longer term, benchmarked approach, GEFshould move from an organizational culturebased on project approval to one more focusedon achieving and measuring project andprogram results. In particular, this suggeststhe need for program managers in the GEFsecretariat to take on a more strategic role,one based less on individual project reviewsand more on assessment of program directionand results and on identifying and feedingback through the focal area task forces lessonsabout what is working in the field.

The report also highlights conclusionsdrawn from the PIR reports and severalevaluations on three cross-cutting issuesselected for special attention in the 1998review�sustainability, leveraging, andcapacity building:

Sustainability. Sustaining projectactivities following the completion of GEFfunding is proving to be much more difficultthan expected. Most terminating GEFprojects face continued needs for externalsupport. The implementation reviewhighlighted five ingredients for sustainability:(1) a policy framework that providesappropriate incentives, including prices, forpractices that produce global environmentalbenefits; (2) long term funding sources; (3)public awareness and understanding of thebenefits of new approaches and activities; (4)local ownership, brought about by genuineparticipation and influence of all keystakeholders in decision-making andprioritization of activities; and (5) the abilityof institutions, including private businesses,to use effectively the resources provided.Achieving sustainability in many of the effortsthat GEF supports requires longer timehorizons.

Leveraging. GEF should adopt a broaderdefinition of leveraging for its programs andprojects that reflects financial resources�bothduring design and implementation�and actionscatalyzed by GEF activities.

Capacity Building. GEF projects arestrengthening a wide variety of organizations,from government agencies, to scientific andresearch institutions, to national andinternational associations, to NGOs andcommunity-based organizations (CBOs). Thereview concluded, however, that more emphasisneeds to be placed on identifying specificcapacity-building needs, so project design andimplementation can be tailored to address keyconstraints and institutions. Considerably moreattention is needed on defining the results andqualitative impacts of GEF�s capacity buildingefforts. There is an urgent need to developindicators that measure the application ofknowledge gained and other changes broughtabout through capacity building efforts and theresulting benefits for the global environment.Assessment of qualitative impacts may bedifficult within the timeframe of a typicalproject, however, since many of these changesoccur over a longer period. This needs to bereflected in the monitoring systems developed,as well as the way GEF addresses the length ofthe commitment required to achieve its intendedimpacts.

Four topics were identified during the PIRfor in-depth review in 1999. Specific plans forthese thematic reviews will be developed by thecorporate M&E team in conjunction with the IAsand program managers in the GEF secretariat.They may include detailed desk reviews, focusgroups or workshops with project managers, andpossibly limited field visits. The objective ofthese reviews is to build on the 1998 andprevious PIRs to identify more comprehensivelythe lessons from experience and define moreprecisely issues requiring further evaluation.The results of these reviews should be availablefor the 1999 PIR. The four topics are:

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• Achieving financial sustainability inbiodiversity projects;

• Experience with GEF-funded off-grid solarphotovoltaics projects, including theirpotential impact on global greenhouse gasemissions;

• Experience with multi-country imple-mentation arrangements in GEF projects,including their requirements forcollaboration among IAs and with otherorganizations; and

• The overall progress of countriesreceiving GEF assistance in the ozonefocal area in implementing their ODSphase-out programs.

Finally, the review concluded thatmore needs to be done to disseminate thefindings of the PIRs and project and programevaluations; to use the results of the reviewsto identify important topics for in-depthassessment by GEF�s M&E program, STAPand others; and to feed back the lessons ofexperience into new project and programdesign.

1. INTRODUCTION

1. This GEF Project Performance Reportpresents the results of the 1998 GEF ProjectImplementation Review (PIR). In addition, forthe first time, this year�s report goes beyondthe implementation review to draw onadditional information and insights about theperformance of GEF�s programs fromevaluations and other studies. This broaderfocus complements Program Status Reviewsprepared for each Operational Program (OP),and provides an assessment of important cross-cutting issues and lessons identified fromimplementation experience.

2. At the request of the GEF Council, PIRsare carried out annually by the GEFimplementing agencies (IAs) and secretariat(GEFSEC). They have two purposes: (1) toprovide a comprehensive overview of the GEFportfolio and trends in performance, and (2) tohighlight themes or issues that may lead to (a)refining Operational Programs, (b) improvingproject design and management, (c) identifyingscientific and technical questions for furtherconsideration, including by GEF�s Scientificand Technical Advisory Panel (STAP), and (d)identifying lessons from experience and topicsfor further examination through evaluations andother studies. The 1998 PIR was the fourthannual implementation review conducted byGEF.

3. Following guidelines developed by theMonitoring and Evaluation Coordinator, eachagency prepared an analysis of its GEFportfolio, an overview emphasizing key trendsand lessons learned to date, and individualreports for all projects that had been inimplementation for at least a year as of June30, 1998. The agencies rated each project onimplementation progress and likelihood that itsglobal environmental objectives would beachieved. Agencies addressed in their

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overviews and project reports the prospects forsustaining and/or replicating project-supportedactivities following completion of GEF funding.In addition, they reported on two other cross-cutting issues: (1) experience in leveragingadditional resources and actions for activitieslikely to achieve global environmentalobjectives, and (2) the extent to which projectshad built recipient capacity and strengthenedinstitutions.

4. The three IAs shared the results of theirreviews and the individual project reports withGEFSEC and the other agencies. For the firsttime this year, these reports were the basis forreviews by GEF�s focal area task forces of theirrespective portfolios�biological diversity,climate change, international waters, and phaseout of ozone-depleting substances (ODS).Culminating the process, an interagency reviewmeeting organized by the Monitoring andEvaluation Coordinator was held in Washingtonon December 15, 1998. It featured discussionof the highlights of the task force reviews andcross-cutting issues. Actions taken in responseto the recommendations of the 1997 PIR werereviewed. In addition, the status of each projectrated as unsatisfactory, and actions being takento address implementation problems affectingthem, was discussed.

5. It is clear from the 1998 review thatUNDP�s GEF Coordination Office has givenhigh priority to its monitoring and evaluationfunction, including its use of the PIR process.It has dedicated staff resources to monitoringand evaluation, supported a series of logicalframework workshops for its personnel andpartners, identified and trained GEF focal pointsin its country offices, and put in place systemsto reinforce implementation oversight incountries with difficult projects or where projectownership or its own institutional capabilities

GEF 1998 Project Performance Report

2

are relatively weak. For a second year, UNEPused the PIR as an occasion to bring togetherits GEF staff and project managers to discussdesign, implementation and procedural issues.From this discussion resulted an insightfuloverview report. On the other hand, the qualityand timeliness of the World Bank�scontributions to this year�s PIR process wereless satisfactory. In part, this reflects theinstitutional changes underway at the Bank asthe 1998 PIR was prepared, which includemoves away from the kind of narrative andissues-based reporting on implementationprogress and lessons learned on which the GEFreview process is based.

6. A large number of project managers andstaff in the implementing agencies and the GEFsecretariat contributed to making the 1998 PIRa successful review. In particular, the reportson nine projects were identified as worthy ofrecognition for their comprehensive review ofimplementation experience, candor, andstrategic reflections on lessons learned:

• Dominican Republic Conservation andManagement of Biodiversity in the CoastalZone

• Hungary Energy Efficiency Co-FinancingProgram

• India Alternate Energy

• India Development of High-Rate Bio-Methanation Processes

• Pollution Control and Other Measures toProtect Biodiversity in Lake Tanganyika

• Panama Biodiversity Conservation in theDarien Region

• Poland Efficient Lighting Project

• Nepal Biodiversity Conservation

• South Pacific Biodiversity ConservationProgram

7. Chapter 2 of this report contains ananalysis of the entire GEF portfolio throughJune 30, 1998. Chapter 3 summarizes the 1998PIR in two sections: (a) an overview of theprojects covered and (b) portfolio highlights byGEF focal area. The PIR overview reports fromeach IA are included in Appendix C. Chapter 4presents the main findings and conclusions ofseveral project and program evaluationsconducted by GEFSEC and the IAs during thepast year. Drawing on the PIR and theseevaluations, Chapter 5 discusses the cross-cutting issues selected for attention in the 1998PIR. Finally, Chapter 6 is a synthesis of theprincipal conclusions and recommendations ofthis year�s review.

2. GEF PORTFOLIO ANALYSIS

A. Overall GEF Portfolio 9. Figure 1 illustrates the growth of the GEFportfolio, including amounts allocated,committed, and disbursed, from June 1991through June 1998. During FY1998, 50 projectswith GEF funding of US$336 million wereapproved by the GEF Council. This comparesto US$374 million approved for 44 projects theprevious year. Implementation of 22 projectswas completed in FY1998.

10. Table 2 shows the distribution of the GEFportfolio as of June 30, 1998. By value, 39percent were biological diversity projects, 38percent climate change projects, 14 percentinternational waters projects, six percentprojects to phase out ozone depletingsubstances, and three percent multi-focal areaprojects.

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Pilot Phase GEF1 (February 95-June 98)* Total

# Projects (US$m) # Projects (US$m) # Projects (US$m)

UNDP 56 256 56 276 112 532

UNEP 6 22 13 38 19 60

World Bank 53 452 71 785 124 1,237

More than One IA 0 0 11 91 11 91

Others** 1 3 0 0 1 3

Total 116 733 151 1,190 267 1,923

* Source: Operational Report on GEF Programs** PRINCE project managed by GEF secretariat

8. As of June 30, 1998, a total of 267projects1 had been allocated funding inapproved GEF work programs. As shown inTable 1, 46 percent of these are administeredby the World Bank, 42 percent by UNDP, sevenpercent by UNEP, and four percent by more thanone GEF implementing agency. One project isadministered by the GEF secretariat. Fundingfor these projects totaled US$1,923 million, ofwhich 64 percent was in World Bank projects,28 percent in UNDP projects, three percent inUNEP projects, and four percent in multi-IAprojects. In addition, as of June 1998, overUS$36 million had been approved during GEF1for 185 individual country enabling activitiesunder the biodiversity and climate changeconventions.

1 Unless otherwise noted, the numbers in this section exclude individual country Enabling Activities and pre-investmentfunds.

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B. Disbursements

11. Cumulative disbursements for theentire GEF portfolio (including enablingactivities and project development funds)

increased during FY1998 to US$612 million.2

Disbursements under many projectsincluded in this year�s PIR continued to bewell below initial projections. This shortfallis generally due to over-ambitious estimates in

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Pilot Phase GEF1 (February 95-June98)*

Total

# Projects (US$m) # Projects (US$m) # Projects (US$m)

Biodiversity 58 332 62 413 120 745

Climate Change 41 259 51 468 92 727

International Waters 12 118 19 151 31 269

Ozone 2 4 13 111 15 115

Multi-Focal 3 20 6 47 9 67

Total 116 733 151 1,190 267 1,923

* Source: Operational Report on GEF Programs

2 Source: Implementing agency quarterly financial reports; implementing agency PIR overview reports.

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GEF Portfolio Analysis

project designs�many included activities forwhich there were few precedents on which tobase projections�and to the considerableamount of time it has taken to expandstakeholder involvement under many GEFprojects. Disbursements in relation tocommitments were 43 percent as of June 1998,the same as in June 1997. Disbursements inrelation to amounts committed by the WorldBank increased to 34 percent at the end ofFY1998, compared to 33 percent a year earlier;for UNDP, disbursements in relation tocommitments remained at 62 percent, while forUNEP, disbursements declined to 52 percentfrom 61 percent of amounts committed.3

12. Amounts disbursed for GEF projectswere US$133 million during the year4, downslightly from US$141 million in FY1997.

Disbursements remained basically the same forthe World Bank (from US$75.6 million in 1997to US$75.7 million in 1998), increased fromUS$4.7 million to US$6.9 million for UNEPfrom 1997 to 1998, but decreased from US$55.9million to US$49.9 million for UNDP. Thestagnation in annual World Bank disbursementsresults from decreases in infrastructure and trustfund projects that have large, lumpydisbursements; the Asia financial crisis, whichslowed implementation of projects in thatregion; and late entry into the portfolio ofseveral large IFC investment funds that had notbegun to disburse before the end of FY1998.The decline in UNDP disbursements is duemainly to the completion of many Pilot Phaseprojects while GEF1 projects were only startingimplementation.

3 The difference in disbursement rates between the World Bank, on the one hand, and UNDP and UNEP on the other, islargely explained by the fact that more of the Bank�s GEF projects are large investment projects which initially disburse moreslowly.

4 Source: Implementing Agency quarterly financial reports; implementing agency PIR overview reports.

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C. Time from Allocation to Implementation

13. In 1998 there was a further reduction inthe time between work program allocations,final agency approval (commitment), and thebeginning of project implementation in theWorld Bank and UNDP. As shown in Figure 2,projects approved by the World Bank inFY1998 took less time on average to reachthe commitment stage than during theprevious year (434 days compared to 536 daysin FY1997). Fifty-six percent were approvedwithin a year or less of allocation in workprograms. For World Bank GEF projects whichbecame effective in FY1998, the average lengthof time between commitment and the beginningof implementation remained basically the same(137 days compared to 139 days in 1997).

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14. Likewise, as illustrated in Figure 3, theaverage time for a UNDP GEF project to movefrom work program allocation to the beginningof implementation (signature of the projectagreement) fell from 425 days in FY1997 to406 days in FY1998, continuing trends begunin 1996. UNDP reported that 58 percent of itsprojects had signed project agreements withina year after work program allocation. Thesereductions reflect greater decentralization ofproject approval authority and the identificationof GEF �focal points� within each UNDPcountry office to liaise closely withgovernments and executing agencies. Inaddition, UNDP/GEF has invested heavily intraining country office focal points, governmentofficials, NGO representatives, and consultantson GEF procedures, eligibility criteria, and thelogical framework methodology.

A. Overview of Projects Covered in the Review

1. Portfolio Reviewed

15. The 1998 PIR covered 119 projects that hadbeen in implementation for at least a year as ofJune 30, 1998, up from 105 projects in 1997.Table 3 shows the distribution of these projects;Appendix A contains a complete list. Tenprojects included in the 1997 PIR werecompleted and not reviewed this year. In viewof its recent evaluation (see Chapter IV below),the GEF Small Grants Programme, which wasincluded in past PIRs, also was not reviewed. Atotal of 25 projects were included for the firsttime in 1998.

16. The PIR portfolio includes slightly less thanhalf of the projects for which GEF funding hasbeen allocated in approved work programs. Theportfolio reviewed was made up of 57

biodiversity, 42 climate change, 12international waters, six ozone, and two multi-focal area projects. A total of 62 of theseprojects are administered by the World Bank,48 by UNDP, and eight by UNEP.

2. Performance Ratings

17. Each agency rated performance withregard to implementation progress (IP) andprospects for achieving development/globalenvironmental objectives (DO) for its projectsin the PIR. They used a 4-point scale: highlysatisfactory (HS), satisfactory (S),unsatisfactory (U), and highly unsatisfactory(HU). Definitions for these ratings are inAppendix B.

18. A total of 33 projects, or 28 percent ofthe PIR portfolio, were rated �highlysatisfactory� by the implementing agency oneither IP or DO. This is fewer than last year,when 34 percent of projects were rated highly

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Biodiversity ClimateChange

InternationalWaters

Ozone Multiple Total

Global 4 6 0 0 2 12

Africa 15 9 3 0 0 27

Arab States/Middle East 4 4 3 0 0 11

Europe/Central Asia 6 5 2 6 0 19

Latin America & theCaribbean

15 7 3 0 0 25

Asia and Pacific 13 11 1 0 0 25

Total 57 42 12 6 2 119

3. 1998 PROJECT IMPLEMENTATION REVIEW

7


8

satisfactory on one or both measures. Byagency, UNEP rated five (62 percent) of itsprojects as highly satisfactory, UNDP 14 (29percent), and the World Bank 14 (23 percent).By focal area, 32 percent of biodiversityprojects, 21 percent of climate change, 25percent of international waters, and 33 percentof ozone projects were reported as performinghighly satisfactorily. Approximately 59percent of the PIR portfolio (71 projects) wererated �satisfactory.�

19. The remaining 15 projects, or 13percent of the PIR portfolio, were rated�unsatisfactory� or �highly unsatisfactory�by the implementing agency on either IP, DOor both. In 1997, 16 percent of projectsincluded in the PIR were rated unsatisfactory.Of the biodiversity projects included in thePIR, 9 percent were rated unsatisfactory, aswere 14 percent of climate change and 33percent of international waters projects. TheWorld Bank reported that 11 (18 percent) ofits projects included in the 1998 PIR weremaking unsatisfactory progress; UNDP hadfour (eight percent) unsatisfactory projects;UNEP had none. These ratings compare to

18 percent (World Bank) and 17 percent (UNDP)unsatisfactory ratings in the 1997 PIR.

3. Review of Problem Projects

20. The status of the 15 projects ratedunsatisfactory was reviewed at the interagencyPIR meeting. In addition, the GEF secretariatidentified another 15 projects that were ratedsatisfactory, but that appeared to be havingimplementation problems, at least in somecomponents. While ratings were not changed,these projects were also reviewed individually.In general, the principal causes of unsatisfactoryperformance were (1) lower than expectedimplementation capacity by executing agencies,including NGOs in several cases; (2)participative approaches taking more time thanexpected; (3) changes in market conditions,especially related to climate change projects; (4)reductions in government counterpart and othercontributions, especially in Asia and Russia; (5)lack of government commitment to projectactivities; and (6) procurement delays. In fourcases, projects were terminated and some or allGEF funding cancelled during the past year dueto continuing performance problems. In others,

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HSHighly

Satisfactory

S

Satisfactory

UUnsatis-factory

HUHighly

Unsatis-factory

RatingImproved

since1997

RatingDeclined

from 1997

Biodiversity 18 34 5 0 7 6

Climate Change 9 27 5 1 6 3

International Waters3 5 4 0 0 2

Ozone 2 4 0 0 1 0

Multi-focal area 1 1 0 0 1 0

Total 33 71 14 1 15 11

9

1998 Project Implementation Review

projects are being redesigned or reformulatedto reflect a more realistic assessment ofimplementation and financial capabilities, andmore structured monitoring systems put in place.

B. Portfolio Highlights by Focal Area

21. This section provides a summary of theprojects in implementation in each focal area.It highlights key issues and areas of significantprogress identified during the PIR.

22. While there are now almost 140 GEFprojects for which there is implementationexperience (those included in the 1998 PIR plusanother 19 completed projects), the complexityof addressing global environmental issues andthe multitude of settings in which these projectsare carried out calls for a certain degree ofcaution and modesty in drawing lessons fromand generalizing about this experience. Withthis caveat in mind, however, this section of thereport discusses insights gained in implementingGEF projects and the principal challenges thatappear to be facing each portfolio.

1. Biological Diversity

23. The 1998 PIR included 57 biodiversityprojects: 31 from the World Bank, 22 fromUNDP, and four from UNEP. Although mostwere approved during the Pilot Phase, beforeGEF�s Operational Programs (OPs) weredeveloped, they have been grouped by OP in theOperational Report on GEF Programs. Basedon this categorization, 24 projects are in OP3(forest ecosystems), 13 projects are in OP2(coastal, marine and freshwater ecosystems), andfour projects are in OP1 (arid ecosystems) andin OP4 (mountain ecosystems). Nine projectsare regarded as short-term response measures,and three are considered global/regional supportprograms for enabling activities.

24. With regard to actual use of funds,approximately 65 percent5 of the projects inthe PIR focus on biodiversity conservation inprotected areas. Twenty-six percent supportthe development of national biodiversityaction plans and/or related research or studies.Twenty-four percent directly address issuesof sustainable use of biological resources.Most projects are located in specific areas orregions within a country, although 19 percentprovide support for broader nationalbiodiversity programs.

25. The information provided in projectreports and the discussion by the biodiversitytask force reinforced the conclusions andlessons identified in previous years� reviews.This underscores the need for GEF to givemore attention to disseminating PIR resultsand getting the lessons emerging from thereview to those who can best apply them,especially field staff. In particular, the reviewof the 1998 PIR biodiversity portfolioreiterated that:

· The active and full engagement ofcommunities in all stages of projectdesign, implementation, andmonitoring is a key determinant ofproject success. It leads to greater�ownership� of project activities.Several GEF projects (e.g., China NatureReserves and the conservation trust fundprojects in Mexico, Peru, and Uganda)have succeeded in bringing about moreparticipative management processes fornature reserves. Some reported positiveresults from involving local stakeholdersin decision-making and managementthrough local committees (see Box 1).However, while stakeholder repre-sentatives have been successful in givinga voice to communities and safeguardingtheir interests, they are not always aseffective in ensuring that information is

5 These numbers are approximate and the categories are not mutually exclusive, i.e., a project could be counted in more thanone category.


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communicated back to those theyrepresent. Engaging a wide range ofstakeholders takes considerably moretime than originally expected, and oftenrequires those involved in carrying outproject activities to develop new skills andapproaches. In addition, the requirements(including reporting) of donors and theneeds of local communities often contrast.These differences need to be identifiedand resolved early in projectdevelopment. The needs of localcommunities must drive projects;otherwise, the sense of ownership vitalto long-term success will be lost.

· Biodiversity projects need to combineconservation efforts with activities thataddress more immediate socio-economic needs and are sensitive topolitical processes. This may call forfinancing schools, health posts, or othercommunity priorities, as was donethrough Uganda�s Mgahinga-BwindiConservation Trust Fund, or developingalternative sources of income (e.g.,retraining turtle shell carvers in theSeychelles). Experience from the SouthPacific Biodiversity Conservation project,however, underlines the need to balanceincome-generation with conservation.

· GEF biodiversity projects are generallyoverly ambitious, have too manyobjectives, and have implementationperiods that are too short. Projectdesigners and managers often misjudgethe complexity of the issues they aretrying to address and underestimate thetime needed for truly participativeprocesses. A longer time horizon isneeded to work through the complexinstitutional, policy, human resourcedevelopment, and financing issues relatedto biodiversity conservation andsustainable use. A flexible, phasedapproach to design and implementationis required, one that is based on firm but

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½ Ghana Coastal Wetlands – Local Site ManagementCommittees (LSMCs) from five areas are workingwith executing agencies to identify problems andpriority activities. The project has also constitutedmicro-enterprise review subcommittees toprescreen proposals for eligibility under theCommunity Investment Support Fund (CISF).

½ Uganda Mgahinga-Bwindi Impenetrable ForestConservation – the Local Community SteeringCommittee (LCSC) is represented on the board ofdirectors of the Trust Fund and has considerableinfluence on the selection of activities financed bythe Fund.

½ South Pacific Biodiversity Conservation – ThroughConservation Area Coordination Committees(CACCs), representatives of communities are nowin direct contact with a number of governmentagencies, NGOs and national and regionalinstitutions that have offered their time and supportwith projects. Community participation in thesecommittees along with representatives of otherorganizations has given them access and contactsthey previously lacked. As a result, institutionswhich in the past had little to do with thesecommunities have now found new partners in theirrural development programs.

achievable benchmarks set within thecontext of a long-term commitment. Projectproposals should identify clear objectives,but leave flexibility for the selection ofactivities to achieve these objectives.

· The long-term financing andsustainability of biodiversity conservationand sustainable use projects remainmajor questions. While several GEF-assisted biodiversity projects have beensuccessful at attracting significant additionalamounts of funding from other sources (e.g.,conservation trust funds in Bhutan and Peru,Guyana Iwokrama Rain Forest), many othershave had disappointing experience with

11


fundraising. In several projects, proponentsare actively looking at various approachesto long-term financing, including thecreation of trust funds. For example, in anumber of protected areas in the SouthPacific islands, the BiodiversityConservation project has promoted thecreation of trust accounts with funds fromincome-generating activities to support theareas following project completion. Aconclusion of the review is that the chancesof achieving financial sustainability forbiodiversity projects are likely to be greaterby combining sources of finance (e.g.,government budget, user fees, trust funds)rather than relying on a single source.

· It is important to understand the rootcauses of the threats to biodiversity loss.This often implies giving attention to thepolicy and socio-economic environmentwithin which biodiversity projects arecarried out, in addition to technical or site-specific factors.

· Support is needed from the full range ofgovernment actors (including local andregional agencies) and private sectorstakeholders (including timber and miningcompanies, wildlife traders, and largelandowners). Even in projects which havemade considerable efforts to involvecommunity groups, NGOs, and otherstakeholders, the lack of active participationby private businesses has limitedperformance. This is the case in the PapuaNew Guinea Conservation and ResourceManagement Program, ColombiaBiodiversity Conservation in the ChocóRegion, Guyana Iwokrama Rain Forest, andGuatemala Conservation and SustainableDevelopment in the Montagua Regionprojects.

26. A lack of absorptive capacity (i.e., theability of partners to carry out project activities)has sometimes delayed implementation. In somecases (e.g., Panama Darien BiodiversityConservation, Uganda Mgahinga-Bwindi

Conservation Trust, Guatemala MontaguaConservation and Sustainable Development,Lebanon Protected Areas), project executingagencies or implementation units wererequired to take on a broader role of buildingthe capacity of NGOs and other organizationsthat were originally expected to carry a greatershare of implementation responsibilities. Onthe other hand, the PIR identified severalsuccessful efforts to strengthen local NGOs.For example, in Jordan, the Royal Society forthe Conservation of Nature (RSCN)�theexecuting agency for the Dana Wildlands andAzraq Wetlands project�now providestraining courses in protected areamanagement, public awareness techniques,and ecotourism development for Yemen,Syria, Lebanon, and the Palestinian Authority.Strengthening RSCN also allowed it tobecome an effective partner with theJordanian government in developing nationalpolicy for protected areas.

27. Although some project reports providegood examples of indicators and systems formonitoring performance and impact, thisremains an area where greater attention isneeded. In general, project indicators in thePIR portfolio focus largely on inputs, outputs,and processes rather than the results orimpacts of project activities. In part, theabsence of good project indicators andmonitoring systems appears to reflect a lackof focus on and identification of clearstatements of project objectives, especially interms of their intended biodiversity impact.

2. Climate Change

28. The 1998 PIR includes 42 climatechange projects: 20 from UNDP, 19 from theWorld Bank, and three from UNEP. Basedon the categorization in the OperationalReport on GEF Programs, 13 of these projectsare in OP6. They focus on one or more offive types of renewable energy sources:biomass gasification, wind, solarphotovoltaics (PV) or water heating, solidwaste, and geothermal. Eleven projects are


12

in OP5 and aimed at energy efficiency andconservation. There are five basic types ofprojects in this OP: demand-side management,efficient lighting, buildings, boiler conversion,and transport. Eight projects are classified asshort-term response measures and anothereight are regarded as enabling activities thathelp developing country parties to the UnitedNations Framework Convention on ClimateChange (UNFCCC) prepare their nationalcommunications to the convention. Theremaining two projects, both in Brazil, areincluded in OP7, reducing long-term costs oflow GHG-emitting energy technologies.

29. A consistent conclusion from previousreviews of the climate change portfolio�theimportance of a favorable policyframework and incentives for the adoptionof alternate energy and more energy-efficient products and technologies�wasagain the topic of substantial discussion in the1998 PIR reports. Several projects reportpositive impacts on policies and regulationsthat have led to greater private sectorparticipation and investments. For example,the wind farm component of the IndiaAlternate Energy project helped bring aboutpolicy changes by state governments that

created incentives to attract private investmentin wind power facilities. A local manufacturingbase for producing wind generation equipmentemerged as a result. In the China Sichuan GasTransmission project, pricing policies wereclearly identified as the key factor to sustainincentives for reducing gas leaks. Pricingpolicies were also found to be important toensure financial viability of power entitiesinvolved in the Philippines Leyte-Luzon andLithuania Klaipeda Geothermal projects. Theimplementation of China�s Coal-Bed Methaneproject brought about policy and institutionalchanges that led to sizable investments throughjoint ventures. Where policy or regulatoryframeworks have been adjusted to accommodatenew technologies, opening of new markets hasoccurred. For example, in the cases of theMauritius Sugar Bio-Energy, Costa Rica TejonaWind Power, and Poland Coal-to-Gas projects,the original physical objectives of the projectshave not been achieved, but other private andpublic investments were stimulated by creationof supportive policy frameworks.

30. Projects involving significant policy andregulatory reforms may require longertimeframes than a typical GEF project toadequately monitor market responses and

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Originally, this project had two components: one focusing on producing methanol from organic wastes, and the otherto create energy service companies (ESCOs) to help reduce energy consumption by electric motors in the coppermining industry. Before the project began implementation, however, the first component was overtaken by events.Chilean imports of Argentine natural gas increased substantially, greatly reducing methanol prices. This componentwas reformulated to pilot the use of sustainably grown biomass to generate power through gasification in remoteislands not connected to the electricity grid. More recently, the second component has also experienced significantdifficulties. These were due to three factors: (1) reluctance by companies to divulge to ESCOs energy consumptiondata that they regarded as confidential and sensitive, (2) decreased electricity prices due to an increased number ofpower plants and the influx of natural gas, and (3) the willingness of mining industries to invest in more efficientmotors on their own, without project assistance, for new facilities being built. As a result, this component, too, isbeing redesigned to focus on energy efficiency of small and medium-sized urban enterprises (e.g., food processing,light industry).

13


determine the results of these changes in termsof global environmental objectives. Legislativechanges, price adjustments, and withdrawal ofsubsidies are often only beginning to have animpact by project completion.

31. The lack of stakeholder involvement hasbeen a key reason for poor progress in severalprojects. For example, inadequate stakeholderconsultations at the outset delayedimplementation of the India Development ofHigh Rate Bio-Methanation Processes andOptimizing Development of Small HydelResources in the Hilly Region projects. Onecrucial assumption�that beneficiaryorganizations would be willing and able tocontribute 50 percent of the costs of individualprojects under the Bio-Methanation project�proved to be incorrect once these consultationswere held. Both projects have spent two yearsdeveloping partnerships and collaborativelyselecting project sites. The level of communityparticipation in the Hilly Hydel project has ledstate governments in India to reconsider theimportance of stakeholder participation in thesmall hydro sector. Lack of stakeholderconsultations also created delays in the selectionof sites for several projects (e.g., TAKAGAS inTanzania, Waste-to-Energy in Pakistan). On theother hand, the China Methane from MunicipalWaste project seems to be making good progressdue to broad stakeholder participation, includingkey municipal agencies, in the design process.

32. Many problems associated with newtechnologies are not technical but relate tocountry-specific administrative and managementissues. During the review, concern was expressedthat the few projects in OP7�which seeks toreduce the long-term costs of new low GHG-emitting technologies�are often limited to oneor two countries. This limits opportunities togain experience under a variety of settings.There is a greater need to recognize the value ofa �portfolio� of parallel but coordinated effortsin several countries under this OP.

33. Two areas were identified for furtherattention by the climate change task force, GEF�s

monitoring and evaluation program, and/orSTAP. First, energy service companies(ESCOs) are significant actors in severalprojects carried out under OP5�removal ofbarriers to energy efficiency and energyconservation�including the Hungary EnergyEfficiency Co-Financing and Chile Reductionof Greenhouse Gas Emissions projects.However, working with ESCOs is oftendifficult. They have a lot of potential, butlegal, regulatory, institutional, and financialissues often limit their effectiveness. Barriersto ESCOs becoming commercially viable areconsiderable, even in relatively conduciveenvironments. An assessment of experiencewith ESCOs could identify opportunitieswhere GEF might best focus its attention inthe future. Second, rural off-grid solar PVprojects, such as the Zimbabwe Photovoltaicsand India Alternate Energy projects, are animportant part of GEF�s portfolio in OP6�promoting adoption of renewable energy.Experience in Zimbabwe and India shows thatit can be difficult to sustain projectachievements. Strategically, an examinationof lessons learned from the current portfolioof rural PV projects could help assess theirpotential impact on global greenhouse gasemissions and how many of these activitiesrequire GEF funding before they canreasonably be expected to be replicated withother resources.

3. International Waters

34. The 1998 PIR includes 12 internationalwaters projects: six from UNDP, five from theWorld Bank, and one from UNEP. Threeaddress transboundary environmental issuesin water bodies shared by more than onecountry: the Black Sea, Rio Bermejo, andLake Victoria. Three others�Industrial WaterPollution Control in the Gulf of Guinea LargeMarine Ecosystem, Pollution Control andOther Measures to Protect Biodiversity inLake Tanganyika, and Prevention andManagement of Marine Pollution in EastAsian Seas�provide support for a variety ofactivities within the framework of a regional


14

project. The first two of these projectsoriginally built upon the interest ofresearchers. The latter focused on threedemonstration projects within a regionalcontext but not specifically on transboundaryissues. Three projects are limited to onecountry�Jordan Gulf of Aqaba Environ-mental Action Plan, Yemen MarineEcosystems of the Red Sea Coast, and EgyptLake Manzala Engineered Wetlands�although two of these were later linked to abroader GEF-supported regional program inthe Red Sea area. The remaining three�OilPollution Management for the SouthwestMediterranean, Wider Caribbean Initiative forShip-Generated Waste, and Eastern Caribbean(OECS) Ship-Generated WasteManagement�aim primarily to reducepollution from ships; the Jordan Gulf of Aqabaproject also includes components related toship waste.

35. Proportionately, international watersprojects were experiencing moreimplementation problems than projects inother focal areas. During the review, this wasattributed primarily to two factors:

• The regional approach of internationalwaters projects is institutionally complex.This is especially true where projectsattempt to work through, or develop,regional mechanisms with weakinstitutions. A lesson drawn in the reporton the Lake Tanganyika project is that thebroad range of institutions involved hasmeant few resources are available toaddress each individual organization,limiting capacity building impact.

• Projects have tended to be too ambitious,and have not sufficiently sequencedactions according to agreed priorities.Project reports describe many activities

6 For additional information on experience involving private sector stakeholders in Batangas Bay, the Philippines, under theEast Asian Seas project, see GEF Lessons Notes No. 4, November 1998..

that may be ancillary to the necessary policy,legal, and institutional reforms and priorityinvestments envisioned by GEF�sOperational Strategy. In fact, too manyinterventions on too many issues, some ofpurely domestic benefit, may be especiallysymptomatic of international waters projectsapproved during the GEF Pilot Phase.

One important lesson is that projects need astrategic phase when cooperating countries canset priorities and agree to focus on only the topone or two transboundary issues.

36. Many of the accomplishments reported inthe international waters projects are proceduralin nature. This is consistent with the strategicapproach mentioned above. For example, boththe Gulf of Guinea (see Box 3) and East AsianSeas projects have been successful at creatingmechanisms to bring private businesses andother key stakeholders into the decision-makingprocess.6 However, it is too early to identify thelong-term impact these actions may have inreducing the transboundary threats, and there isa need to link these �political� accomplishmentseventually to technical achievements.

37. The Black Sea experience also highlightsthe importance of inter-ministerial, cross-sectoral coordination in each country toachieving on-the-ground results. The initialGEF project involved mostly environmentalofficials and experts, while the intent of thecurrent follow-on project is to mobilize theagriculture, industry, and municipal sectors.Finance and planning ministries are alsoencouraged to participate.

38. The international waters focal area isunique within GEF in depending onimplementing agency collaboration toleverage policy, legal, and institutionalreforms�and investments�to address

15


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The Industrial Water Pollution Control in the Gulf of Guinea Large Marine Ecosystem project has overcome earlyimplementation difficulties to become a satisfactory project. In part, this was because it moved from a narrow initialtechnological focus of interest to only a few research organizations in the region, to encouraging a broader process tocreate a framework for shared management of transboundary problems affecting the Gulf of Guinea ecosystem. Theproject has raised awareness and increased commitment at the policy level in several countries to address commonpollution problems. This culminated in a ministerial declaration in 1998 in which governments agreed to sustainregional approaches—as opposed to unilateral actions—to solving shared environmental issues.

In addition, the Gulf of Guinea project has actively included private businesses in its consultative processes anddecision-making structures. Industry involvement in formulating regulatory and other measures has maderegulations more practical and increased the prospects of compliance. For example, creation of a Waste StockExchange Management System, an initiative of the private sector that received project support, is expected to lead toreduced pollution through reduction and recycling of wastes on a commercial, cost-effective basis.

complex trans-boundary water problems. Itis important that the regular programs of IAs, aswell as other donors, support recipient countryneeds in this area. As the Black Sea report notes,progress can be delayed when decisions onpriority investments are not forthcoming. TheWorld Bank is currently addressing thisdeficiency. It recently announced an initiativefor priority investments in the six Black Seacountries that may constitute the basis for astrategic partnership, with GEF focusing onnutrient reduction in the basin. Elsewhere, thereare also encouraging signs of IA collaboration.For example, concerns expressed in previousPIRs about the limited number of countriesactively involved in the Gulf of Guinea projectmay now be resolved as UNDP and UNEP joinforces with the Regional Seas Programme toaddress the entire large marine ecosystem. Still,more effort is needed to address the complexityof problems and challenges of coordination inthe international waters area.

4. Phase Out of Ozone Depleting Substances

39. The 1998 PIR portfolio included six ozoneprojects, all from the World Bank.

40. There was little discussion in projectreports of overall progress by countries in

implementing their ODS phase-out programs,which form the framework for GEF-fundedactivities. The review concluded that moreinformation about the status of these programswas needed to judge the impact of GEFprojects. Broader country progress will bepart of reporting on GEF project performancein the future. A complementary portfoliostudy will also be undertaken in 1999 toprovide and analyze this information as asupplement to the reporting provided in the1998 PIR. This may include the definition ofspecific project and country programmilestones, where feasible.

41. Through its ozone projects, GEF hasgained experience working in countries intransition�especially with private businessesthere�that can provide insights valuable toother programs. Contacts with privatecompanies were facilitated in the case of someproducts (e.g., refrigeration and foam) by thefact that all manufacturers buy their chemicalinputs from a limited number of suppliers.This helped project managers to identifythrough these suppliers individual firms withwhich to work. This information wouldusually not have been available fromgovernment sources. In other subsectors (e.g.,solvents), however, this supplier network doesnot exist and it has been much more difficult


16

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GEF’s portfolio of ODS phase-out projects in Central andEastern Europe has been especially affected by the pace ofbroader economic change. This is well illustrated by the projectin Bulgaria. The project has been substantially delayed,although performance improved in 1998 due to measures takenby the government to strengthen its Ozone Task Force andexempt participating companies from paying Value Added Taxon goods purchased under the project. Activities at severalenterprises originally included were canceled due to delays inprivatization or because they were no longer financially viable.As a result, investment plans in participating companies had tobe adjusted, other enterprises were considered for inclusion inthe program, and funds were reprogrammed to new activities.The latter include training of refrigeration technicians in the useof non-ODS substances.

to reach individual companies. It hasbeen especially difficult to reach smalland medium sized enterprises usingODS. A lesson from this experience isthat projects should try to find upstreamnetworking systems through which toreach individual enterprises wheneverpossible.

42. Another lesson from the ODSportfolio is the need for flexibility toadjust implementation arrangementsand schedules until companies can geton a viable financial footing, especiallyin economies undergoing rapideconomic change. The countries inwhich GEF ODS phase-out projects arenow being completed are generallythose that started reforming theireconomies early, i.e., Czech Republic,Hungary, Slovenia. Even in thesecountries, implementation has taken muchlonger than expected, and enterprisesoriginally included in the GEF program werechanged because some went out of businessor stopped producing products using ODS. Asillustrated by the case of Bulgaria (Box 4), inother countries that have not moved as rapidlyto reform, even greater implementationflexibility and realism about the time requiredto carry out projects is needed.

43. The ozone task force concluded that moreeffort was needed to communicate the lessonsidentified in implementation reviews to projectmanagers and designers. The UNEP-IE OzoneClearinghouse and others are developingchecklists for project design based on experienceunder the Multilateral Fund of the MontrealProtocol. GEF should look for ways tocontribute to this process.

4. SUMMARY OF RECENT EVALUATION FINDINGS

the situation of the country it serves. However,the team found it useful to group them into twogeneral categories. �Parks funds� supportspecific protected areas within a nationalprotected areas system. (The majority of GEF-supported funds fall into this category.) �Grantsfunds� channel resources to specific groups(typically NGOs and community-basedorganizations) for a broad range of conservationand sustainable development projects, andoften include the development of civil societyinstitutions among their objectives. These twotypes of funds tend to have significantdifferences in their relation to nationalstrategies, and in their governance structures,program management, and the ways and easewith which they meet GEF criteria.

48. Conservation trust funds were often seenmainly as financial mechanisms that could takelarge amounts of money from debt swaps orinternational grants and �retail� them intosmaller projects over long periods. Theirboards of directors and staff reflected thisemphasis. But a key conclusion of theevaluation is that the overall success ofconservation trust funds depends on theirability to participate in developing nationalconservation strategies, to work with otherpublic and private agencies to develop agilemanagement approaches, and to nurturecommunity groups and others becominginvolved in biodiversity conservation for thefirst time�in short, to be more than justfinancial mechanisms. To succeed, trust fundsneed the governance structures, staff, andtechnical support to allow them proactively toinfluence their environment, monitor theirresults and learn from experience, maintain

44. Program evaluations and other reviewsconducted by GEF�s corporate M&E team and/or IAs provide insights and lessons thatcomplement those from the PIR. This sectionsummarizes the findings of five evaluations andother assessments carried out during the pastyear that are especially relevant to the themesexamined in this year�s review.

A. Evaluation of Experience with Conservation Trust

Funds7

45. GEF has supported conservation trust fundsin several countries as a means of providing long-term funding for biodiversity conservation. Anevaluation was carried out in 1998 to determinethe extent to which the advantages of trust fundshave been realized, how concerns expressedabout them have been addressed, whatconditions are needed for funds to functioneffectively, and their impact to date onbiodiversity conservation and sustainable use.

46. The evaluation analyzed the experience of13 funds to identify lessons and makerecommendations regarding future assistance toconservation trust funds. It focused on GEF-supported funds8 and six others selected toinclude funds of various sizes and types,geographical balance, and insights on particularaspects of interest, such as innovative fundingmechanisms. Visits were made to seven fundsin six countries.

47. The evaluation showed that there is notypical conservation trust fund. A fund�sstructure, scope of activities, priorities, andprocedures vary according to its purposes, and

7 The full report of this evaluation, and a summary evaluation report, are available on the GEF web site (www.gefweb.org).Copies may also be requested from the M&E Team, GEF Secretariat, telephone: (202) 458-2548; fax (202) 522-3240; e-mail: [email protected].

8 GEF experience to date is largely with trust funds supported by the World Bank.

17


18

credible and transparent procedures, andsupport participatory approaches toconservation and sustainable development.

49. The evaluation found that trust funds havemany accomplishments. They have:

• helped create new national parks andexpand existing protected areas. Byproviding an increased �resource security�for their operations�the assurance thattheir basic operating costs and staff salarieswill be covered�trust funds have allowedprotected area managers to concentrate onconservation activities, attracting projectfunding, and collaborating withcommunities and interested organizations;

• generated and managed substantialfinancial resources;

• enabled the participation of civil societyinstitutions in resource conservation;

• increased the level of scientific researchapplied to conservation issues; and

• increased public awareness of conservationissues.

50. Uncertainty remains, however, about trustfunds� ability to show long-term biodiversityconservation impact. In part, this is due to thedifficulty of measuring biodiversity impact, andof attributing results to a particular intervention,especially over the short term. It is also truethat trust funds generate relatively smallamounts of resources in relation to nationalconservation needs. The two types of trustfunds are addressing concerns about achievingimpact in distinct ways. An example from the�parks funds� is the protected areas fund inMexico, which has used a logical frameworkmethodology to define the impacts it intendsto have in each protected area and in the systemas a whole. Several �grants funds� have chosena programmatic or geographic niche in whichto focus their activities to achieve maximumimpact.

51. Trust funds have leveraged substantialadditional funding for conservation. This hashappened at the level of the fund itself�forexample, the six GEF funds with operatingexperience have raised more than US$33million in non-GEF contributions�and at thelevel of projects financed by the fund, whichgenerally include substantial counterpartcontributions by recipients. However, only oneof the funds studied has met its objectives forraising additional endowment funding. Mostof the money raised has been short-term projectfinancing or six-to-ten year sinking funds.

52. Most of the funds studied were privateinstitutions with mixed public-privategoverning bodies. Non-governmental boardmembers typically held the majority, withgovernment sometimes limited to one or twoseats. The team found advantages of larger oversmaller boards, especially because of theirability to establish working committees to dealwith the diverse issues that funds must address:financial management, fundraising, technicaloversight, etc. Also, governing boards whosemembers are elected in their personalcapacity�rather than as formal representativesof organizations or sectors�tend to develop astronger sense of �ownership� of the fund asan institution, and work more effectively toimplement the fund�s mission. The moreformally representative boards tend to see theirrole in terms of allocating resources amongtheir various agencies and sectors.

53. The GEF-supported funds havesuccessfully applied an asset managementmodel developed by the World Bank. Itincludes development of investment guidelinesthat reflect a conservative risk strategy andportfolio diversification; competitive,international selection of experienced,professional asset managers; and activeoversight by the fund�s board of directors ofinvestment performance compared to standardbenchmarks. GEF-supported funds havegenerally established spending rules orpractices that preserve capital and buildcushions when investment returns are good that

19

Summary of Recent Evaluation Findings

permit them to continue program supportduring financial market declines.

54. Trust funds have attracted highly qualifiedpersonnel but still require capacity-buildingassistance to develop their potential asinstitutions. Among the community of trustfunds there is a considerable store of experienceand innovation, and potential for developing�learning networks� to share this knowledge.

55. An important factor influencing themanagement of trust fund programs has beenthe extent to which there is an �effectivedemand� for these activities among targetgroups. Contrary to original expectations, somefunds have not been able to make grants withall of the resources they had available withoutfirst devoting considerable effort to helpingNGOs and community organizations prepareproject proposals and strengthenimplementation capacity to meet theirstandards, or devising new approaches aroundburdensome government contracting orfinancial procedures.

B. Evaluation of the Small Grants Programme9

56. As of June 1998, GEF�s Small GrantsProgramme (SGP) had set up 45 nationalprograms and made grants to more than 1,100projects at a total cost of US$42 million oversix years. A comprehensive, independentevaluation was carried out for UNDP in 1998to review the performance of the program,especially its �Operational Phase� from 1995to 1998. It was based on interviews, visits toseven countries and studies on two others, anda self-evaluation questionnaire sent to thecountry programs.

57. The evaluation concluded that the SGPoccupies a unique niche not only within GEFbut within all international environmentalefforts. Many national programs have engageda wide range of actors in addressing globalenvironmental problems, leading to newcoalitions and partnerships. The SGP providesa stream of funding which, while modest, isunmatched by other environmental programsin terms of innovation, flexibility, andresponsiveness. There is no comparablemechanism for raising environmentalawareness and building capacity across such abroad spectrum of constituencies within therecipient countries. National ownership of theSGP and commitment to its participatoryprinciples is shown by the talented andexperienced people attracted to becomenational steering committee members, as wellas enormous voluntary inputs from all levelsof society.

58. The evaluation assessed program impactsin four areas: capacity development, leveragingof experience, sustainability, and raisingawareness. In addition, it identified a numberof program issues for attention by GEF.

1. Capacity Development

59. The evaluation found that the SGP hadsignificant positive capacity building impactsin many countries, even without asystematically planned strategy. Progress intechnical and organizational capacity amongNGOs and community-based organizations(CBOs) has been impressive. It has enhancedthe credibility of these organizations and theirability to make important contributions tosolving local as well as global environmentalproblems. Many SGP projects have encouragedNGOs, CBOs, and communities to learn about

9 This section is summarized from the �Report of the Second Independent Evaluation of the Global Environment FacilitySmall Grants Programme (GEF/SGP)�. The report is on the UNDP/GEF web site (http://www.undp.org/gef/) or can beobtained from Marie Khan Kacou in the UNDP/GEF SGP management unit, telephone: (212) 906-5842, fax: (212) 906-6568, email: [email protected].


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environmental issues and integrate them withtheir existing development programs, oftenwhere the environment had previously beenignored. Environmental knowledge and avariety of technical skills have been acquiredby a large number of organizations, includingthe ability to analyze local natural resourceissues, diagnose problems, and implementsolutions. Organizational strengthening hastaken place through the management of SGP-financed projects, with special emphasis ondeveloping viable proposals, participatoryplanning, management of financial resources,and meeting donor reporting requirements.

60. SGP grants have been used to increase anddiversify community access to sources oftechnical assistance and training, includinggovernment services, research institutions, andspecialized NGOs. Interactions withgovernment agencies have given communitiesconfidence and led to working relationships thathave persisted beyond the life of individualprojects. Such links have provided valuableopportunities for government technicians anduniversity researchers to work closely withgrassroots communities. Grants have alsofostered the development of networks andcollaboration between different types of NGOs.

61. Women�s groups have been given sizeablesupport and the special needs of women havereceived considerable attention in all of the SGPcountry programs visited as part of theevaluation. It was found that women aregenerally more receptive and sensitive toenvironmental issues than men. Grants havehelped women enhance their role and capacitieswithin their communities, and strengthenedtheir will to increase their involvement in thedevelopment process.

2. Leveraging of Experience

62. The evaluation found that most countryprograms had attracted co-financing from othersources for their grants, although the amountsvaried between countries. While they weresubstantial in some places, it found the potential

for co-financing quite limited in countrieswhere donor programs are shrinking, publicfunds are limited, and/or there is no traditionfor philanthropy. The program also attractedextraordinarily high amounts of volunteerinputs to its projects. They come fromuniversities and research institutions,government services, NGOs, private and publicsector organizations and individuals, localgovernment representatives, national andforeign experts with development projects, aswell as the volunteer members of nationalsteering committees. Some replication andscaling-up of promising projects has takenplace.

63. Although the SGP encourages grants tobe used for policy analysis and dialogue, theevaluation found that this opportunity remainsundeveloped in most countries. The mostobvious policy impact has been convincing keydecision-makers of the benefits of aparticipatory approach to the design andimplementation of development programs. Insome countries, the SGP has also been able toinfluence spending policies of nationalenvironmental funding agencies.

64. Skillful use of the media has helpedseveral national SGPs achieve recognition asprograms focusing on environmental problem-solving, community action, and activitiesrelated to meeting the country�s internationalobligations. The SGP is often the GEFshowcase, more recognized by NGOs and thepublic than other GEF-supported activities.

3. Sustainability

65. A mix of approaches has been used toenhance project sustainability, but theevaluation concluded that it is too early toassess their impacts. The evaluation identifiedseveral characteristics associated with highpotential for sustainability: (a) strongcommunity adhesion to the project goals andapproach; (b) addressing genuine priority needsof the community; (c) communities that areunified and/or experienced in implementing

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small projects; (d) strong and consistentleadership from the implementing NGO/CBOand/or within the community; (e) the capacityto network or link with others, eithertechnically, financially, or politically; and(f) viable income-generating components.

66. Working against sustainability, most SGPgrants are for a maximum of two years. Mostprojects, especially those to inexperiencedCBOs and communities, require additionalsupport before serious progress can beanticipated. The evaluation found experienceto be disappointing with income-generatingactivities, which it attributed to the fact thatmost country programs and their partner NGOshave limited small business expertise orexperience.

67. The idea of country program sustainabilityremains unclear in most countries. So far, onlythe Mexico and Philippines SGPs have takenconcrete steps toward financial and institutionalindependence, although both expect to needanother three years or more under the SGPumbrella before their operations becomesustainable. The evaluation concluded that asignificant number of country programs havelittle prospect of achieving independence underexisting donor and national governmentspending priorities.

4. Awareness Raising

68. The SGP has helped establish a newgeneration of NGOs in some countries, notablyPoland and Jordan. SGP awareness-raisingefforts have directly increased the participationof dynamic individuals and groups inenvironment issues in general, as well as inprojects. Combined with skillful use of themedia, this has led to substantially increasedenvironmental awareness. Awareness raisingrelated to GEF�s focal areas has been mosteffective among NGO grantees andcollaborating organizations, includinggovernment agencies, but was much lessevident at the community level.

5. Major Programming Issues

69. The evaluation identified a number ofprogramming issues for attention by GEF.Among them, three in particular stand out:

70. Tension between community prioritiesand GEF�s focal areas. Many national SGPsare struggling to establish credible linksbetween the community-level activitiessupported by their grants and the globalenvironmental problems targeted by GEF. Theprospect of meeting basic needs or capacitybuilding often provides the SGP or its NGOgrantees with their entry point to a community.But winning the confidence of communities�especially ones without a history of externalassistance�and helping them organize takestime, involves much uncertainty, and is unlikelyto succeed if it begins with an explicit emphasison GEF focal areas. As a result, many SGPprojects begin with activities that are not relatedto global environmental problems. Identifyingprojects which balance immediate communityneeds with the GEF focal areas has beenespecially challenging in countries where donorsupport has decreased and economies arestruggling. In these places, many communityand NGO programs have run out of funds andgovernments have not made up the difference.This pressures the SGP to support communitybasic needs instead of global objectives.

71. Target projects and organizations. TheSGP projects which have moved fastest andshown the greatest progress are usually thoseinvolving experienced NGOs in urban or semi-urban areas. These projects also require farless management support and supervision, animportant consideration in a program that hasstressed keeping operating expenses low.However, this contrasts with the target of theSGP, which is to work with poor ruralcommunities and inexperienced CBOs.Projects of this type have generally progressedmuch more slowly. The evaluation concludedthat the program has so far given little attentionto the important operational implications of the


22

choices between these types of projects andtheir different definitions of �community.�

72. Measuring performance and impacts,and disseminating lessons. The evaluationfound that the SGP did not have an effectivestrategy for measuring or assessingperformance and impacts. It recommended thatperformance indicators be developed forprojects and country programs and thateffective monitoring and evaluation systems beestablished. In addition, it found that theprogram has disseminated little information onwhat has been learned from its experience. Itrecommended giving systematic attention tocarefully documenting, objectively analyzing,and broadly disseminating lessons from SGP�sexperience.

C. UNDP IntegratedCoastal ManagementProjects

73. UNDP funded four integrated coastalmanagement projects in Latin America and theCaribbean during GEF�s Pilot Phase: thePatagonia Coastal Zone Management Plan inArgentina; Sustainable Development andManagement of Biologically Diverse CoastalResources in Belize; Protecting Biodiversityand Sustainable Development of the Sabana-Camaguey in Cuba; and Conservation andManagement of Biodiversity in the CoastalZone in the Dominican Republic. BetweenJanuary 1997 and August 1998, final projectevaluations were conducted for these projectsby the University of Rhode Island (URI). Thissection synthesizes the main findings andconclusions of these evaluations.10

74. The URI evaluations examine theperformance of the four projects through thelens of a framework of an integrated coastalmanagement �policy cycle� identified by the

international Group of Experts on the ScientificAspects of Marine Environment Protection(GESAMP), based on worldwide experience.While it recognized that none of the GEFprojects were explicitly guided by this model,the framework was considered to be a usefultool to analyze their experience and compareit to similar projects. The policy cycle involvesfive steps: (1) issue definition, (2) selectionof objectives, (3) formal adoption ofmanagement structures and funding, (4) imple-mentation, and (5) evaluation. It is essentialthat actions and priorities at any given time beappropriate to the step in the policy cycle thata program has achieved. Experience suggeststhat eight to twelve years is usually needed tocomplete an initial cycle through these fivesteps. In addition to the steps of the policycycle, the framework includes severalprinciples and features associated withsuccessful coastal management efforts. Theyinclude (1) stakeholder participation at allphases of the program; (2) strategic issue-driven program focus and decision making;(3) integrated approaches and methods; (4) acommitment to adaptive learning; and (5) build-ing human and institutional capacity.

75. The four GEF projects differ somewhatin their scope and aims. In Argentina and Cuba,the projects focus on one specific region richin biodiversity that is under considerable threatfrom development. Both sought to provide ascientific basis for integrated coastalmanagement, sustainable development, andprotection of biodiversity. The Patagoniaproject was led by a respected Argentine NGO.In Belize, the project sought to create agovernment policy framework and structure forcoastal management, while the DominicanRepublic project was carried out in four specificareas and was implemented exclusively throughNGOs. All four projects concentrated on theearly steps in the policy cycle, especially ondata collection and planning, although only in

10 Copies of the evaluation reports can be obtained from Martin Krause in UNDP�s GEF Coordination Office, 304 East 45th

Street, 10th floor, New York, NY 10017, telephone: (212) 906-5723, fax: (212) 906-6998, email: [email protected].

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Cuba was the project explicitly conceived asthe initial phase of a longer term effort thatwould be supported by GEF.

76. The evaluations found that the GEFprojects were uniformly overly ambitious. Atcompletion, all were at the initial stages of step3 of the policy cycle, rather than beginning step4, as they had envisioned. Furthermore, mostlacked a clear conceptual framework fordefining and carrying out their activities. As aresult, they tended to support a broad range ofactivities rather than a focused set of initialinterventions selected to build a betterunderstanding of the issues confronting coastalzone management. For example, the evaluationconcluded that the Belize project was unableto effectively make the strategic progressionfrom an assessment of many managementissues to a limited and well-focused agenda thatbalances institutional capacity with short andmedium term actions. The result is a gapbetween technical analysis and planning on theone hand, and effective implementation on theother.

77. Experience under the four projectsconfirmed that integrated coastal managementis informed by, but not driven by, science.Institutional and financial issues tend to be mostimportant. Especially in Argentina and theDominican Republic, this finding contrastedwith the initial focus of the projects, whichemphasized scientific issues and research. Theevaluations highlighted the importance oflinking data collection and scientific activitiesto institutional and policy issues, and ofresearch being issues-driven. In Argentina,Belize, and the Dominican Republic, this wasnot done as effectively as it might have been.For example, in Argentina the evaluationconcluded that the coastal zone managementplan, while rich in information on biodiversity,gives limited practical guidance on how theemerging management process should unfold.

78. The evaluations also underlined theimportance of education and awareness-raisingactivities. Several of the projects�especially

in Argentina�achieved significant success inthis area. A key factor in Patagonia was thedecision to allow teachers to identify the issuesand topics that were important, and to workwith them to develop the curricula. Educationefforts, like research and data collection, needto be focused on and related to institutional andpolicy issues, and sustained over long periods.

79. Local ownership of project activities andthe planning process was generally good. Inthe Dominican Republic, participation ofcommunities, NGOs, and national agencies wasthe primary emphasis and success of theproject. Relevant government bodies wereeffectively involved even though the projectdesign did not call for this. Activities at allfour pilot sites demonstrated the power andmany benefits of community-level participationin both research and the governance process.Cross-sectoral activities among scientists,government, developers, and architects werehighly successful in Cuba in changing attitudesand minimizing adverse environmental impactsfrom development in the Sabana-Camagueyregion. In Argentina, the project greatlystrengthened a local NGO that draws togetherthe community of natural scientists andconservationists in the Patagonia region. InBelize, however, project efforts primarilyinvolved increased consultations with variousgovernment agencies. The evaluationconcluded that greater efforts were needed toinvolve people living in coastal areas inplanning efforts.

80. Looking at the four evaluations as awhole, it is clear that the Sabana-Camagueyproject in Cuba was regarded as the mostsuccessful. It met or exceeded its objectives,and made substantial progress in integratingscience, planning, and public policy formu-lation. The government�s financial contributionincreased from US$4 million to an estimatedUS$9 million. The project produced acomprehensive strategic plan for the Sabana-Camaguey region that identifies the majorissues affecting sustainable development andbiodiversity conservation, and the actions and


24

policy reforms required for its successfulimplementation. A major strength was theapplication of this planning process to ongoingtourism development, which led to tangibleapplications of elements of the strategy thathave had significant impact on developmentstandards in the region.

81. The evaluation states that Cuba provides,in many respects, an unusual social andinstitutional context for an integrated coastalmanagement program: (1) many of the usualtensions between public and private sector areabsent; (2) there are higher technicalcapabilities and an absence of corruption in theCuban public sector, compared to governmentagencies in many countries; (3) the Cubangovernment has made a major commitment toreforming its policies and restructuringgovernmental institutions to follow therecommendations of Agenda 21, whichprovided a high degree of government supportfor the project; and (4) Cuba�s scientificcommunity is technically excellent and verydedicated. The evaluation found that theSabana-Camaguey project exhibited a highdegree of commitment to adaptive learning. Itis also possible that the fact that the projectwas conceived from the outset as the first phaseof a ten-year effort may have contributed to itssuccess relative to similar projects in the regionwhich did not benefit from being set in thislonger term context from the beginning.

D. Evaluation of the Biodiversity Data Management (BDM) Project

82. The BDM project was implemented byUNEP in collaboration with the WorldConservation Monitoring Centre (WCMC) tohelp developing countries strengthen theircapacity to manage information on theirbiological diversity. It financed surveys toidentify sources of biodiversity data, creationof information networks, and development of

biodiversity data management plans in tencountries. The project also producedmethodological guidelines for carrying outBDM activities in other countries.

83. The final evaluation of the BDM projectwas carried out in mid-1998 jointly by UNEP�sEvaluation and GEF Coordination offices andGEFSEC�s M&E team. It involved fieldreviews and reports by local consultants in eachof the ten countries, a two-day workshop of allproject participants and UNEP and GEFSECevaluation staff and consultants, and a synthesisreport prepared by an independent consultant.

84. The evaluation concluded that the BDMproject was very appropriate for theparticipating countries. It allowed them todocument information on biodiversity that wasavailable, and to identify where data was stored,how it was managed, and the conditions underwhich it could be accessed. It helped countriestake the first steps toward establishing nationalbiodiversity information networks. It providedthe opportunity to pull together a variety oforganizations to develop common proceduresfor the collection, processing, storage,management, and exchange of biodiversitydata.

85. The project helped build capacity forBDM in a variety of ways. Training andprovision of equipment gave participatingcountries new tools to identify, organize, andaccess information, including expanded use ofthe internet. Institutional surveys gave datamanagers a more comprehensive knowledge ofinformation available and linkages with otherswho collected or were interested in biodiversitydata. In fact, it was only under the BDM projectthat many management officials became awarethat they dealt with and possessed biodiversitydata.

86. Some countries were more successful inimplementing project activities than others.The key factors that contributed to successincluded:

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• widespread political support andcommitment, including the formation ofproject steering committees that had broadrepresentation and met regularly;

• good telecommunications facilities andaccess to advanced informationtechnology;

• active participation by a wide range ofstakeholders, especially informationsuppliers and users, which led to greatersharing of experiences; and

• existing in-country technical expertise andproject management abilities.

The use of local consultants also increasedacceptability and credibility of project activitiesamong stakeholders, contributing to successfulproject implementation.

87. The evaluation found that no training orcapacity building needs assessments in theparticipating countries were carried out beforeproject activities began. Given the high degreeof technical competency in the rapidly evolvingfield of environmental information systemscalled for in the design, this contributed todifferences in implementation performanceamong participating countries. Countries withhigher levels of capacity in informationtechnology were able to take greater advantageof project training than were others. Theevaluation concluded that capacity needsassessments could have allowed activities tohave been tailored to each country�scircumstances and needs, for example, givingmore emphasis to training in countries wheretechnical skills were not as strong. Theevaluation also reported that capacity buildingin some countries was limited due to staffturnover, especially by those who receivedcomputer training.

88. The evaluation concluded thatsustainability of project activities needed moreserious consideration. A number of BDM plans

prepared under the project did not address theissue of funding. Others did not containimplementation schedules and budgets. Morecreative researching and identification offinancing options for BDM plans and activitieswould have made a useful contribution tooverall project success. The evaluation alsoconcluded that the four-year projectimplementation period was too short, and thatfurther donor funding was needed to continuesome project activities.

89. Support for intra-country linkages was amajor success. The project created a greaterawareness of the wide variety of databasesalready existing in the participating countries,and increased possibilities of data sharingbetween organizations, particularly amonggovernment agencies and research institutionsand universities. Nevertheless, in somecountries, key institutions refused to participatein the project. The evaluation concluded thatmore stakeholder representation would havebeen beneficial in the national institutionalsurveys, in particular by planners, the media,NGOs, consulting firms, and other privatesector organizations.

90. At the regional and global level, theevaluation concluded that the advantages thata multi-country umbrella project can potentiallyoffer were not fully exploited during theimplementation of the project. Linkages wereformed between national institutions and UNEPand WCMC networks through informationexchange, workshops, and activities related toproject management. But there was littleevidence of contacts between national andregional agencies promoted by the project, orlinkages with other global networks, althoughmany beneficial relationships could have beenestablished, especially through the more activeparticipation of the project�s internationaladvisory committee. Likewise, greater sharingof experiences among participating countrieswould have been beneficial. An extremelyvaluable feature of the evaluation itself was thepromotion of exchanges among country


26

representatives at the final evaluationworkshop. However, other opportunities of thisnature were limited under the project.

E. World Bank Quality Assurance Group�s Review of Africa Biodiversity Projects11

91. In November 1997, the World Bank�sQuality Assurance Group (QAG) assessed thequality of the Bank�s work on four biodiversityconservation projects in Africa; a fifth projectwas assessed in March 1998. Three of theseare GEF projects or include GEF-financedcomponents. The results of these assessmentsprovide a number of insights that complementthe lessons emerging from GEF�s PIRs andother evaluation work.

92. While the Bank�s biodiversity projects inAfrica have been in the forefront of introducingstakeholder analysis and beneficiaryparticipation into project design efforts, manyof the conditions which normally help ensureproject success at the outset are notably missingfrom the projects reviewed. The principal onesare:

· Ownership. Biodiversity is still primarilyan agenda of the international community.This has meant little integration with thebroader development agenda, shortages ofcounterpart funds, and staffing difficulties.Any ownership of a biodiversity orconservation agenda is likely to be at thelevel of the local population, rather thanwith the national government.

· Clarity of Objectives. Between lofty goalsand specific outputs there need to bestrategic objectives which focus the effort

and bring real meaning to the program. Inbiodiversity, it has proven very difficult tospecify meaningful strategic objectives,and the projects reviewed generally lackedsuch objectives.

· Simplicity of Design. Biodiversityprojects are by nature complex.Biodiversity encompasses many sectorsand activities. It requires interactions withmultiple stakeholders, agencies,constituencies, and donors. Usually, theinstitutions charged with managing theseinter-relationships are new and relativelypowerless. While the projects wereinevitably complex, they also tended to beoverly ambitious relative to imple-mentation capacity.

· Technical Solutions. Most Bank-financedactivities are grounded in technical andeconomic solutions which are relativelywell established by experience andanalysis. This is less true for biodiversityconservation.

· The Macroeconomic Context.Biodiversity programs are particularlyvulnerable to conditions in the nationaleconomy, especially in high-populationdensity, low-growth countries. In mostcountries, exploitation of natural resourcesalmost always takes precedence overconservation. Biodiversity projects areunlikely to be sustainable in stagnant orslow-growing economies, yet these arewhere many of the world�s ecosystems aremost diverse, abundant, or threatened.

93. From its assessment, the QAG identifiedfour principal lessons that can contribute tosuccessful Bank biodiversity operations in thefuture:

11 This section is summarized from the World Bank Environment Department�s Dissemination Note No. 62, dated July 1998,entitled, �Biodiversity Conservation Projects in Africa: Lessons Learned from the First Generation.� Copies are availablefrom the Environment Department, fax (202) 477-0565.

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· Biodiversity operations are not likely tobe sustainable unless they are integratedinto country and Bank developmentstrategies, or financed indefinitely by theinternational community. Future effortsshould be designed with more emphasis onthe underlying causes of biodiversity loss.

· The biodiversity portfolio requires moreaggressive supervision. In the projectsreviewed, problem definition wasexcellent. But often nothing happened:decisions were delayed or not taken, andno formal restructuring or redesign tookplace. Supervision of biodiversity projectsmust focus on learning and encouragechange and adaptation. Greater continuityof staff and closer management attentionis required.

· There needs to be a more disciplinedprocess in project design. Most of theprojects reviewed had undergonecomprehensive technical and stakeholderreviews during preparation, which seemedto have little, if any, impact on the finaldesign. GEF�s requirement of independent

technical (STAP) reviews that must beresponded to formally has addedobjectivity and open debate to issues wherespecial interest advocacy is still prominent,and can be a model of other Bank projectswith complex and controversial designissues. More care should be taken tounderstand the interests of differentstakeholders. Local resource users,international NGOs, and the privatesector�which has been largely absentfrom the projects�all play a critical role.

· Stronger leadership needs to be providedto sharpen focus on choices andpriorities. Several of the projectsreviewed were notable for Bank leadershipat the outset in stimulating debate andformulating programs. But asimplementation began, the intellectualleadership of the Bank declined. Based onthe experience to date, the Bank and GEFshould become more proactive in helpingto set the biodiversity agenda in the contextof a country�s overarching developmentneeds.

94. Drawing on the PIR reports andevaluations summarized above, this sectiondiscusses three cross-cutting issues selected forspecial attention in the 1998 review�sustainability, leveraging, and capacitybuilding�as well as three additional topics thatarose during the task force and interagencydiscussions.

A. Sustainability

95. Sustaining project activities followingthe completion of GEF funding is provingto be much more difficult than expected.Most terminating GEF projects faced continuedneeds for external support. More recently, thefinancial crises in Asia and Russia have alsoaggravated the ability of these countries tosustain GEF-supported projects in the nearfuture.

96. The implementation review highlightedfive ingredients for sustainability:

• a policy framework that providesappropriate incentives, including prices, forpractices that produce globalenvironmental benefits;

• long-term funding sources;

• public awareness and understanding ofthe benefits of new approaches andactivities;

• local ownership, brought about by genuineparticipation and influence of all keystakeholders in decision-making andprioritization of activities; and

• the ability of institutions, includingprivate businesses, to use effectively theresources provided.

97. The relative significance of thesefactors varies among focal areas. Inbiodiversity projects, participation of theentire range of actors with a stake in theconservation or sustainable use of importantresources is key. Reliable sources offinancing are also extremely important,given the nature of many conservationactivities and expenses. Conservation trustfunds have been able in some countries (e.g.,Bhutan, Mexico, Peru, Uganda) to provide afoundation for sustainable funding ofprotected areas and other conservationactivities. But trust funds cannot be expectedto provide all of the financial and other needsfor biodiversity conservation activities to befully sustainable over the long term. Ideally,funding should include a mix of resources,from user fees to revenues from sustainableeconomic activities to government budgetallocations to project funding from domesticand external organizations.

98. The policy environment, and theincentives it provides for individual practicesand corporate investments, is very importantfor projects in the climate change portfolio.Public awareness was also documented in boththe 1997 and 1998 PIRs to be a key factor forthe progress made by several climate changeprojects, especially those focusing on demand-side management of energy use. Thedevelopment or identification of domesticsources of finance�mostly in the privatesector�that do not rely on subsidies is alsoimportant if practices and technologiespioneered with GEF support are to be replicatedwidely and sustained. Subsidies have beenuseful in many GEF projects to provideincentives for change. However, more attentionneeds to be given to ways to maximize theirimpact and to phasing them out. The PolandEfficient Lighting Project (PELP) has providedinteresting lessons in this regard, by focusing

5. CROSS-CUTTING ISSUES

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subsidies for energy-efficient light bulbs at thewholesale level to leverage contributions bymanufacturers and reductions in retail markupsand sales taxes. These subsidies wereconsciously phased out while the projectcontinued to support marketing and otherawareness-raising activities.

99. In international waters projects,nurturing credible mechanisms to identifytransboundary issues and priorities is key tothe effective selection of activities and,ultimately, their sustainability. As experiencein the Black Sea region has shown, it isimportant to involve a wide range ofstakeholders at all levels in these processes tobring about the necessary awareness andownership. External financing for the sizablepublic and private investments needed toaddress transboundary pollution is likely to bea major determinant of the sustainability ofGEF-supported activities.

100. Sustainability in the ozone focal area ismore straightforward�it is achieved byphasing out the use of ODS, usually in a limitednumber of manufactured products, within thecontext of country agreements under aninternational convention. The viability ofenterprises that are the target of GEF-fundedactivities is a significant determinant ofsustainability. This has caused delays andadjustments in several projects in CentralEuropean countries undergoing rapid economicchange. The policy environment is alsoimportant, not only to assure that regulationsand incentives encourage ODS phase-out andproper recycling programs, but also to enforcecontrols on imported goods containing ODSwhere neighboring countries have differentODS phase-out schedules.

101. Institutional capacity is a factorinfluencing sustainability across all focal areas.Where it is lacking, capacity building effortsmay need to precede provision of substantialamounts of funding. (Capacity building is

discussed more fully in section 5.C. below.) Itis important to keep implementationarrangements simple, and integrate projectactivities and implementation units into regularnational institutions and budgets. The PIRidentified several examples of where the latterhad been successful, helping to sustainactivities funded by GEF. In Belize, the GEFproject led to the creation of a Coastal ZoneManagement Authority (CZMA), a permanentinstitutional structure that absorbed projectstaff. The CZMA includes a multi-institutionalBoard of Directors (formerly the projectsteering committee), an Advisory Council(previously the project�s technical committee)and a CZM Institute at the University Collegeof Belize. Similarly, the coordination officefor the Dominican Republic Conservation andManagement of Biodiversity in the CoastalZone project was given responsibility tocoordinate biodiversity and environment policyprojects generally, and will oversee a newWorld Bank National Environment Policyreform loan. The project coordinator will alsocoordinate the GEF biodiversity enablingactivity in the Dominican Republic. Likewise,institutional mechanisms developed forinvolving stakeholders and making decisionson activities under the East Asian Seas projecthave been integrated into local governmentframeworks and budgets in Xiamen, China andBatangas Bay, the Philippines.

102. Long-term sustainability of many ofthe efforts that GEF supports requireslonger time horizons. One three-to-five-yearproject will not be enough in most cases,especially in the biodiversity and internationalwaters. A longer term commitment, carriedout within the framework of a flexible,iterative approach based on agreedbenchmarks at key stages, is needed.

103. The financial sustainability of biodiver-sity projects was identified as a topic for in-depth review during 1999. GEF�s corporateM&E team will develop a proposal to conduct

29

Cross-Cutting Issues


30

the study, building on the recently completedevaluation of experience with conservationtrust funds. It may involve desk reviews, focusgroups or workshops with project managers,and a clearer definition of issues affectingfinancial sustainability for possible furtherevaluation. Results should be available for the1999 PIR.

B. Leveraging

104. How to identify additional resourcesleveraged by GEF programs�and to attributeto GEF actions taken as a result of itsprograms�are fundamental questions indetermining GEF�s overall impact on the globalenvironment. Leveraging was a focus of theStudy of GEF�s Overall Performance. It wasincluded as a cross-cutting issue in the 1998PIR to help further understand the broadereffects of GEF activities and to inform thedevelopment of an improved definition ofleveraging for use within GEF.

105. The Study of GEF�s Overall Performanceconsidered leveraging in narrow terms, i.e.,funding identified during project design.However, the 1998 PIR guidance requestedproject and agency reports to examineleveraging in a broader context. The PIRdiscussion concluded that GEF should adopta broader definition of leveraging for itsprograms and projects that reflects financialresources�both during design andimplementation�and actions catalyzed byGEF activities. It was a conclusion of the PIRthat, in the future, reporting on projectperformance should reflect this broaderdefinition. This conclusion was based on tworeasons.

106. First, limiting the calculation of fundingleveraged to co-financing identified at thedesign stage can be misleading. UNDPdocumented in its PIR reports substantialfinancial resources that have been stimulatedby GEF activities during implementation. Forexample, several climate change projects

brought about increased private sectorinvestments, often as a result of changes inpolicies and regulations. They include theMauritania Wind Energy, India AlternateEnergy, Tunisia Solar Water Heating, andBrazil Biomass Integrated Gasification/GasTurbine projects. Substantial funding to carryon the Guyana Iwokrama Rain Forest projecthas also been provided by other donors as aresult of project actions. Most of these financialresources were not explicitly anticipated orcalculated as co-financing at the time of projectapproval. In addition, GEF-supported trustfunds in Bhutan and Peru have attracted largeamounts of funds from other donors thatexceeded estimates at the design stage andwould not likely have been available forconservation in the absence of these trust funds.The evaluation of the Small Grants Programmefound that many country programs had attractedco-financing for their grants and high amountsof volunteer inputs to its projects.

107. Second, in addition to financial resources,the PIR reports identified many actionsattributed to GEF projects that producedsignificant outcomes beyond those associateddirectly with project activities. They include:

· Replication or expansion of activitiesbased on demonstrations or modelsfinanced by GEF. For example,restructuring of forestry enterprises underthe China Nature Reserves Managementproject is providing a model for resolvingland use conflicts elsewhere in China. InJordan, the protected area managementmodel and community-based approachcarried out under the Dana Wildlands-Azraq Wetlands project was appliedsuccessfully to several other protectedareas. Efforts to expand communityparticipation in the Small Hydel Resourcesin Hilly Regions project, whichconsiderably delayed implementation, arenow leading state governments in India toadopt this approach more broadly. And insome cases, GEF support for new activities

31


has stimulated private investment even thoughGEF-funded activities themselves have notproceeded as planned. This is the case of windenergy in Costa Rica through the Tejona WindPower project, conversion from coal to gas boilersin Poland, and development of biomass gasificationfrom sugar wastes in Mauritius.

· Development of common methodologies forconducting biodiversity and climate change countrystudies and assessments through several UNEP-GEF projects has provided tools and models forcountries not included in these projects to carry outsimilar assessments.

· Changes in attitudes and awareness of globalenvironmental issues. For example, a successfulregional �year of the sea turtle� campaign supportedby the South Pacific Biodiversity Conservationproject resulted in a one-year moratorium (laterextended three more years) on commercialharvesting of sea turtles in one country. The GlobalBiodiversity Assessment commissioned by UNEPand financed by GEF has become a standardscientific reference on the main issues of biologicaldiversity, and a large number of scientificorganizations and donor agencies are using theassessment as a foundation for initiatives they aretaking in this area.

· Broader country policy or market-level changesstimulated by project activities or participants.These changes can result from information oranalyses provided to policy-makers and industry,direct involvement in preparing proposedlegislation, and reviews of existing laws to advocatetheir stricter application. For example, the CubaSabana-Camaguey project successfully influencedthe physical planning and construction of tourisminfrastructure (see Box 5). In Belize, Bhutan,Colombia, Cuba, Jordan, and elsewhere, GEFprojects participated actively in the elaboration ofnational policies on protected areas and integratedcoastal management. India�s Small HydelResources in Hilly Regions project and many SGPprograms have convinced key decision-makers ofthe benefits of a participatory approach to the designand implementation of development projects and

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The Protecting Biodiversity andSustainable Development of theSabana-Camaguey project in Cubaactively promoted stronger linksamong the science community,government agencies, anddevelopment interests. As a result,construction practices have beensignificantly altered so thatcauseways no longer cut offcirculation within lagoons,construction site disturbance iskept to a minimum, and the style oftourism facilities and infrastructureis more environmentally sensitive.Representatives of the tourismindustry believe the scientificcommunity has become moreattuned to their needs and has amuch greater understanding of theinformation and ideas that areuseful to guide the developmentprocess. Similarly, scientistsparticipating in the project noted aradical change in the attitudes ofdevelopers, architects, and theMinistry of Construction as theylearned how to minimizeenvironmental impacts andsafeguard the biodiversity andenvironmental qualities of theregion. Construction guidelinesdetailed in the draft coastalmanagement strategy developedthrough the project—which reduceenvironmental impacts andconstruction costs—are beingapplied elsewhere in the Sabana-Camaguey region, and the newconsultative approaches toplanning pioneered by the projectare having an impact well beyondthe project area.


32

programs. And the Coal Bed Methaneproject in China shows how new policiesand regulations, combined with thecreation of institutions to promote newtechnologies, can lead to substantialinvestments and market restructuring.

108. The PIR reports also illustrate a varietyof approaches that have been used by GEFprojects to expand their leverage:

• A strategic focus-ing of effort hasled to systemicchange in Polandand Hungary. InPoland, PELP�sdemand side man-agement activityconcentrated onlarge-scale subs-titution of energy-efficient lightbulbs in severalsmall towns.Typically, utilitycompanies viewthese bulbs primarily as a product that willdecrease their revenues. But through thisexperience, the project was able todemonstrate system-wide effects to theutility company and show the potentialbenefits that could come from savingcapital investments in generating capacity.In Hungary, the availability of technicalassistance funding to support the develop-ment of energy efficiency projects isproving to be a valuable tool to influencethe financing patterns of commercialbanks.

• Another approach has been to workthrough executing agencies that havelinkages to other agencies with similarprogram interests. One example is theEconomics of Greenhouse Gas Limitationsproject (see Box 6). The relationship

between the executing agency for theMauritius Biodiversity Restorationproject�a national NGO�and severalEuropean NGOs enabled it to takeadvantage of volunteers from Europe towork on project activities.

· Involving key stakeholders has multipliedproject impacts. For example, includingprivate business organizations in decision-

making bodies inthe Gulf of Guineaproject and inBatangas Bay, thePhilippines, underthe East Asian Seasproject has changedthe attitudes of allmajor stakeholdergroups toward eachother and led tosubstantial volun-tary private sectorcontributions topollution controlefforts. The parti-cipation of national

researchers in the Alternatives to Slash andBurn project has reportedly had a markedinfluence on internal research agendas intheir institutions.

• Finally, flexibility to respond to targetsof opportunity with potential forsignificant leveraging was illustrated by theODS phase-out project in Russia.Implementation was delayed due toconcerns about the financial viability of anumber of manufacturing enterprises usingODS. By indicating a willingness toreprogram funds allocated to ODSconsumption subprojects to measuresenabling the complete closure of allRussian ODS production sites, GEF hasleveraged more than 200 percent additionalresources and provided a key catalyst forcarrying out the production program.

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The executing agency for the Economics of GreenhouseGas Limitations project, the UNEP Collaborating Centreon Energy and Environment at Riso National Laboratoryin Denmark, is also implementing a number of bilateralclimate change capacity building projects and providessupport to GEF enabling activities in three countries.This has allowed it to increase from eight to 15 thenumber of national teams participating in projectworkshops and the application and testing ofmethodological guidelines developed under the project.

33


C. Capacity Building

109. Capacity building and institutionalstrengthening are features of most GEFprojects, and are closely linked to sustainability.This was identified as a cross-cutting issue forthe 1998 PIR to gain insights into theingredients of capacity building and the lessonsemerging from the experience.

110. The PIR reports and evaluationssummarized above show that GEF projects arestrengthening a wide variety of organizations,from government agencies, to scientific andresearch institutions, to national andinternational associations, to NGOs andcommunity-based organizations (CBOs). Theydo this in many ways, especially by:

· Increasing knowledge and awareness ofenvironmental issues. Examples rangefrom biodiversity and climate changecountry studies supported under severalUNEP-GEF projects and the production of

the Global Biodiversity Assessment, tostudy tours to acquaint project participantswith how others are addressing issuessimilar to those they confront. Increasedawareness of environmental issues byNGOs and CBOs was one of the keysuccesses of the Small Grants Programmedocumented in the recent evaluation. TheALGAS project (see Box 7) is anotherexample of a project that has increased theunderstanding of issues and optionsrelating to climate change.

· Transferring technologies or providingtechnical skills, including the ability todiagnose problems and implementsolutions. The provision of training andoften new equipment is a feature of manyGEF projects. Improving methodologiesfor analysis of global environmental issuesis a focus of many of the projects in thePIR portfolio regarded as enablingactivities, including the ALGAS project.

$1:��&'(+0+0)�%#2#%+6;�61�#&&4'55�)4''0*175'�)#5�'/+55+105

The Asia Least-Cost Greenhouse Gas Abatement Strategies (ALGAS) project helped 12 participating countriesexpand their capacity to quantify GHG emissions, prepare baselines and inventories of GHG emissions and sinks,identify least-cost options to reduce emissions or enhance sinks, develop national policy responses to implementthese measures, and design national portfolios of technical assistance and investment projects to help reducegrowth of GHG emissions. The project provided extensive training for scientists and others in the region, promotednetworks and linkages among the participating countries and with similar projects in the region, and providedtechnical assistance from international and Asian experts.

Like many capacity building projects, ALGAS has struggled to define indicators of capacity that can be used toidentify needs and measure results. During the interagency PIR meeting, a presentation on ALGAS put forward thefollowing definitions developed by the project.

Technical capacity =• level of understanding of issues and options related to climate change• Asian experts able to contribute to IPCC global assessments• improvements in IPCC GHG inventory methodology

Institutional capacity =• level of involvement of national decision-makers• cross-sectoral representation of government agencies, NGOs, research institutions, and private sector• ability to update national GHG inventories, install and operate analytical models, and use models to identify

least-cost GHG abatement strategies


34

· Creating or reinforcing new institutionalstructures. Examples include support forcentral coordination entities under theBDM project, a new coastal zonemanagement agency in Belize that broughttogether under one agency all governmentagencies dealing with coastal zones, andcreation of conservation trust funds.

· Improving project design andmanagement capabilities. Especially forNGOs and CBOs, this is often the productsimply of being involved with a donorproject for the first time. The Mgahinga-Bwindi Conservation Trust in Uganda hasdedicated considerable effort to helpingcommunity groups put together and carryout small projects. This has also been amajor contribution of the Small GrantsProgramme.

· Stimulating the creation of networksamong national or international institutionsor individuals engaged in similar work.This has been a feature of most multi-country GEF projects, including ALGASand BDM. The Gulf of Guinea project hasbuilt a network of 350 managers andscientists, linked by an electronicmessaging system, on matters related toecosystem degradation, socio-economicimpacts, and management measures toimprove environmental quality andlivelihoods.

· Promoting increased interaction amonggovernment agencies, academic andbusiness organizations, NGOs andcommunity groups, and other donors.This has often led to greater and diversifiedaccess to resources, and a more enlighteneddebate about national and globalenvironmental issues. More importantly,it has led to broader working relationshipsand institutional credibility that have lastedbeyond individual project activities. Thishas been a result, for example, of the SmallGrants Programme and the ConservationArea Coordination Committees created

under the South Pacific BiodiversityConservation project (see Box 1 onpage 10).

111. Considerably more attention is neededon the results and qualitative impacts ofGEF�s capacity building efforts. With only afew exceptions, such as Nepal BiodiversityConservation and Dominican Republic CoastalZone, project reporting was limited to outputs(e.g., number of people trained or participatingin workshops). Discussion of the ALGASproject during the interagency meeting includedmeasures it has developed to measure technicaland institutional capacity (see Box 7).However, in general there was little focus onor documentation of changes in skills orindividual and organizational performance.

112. Moreover, in many cases there appearedto be an explicit or implicit assumption thatlack of human capacity or skills is the mainproblem impeding accomplishment of globalenvironmental objectives. This assumptiondoes not tally with international experience thatenabling or disabling characteristics oforganizations can be attributed as much to theirinternal organizational processes and political,economic, cultural, or other contexts as to theskills and competence of their personnel.Indeed, an insightful discussion in the reporton the Dominican Republic Coastal Zoneproject identified the following ingredients ofinstitutional viability, which are very relevantto any discussion of capacity building:adequate budgets, equipment, trainedpersonnel, scientific credibility, clearinstitutional mandate and linkages to otherorganizations, and political support andrecognition through government adminis-trations over time.

113. Motivation to apply knowledge gainedfrom education and training depends very muchon the enabling environment within a country.In fact, there was ample evidence from thereview that benefits that should result fromtraining and other capacity building inputs,especially in government agencies, are often

35


lost due to mistrust and poor relations amongparticipating institutions, reluctance to changeinstitutional structures, and staff turnoverbecause of inappropriate policies, competitionfor their services from others, and/or changesin management resulting from politically drivendecisions.

114. More emphasis needs to be placed onidentifying specific capacity-building needs,so project design and implementation canbe tailored to address key constraints andinstitutions. As the evaluation of theBiodiversity Data Management projectshowed, this is especially important for multi-country projects that involve nations with verydifferent conditions. These projects, inparticular, need the flexibility to adjust capacitybuilding efforts and strategies to the situationin each country, since it is not likely that �onesize fits all.� At the same time, multi-countryprojects allow rich opportunities forparticipating countries to learn from each otherand strengthen intra-regional consultingcapacity. For example, under ALGAS, many�national� experts became �international�experts as the project provided chances forthem to provide advice and experience to otherswithin the Asia region.

115. There is an urgent need to developindicators that measure the application ofknowledge gained and other changesbrought about through capacity buildingefforts and the resulting benefits for theglobal environment. Assessment ofqualitative impacts may be difficult within thetimeframe of a typical project, however, sincemany of these changes occur over a longerperiod. This needs to be reflected in themonitoring systems developed, as well as theway GEF addresses the length of thecommitment required to achieve its intendedimpacts.

D. Project Leadership

116. The quality of project leadership wasidentified in the 1998 review as a key

determinant of project success. More oftenthan not, projects rated as highly satisfactoryhave dynamic and enterprising leaders, whilethose rated as unsatisfactory were plagued withineffective leaders and rapid turnover ofleadership. Successful leaders also served aslocal �champions� for their projects. The SmallGrants Programme evaluation also found thatthe emergence of such individuals is often keyto progress in the early phases of a project,although over-reliance on one or two people inan organization or community can eventuallyjeopardize sustainability.

117. The discussion by the internationalwaters task force brought out the importanceof project leadership. The East Asian Seas,Black Sea, and Gulf of Guinea projects are ledby highly respected, charismatic internationalwaters professionals. Their technicalcompetence, political astuteness, andprofessional credibility allowed them access tothe highest levels of government to, in somecases, turn around projects that strayed or toadjust projects to meet GEF�s OperationalStrategy. In addition, the SGP evaluation foundthat the competence and energy of theindividual selected as the national coordinatorstood out as the single most important factordetermining the effectiveness of the countryprogram and the quality of its portfolio.

118. This conclusion was echoed in other PIRdiscussions and evaluation findings. Animportant lesson is that leadership attributesmust extend beyond technical competenceto include communications skills,entrepreneurial abilities, managementexpertise, and political skills.

E. Multi-CountryOrganizationalArrangements

119. There were a sizable number of regionalor multi-country projects in the 1998 PIR. Theyinclude most of the international watersportfolio and several �enabling activity�


36

$1:��6*'�0''&�(14�.10)�6'4/%1//+6/'06�61�%1/2.':��4')+10#.+557'5��6*'�%#5'�1(�.#-'�8+%614+#

The Lake Victoria Environmental Managementproject is a five-year project involving more thanUS$77 million in financing, US$34 million fromGEF. The project has ten components rangingfrom fisheries management, water hyacinthcontrol, water quality, management of land use inthe catchment area, wetlands management,pollution disaster contingency planning, andinstitutional support for lake-wide research andmanagement. Funding is channeled throughsecretariats in each of the three participatingcountries to a variety of implementing agencies inthe lake region. Implementation was seriouslydelayed by procurement issues and lack ofcounterpart funding. Many of these issues arenow resolved and the project is at the pointwhere it can begin implementation on the ground.But now only two and a half years remain toactually carry out the ambitious set of projectactivities.

Discussion of this experience during the 1998PIR highlighted the need for a long-term (10-15years) commitment to complex undertakingssuch as the one at Lake Victoria. Traditionalprojects, with their shorter timeframes andemphasis on a priori design, are not appropriate.Efforts to prioritize and simplify the Lake Victoriaproject and to develop a phased approach toaddressing the many problems facing the lakeare only likely to succeed in the context of a long-term commitment. Otherwise, it will be extremelydifficult to reach agreement at this point to leavesome activities for later while concentratingimmediate attention on a few key priorities.

projects implemented by UNDP and UNEP,e.g., the biodiversity and climate changecountry studies projects, BDM, and regionalclimate change capacity building or researchprojects in Africa, Asia, and the Maghreb.

120. A number of advantages of the multi-country umbrella approach were documentedin PIR reports. They include sharingexperiences among countries dealing withsimilar issues, developing and testingguidelines and methodologies intended to beapplied in many countries under varyingcircumstances, and the ability to �bundle�technical assistance and training for severalsimilar countries. These advantages aredemonstrated by the Economics of GreenhouseGas Limitations project (see Box 6 on page 32),the ALGAS project highlighted above (see Box7 on page 33), and others.

121. At the same time, multi-country projectstend to be much more complex. They ofteninvolve the development of regionalmechanisms built on weak local institutions.(For example, see Box 8 on the Lake VictoriaEnvironmental Management project.)Resources available to address institutionalweaknesses can be stretched thin by the broadrange of institutions involved in some multi-country projects, limiting capacity buildingimpact on any one organization. To beeffective, regional efforts often require greatercollaboration among GEF�s implementingagencies (including their regular programs) andother donors, because of the scope of activities.

122. Despite the advantages a multi-countryproject can offer, UNEP�s overview reportidentified a number of areas�including projectdevelopment financing ceilings and deadlines,and obtaining country endorsements�wherestandard GEF practices and requirements aremuch more difficult for multi-country projects.In addition, experience has shown that movingfrom a multi-country approach to individualcountry projects dealing with the same issuehas constrained the provision of technicalsupport to governments. UNDP and UNEP

have pointed to several such instances in thecase of enabling activities, where GEF shiftedfrom an initial emphasis on a multi-countryapproach (e.g, the biodiversity and climatechange country studies projects and theregional capacity building projects in Africa,Asia, and the Maghreb) to enabling activityprojects in individual countries. To someextent, this undermined the rationale for andinterest in the earlier regional projects. This

37


question is being examined in greater depth aspart of an evaluation of biodiversity enablingactivities currently being conducted by GEF�scorporate M&E team.

123. One of the actions recommended by the1997 PIR was a more in-depth examination ofexperience with institutional arrangements inregional projects. This was not done, and the1998 review reiterated the need to moveforward with an analysis of multi-countryimplementation arrangements to identifymodels, strengths and weaknesses of variousapproaches, coordination requirements amongIAs and other organizations, and criteria forevaluating their effectiveness.

F. Indicators

124. Although there are several exceptions,most of the project reports submitted for the1998 PIR do not yet have satisfactoryindicators to measure and monitorachievement of their intended outcomes andimpacts. The PIR reports reflect a general lackof clarity in determining linkages betweenproject goals, objectives, and outputs. Inaddition, there is very little strategic use ofevaluation assumptions. Project monitoringsystems focus more on processes (e.g.,procurement) and production of outputs thanon results.

125. This may reflect the composition ofprojects in the PIR portfolio, most of whichbegan during GEF�s Pilot Phase when lessexplicit attention was given to identificationof clear objectives and measurable impact

indicators. Unfortunately, some GEF1 projectsincluded in the PIR also share this shortcoming.A more thorough review of more recentprojects, approved after use of the LogicalFramework and similar methodologies were putinto wider use, might reveal substantialimprovements. Future PIRs will also providea basis for judging the extent of theseimprovements.

126. The World Bank, which last yearcommitted to retrofit all of its GEF projectswith indicators by June 1998, fell considerablyshort of this goal. Only about one-third hadindicators by that date, about the same as theBank�s overall average. The World Bank hasstated that further work on retrofitting projectswith indicators is a high priority for its GEFoperations in 1999. In general, an explanationgiven by implementing agencies for some ofthe delay in developing indicators for GEFprojects once implementation has begun is theneed to discuss them with the countriesconcerned, and the resistance they sometimesencounter in this process.

127. The PIR concluded that clearer andmore specific guidance on monitoringindicators for GEF projects is needed, andshould be a high priority for the corporateM&E team and focal area task forces. Inaddition, broader dissemination should begiven to existing resources and guidelines, suchas the World Bank�s recently revised Guidelinesfor Monitoring and Evaluation of BiodiversityProjects and its companion for climate changeprojects that is due to be published in early1999.

6. SYNTHESIS OF CONCLUSIONS AND

RECOMMENDATIONS

managers should be given flexibility to selectand modify the activities and tactics neededto achieve these objectives, based onmonitoring and evaluation systems thatincorporate regular review of performanceinformation. The World Bank has recentlyintroduced a new Adaptable Program Lending(APL) approach, which embodies many ofthese features. Its use in GEF projects shouldbe expanded. UNDP�s new approach to theSmall Grants Programme�which involveslonger term commitments, performancebenchmarks, and a greater emphasis onmonitoring and evaluation at the project andoverall program level�is a similar model thatcould be followed.

130. This approach puts a premium on thequality of project leadership and managementsystems in the institutions that make up the GEFfamily and their partners in recipient countries.As UNDP�s experience in its climate changeportfolio indicates, where field offices andnational counterparts are strong, providingflexibility to change course in response toperformance and new situations has workedrelatively well. Where this is not the case,however, it has led to increasingly problematicprojects that have been unable to adapt.

131. A major implication of making a longerterm commitment to address the challengesGEF and its partners face is that GEF willneed a more strategic focus on the issues,problems, and places to which it is able toprovide sustained support. With a change toa longer term, benchmarked approach, GEFshould move from an organizational culturebased on project approval to one morefocused on achieving and measuring projectand program results. In particular, thissuggests the need for program managers in the

128. As UNEP points out in its overview report,it is important that recommendations resultingfrom the PIR and evaluation reports beintegrated into the management of GEFoperations. Many people throughout the GEFfamily devote substantial time and effort to theannual implementation reviews and project andprogram evaluations. To justify this allocationof resources, the lessons emerging from theirwork must be applied. This final chapter ofthe 1998 GEF Program Performance Reportsummarizes the principal conclusions andrecommendations from this year�s review.

A. Flexible, Long-Term Approach

129. The conclusion that stands out moststrikingly from the reports and discussions thatmade up the 1998 PIR is the need for anapproach to addressing globalenvironmental problems that is longer termand more flexible than current projectinstruments. Whether the challenge isconserving biodiversity, reducing the emissionof greenhouse gases, or slowing the degradationof international waters, experience indicatesthat being able to make a commitment ofsupport over a longer time period and adapt tochanged circumstances and opportunities areoften prerequisites to achieving and sustainingglobal environmental results. In many cases,this requires a phased approach that sets outfirm benchmarks (including adoption ofappropriate policy reforms) and providesassurance of support over ten years or longerif these benchmarks are met. Projectproposals should identify clear objectivesand performance indicators, but devote lesseffort to mapping out detailedimplementation plans. Instead, project

38

GEF secretariat to take on a more strategic role,one based less on individual project reviewsand approval and more on working withimplementing agencies to (1) facilitate periodicassessments of program direction and results,and (2) through the focal area task forces,identify and feed back lessons about what isworking in the field and what is not.

B. Indicators

132. The need for greater attention to projectindicators is a clear message from the 1998review. It is also essential for the longer term,phased approach described above to work.GEF�s implementing agencies must makefirm commitments to retrofit each ongoingproject with a significant implementationperiod still remaining with indicators thatmeasure progress toward its objective.

133. Two priorities for indicator developmentwere identified during the review. First, GEFshould give more attention to analyzingcapacity needs, and defining indicators tomeasure the results sought from its capacitybuilding efforts. Second, the internationalwaters task force and the secretariat�s M&Eteam should produce guidance to assistcountries in understanding the purpose ofGEF�s framework of international watersproject indicators, choose indicators appro-priate to each activity, and monitor progress inachieving them. Guidelines for conductingTransboundary Diagnostic Analyses (TDAs)and Strategic Action Programs (SAPs) shouldbe issued.

134. As indicators and M&E systems focus onlonger term results, there will be a need torethink how resources are programmed formonitoring and evaluation. Funding theseactivities only through projects will not besufficient, since many of the results they willbe designed to measure will occur after projectactivities and supervision are completed.

135. In addition to the project level,identifying indicators to measure andmonitor progress toward its programobjectives is a high priority for GEF. GEFmust be able to communicate convincingly toits various stakeholders the collective resultsof all of its activities. Work began in early 1999to identify program indicators for GEF�sbiodiversity and climate change programs.

C. Leveraging

136. GEF should adopt a broader definitionof leveraging for its programs and projectsthat reflects financial resources�bothduring design and implementation�andactions catalyzed by GEF activities. In thefuture, reporting on project performance,including for PIRs, should reflect this broaderdefinition. The precise details of such a broaderdefinition should be developed during 1999under the leadership of the GEF secretariat.

D. Topics for In-Depth Review for 1999 PIR

137. Four topics were identified for in-depthreview during 1999 as a result of the PIR.Specific plans for these thematic reviews willbe developed by the corporate M&E team inconjunction with GEFSEC program managersand the IAs. They may include detailed deskreviews, focus groups or workshops withproject managers, and possibly limited fieldvisits. The objective of these reviews is to buildon the 1998 and previous PIRs to identify morecomprehensively the lessons from experienceand define more precisely issues requiringfurther evaluation. The results of these reviewsshould be available for the 1999 PIR. The fourtopics are:

· Achieving financial sustainability inbiodiversity projects;

Synthesis of Conclusions and Recommendations

39


40

· Experience with GEF-funded off-grid PVprojects, including their potential impacton global greenhouse gas emissions;

· Experience with multi-countryimplementation arrangements in GEFprojects, including their requirements forcollaboration among IAs and with otherorganizations; and

· The overall progress of countries receivingGEF assistance in the ozone focal area inimplementing their ODS phase-outprograms.

E. Dissemination of PIR Findings

138. More needs to be done to disseminate thefindings of the PIRs and project and programevaluations; use the results of the reviews toidentify important topics for more in-depthassessment by GEF�s M&E program, STAP,and others; and feed back the lessons ofexperience into new project and programdesign.

F. The Role and Purpose of the PIR

139. Finally, the individual task force reviewsand the interagency PIR meeting includeduseful discussions of the role, purpose, andfuture direction of GEF�s annualimplementation reviews. There was consensusthat the increasing number of projects includedin the review made it difficult for each PIR tocover all topics of interest in satisfactory depth.Therefore, future reviews should be morefocused around key cross-cutting issues, whileretaining a comprehensive tracking ofperformance and underlying forces. It wasagreed that the quality and depth of reportingmust be improved. But even when this wasdone, caution was expressed about the extentto which lessons could confidently be identifiedsolely from the PIR process. Rather, the PIRwas viewed as a good scoping exercise, that isa process to identify themes or issues thatdeserve follow-up through more in-depthevaluations and studies, including STAPselective reviews. The points raised in thesediscussions will be reflected in the guidelinesfor the 1999 project implementation review.

41

Multi focal areas

IA Project Description Work

Program (A)

IA Approval

(B)

EffectiveDate(C)

US$ millions

Disbursed as of 6/30/98

% disbursed

1 GEFSEC PRINCE Jul-93 Jul-93 Nov-94 2.60 1.06 40.69

2 WB Small and Medium Scale Enterprise Program Apr-94 Dec-95 Mar-96 4.30 2.40 55.81

Total 6.90

Biodiversity


Program (A)

IA Approval

(B)

EffectiveDate(C)

US$ millions


% disbursed

1 WB ALGERIA El Kala National Park/Wetlands May-91 Apr-94 Sep-94 8.99 3.37 37.49

2 UNEP BD Country Studies Phase 1 Dec-91 Mar-92 Mar-92 5.00 4.51 90.20

3 UNEP BD Country Studies Phase 2 Dec-92 Jun-94 Jun-94 2.00 1.57 78.50

4 UNDP BELIZE Sustainable Development in Coastal Resources

Dec-91 Feb-93 Mar-93 3.00 2.70 90.00

5 WB BHUTAN Trust Fund for Conservation May-91 May-92 Nov-92 10.35 10.51 101.55

6 UNEP Biodiversity Data Management Dec-92 Jun-94 Jun-94 4.00 3.78 94.43

7 WB BOLIVIA Biodiversity Conservation Apr-92 Nov-92 Jul-93 4.62 4.42 95.67

8 WB BRAZIL National Biodiversity Project May-91 Apr-96 Dec-96 10.00 1.03 10.30

9 WB BRAZIL Biodiversity Fund Project May-91 Apr-96 Sep-96 20.00 10.00 50.00

10 UNDP BURKINA FASO Nazinga Ranch Dec-92 Feb-95 Jul-95 2.43 2.43 100.00

11 WB CAMEROON Biodiversity Conservation and Management

May-93 Mar-95 Dec-95 5.96 2.21 37.08

12 WB CHINA Nature Reserves Management Feb-95 Jun-95 Aug-95 17.90 9.40 52.51

13 UNDP COLOMBIA Biodiversity Conservation in the Choco Region

May-91 Feb-92 Feb-92 9.00 8.21 91.23

14 WB CONGO Wildlands Protection May-91 Mar-93 Oct-93 10.05 6.50 64.68

15 UNDP COSTA RICA Conservation of La Amistad and Osa Conservation Areas

Sep-91 Apr-93 May-93 7.99 7.99 100.00

16 UNDP COTE D’IVOIRE Aquatic Weeds Control Dec-92 Jun-95 Nov-95 3.00 0.70 23.48

17 UNDP CUBA Protecting Biodiversity and Establishing Sustainable Development Sabana-Camaguey Ecosystem

Sep-91 Jul-93 Dec-93 2.00 1.94 96.84

18 WB CZECH Republic Biodiversity Protection Dec-91 Oct-93 Jan-94 2.30 1.86 80.87

19 UNDP DOMINICAN REPUBLIC Conservation and Management of Biodiversity in the Coastal Zone

Oct-93 Nov-93 May-94 3.00 2.03 67.67

20 WB ECUADOR Biodiversity Protection Apr-92 May-94 Jul-94 7.20 6.52 90.56

21 WB EGYPT Red Sea Coastal/Marine Resource Management

Apr-92 Nov-92 Dec-94 5.29 2.11 39.89

22 UNDP ETHIOPIA Conservation of PlantGenetic Resources

Dec-92 Apr-94 Sep-94 2.50 0.80 31.86

23 UNDP GABON Effective Management of Wildlife Trade

May-91 Jan-94 Jul-94 1.00 0.73 73.00

24 WB GHANA Coastal Wetlands Dec-91 Aug-92 Mar-93 7.32 2.88 39.34

25 UNEP Global Biodiversity Assessment Dec-92 May-93 May-93 3.30 3.13 94.85

26 UNDP GUATEMALA Conservation and Sustainable Development of the Motagua Region

May-95 Apr-97 Apr-97 4.00 0.87 21.65

27 UNDP GUYANA Iwokrama Rain Forest Programme

May-91 Apr-92 Feb-93 3.00 2.71 90.25

28 WB INDIA Ecodevelopment Sep-96 Dec-96 19.70 3.09 15.69

.+56�1(�241,'%65�+0%.7&'&�+0��2+4#22'0&+:�#


42

29 WB INDONESIA Biodiversity Collections Apr-92 Jun-94 Jul-94 7.48 5.31 70.99

30 WB INDONESIA Kerinci Sablat Integrated Conservation and Development

May-95 Apr-96 Aug-96 13.70 0.72 5.26

31 UNDP JORDAN Dana/Azrak II Aug-96 Oct-96 Apr-97 1.95 0.64 33.09

32 WB LAO PDR Wildlife and Protected Areas Conservation

May-91 Mar-04 Jan-95 4.96 2.19 44.15

33 UNDP LEBANON Protected Areas Feb-96 Feb-96 Feb-96 2.50 0.84 33.41

34 WB MADAGASCAR Second Environment Support Program (EP2)

Aug-96 Dec-96 Jun-97 20.80 0.65 3.13

35 WB MALAWI Lake Malawi/Nyasa Biodiversity Conservation

Dec-91 Dec-94 Jul-95 5.00 3.27 65.40

36 WB MAURITIUS Biodiversity Restoration May-95 Nov-95 Feb-96 1.20 0.62 51.67

37 UNDP MAURITIUS Restoration of Native Forest May-93 Jun-95 Jun-95 0.20 0.08 40.00

38 WB MEXICO Protected Areas Program May-91 Mar-92 Apr-93 26.10 26.10 100.00

39 WB MOZAMBIQUE Transfrontier Conservation Areas

Dec-92 Dec-96 May-97 5.00 0.70 14.00

40 UNDP NEPAL Biodiversity Conservation Dec-91 Jun-93 Sep-93 3.80 2.75 72.34

41 UNDP PANAMA Biodiversity Conservation in Darien Region

Jan-92 Feb-94 May-94 2.00 1.37 68.40

42 UNDP PAPUA and NEW GUINEA Conservation and Resource Management Programme

Dec-91 Jul-93 Oct-94 5.00 4.81 96.27

43 WB PERU National Trust Fund for Protected Areas

Dec-91 Mar-95 Sep-95 5.00 5.22 104.40

44 WB PHILIPPINES Conservation of Priority Protected Areas

May-91 May-94 Oct-94 19.01 5.15 27.09

45 UNDP REGIONAL - INDONESIA AND MALAYSIA Conservation Strategy for Rhinos in Southeast Asia

May-93 Dec-94 Dec-94 2.00 0.97 48.50

46 UNDP REGIONAL Ecologial Zoning and Geographic Monitoring of the Amazon River

May-91 Jan-93 Mar-93 4.50 4.22 93.78

47 UNDP REGIONAL South Pacific Biodiversity (Samoa)

Jan-92 Jan-93 Apr-93 6.27 6.02 95.95

48 WB ROMANIA Danube Delta Biodiversity Apr-92 Aug-94 Feb-95 4.50 2.75 61.11

49 WB RUSSIA Biodiversity Conservation Dec-94 May-96 Nov-96 20.10 2.57 12.79

50 WB SEYCHELLES Biodiversity Conservation & Marine Pollution Abatement

Dec-91 Nov-92 Mar-93 1.80 1.85 102.78

51 WB SLOVAK Republic Biodiversity Protection Dec-91 Sep-93 Oct-93 2.48 2.18 87.90

52 UNDP SRI LANKA Wildlife Conservation Dec-91 Jan-92 May-92 4.09 2.87 70.32

53 WB TURKEY In-Situ Conservation of Genetic Biodiversity

Apr-92 Mar-93 Mar-93 5.40 4.64 85.93

54 WB UGANDA Bwindi and Mgahinga Gorilla National Park Conservation

May-91 Jan-95 Jul-95 4.00 4.35 108.75

55 WB UKRAINE Danube Delta Biodiversity Apr-92 Jul-94 Aug-94 1.61 1.28 79.50

56 UNDP VIETNAM Wildlife Conservation May-91 Jan-92 Jul-92 3.00 3.00 100.00

57 WB West Africa Pilot Community Based NaturalResource and Wildlife Mgmnt Project

May-91 Sep-95 May-96 7.02 1.11 15.81

Total 375.38

Climate Change


Program (A)

IA Approval

(B)

EffectiveDate(C)

US$ millions


% disbursed

1 UNDP BENIN - Carbon Sequestration & Rangeland

Dec-92 Jul-93 Jan-94 2.50 2.01 80.32

2 UNDP BRAZIL - Biomass Integrated Gasification/Gas Turbine

Sep-92 Sep-92 8.12 7.97 98.15

3 UNDP BRAZIL - Biomass Power Generation: Sugar Cane Bagasse and Trash

Apr-96 Mar-97 Oct-92 3.75 1.08 28.73

4 UNDP CHILE Reduction of GH Gas Emissions May-92 Jun-95 Jun-95 1.70 0.71 41.53

43

Appendix A: List of Projects Included in the 1998 PIR

5 UNDP CHINA Development of Coal-Bed MethaneResources

Apr-92 Apr-92 Jun-92 10.00 10.00 100.00

6 WB CHINA Efficient Industrial Boilers Apr-96 Dec-96 Feb-97 32.81 1.50 4.57

7 UNDP CHINA Promoting Methane Recovery and Utilization from Mixed Municipal Refuse

Apr-96 May-97 5.29 1.86 35.25

8 WB CHINA Sichuan Gas Transmission Apr-92 Jan-94 Sep-94 10.71 2.15 20.07

9 WB COSTA RICA Tejona Wind Power Dec-93 Dec-93 Nov-95 3.30 0.00 0.00

10 UNEP Country Case studies on Greenhouse Gases

Dec-91 Jul-92 Sep-92 4.50 4.32 96.00

11 UNEP Country Studies on Climate Change Impacts + Adaptation Assessments

Feb-95 Feb-96 Mar-96 2.00 1.82 91.00

12 UNEP Economics of Greenhouse Gas Limitations Feb-95 Mar-96 Apr-96 3.00 0.86 28.67

13 UNDP GLO Climate Change Capacity Building May-93 Jan-94 Sep-95 2.00 0.65 32.43

14 UNDP GLO Research on Methane Emissions from Rice Fields

May-91 Jan-92 Jan-93 5.00

15 UNDP GLO Training Programme on Climate Change (CC:TRAIN)

May-95 Mar-96 Mar-96 2.56 2.14 83.49

16 UNDP GLOBAL Alternative to Slash and Burn Agriculture (Phase II)

Jun-96 Jun-96 Jun-96 2.94

17 WB HUNGARY Energy Efficiency Co-Financing Program

Apr-96 Mar-97 May-97 5.00 0.00 0.00

18 WB INDIA Alternate Energy Dec-91 Dec-92 Apr-93 27.62 20.10 72.77

19 UNDP INDIA Bio-methanation Process Jan-92 Jan-94 Mar-94 5.50 1.57 28.55

20 UNDP INDIA Optimizing Development of Small Hydel Resources in the Hilly Regions of India

Jan-91 Jan-94 Mar-94 7.50 2.97 39.60

21 WB IRAN Teheran Transport Emissions Reduction

Apr-92 Oct-93 Jan-94 2.17 2.13 98.16

22 WB JAMAICA Demand Side ManagementDemonstration

May-93 Mar-94 Aug-94 4.10 1.71 41.71

23 WB LITHUANIA Klaipeda Geothermal Demonstration

May-95 Sep-96 Oct-96 6.90 3.48 50.43

24 WB MALI Household Energy Project Dec-92 Jun-95 Oct-95 2.50 1.21 48.40

25 UNDP MAURITANIA- Decentralized Wind Electric Power for Social and Economic Development

Dec-92 Jun-94 Sep-94 2.08 2.07 99.47

26 WB MAURITIUS- Sugar Bio-Energy Technology May-91 Mar-92 Dec-93 3.38 3.39 100.30

27 WB MEXICO High Efficiency Lighting Pilot Dec-91 Mar-94 Feb-95 10.71 10.72 100.09

28 WB MOROCCO Repowering of Power Plant Dec-92 Sep-94 Apr-96 6.08 0.37 6.09

29 UNDP PAKISTAN Fuel Efficiency Transport Sector Jan-92 Jul-95 May-96 7.00 0.41 5.84

30 WB PHILIPPINES Leyte-Luzon Geothermal May-91 Jun-94 Mar-95 31.69 26.79 84.54

31 WB POLAND Coal-to-Gas Project Dec-91 Nov-94 Jun-95 24.92 0.85 3.41

32 WB POLAND Efficient Lighting Project (PELP) Dec-94 May-95 Aug-95 5.00 4.70 94.00

33 UNDP REGIONAL Asia Least Cost GHG Abatement Strategy (Philippines) ALGAS

Dec-91 Aug-93 Aug-94 9.50 5.47 57.58

34 UNDP REGIONAL Building Capacity in Mahgreb for CCC (Morocco)

May-93 Sep-94 Dec-94 2.37 0.41 17.24

35 UNDP REGIONAL Cote d’Ivoire Senegal Energy Efficiency

Dec-92 Dec-94 Sep-95 3.50 2.06 58.98

36 WB REGIONAL Planning for Adaptation to Climate Change (Caribbean) CARICOM

May-95 Mar-97 Apr-97 5.91 1.42 24.03

37 WB RUSSIA Greenhouse Gas Reduction Dec-92 Dec-95 Dec-96 3.20 0.29 9.06

38 UNDP SUDAN Community-Based Rangeland Aug-94 Aug-94 Oct-94 1.50 0.90 60.19

39 UNDP TANZANIA - Electricity, Fuel and Fertilizer from Municipal and Industrial Organic WasteTAKAGAS

May-93 Dec-93 Mar-94 2.50 0.74 29.68

40 WB THAILAND Promotion of Electricity Energy Efficiency

Dec-91 Apr-93 Nov-93 10.12 5.98 59.09

41 WB TUNISIA Solar Water Heating May-93 Nov-94 May-95 4.05 0.66 16.30

42 UNDP ZIMBABWE - Photovoltaics Dec-92 Feb-92 Feb-92 4.59 4.30 93.75

Total 299.56


44

International Waters


Program (A)

IA Approval

(B)

EffectiveDate(C)

US$ millions


% disbursed

1 UNDP EGYPT - Lake Manzala Engineered Wetlands

Dec-92 Jun-97 Jun-97 4.50 0.44 9.82

2WB

JORDAN Gulf Aqaba Environmental Action Plan

Oct-95Jun-96 Jun-96 2.70 0.53

19.63

3 UNDP REGIONAL Environmental Management & Protection of the Black Sea (Turkey)

May-92 Dec-92 Oct-94 9.30 9.23 99.25

4 UNDP REGIONAL Gulf of Guinea Dec-91 Oct-93 Jul-94 6.00 3.80 63.33

5 WB REGIONAL Lake Victoria Environmental Management Project

Apr-96 Jul-96 Mar-97 35.00 2.38 6.80

6 WB REGIONAL OECS Ship-Generated Waste Mgmt. (Caribbean)

Dec-92 May-95 Nov-96 12.51 0.48 3.84

7 UNDP REGIONAL Pollution Control and Other measures to Protect Biodiversity in Lake Tanganyika

Dec-91 Oct-93 Feb-95 10.00 4.97 49.72

8 UNDP REGIONAL South East Asian Seas (Philippines)

Dec-91 Jul-93 Nov-93 8.00 5.57 69.63

9 UNEP REGIONAL Strategic Action Programme for the Binational Basin of the Bermejo River (Argentina - Bolivia)

Nov-96 Apr-97 Mar-99 3.22 0.00 0.00

10 WB REGIONAL Wider Caribbean Initiative for Ship-Generated Waste

May-93 Jun-94 Sep-94 5.50 2.93 53.27

11 UNDP YEMEN Marine Ecosystems of the Red Sea Coast

May-92 Apr-93 Jun-93 2.80 1.62 57.86

Total 99.53

Ozone

IA Project DescriptionWork

Program (A)

IA Approval

(B)

EffectiveDate(C)

US$ millions


% disbursed

1 WB BULGARIA ODS Phase-Out May-95 Nov-95 May-96 10.50 2.31 22.00

2 WB CZECH Republic - Phase Out of Ozone Depleting Substances

Dec-92 Aug-94 Dec-94 2.49 2.42 97.19

3 WB HUNGARY ODS Phase-Out May-95 Nov-95 Feb-96 6.90 5.89 85.36

4 WB RUSSIA ODS Consumption Phase-Out Apr-96 May-96 Sep-96 60.00 2.82 4.70

5 WB SLOVAK REP Investment Project for the Phase Out of Ozone Depleting Substances in the Production of Refrigerators and Freezers

May-95 Jun-96 Nov-96 3.50 2.66 76.00

6 WB SLOVENIA Phase Out of Ozone Depleting Substances

May-95 Nov-95 Dec-95 6.20 5.90 95.16

Total

89.59

Grand Total 870.95 405.40 46.55

APPENDIX B

DEFINITION OF RATINGS USED IN 1998 PIR

Assumption and Risk Ratings

The risk that individual assumptions relevant to the project may not prove to be accurateand, thus, may seriously affect implementation or prospects for achieving project objectives,should be rated on the following scale:

High (H) There is a probability of greater than 75% that theassumption may fail to hold or materialize.

Substantial (S) There is a probability of between 51% and 75% that theassumption may fail to hold or materialize.

Modest (M) There is a probability of between 26% and 50% that theassumption may fail to hold or materialize.

Low (L) There is a probability of less than 25% that the assumptionmay fail to hold or materialize.

Implementation Progress Ratings

Highly Satisfactory (HS) Implementation of all components is in substantialcompliance with the original (or formally revised)implementation plan for the project.

Satisfactory (S) Implementation of most components is in substantialcompliance with the original/formally revised plan exceptfor a few that are subject to remedial action.

Unsatisfactory (U) Implementation of most components is not in substantialcompliance with the original/formally revised plan butremedial action has been agreed.

Highly Unsatisfactory (HU) As in �U�, but remedial action has not been agreed.

Global Environment/Development Objective Ratings

Highly Satisfactory (HS) Project is expected to achieve or exceed all its major globalenvironment/development objectives and yield substantialglobal environment benefits.

Satisfactory (S) Project is expected to achieve most of its major globalenvironmental/development objectives and to yieldsatisfactory global environmental benefits without majorshortcomings.

Unsatisfactory (U) Project is expected not to achieve most of its major globalenvironmental/development objectives nor to yieldsubstantial global environmental results.

Highly Unsatisfactory (HU) Project is expected not to achieve any of its major globalenvironment/development objectives nor to yieldworthwhile global environmental results.

45


46

1 INTRODUCTION

1.1 M&E in UNDP and the PIR process

The annual GEF Project ImplementationReview (PIR) has become an integral part ofUNDP�s regular monitoring system composedof the Tripartite Project Review (TPR), theAnnual Programme/Project Report (APR), theMid-term Report, and the Final CompletionReport. For UNDP/GEF the PIR is themoment to take stock and review theperformance of its portfolio.

This summary of the 1998 PIR combinesinformation provided by the specialized PIRreporting forms, by UNDP�s monitoring andevaluation tools, and by other independentevaluations and lessons learned studies. Thepurpose of the PIR is twofold: (a) to report onthe performance of the UNDP/GEF portfolioto the GEF Council, and (b) to identify andaddress new challenges and identify and disse-minate successful strategies and lessons thatare emerging from project implementation.Through the PIR and other M&E tools,UNDP/GEF provides feedback to its projectpartners, and if necessary the unit supportscorrective measures to ensure that each projectis progressing according to the objectives andtimetables stated in the project document.

The PIR is indispensable for continualimprovement of the portfolio, and foruncovering important information such as thefact that the process of leveraging co-financing continues throughout a project�s

implementation phase. This year�s PIR showsthat for every dollar (US) invested by the GEFin UNDP/GEF projects, an additional 3.45dollars are secured in co-financing duringpreparation and implementation.

The PIR reports for individual projects are theresult of a collaborative effort, reflecting theviews of UNDP/GEF Country Office focalpoints, regional coordinators, and technicaladvisors. In this sense, the PIR is a UNDP reviewreflecting UNDP/GEF�s consolidated view onits portfolio. The reporting format was sentelectronically to UNDP Country Offices thathave projects meeting the review criteria. Atheadquarters, the regional coordinators andtechnical advisors reviewed the completedreports.

The UNDP/GEF portfolio encompasses a varietyof project types such as Full Projects, PDFs,PRIFs, and Enabling Activities. According to thePIR selection criteria, the PIR reports on only asubset of the total portfolio. Enabling activitiesand projects, which were operationallycompleted before June 10, 1997, are not includedin the review. Projects, which startedimplementation after June 30, 1997, are alsoexcluded.

The review under the Regular PIR includes allfull UNDP/GEF projects (excluding enablingactivities, PRIFs, PDFs) that have been underimplementation for more than one year as of June30, 1998. To be selected for the review, projectsalso had to have their Project Documents signedbefore June 30, 1997.

APPENDIX C.1

UNITED NATIONS DEVELOPMENT PROGRAMMEGLOBAL ENVIRONMENT FACILITY

Project Implementation Review 1998

Summary Performance and Lessons Learned Overview

47

Appendix C: PIR Overview Reports of Implementing Agencies

The review under the Status PIRincludes all projects (includingPDFs, and PRIFs), which wereapproved by the GEF Councilbefore June 30, 1996, but whichhave not yet been formallyapproved (ProDoc Signature). Italso includes all projects that havehad their ProDocs signed beforeSeptember 30, 1997, but whichhave not yet begun disbursement.

It is important to recognize that thevast majority (90%) of projectsincluded in the PIR review are stillPilot Phase Projects.

Based on guidelines provided fromthe GEF Secretariat, PIR reportscover all aspects of projectperformance including imple-mentation and impact rating,leveraging, capacity building,stakeholder involvement, andlessons learned.

1.2 Statistical Analysis

The geographical distribution of projectsincluded in the PIR reveals that Africa, Asia &Pacific, and Latin America & Caribbean accounteach for approximately one quarter of all projectsreviewed under the PIR. Europe & CIS and ArabStates account for approximately 10% of theremaining PIR projects. Large scale pipelinedevelopment and project implementation in theArab States and Europe & CIS region has startedlater than in the other regions, which explainsthe small number of projects from those regionsin the present PIR. The distribution by focal areashows that Biodiversity and Climate Change projectseach account for approximately 45% of the totalnumber of projects included in the PIR review.International Waters projects represent approximately10% of all PIR projects. There are a number of IWprojects which have started implementation recentlyand will be included in next year�s PIR.

Table 4 clearly shows that UNDP/GEF ismoving towards national execution of itsprojects. Already more than 60% of UNDP/GEF projects are nationally executed whichcontributes to enhanced national ownershipof GEF projects and builds national capacity.

2 TRENDS AND LESSONS LEARNED

2.1 Cross Cutting Issues

2.1.1 Capacity Development

GEF goals such as sustainability, leveraging,awareness raising, and many other overridingobjectives can only be achieved by enhancingthe human and institutional capacities ofrecipient countries. The 1997 PIR highlightedthe importance of consultations, inter-institutional networking, and awarenessraising. UNDP/GEF�s capacity development

6#$.'��07/$'4�#0&�&+564+$76+10�1(�241,'%65�+0%.7&'&+0�6*'�2+4�$;�4')+10

Region

PIR Report

FullReport

StatusReport

Total

Global 3 0 3Africa 13 8 21Asia & Pacific 13 5 18Arab States 6 1 6Europe & CIS 1 0 1Latin America &Caribbean

11 6 16

Total 47 20 67

6#$.'��07/$'4�#0&�&+564+$76+10�1(�241,'%65�+0%.7&'&��+0�6*'�2+4�$;�(1%#.�#4'#

Focal Area

Project Type

FullReport

StatusReport

Total

Biodiversity 22 11 32Climate Change 19 6 25International Waters 6 2 7Ozone 0 0 0Multi-Focal 1 1Total 47 20 67


48

initiatives continue focusing on increasinghuman resource and institutional strengths; onpromoting networking and the creation ofpartnerships; on building public awareness;and on providing decision makers withinformation and training conducive to thedevelopment of appropriate policies.Developing such capacities is one of thecentral missions of UNDP. Hence capacitybuilding measures are an integral part ofalmost all UNDP/GEF projects. The 1998 PIRsystematically reports quantitative andqualitative data on human resource andinstitutional development.

2.1.1.1 Human Resource Development

Building human capacity through training andeducation remains one of the cross-cuttingsuccesses ofU N D P / G E Fp r o j e c t s .However, it isdifficult tomeasure theimpact of thetraining initia-tives. Morework is needed

to develop objectively verifiable indicators,which measure the application of the gainedknowledge and the resulting benefits for theglobal environment. Projects usually use indirectindicators such as �number of degrees andcertificates earned,� or �number of managersintroduced to new methodologies.�

Projects provide training and education througha large variety of mechanisms such as:internships and scholarships; short-term tech-nical training; workshops; in-service training;staff exchanges; study tours; and many more.Depending on the objective of the project, humancapacity is built in areas such as: natural resourcemanagement; pollution response; internationalconventions and national regulations; riskassessment/risk management; natural resourcedamage assessment; environmental impactassessment; GIS introduction; and many more.

The recipients ofcapacity buildingefforts includekey national andlocal stakehold-ers from govern-ments, NGOs,academic, andprivate sectorinstitutions.

6#$.'�� (+0#0%+#.�&#6#�(14�#..�70&2�)'(�241,'%65�#5�1(�(;��

Region April 91-Jun 98Total Authorized

Allocation (1)

($’000)

April 91-Jun 98Total Approved UNDP

Budget (2)

($’000)

Jan 92-Jun 98Total Actual

Expenditure (3)

($’000)Global 27,425 25,985 24,940Africa 136,109 95,080 46,030Asia & Pacific 165,310 118,095 72,700Arab States 83,270 30,880 10,760Europe & CIS 58,175 37,570 21,300Latin America &Caribbean

131,700 81,810 61,180

Small GrantsProgramme

38,900 38,900 28,670

Total UNDP/GEFProjects

640,889 428,320 265,580

(1) Authorized allocation refers to GEF allocation approved by GEF Council or GEFSEC CEO.(2) Total approved UNDP budget refers to GEF allocation approved by UNDP as commitment.(3) Actual expenditure refers to the actual disbursed amounts.

6#$.'��':'%76+0)�#)'0%;�6;2'

Type: Number PercentageNEX/Government 29 61%UNOPS 13 27%Other UN Agencies 4 8%Others 2 4%TOTAL 47 100%

49


Project examples include:

· The Regional Gulf of Guinea project trainedmore than 600 scientists, managers andgovernment officials. Their skills wereupgraded and they were exposed to newapproaches for pollution monitoring,information management, etc.

· The Lake Tanganyika project conducted alarge number of training courses in subjectssuch as fishing practices, environmentaleducation methods, GIS introduction,underwater survey training, etc.

· The Vietnam BD conservation projecthelped to build capacity through short-terminternational scholarships and study tours.

· The Cuba Sabana-Camaguey projecttrained more than 500 people in fieldsrelated to GIS, biodiversity, environmentalresearch, etc.

· The Lebanon Protected Areas Project hasbuild management expertise in a series ofnational NGOs which are today managingthree protected areas under an innovativeGEF-leveraged government mandate.

2.1.1.2 Institutional Development

Institutional development is the second pillar ofcapacity building efforts. All told, some 2,000

institutions have benefited from UNDP/GEFcapacity building initiatives. On average eachproject has enhanced the capacity of 54institutions. The majority of these institutions(43%) reported substantial increases incapacity. Most were governmental institutionseither at the national, regional, or local level.24% of the 2,000 institutions are NGOs, andanother 20% are academic or researchinstitutions. Ninety-two private sectororganizations (4.6%) benefited from capacitystrengthening activities � an average ofalmost 3 for-profit organizations per project.Table 5 summarizes the data gathered throughthe PIR process.

2.1.1.3 Conclusions and Lessons Learned

A capacity needs assessment seems to be afundamental requisite to effectively addressand tailor capacity building programmes torecipient countries, institutions, and relevantstakeholders. During project design,eventually at the PDF B level, and at earlystages of implementation, more emphasisshould be put on the identification of capacityneeds.

Second phase projects such as the BelizeCoastal Zone Management project or projectsthat can build on the capacity of an existinginstitution can afford to spend less energy andresources on capacity building.

6#$.'�� 241,'%6�%1064+$76+10�61�+056+676+10#.�&'8'.12/'06 Institution Government NGOs For

Profit Org.

Academic/ Research Institution

Others

Natl. Reg. Local Intl. Natl. Comm.Org

Limited 53 21 41 19 14 6 17 10 12 Moderate 318 46 57 1 143 85 70 260 33 Substantial 239 65 175 10 36 164 6 127 15 TOTAL 610 132 273 30 193 255 93 397 60 * Information based on 37 projects


50

People�s motivation to participate in educationand training measures and apply the newknowledge depends very much on theenabling environment within the country. E.g.,a lack of legislation which could accordincentives to invest in renewable energy (taxcompensation) discourages people fromparticipating in capacity building efforts.Other constraints include: deeply rootedmistrust and poor relations between projectbeneficiaries and government; rapid turnoverof senior government officials.

The efforts of UNDP/GEF projects in buildinghuman and institutional capacity aredemonstrated by the large number of peopletrained and institutions strengthened.However, it is difficult to fully capture andmeasure the results or impacts of capacitybuilding efforts. More emphasis should be puton developing appropriate indicators forcapacity building. The successes of projectsin terms of leveraging �actions� and financialresources which is one of the cross-cuttingissues of this year�s PIR, could be interpretedas one indicator.

2.1.2 Leveraging

Leveraging has many dimensions. This year�sPIR is the first attempt to capture and fullyreport on leveraging efforts of UNDP/GEFprojects. The leveraging report is divided into(a) �actions� leveraged and (b) financialresources leveraged. Financial leveraging canbe seen as a result or indicator of leveragedactions such as greater awareness or changedattitudes. However, since our partners are notfamiliar with the process of reporting onleveraging, and because definitions need tobe further refined, the information capturedin PIR reports will not be complete untilreporting on leveraging becomes a wellestablished feature of the PIR.

2.1.2.1 Actions �leveraged�

Projects have stimulated and initiated a widerange of actions internal and external to

institutions directly involved in projects. Theseactions are reflected in greater awareness aboutglobal environmental issues, changed attitudes,the establishment of new policies andregulations, and new regulatory mechanisms.The leveraged actions go beyond contributingto project specific goals. They also help to createan environment conducive to the achievementof GEF, CBD, and UNFCC goals.

Awareness

Capacity building and dissemination ofinformation leads to heightened awareness aboutglobal environmental issues. For the majorityof GEF partners, issues related to the globalenvironment are still very new and are often notperceived as the most important and urgent ones.With many countries struggling to resolveeconomic, social, and political crises, it shouldbe recognized that UNDP/GEF projects areplaying an extremely important role by raisingawareness of the global environment insituations where it would not be on the agendaat all. The recent evaluation of the SGP has alsohighlighted this key contribution.

Project examples include:

· The Jordan Dana/Azraq II and LebanonProtected Areas projects have contributedtowards enhancement of the overall enablingenvironment for conservation throughawareness raising and dissemination efforts.

· The Zimbabwe PV project reports thatproject activities have led to more extensivemedia coverage of global environmentalissues.

· The Black Sea project reports that proposalswere discussed to introduce special chapterson ecology and environment protection intoschool education manuals.

Attitudes

Attitudinal change amongst key actors is animportant prerequisite for impacting the course

51


of action beyond the scope of specific projects. Changedattitudes result in changed actions, which are sometimesdifficult to capture in a reporting format such as the PIR.Nevertheless, attitudinal change is a strong indicator forleveraging, sustainability, and replication.

One way to help facilitate attitudinal change amongst decision-makers is through successful demonstration of newtechnologies or new approaches. Participatory approacheshave proven to be successful, e.g., in the Colombia Chocoproject and India�s Hilly Hydel and GHG projects. Stategovernments in India are changing their policies to fosterparticipation in setting up hydropower projects. The HillyHydel project has demonstrated that the participation of localcommunities is a key determinant of success in theestablishment and operation of hydropower projects.

Some projects (e.g., Regional South Pacific BD project andGuayana Rain Forest project) report that the creation ofemployment opportunities for beneficiaries and incomegenerating activities (ecotourism, etc.) has helped to changecommunity�s attitudes and practices towards wildlifepreservation.

Other project examples include the following:

· Private sector involvement in the Regional Gulf of Guineaproject resulted in attitude change amongst decision-makers in the private sector who are now more amenableto cooperation. The success of the Brazil Biomass projecthas contributed to Shell�s decision to create a newcompany dealing with renewable energy resources.

· The Belize Coastal Zone Management project has helpedto ensure the designation of a World Heritage Site, whichwill direct other donor funding to the project area and ensure environmentally sound practices bythe private sector, e.g. in sewage and solid waste disposal methods.

· The Global Alternatives to Slash & Burn project highlights that as a result of attitudinal changeenvironmental considerations are now being incorporated into national projects as a routine matter.For example, the Indonesian government has decided that all future environmental planningresearch should incorporate the ASB approach.

Policies and Legislation

Projects have helped leverage development of new policies and regulations by providing law makerswith information on win-win outcomes, co-formulating legislation, and demonstrating that existinglegislation can be applied.

The East Asian Seas project hasincreased awareness andconcern among participatingcountries regarding marinepollution and associated issuessuch as biodiversity conservation,transboundary pollution, landdegradation, sea level rise, etc.This is reflected in the move bycountries to ratify and implementinternational conventions onprevention of marine pollution—more than 30 since thecommencement of the project.The institutional framework,capacities, and financialcommitments have beenintegrated into the localgovernments’ planning,operational, and fiscal cycle.Private sector support and publicawareness have also beenstrengthened, thereby ensuringtransparency and continuity infuture actions. Replication of ICMsites has occurred at three sitesin China, and is planned for threesites in the Philippines. Otherparticipating countries (Malaysia,Thailand, Vietnam, Indonesia,Cambodia, and DPR Korea) haveexpressed a desire to set up ICMsites, as a follow-on action of theexisting project.


52

Projects provide important technicalbackground information for lawmakers whouse them as a basis for decision making.Projects have even been requested on occasionby national environmental authorities tosubmit papers, concepts and technical reviewsfor environmental legislation and reviewexisting laws and co-formulate newlegislation. Outstanding examples are:Colombia Choco, Cuba Sabana-Camaguey,Vietnam Conservation Training, and RegionalEast Asian Seas.

Chinas Coal Bed Methaneproject highlights that newsets of policies andregulations combined withthe creation of a new entityto promote and manage thenew technology are clearindicators that the project hashelped to overcome barriersand initiated the restructuringof market segments.

Some more examples ofpolicy and legislative reformcatalyzed by UNDP/GEFprojects include:

· The Belize Coastal ZoneManagement project hascontributed towardsdevelopment of a legis-lative framework (CZMAct) and establishment ofa CZM authority.

· The Regional Maghreb GHG project hascontributed towards integration ofenvironmental impact assessmentprocedures into current policies.

· The Regional African Energy Efficiencyproject has proposed a regulatoryframework for energy efficiency inbuildings.

· The formulation of National Action Planson Climate Change in East Asian countriesbuilds on results achieved through theRegional ALGAS project.

· The Guatemala Motagua Region project hassignificantly contributed towardsdecentralization of protected areamanagement.

· The Guyana Rain Forest project has pavedthe way for other activitiesand programmes such asdevelopment of theNational Protected AreasSystem, the establishmentof the EnvironmentalProtection Agency, thestrengthening of theGuyana Forest Com-mission, and the NationalResources ManagementProject all of whichrepresent advances inpolicy and legislation.

· The Regional SouthPacific BD project hasinfluenced governmentdecision-makers to extenda moratorium on commer-cial harvesting of seaturtles.

· The Gulf of GuineaStates have adopted the

�Accra Declaration,� which is a direct resultof the Regional Gulf of Guinea project.

2.1.2.2 Financial Leveraging

The recent Berlin LogFrame workshop hasshown that actors within the GEF familyinterpret terminology differently. Part of theproblem is that some terms have differentconnotations within the IAs. The terms�leveraging,� �co-financing,� and �associated

The Colombia Chocó project hascontributed not only to the

production of information andknowledge but also, and perhaps

more importantly, to thedevelopment of innovative

methodological tools and strategicinstruments for basic and applied

research by the scientific communityand traditional knowledge bearers,

strengthening of sustainableproductive practices, communityparticipation in decision-making

processes, project management atthe grassroots level, social

communication, ethno-environmental education and inter-institutional territorial management.

The experience acquired by theProject in developing a participatorystrategy and mechanisms is viewedas a model for other GEF projectsas well as some national, regional

and local institutions.

53


financing� cause particular problems as theyimply different things within GEF and UNDP.In order to promote discussion and with a viewtowards standardizing use of terminology, adefinition of these terms is provided.

Definition of financial leveraging (financialleveraging = co-financing): Monies leveragedin association with a GEF project to addressglobal environmental objectives. This includesfunds to reach the sustainable developmentbaseline. Two types of leverage may bedistinguished:

1. Complementary funds: New andadditional monies leveraged to address theglobal environmental problem. This caninclude activities in the country�s nationalsustainable development interest, requiredto fortify the baseline, or a portion of theincremental costs.

2. Substitutional funds: Baseline activitiesthat have been modified (thematically orspatially) in order to address the globalenvironmental problem (this may include in-kind contributions such as when agovernment agency reallocates staff time oroffice space, or cash outlays). The leveragerelates to the amounts substituted.

Definition of Associated Financing: Fundingassociated with achievement of globalenvironmental objectives that would beappropriated irrespective of GEF intervention(associated financing = realistic baseline).

Clarity needs to be brought to the relationshipbetween co-financing and leveraging. UNDPtreats financial and in-kind resources leveragedto cover sustainable development activities,necessary to capture global benefit, as co-financing. The rationale is, that without thisleveraged support, the project would not be ableto achieve its objectives, and even though it maybe in the national interest to conduct theseactivities, they may not be as high on the national

agenda as more immediate problems. Thisshift in national priorities demonstrates clearnational commitment to conservation goalsand should be considered as a source of co-financing to the project.

Only a fraction of leveraged resources iscurrently captured in the existing formats,namely those amounts which have beenleveraged up front during project preparationand are reflected as co-financing in the projectbudget. Resources leveraged during projectimplementation are reported for the first timein the 1998 PIR.

UNDP/GEF projects have leveraged 3.45additional dollars for each dollar allocated byGEF. Leveraged resources of the 47 projectsincluded in the regular PIR amount to US$623million (includes: co-financing reflected in thebudget + in-kind contributions + resourcesleveraged during implementation; excludes:associated financing). The sum of GEFfinancing for all full PIR projects amounts toUS$181 million. From the total of US$623million only US$61 million (9%) are reflectedin the project budgets as co-financing,constituting leveraging during projectpreparation.

This is the first time that UNDP/GEF hascaptured systematically leveraged resourcesin its reporting apart from the regular reportingon co-financing and associated financing.Although the definition of �leveraging� hasto be further refined the PIR brings to lightthe extraordinary capacity of our projects tomobilize resources for global environmentalprotection.

Financial leveraging has many dimensions. Itincludes subsidies from project partners,follow on investments, support of specificproject activities, and soft loans from revolv-ing funds. The leveraged resources come froma multiplicity of sources such as private andpublic companies, governments, UNDP and


54

other UN agencies, regional developmentbanks, bilateral agencies, and NGOs.

In several projects with strong private sectorinvolvement, participating companies aresubsidizing the project by contributingbudgetary resources to cover costs related totravel, communication, remuneration, andother administrative expenses. Thesesubsidies are only partially reflected in theproject budgets under �in-kind� contribution.In the case of the Brazil Biomass project thesecosts amount to approximately US$4 million.The same is true for projects with strong NGOinvolvement, e.g., in the GuatemalaMontagua Region project. The level ofinvolvement in and support from privatecompanies for renewable energy technologyprojects is a clear indicator of the leveragingcapacity of projects.

Furthermore, several successful UNDP/GEFprojects in the climate change area haveattracted significant investments from theprivate sector. In the case of the China CoalBed Methane project, these investmentsamount to more than US$500 million.

Projects leverage funds to secure additionalsupport for project activities which cannot befunded directly through the project budget butwhich are complementary to the project andcontribute to its development goals. The IndiaGHG project has leveraged substantialresources (approximately US$1.8 million)from the government, beneficiaryorganizations, and UNIDO to support projectactivities in the leather sector. A revolvingfund created under the India Hilly Hydelproject has given soft loans to privatecompanies and a NGO for setting updemonstration projects.

There are promising examples of co-financingfrom UNDP and other UN-agencies indicatingUNDP�s successes in its mainstreamingefforts. The Lebanon Protected Areas project

and the Guyana Rain Forest project have beensuccessful in leveraging funds from the UNDP/Capacity 21 window and stimulatedcollaboration with UNDP�s Global Programmeon Forests. The UNDP Country Office inLebanon has worked with FFEM on theformulation of a Wetlands/Coastal componentof the Mediterranean Initiative, which amountsto US$250,000 from FFEM to be managedjointly by FFEM and Lebanon Protected Areasproject. In addition, the Lebanon project hasbeen extremely successful in mobilizing both theArab and Lebanese private sector for contri-butions to the project and well over US$250,000has now been mobilized from private Arabbusinessmen and philanthropists throughtargeted fund raising by the NGOs and theproject management team.

Some other examples of successful financialleveraging efforts include:

· The ALGAS project, which has leveragedUS$500,000 from the ADB;

· The Costa Rica Osa-La Amistad project,which has leveraged more than US$800,000from government, bilaterals, and NGOs;

· The Colombia Chocó project has securedalmost US$5 million from government andsubcontractors;

· The Guatemala Motagua Region project:US$740,000 obtained from government andbilaterals;

· The Guyana Rain Forest project US$8.3million secured from bilaterals, and UNprograms such as Capacity 21 and ITTO;

· The Regional South Pacific BD project:US$1 million from different sources;

· The Regional East Asian Seas project:US$11.3 million.

55


2.1.2.3 Conclusions and Lessons Learned

Leveraging is much more than showing co-financing amounts in the project budget.Leveraging also refers to resources mobilizedduring project implementation and �actions�initiated such as awareness raising, attitudechanges, and changes in policies and regulations.Projects are reporting many examples ofsuccessful leveraging. Leveraging in fact is aprocess, which starts in the project formulationphase and continues during the project cycle.Only a small part of leveraged resources isdocumented (as co-financing) in the projectbudget. Large sums, leveraged duringimplementation, are not captured by the existingdocumentation. The PIR is the first attempt toreport on leveraging.

Recommendation: Definitions should befurther refined in order to capture all relevantresources and actions leveraged by GEF projects.Indicators for leveraging should be developedand consistently applied. UNDP/GEF suggeststhat the GEFSEC M&E team together with theIAs conduct a study to further explore this issue.

2.2 Performance Rating

Ninety percent of the projects reported thattheir implementation progress was eithersatisfactory or highly satisfactory.Implementation progress refers to: thedelivery of inputs and achievement of outputs(focus on features such as workplan,timeliness, disbursement, procurement,quality of technical advice, goods and servicescreated, etc.). Only 9% of the projectsreported unsatisfactory or highly unsatis-factory progress. Explanations will beprovided under the focal area sections. Oneindicator for implementation progress is theaverage timing of disbursement. The PIRshows that the percentage of planned vs. actualexpenditures for all full PIR projects is 82.9%.Ninety-four percent of the projects reportsatisfactory or highly satisfactory impact.Impact is understood as: contribution to GEF�sglobal objectives resulting in globalenvironmental benefits (global objectives arelaid down in the four focal areas, and 10operational programs, and are usuallyreflected in the development objective of theproject).

Only 6% of the projects report unsatisfactoryor highly unsatisfactory impact. Explanationswill be provided under the focal area sections.

2.2.1 Conclusions and Lessons Learned

Ratings are reflecting UNDP/GEF�sconsolidated view on project performance.Recently introduced tools such as the LogicalFramework approach and the identification ofobjectively verifiable indicators contribute tobase the ratings on more solid ground. Ninetypercent of all regular PIR projects have startedin the pilot phase where tools such asLogFrame and indicators were notsystematically introduced. The PIRs for theyears to come will increasingly benefit fromthe introduction of LogFrame tools and ratings

��6#$.'��+/2#%6�4#6+0)

Project as a whole: PercentageHighly Satisfactory 34%Satisfactory 60%Unsatisfactory 6%Highly Unsatisfactory 0%TOTAL 100%

��6#$.'�� +/2.'/'06#6+10�241)4'55�4#6+0)

Project as a whole: PercentageHighly Satisfactory 11%Satisfactory 80%Unsatisfactory 6.5%Highly Unsatisfactory 2.5%TOTAL 100%


56

will be based on objectively verifiableindicators. For the assessment of projectimpact many projects highlight that a longerassessment period is needed in order to makedefinite statements on trends in environmentalquality.

2.3 Stakeholder Involvement

The 1997 PIR reported that several projectshave made substantive efforts to shift fromconsultation (passive participation) to activeinvolvement (active participation). Theseefforts continue, and are proving to beessential in order to enhance stakeholder�ownership� of conservation initiatives.

Table 8 shows that projects are involving abroad range of stakeholders in all stages ofthe project cycle. It is not surprising that thevast majority are involving government andacademic institutions in design,implementation, monitoring, and evaluation.But it should be highlighted that communityorganizations and for-profit institutions arealso active partners in many projects. Sixty-two percent of the projects involve communityorganizations in project implementation and48% involve for-profit organizations.

2.3.1 Conclusions and Lessons Learned

Projects report that stakeholder involvementis a process which needs time, dedication, andalso resources. Stakeholder Involvement is notjust a single event covered by a stakeholder

workshop but an ongoing task during the wholeproject cycle. A phased approach would beextremely helpful in allowing projects to startslowly, build trust amongst the majorstakeholders, and lay a solid ground for asuccessful intervention.

3 FOCAL AREA HIGHLIGHTS

3.1 Biodiversity

In the PIR 1998 there are 22 Biodiversity projectsunder active implementation: 2 projects underOP1 (drylands), 6 projects under OP2 (coastal,freshwater, marine), 12 projects under OP3(forests), and 3 projects under OP4 (mountains).(Some projects contribute to more than one OP,but for simplicity they are assigned to just oneof them). The percentages of projects in the PIRand in the various OPs roughly correspond totheir proportions in the overall portfolio. Thetotal resource commitment from GEF for theseprojects is about US$69 million.

Implementation Progress

Except for the Panama Darien and theGuatemala Montagua Region interventions, allprojects obtained at least a satisfactoryimplementation rating. Moreover, five projectsreported Highly Satisfactory implementationratings. The Darien project has passed throughmany difficulties, including local politicalinstability and high personnel turnover forvarious reasons, including the harsh livingconditions at the project site. UNDP just

6#$.'�� 6;2'�1(�56#-'*1.&'4�+081.8'&�+0�6*'��2*#5'5�1(�6*'�241,'%6�%;%.'

ProjectPhase

Government NGOs ForProfitOrg.

Academic/ResearchInstitution

Others

Natl. Reg. Local Intl. Natl. Comm.Org

Design 39 13 12 16 18 13 11 30 7Implem. 39 21 22 22 28 27 21 38 13M&E 38 13 14 14 20 14 8 21 10TOTAL 116 47 48 52 66 54 40 89 30

* Information based on 43 projects

57


completed an independent evaluation of theDarien project and will introduce measures tocorrect the course of the project to ensure thebiodiversity of the Darien is protected.

In Guatemala, project inception needed to forgea mutual consensus between NGO andgovernment partners regarding implementationmodalities and strategies. Although GEF projectsencourage NGO participation in projects,collaboration is often hampered by mutualdistrust between NGOs and governmentagencies, or the dearth of existing workingrelationships, requiring an initial investment inconflict resolution (and longer lead times fordesign). These conflicts have recently beenaddressed, and progress has now been re-established.

It is important to recognize that whileimplementation progress is necessary forachieving impact, it is not a sufficient indicatorof impact.

Impact

Impact estimates of all biodiversity projects inthe FY 98 PIR indicate they are either likely, orvery likely, to have significant impacts on thebiodiversity of recipient Party countries.

Presently, all projects report on indicators forthe short-term impact, such as people trained in

the various disciplines or institutions strength-ened. However, to evaluate the long-termimpacts of these biodiversity conservationinterventions, there is a need for longer termmonitoring and evaluation systems to capturethese impacts.

Capacity development

One long-term impact of capacity building andinstitutional strengthening will be an effectiveincrease in the absorptive capacity in thecountry for new conservation initiatives, andin changing frameworks and attitudes towardsconservation. Experience has shown (forexample in the Argentina Patagonia project)that success of projects is tightly related tothe presence in the country of qualified NGOsthat can professionally carry out the neededplanning and execution. In this PIR, severalprojects (Ethiopia Plant Genetics, LebanonProtected Areas, Mauritius Forests, PanamaDarien) expressed that they could havebenefited from the presence of moretechnically qualified NGOs.

Actions �leveraged�

It becomes all the more important to captureex-post impacts that also demonstrateevidence of country commitment, additionalto national commitments made at the time of

Further examples of ex-post leveraged actions relate to education and awareness. Conservation educationrequires time to evoke attitudinal change, and needs to build a basic awareness and understanding amongcommunities of conservation issues, before it is possible to have more in depth discussions of conservationneeds, challenges, and strategies, and translate changing attitudes to conservation actions. One example isthe successfully piloted innovative conservation education approaches in the Papua New Guinea BiodiversityProgram, which in turn have served to bolster the conservation constituency. The program has forged linkageswith local church groups working at the field site in Bismarck Ramu, developing messages that could bedisseminated by pastors and other church personnel. This strategy builds on existing infrastructure and socio-cultural norms, although care has been taken not to show preference to any one group. Other projects havemade heavy use of local radio, which provides an effective and cost-efficient means of reaching out tocommunities in remote locations. Increasing emphasis has been placed, throughout the portfolio, on raising theawareness of civil society on the genesis of conservation dilemmas, and the global and domestic benefits thataccrue from biodiversity conservation.


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submitting the project brief to Council forapproval. There is already some evidence ofhow projects are starting to improve theoverall country framework of attitudestowards the CBD and conservation. Forexample, the Capacity Building andDemonstration project in Lebanon reports animportant role in training people and in raisingnational awareness about the importance ofthe CBD and the need to support it. Withoutthe project the degree of awareness amongpeople about the CBD would be much smaller;with it a new set of national options is startingto unfold. Although in several cases(Colombia Chocó, Burkina-Faso NazingaRanch, Cuba Sabana-Camaguey, JordanDana/Azraq), projects leveraged policies onissues directly related to the project, in othersthe projects were also sought as a source ofadvice for matters with importantconsequences for the national biodiversityframeworks (for example, Jordan, Colombia).These are all very important actions leveragedby UNDP/GEF projects that, although notfully quantifiable yet, should not be dismissed.The existing M&E systems do not captureleveraging in terms of long-term and profoundimpacts. New and additional capacity for longterm (10 year horizon?) monitoring andevaluation should be established.

Financial leveraging

Similarly, experiences from projectimplementation are showing that importantfinancial resources are being leveraged duringproject implementation, as well as aftercompletion. Almost US$15.5 million of newresources were obtained by capacitatedproject participants during projectimplementation. The single most importantnew co-funding was for the Guyana project(US$8.3 million), but there were 11 otherprojects (mostly Pilot Phase projects) thatbrought new accumulated funding in amountsvarying between US$200,000 to US$1.4million. More important than the absolutesums, in these cases are the conservation-sustainability processes that have been

triggered by the GEF projects. The total amountto be leveraged by these projects is still inprogress. Recognizing that co-financing maybe more effectively leveraged once newconservation prototypes have been demonstratedraises an important lesson. Conservationopportunities may be enhanced by extending thefocus of fund raising activities to projectimplementation phase, and by generatingresidual capacity to continue raising funds afterproject completion, in addition to raising co-financing during the design phase of the project.

Sustainability

In general, the menu of options for reachingsustainability is limited. This is an issue linkedto difficulties in capturing, in tangible terms, thepositive externalities of biodiversityconservation. Projects report some success atdoing this. The Indonesia and MalaysiaConservation Strategy for Rhinos has sought toachieve sustainability by developing eco-tourismfacilities at Way Kampas National Park inSumatra; profits from the venture will bechannelled to the field patrol units establishedto protect rhinos. Bridging funds have beensecured from other donor agencies to coverrecurrent costs until the eco-tourism venture isfully operational. However opportunities tointernalize biodiversity externalities need to bemore fully explored, through institution of �userpays� mechanisms and other fiscal instruments(thus capturing rent from productive sectors).In some cases, trust funds will still be needed tocover the recurrent costs of management,particularly in cases where economic constraintsmean that governments are unable to absorbthese costs, and where national turmoilforecloses market opportunities for biodiversityconservation.

Recognizing the challenges of capturing long -term solutions for sustainable use andconservation of biodiversity emphasizes the needfor short-term solutions to protect biodiversityin the meantime. Attention needs to be paid toenhancing basic policing, enforcement, andoutreach functions�while at the same time

59


seeking to involve local communities inconservation efforts through integratedconservation and development programs. Such�carrot and stick� approaches, embodying bothshort-term response and longer term stabiliza-tion strategies, offer a blend of incentives andpenalties to abet conservation management.

The success of early responses to a great extenthinges on the performance of protected areasstaff and other key conservation workers. Bybuilding new ranger quarters and upgrading parkinfrastructure, the Costa Rica BiodiversityConservation La Amistad project has improvedworking conditions for rangers and other parkspersonnel working at the forefront ofconservation efforts in a bid to enhance workincentives. Although several projects have paidattention to this need, other opportunities forproviding incentives need to be investigated. Forinstance, the possibility of providing insuranceto conservation workers forced to operate indifficult conditions, with poor security (i.e.,Indonesia/Malaysia�Conservation Strategy forRhinos project), could be considered.

As part of its regular operations, UNDP monitorsits projects and looks for lessons learned. DuringFY 98 UNDP prepared a desk study of coastaland freshwater projects (OP2) under imple-mentation and produced a guide for its CountryOffices that will help them in future projectpreparation. The document contrasts projectapproaches with current best practice and makespractical suggestions for project design underOP2.

Benchmarking

Two projects (Belize, Cuba) and one PRIF(Pakistan) successfully completed a first phaseand recently submitted to Council project briefsfor a consolidation and final phase. In all theseprojects there were important capacity buildingactivities that led the proponents toconceptualize the consolidation phase and,judging from their previous performance, arelikely to also be successful in the phase. Asdiscussed in earlier PIRs, these projects showed

that the time initially allocated to securingbiodiversity global benefits was toooptimistic, and another phase was needed.This PIR indicates that the Gabon and BurkinaFaso projects may end up in this category.

A lesson emerging as projects enterfinalization, and with second phase projectsnow included in the PIR, is the need to selecta realistic timeframe. An alternative to simplyincreasing the time of project intervention, orplanning a second phase towards the end ofthe first phase, is to lay out a benchmarkedapproach in designing projects.Benchmarking project interventions canreduce the risk of planning over a longer andmore realistic timeframe, if the release offunds is contingent on milestones being met.In some cases, benchmarking may beorchestrated thematically, allowing socialmobilization, planning, and policy changefollowed by activities to fully mature theconservation process. Selecting benchmarkindicators as a basis for moving to the nextphase may include the mobilization offinancial resources, evidence of policy orregulatory change, where this is a necessaryelement of efforts to mitigate the root causesof biodiversity loss, and evidence ofcommunity commitment, such as sweat equityinputs. Several projects (notably the PNGBiodiversity Conservation and ResourceManagement Programme) have identifiedindicators of community receptivity to and thesocial feasibility of biodiversity conservation.While these indicators are socio-culturallyspecific, they may be modified to suitprevailing socio-economic and other specificcircumstances.

The PIR provides good examples wherebenchmarking could have been advantageous.In Gabon, community-based conservationcontradicts existing laws on resourcemanagement, hampering efforts to securewider community participation inconservation efforts. Resolution of issues suchas these often requires considerable attentionto be paid at an early stage to advocacy�to


60

sensitize decision makers within keyinstitutions to the benefits of new strategiesand approaches. In this case setting legalreform as a benchmark for the next release offunds could have had a positive impact increating the necessary conditions for securingcommunity participation.

Stakeholder Involvement

The 1997 PIR reported that several projectshave made substantive efforts to shift fromconsultation (passive participation) to activeinvolvement (active participation). Theseefforts continue, and are proving to beessential in order to enhance stakeholder�ownership� of conservation initiatives. TheColombia project suggests that greater effortsare needed to involve stakeholders at thedesign stage of projects, to enable them toarticulate their perspectives and needs, andshape activity design. The South PacificBiodiversity project reports that getting allstakeholders involved in a constructivedialogue has taken about two years. Thisconcurs with trends of generating stakeholderinvolvement found in other projects (forexample, Costa Rica, Colombia, Darien, andGuatemala). Such emerging trends areshowing that whereas stakeholderinvolvement is critical for project success,having them really committed to project goalsand agreeing to participate as part of anintegrated team, is challenging, timeconsuming, and perhaps one of the biggestchallenges in the implementation ofbiodiversity projects. These initiatives showthat the process of engagement should not beshort changed but rather allocated additionaltime and resources (working within theconstraints posed by absorptive capacity).

The complexities of generating stakeholderparticipation is multiplied by the very wideset of stakeholders often found in biodiversityfocal area projects when compared to otherfocal areas. While the private sector istypically not involved as a stakeholder perhapsbecause of the protected areas nature of many

of the projects included in the PIR, governmentsand various non-government and community-based organizations are regularly part of thestakeholders, steering committees, and trainingefforts. There is also often greater emphasis onwomen in biodiversity projects. This relates notonly to the UNDP-wide policy towards women,but to the role women play as custodians of BDin many settings. In general, stakeholderinvolvement (for example, Colombia, Panama,Guyana) increased during project execution.

Status Report Biodiversity

Eleven PDFs and PRIFs are listed in the slowimplementation category (Status Reports).

The India Eco-Development project produced aproject currently implemented by the WB. Onlyclosure of this project is pending.

Three African PDFs have had delays due topolitical unrest: Congo Protected Areas, LesothoMountains Biodiversity, and Upper GuineaRainforest. As soon as situation permits,activities will continue.

India Gulf of Mannar has been slow inpreparation but is expected to generate a ProjectBrief very soon. Another India PDF, Andamanand Nicobar has a very slow start but hasrecently commenced activities.

Regional Western Indian Ocean and WhiteRhinos are stopped. In the Western Indian Oceancase there is a discrepancy between GEFSECand requesting countries in the goals of theproject, whereas in the rhino case it is adiscrepancy among participants.

The Brazil Juruena Non-Timber Forest Products(NTFP) PDF has been delayed for lack ofagreements on the scope with authorities. Aninteresting outcome of this PDF is that it wasfound out that with current market prices andtransport costs, concentrating on NTFP wouldnot be a feasible strategy for conservation in theregion. Therefore the work has been re-focusedto treat NTFP as one element of a wider scope

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brief that will soon be brought to bilateralconsultations.

UNDP/GEF is concerned about the delays in thetime required by some its PDFs and PRIFs inproducing eligible Project Briefs, and is workingto implement a procedure to expedite delivery.

3.2 Climate Change

This year�s PIR includes 19 climate changeprojects that account for slightly more than US$96 million. Although a few Pilot Phase projectswere operationally completed previously, severaladditional ones are winding down in this year.Until now, the PIR has focused exclusively onPilot Phase Projects. This is the first year thatthe PIR has included projects from GEF1. FuturePIRs can be expected to focus increasingly onGEF1 projects as the more successful Pilot Phaseprojects become operationally completed.

In terms of breakdown by Operational Program,the fit is not perfect as most of these projectspreceded the programs. However, three projectsdeal very clearly with energy efficiency andbelong in OP5. Six projects focus on someexpanded utilization of renewable energy,belonging to OP6. Two projects fit into OP7 andfour can be considered the full-project equivalentof Pilot Phase enabling activities. The remainder,considered short-term, include two carbonsequestration/rangeland management programs,one coal-bed methane project, and one targetedresearch and monitoring project.

For the three projects under OP5, the RegionalAfrican Energy Efficient Buildings projectappears to be making very satisfactory headway.Significant training has taken place and theproject is about to launch a program of demons-tration incorporating new, more energy-efficientelements into West African buildings. ThePakistan Road Transport project finally seemsto be getting off the ground, largely because thefinal impasse that was causing delays (i.e.,whether the demonstration tune-up stationsshould be nationally procured or procured viaUNIDO) was resolved in favor of the national

executing agency, who have becomeextremely supportive and cooperative. Thefirst such station established with projectfunds was opened at the end of September1998.

More than any other project in UNDP/GEF�sclimate change portfolio, the Chilean GHGReduction project is the one that has been mostovertaken by external events. Originally, thisproject had two elements: the first focusingon improving the use of energy efficientmotors in the Chilean mining sector and thesecond focusing on producing methanol fromorganic wastes. From the time when the initialproject was approved, Argentine natural gasmade headway into the Chilean economy,making it the source of arguably the cheapestmethanol in the world. As a result, themethanol portion of the project wasreformulated to focus on rural electrificationthrough biomass gasification. This portion ofthe project seems to be making satisfactoryprogress this year. However, the portion ofthe project dealing with efficient motors hasmore recently encountered problems. Havingconvinced the mining industry that substantialsavings could be achieved, there has still beenno interest in the establishment of a revolvingfund for the procurement of these motor drivesas the mining companies are largely interestedin and capable of self-financing the initiatives.In addition, some of the interest in savingelectricity is being lost as, again due to theinflux of natural gas and the privatization ofthe electricity sector, the price of electricityis expected to fall significantly over thecoming two years. As a result, the project iscurrently undergoing yet anotherreformulation.

With one notable exception (discussedbelow), all of the 6 projects that fall into therealm of OP6 on renewable energy madesatisfactory progress this year. The ZimbabwePV project is being operationally concludedthis year and has surpassed its stated goal offacilitating the dissemination of 9,000 PVsystems. By current counts, nearly 10,000


62

systems have been distributed with theassistance of the project. The Mauritaniaproject, which has also been operationallyconcluded this year, has electrified all of the19 villages targeted in the project. While theseall appear to be working, in a few cases thereis a seasonal shortfall of electricity�a factthat reflects the weak information based uponwhich the project was built. These twoprojects both appear to have achieved theirstated goals.

Both India�s Hilly Hydel and Biomethanationprojects have made satisfactory progress thisyear. In the case of the latter, four of thetargeted 29 units are in operation. Theremainder have been identified, selected, andshould be under construction. Many factoryowners are either reluctant to finance half ofthe investment due to the perceived risks ofthe return to the investment or theunfamiliarity with the technology. As moredemonstration units become operational, thisbarrier is expected to come down. Withrespect to the former project, 18 out of 100watermills have been built, with the remainderplanned and scheduled to take place beforethe end of the project (December 1999). All25 small hydro-electric sites have beenselected and are under construction. Both ofthese projects have made considerableprogress in the past year, as they both receivedunsatisfactory ratings on the PIR for 1997.

The one GEF I project found in OP6 that isincluded in the PIR is the China Landfill Gasproject. This project has made satisfactoryprogress as indicated in the PIR. However, itis still too early to judge the performancecharacteristics of the landfill gas technologyin the Chinese context.

The only one of the six projects under OP6that received an unsatisfactory rating this yearis the Tanzania Takagas project. This projectwas originally designed to accelerate thefermentation of organic wastes and utilize thecaptured methane. It also received anunsatisfactory rating last year. The plant itself

still has not been built. As this is being written,the Tanzanian government, the Danishgovernment, and UNDP have fielded a jointmission to consider which future alternativesshould be pursued with this project.

The two projects under OP7 are both set in Braziland are part of the same programmatic initiativeto utilize biomass for advanced powergeneration. The BIG/GT Phase II project hasnow been operationally closed, having ledsuccessfully to the public/private consortium andthe follow-on World Bank/GEF project. A finalproject evaluation report is available. TheSugar-Cane Bagasse and Trash project is aGEF1 project designed to apply the informationlearned in the BIG/GT project to the utilizationof the same technology to utilize sugar-canewaste. It has made satisfactory progress this yearand has already characterized sugar-cane trashfor energy use; tested a dry-cane cleaning station;and tested a green-cane harvester. All of theseare necessary preconditions to effectively utilizesugar-cane wastes for electricity generation.

Among the four enabling activity projects, allof the appear to have made successful progressthis year. The Regional ALGAS and the Africaregional projects are already operationallycompleted, with only minor bookkeepingadjustments required. Both have final evaluationreports available in draft form. The Maghrebregional project should be completed by the endof 1998. All three of these projects were designedas enabling activities prior to the formaldevelopment of the phrase �enabling activities.�In some ways, the development of the GEFguidelines for the enabling activities hasundermined the rationale for and interest in theseprojects. Each had to adjust in a slightly differentmanner. For ALGAS, the project continued itsplanned approach of following the formalanalysis from inventory to abatement analysisand project identification. The Maghreb projectconcentrated on sponsoring activities and theproduction of the materials, which could not besupported under the newly defined enablingactivities. The Africa project redirected its effortstoward supporting the countries in preparing

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their initial national communications. However,so far, only Zimbabwe has finalized andpresented its initial national communication. Allof these projects will have been successfuldespite being undermined by the laterdevelopment of events. All of them have servedto create strengthened national capacity in theclimate change arena.

CC: TRAIN Phase II is the other project in theEA category. It is now in the second full year ofimplementation and is currently undergoing anindependent mid-term evaluation that will beavailable in draft by COP4. The trainingmaterials developed under CC: TRAIN are nowavailable for use by all parties to the UNFCCC.

Under the short-term window, the China Coal-bed Methane project appears to have been verysuccessful. As has been indicated previously,the Chinese Government has created a newagency to oversee coal-bed methanedevelopment, and the project has spurred thedevelopment of numerous joint ventures toharness this resource. This project will beoperationally completed during calendar year1998. The two range management and carbonsequestration projects (Benin and Sudan) appearto have been very successful at improving forestand rangeland management in the project areas.The main emphasis of the Sudan projects wasto take the pressures off the land by introducingalternative livelihood systems and modifiedrangeland practices so as to reduce theoverutilization and thereby also improvingcarbon storage. Later this year, actual field dataon carbon sequestration potential attributable toinitiatives of this kind will be available to informdeliberations in the development of the carbonsequestration programme (OP12). In the contextof the Sudan project, a series of publications arebeing planned to further highlight the carbonsequestration results in the project and potentialsfor carbon sequestration in the drylands.

Capacity Development

Many of the projects included in the PIR thisyear have played an important role in raising both

capacity and awareness with respect to thechallenges and opportunities posed by theclimate change focal area. Many of thebenefits from these capacity building effortsare synergistic�where efforts from oneproject benefit another�thereby becomingvisible only with a portfolio-wide overview.Three examples come to mind from theperspective of a broader overview.

First, the ALGAS project has trained over 175national experts from the 12 participatingcountries in the IPCC inventory methodology.In addition, it has trained experts on themeasurement of methane emissions from ricepaddy; on GHG abatement analysis; and onthe development of abatement projects. Thiscapacity-building initiative has laid arelatively solid foundation in the Asian regionfor future response in the climate change focalarea. Similar experiences can be traced forboth the African and Maghreb regionalprojects. All of these experts are nowavailable to assist their countries and othersin the preparation of climate change nationalcommunications. Unfortunately, only timewill tell how much of this capacity remainsin situ and how much is lost through attrition,but capacity building and training remainperpetual processes.

Second, the IAI component of the STARTproject trained well over 200 nationalparticipants in GIS, remote sensing, andmapping, as required for environmental andland-use analysis. Many of these nationalexperts are now involved not only in preparingnational communications, but also in helpingtheir countries plan and manage land-use andforestry and to be better able to documentclimate change trends and patterns. Thisproject continues to have very strong supportat the local level, merely because it was soeffective in building capacity within theregion.

Thirdly, the Global Research project onmethane emissions from rice paddies has notonly helped improve the global understanding


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of this problem, but has also provided trainingto national professionals through the ALGASproject.

Actions �Leveraged�

A few of the examples listed below will showthat many of the projects have had successfuleffects on leveraging activities elsewhere ingovernment. The section below highlightssome of these.

In India, both the Biomethanation project andthe Hilly Hydel projects have appear to havehad leveraging impacts. The Biomethanationproject, which originally proposed that GEFwould support the construction of 16demonstration plants, so convinced thegovernment of the value of these projects, thatthey increased both the funding and the targetof the project to 29 demonstration plants. Inthe Hilly Hydel project, although the projectwas originally slow in reaching implemen-tation, the government is now consideringwriting into their practice for all small hydroinitiatives this approach to involving localdecision-makers in the planning process.

In the case of China�s Coal-Bed Methaneproject, the government has not onlyestablished a coal-bed methane agency, butthey have been convinced to allow an entirelynew set of joint ventures to be created tocapture the resource. In Mauritania, theapproach adopted under the Wind Electricproject has been adopted not only in thefollow-on project, but it appears to form thebasis for all of the Government�s thinking withrespect to rural electrification.

Lessons Learned

Upon reflection, four lessons emerge from theexperience of this year�s PIR with relation toclimate change. While two of these relatedirectly to the cross-cutting themes of capacitybuilding and leveraging, the others are moregeneral in character, relating to theimplementation of GEF climate changeprojects.

In the first instance, it is clear that a number ofthe UNDP-GEF Pilot Phase projects havecontributed to successful capacity buildingamong recipient countries. These projects�such as START, IAI, or Methane from RicePaddies�have contributed both to strengthencapacity in the countries involved and to raisepublic awareness of climate change generallyin these recipient countries. In both last year�sPIR and this year�s, it has been pointed out thatthese projects had a positive impact on theenabling activity process, with successful carry-over from these projects to the nationallyexecuted EAs. However, to date, there has beenlittle or no systematic effort to share experiencesand promote synergistic cooperation betweenthese projects, which are largely executed indifferent regions with different participants. Witha little thought and minimal resources, it shouldbe possible to catalyze greater synergisticbenefits from these different capacity-buildingefforts by adopting a cross-cutting,programmatic approach. Such activities wouldenhance both the benefits from these projects aswell as the visibility of the GEF and its supportfor climate-change related activities in itsrecipient countries.

The second lesson relates to leveraging andcommitment. Many of the Pilot Phase projectsappear to have been prepared with minimalstakeholder consultations, as was discussed inthe 1997 PIR. At the same time, they underwentno detailed incremental-cost analysis. Thismeans that in many cases, there may be little orno counterpart budget and the commitment ofnational executing agencies may be tepid, at best.Across a number of these Pilot Phase projects,the willingness of national executing agenciesto contribute human resources, financialresources, and policy analysis and changes to aproject have been a major determinant ofsuccess. In several projects, governments havetaken time to consider their position with respectto Pilot Phase projects. In the cases where theyhave responded favorably through largercommitments to the project, the projects havetended to be successful, even though they aredelayed. In other cases where the GEF projects

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did not leverage out a suitably large commitmentfrom the government, the projects continue tostruggle. The level and seriousness of thecounterpart contributions leveraged out ofgovernments provide an interesting indicator ofcommitment to the project, and may even be anindicator of eventual project success.

Two other issues relating to general projectimplementation are worth raising here. First,UNDP�s ability to alter ongoing projects to fitchanging needs and goals is one of theorganization�s advantages. This can be seen tohave worked relatively well in offices where theUNDP office is strong or works with a strongcounterpart within the government. Projectssuch as the Chilean Reduction of GHGs, AfricanRegional Capacity Building for the UNFCCC,and several others have responded well andadapted to changing circumstances. In othercases where neither the government counterpartnor the UNDP office is sufficiently strong, thishas led to increasingly problematic projects thathave been unable to adapt.

Finally, it is interesting to note that based uponthe experience of several projects, the personshired to manage a project frequently need skillsother than those normally associated with thetechnical substance of the project. Technicalskills are important to carrying out projectconceptualization, identification, and design, butfor project implementation, a more entrepre-neurial, managerial, or political profile is oftenrequired. For example, the technical aspects ofenergy efficiency are relatively straightforwardby the time a project is ready to be implemented.

At that stage, a technical specialist may notbe appropriate as his or her tendency will beto spend too much time and effort focusingon the purely technical aspects of the work.In contrast, what is needed (as witnessed byseveral UNDP-GEF projects) is someone withbusiness or entrepreneurial skills to sell theadvantages of the energy-efficient investmentsto a wider audience consisting largely of thefinancial and business communities. There isa lesson to be learned from these experiencesin the design of future projects. Thisunderstanding may exist in other fields ofdevelopment assistance, but it should also bekept in mind within the climate change focalarea.

3.3 International Waters

Basic Project Data

Five UNDP-GEF International Waters fullprojects under implementation for at least oneyear reported to the 1998 PIR. Reportedfinancial data are summarized below:

Implementation Progress

The majority of International Waters projectsreport at least a satisfactory progress inimplementation, with the East Asian SeasMPP rated highly satisfactory on theachievement of all objectives. The LakeTanganyika project cited dedication of fieldstaff under extremely difficult conditions asa key element contributing to what successeshad been achieved. Difficulties relating to

Project Planned Disburs. ($ m illion)

Actual Disburs. ($ m illion)

Budget ($ m illion)

Lake Tanganyika N/A N /A 10.0Lake Manzala Eng. W etland .946 .442 4.5Gulf of Guinea LME 4.53 4.65 6.0East Asian Seas MPP 5.14 5.57 8.0Black Sea SAP 1.78 1.34 1.79TOTAL 12.396 12.002

(96.8% )30.29


66

delays in choice and procurement ofequipment were noted. In Egypt, the LakeManzala project had been delayed due torestructuring of the EEAA as well as delaysin the allocation of land on which the wetlandwill be constructed. These issues have beenresolved, and the project has now started upat a relatively rapid pace. The Black Sea citeddelays due to a passive Advisory Group, slowpace of cooperation with IFIs in organizing aloan portfolio, and limited managementcapacity in the PCU due to staff shortages. Inthe Philippines and China, the EAS-MPPproject cited the use of ICM nationaldemonstration sites to illustrate the potentialbenefits to be derived from management-focused monitoring efforts and the value ofsharing information among managers ofcoastal sites. The Gulf of Guinea project notedthe enthusiasm and strong support of thegovernments as a key success factor, as wellas the recognition across a broad suite ofstakeholders of the necessity of ICM Plans asmanagement tools.

Impact

Again, the majority of IW projects report ahighly satisfactory or at least satisfactory impact.Demonstrable impacts from the Lake Manzalaproject are not yet available due to the delayedstart-up of project activities over the last threeyears. The EAS-MPP succeeded indemonstrating workable solutions to marinepollution prevention that can be replicated bythe participating countries. Approaches usedincluded national marine and coastal policyformulation, development of regulations, coastalplanning and management, risk assessment andmanagement of sub-regional sea areas,institutional organization, pollution monitoring,waste management, capacity building, andsustainable financing mechanisms. In the Gulfof Guinea, National Integrated Coastal AreaManagement Plans have been developed alongwith National Steering Committees to guide andpromote the multi-sectoral managementapproaches required in these plans. An ongoingmangrove pilot reforestation efforts is being�ground truthed� using satellite images and

56#-'*1.&'4�+081.8'/'06

Project Government* NGOs** For profit Academic

Tanganyika Design n x x Implem. n,r,l i,n,c x x M&E n, r i,nManzala Design n x x Implem. n c x x M&E n xGOG-LME Design n,r i,n x Implem. n,r,l i,c x x M&E n,r,l i,n,c x xEAS-MPP Design n,r,l i,n,c x x Implem. n,r,l c x x M&E n,r,l c x xBlack Sea SAP Design n i,n x Implem. n i,n x M&E* n = national, r = regional, l = local; ** i = international, n = national, c = community

67


fishery statistics; while limited, it will serve asa baseline to track future improvements in stocksand marine biodiversity. Through both theregional and national Black Sea Strategic ActionPlans (SAP/NAP), the Black Sea project hascontributed to the global and regional objectivesof GEF by establishing a mechanism which willallow countries to address transboundaryenvironmental problems. The project is in theprocess of orchestrating a �basin-wide� approachto coordinating the joint efforts of 17 countriesin addressing the priority transboundary problemin the region of eutrophication.

Sustainability and Replication

In Lake Manzala, it is hoped that throughnational execution, the technology transfer ofknowledge during the design andimplementation of the wetland will ensure theexistence of local and national knowledge forsimilar future projects. In the East Asian Seas,sustainability at each of the demonstration siteshas been achieved via the integration of theinstitutional framework, capacities, and financialcommitments into the local government�splanning, operational, and fiscal cycles. Privatesector support and public awareness have alsobeen strengthened, helping to ensuretransparency and continuity in futureenvironmental management actions. Replicationof the ICM sites has already occurred at threesites in China and is planned for three sites inthe Philippines. In the Gulf of Guinea, therecently adopted Accra Ministerial Declarationcontains commitments on the part of thegovernments to sustain the regional approachesto solving shared environmental problems, aswell as the replication of successful projectcomponents. A study of financial mechanismsto make this process self-sustaining is currentlyunderway. In the Black Sea, the recent inability(due to the severe financial situation in theregion) on the part of the riparian countries tofinancially sustain the PIU until the Secretariatis functioning and the new GEF basin-wide

project established pose ongoing threats toboth the short and long-term sustainability ofthis program.

In the East Asian Seas, management andcoordination mechanisms (Batangas BayCouncil for ICM/Xiamen MarineManagement and Coordination Committee)were developed and institutionalized duringthe project and include representation fromall stakeholder groups, at both the local andnational levels. Project activities wereimplemented in collaboration and/or throughcontractual arrangements with diversestakeholders including universities, researchinstitutions, industry, international agenciesand organizations, and national and localgovernment units. In the Gulf of Guinea,representative stakeholders participate in thedecision-making meetings (e.g., SteeringCommittee, TPR, at both regional and nationallevels) of the project. As members of theBlack Sea Environmental ProgrammeSteering Committee, representatives ofgovernments and NGOs take an active role inthe implementation and day-to-day manage-ment of the project.

Tanganyika noted that the strong technical/scientific bias in the project limited NGOinvolvement because few NGOs in the regionhad these capacities. In the East Asian Seas,a lack of focus by national and communityNGOs on marine issues was observed to limittheir participation in International Watersprojects. In the Gulf of Guinea, despitemodest funds allocated to NGO/CBOparticipation, the NGOs have been verysuccessful at generating extra-budgetary fundsin support of their activities. The Black Seaproject noted that in recent times NGOs havebecome more donor-driven and thus they donot act solely as independent institutions withtheir own programs.


68

Leveraging Policy or LegislationChanges

The East Asian Seas project has set upa regional network on the legal aspectsof marine pollution. Related initiativeshave included drafting of nationallegislation to implement internationalconventions, model framework legislation onmarine pollution, draft models for nationalcoastal policy, and a training program focusedon international conventions and nationalregulation development. These efforts havebeen reflected in the efforts by countries toadhere to international maritime conventions,over 30 of which have been ratified orimplemented since the start of the project. Inthe Gulf of Guinea, selected countries/areashave adopted domestic and industrial wastemanagement policies as well as preliminaryfishing regulatory measures. Each country isalso moving towards the creation, adoption,and implementation of Integrated CoastalArea Management Plans. Finally, increasedawareness has been created in the region onexisting International Conventions ofrelevance to marine and coastal resources. Inseveral Black Sea countries, the NEAPs wereexpanded with a special chapter for the marineenvironment, the NBS-SAPs. Finally, theVice President of the World Bank hasannounced the development of a major newinitiative seeking a portfolio of up to US$500

07/$'4�1(�+056+676+105�+081.8'&�+0�241,'%65

Government NGOs Project Nat’l. Reg’l. Local Int’l. Nat’l. Comm. For profit AcademicTanganyika 48 10 5 3 6 5 4 6Lake Manzala 3 1GOG-LME 104 15 50 8 100 25 25 60EAS-MPP N/ABlack Sea SAP 6 6 36 0 30 3 6 25

million in investments related to the Black Seaenvironment over a period of three years.

Lessons Learned

For a project such as Lake Tanganyika in such ahigh-risk region, more resources need to becommitted to operational planning prior toproject start-up. Earlier and more thoroughstakeholder consultations, especially at the locallevel, would have improved subsequent projectperformance. Countries need to feel that projectfinancial resources are being partitionedequitably and this is best agreed upon at an earlystage in a transparent manner.

Several valuable lessons were reported by theEAS-MPP project. Flexibility in program designallows a good manager to take advantage ofopportunities for linkages with other projects andprograms, to their mutual benefit. Enhancing thetechnical capacity of local governments andproviding meaningful participation for localstakeholders were found to be essential elements

%#2#%+6;�&'8'.12/'06

Project No. workshops No. trainedTanganyika 19 >200Lake Manzala N/A N/AGOG-LME N/A 600EAS-MPP N/A 500Black Sea SAP N/A N/A

69


of ICM projects. Finally, sustainable coastal andmarine management requires that stakeholdersunderstand the benefits to be derived beforeinvestments are made.

In the Gulf of Guinea, the importance ofinvolving the private sector in project decision-making and in the consultative process, includingformulation of regulations, was noted. Theinvolvement of communities based aroundintervention sites in the consultation anddecision-making process was also underscored,in order to give them a sense of ownership andcommitment to sustain the selected actions/interventions. Finally, since NGOs are oftenmore effective in reaching grassrootspopulations, they may be better placed to serveas vehicles for mass mobilization and outreachprograms, with government assistance asappropriate.

The Black Sea noted some of the followinglessons learned:

1) Donor coordination and inter-agencycoordination are vital in order to avoidoverlaps and to avoid confusing recipientsof support;

2) Networking existing institutions is animportant first step towards consolidatingtechnical support for program imple-mentation and the networks should not bedeveloped in such a way as to rely uponexternal support; and

3) Training activities should focus on smallgroups which can be �connected� to theproblems through direct contact with therelevant stakeholders and specialists.


70

APPENDIX C.2

UNITED NATIONS ENVIRONMENT PROGRAMME GLOBAL ENVIRONMENT FACILITY


Overview ReportMorocco, Namibia, Nigeria, Papua NewGuinea, Peru, Philippines, Poland, Syria,Tanzania, Thailand, and Tunisia)

2. Biodiversity Data ManagementCapacitation in Developing Countries andNetworking Biodiversity Information(BDM) (Bahamas, Chile, China, Costa Rica,Egypt, Ghana, Kenya, Papua New Guinea,Poland, and Thailand)

3. The Global Biodiversity Assessment

4. Country Case Studies on Sources andSinks of Greenhouse Gases (Costa Rica,Gambia, Mexico, Morocco, Poland,Senegal, Tanzania, Uganda, and Venezuela)

�� 6#$.'�� 56#675�1(�70'2�)'(�241,'%65�%18'4'&�$;�2+4��#5�1(�,70'��

Project GEF Allocation(US $ millions)

Commitment Disbursement

1. Support to the Preparation of Biodiversity Country Studies Phase I

5 M 5 M 4.51 M

2. Biodiversity Data Management Capaci- tation in Developing Countries and Networking Biodiversity

4 M 4 M 2.99 M

3. Support to the Preparation of Biodiversity Country Studies Phase II

2 M 2 M 1.57 M

4. The Global Biodiversity Assessment 3.3 M 3.3 M 3.13 M5. Country Case Studies on Sources and Sinks of Greenhouse Gases

4.5 M 4.5 M 4.44 M

6. Strategic Action Programme for the Binational Basin Of The Bermejo River.

3.2 M 6.0 M *

7. Country Studies on Climate Change Impacts and Adaptation Assessments

2 M 2 M 1.82 M

8. Economics of Greenhouse Gas Limitations - Establishment of a Methodological Framework for Climate Change Mitigation Assessment

3 M 3 M 1.69 M

* expenditure for this project not yet recorded.

1. PROJECT STATUS LIST

1.1 The UNEP GEF Project ImplementationReview (PIR) for 1998 covered the followingUNEP projects in the GEF Work Programwhich began implementation before June 101997 and were under implementation for partof FY 98:

1. Support to the Preparation ofBiodiversity Country Studies, Phases I &2 (Bahamas, Burkina Faso, China,Colombia, Democratic Republic ofCongo [Former Zaire], Cuba, Egypt,Estonia, Georgia, Ghana, Guinea, Jordan,Lebanon, Madagascar, Malaysia,

71


5. Country Studies on Climate ChangeImpacts and Adaptation Assessments(Antigua and Barbuda, Cameroon, Estonia,and Pakistan)

6. Economics of Greenhouse GasLimitations - Establishment of aMethodological Framework for ClimateChange Mitigation Assessment (Argentina,Ecuador, Hungary, Indonesia, Mauritius,Senegal, Vietnam, the SADCC, and theAndean regions)

7. Strategic Action Programme For TheBinational Basin Of The Bermejo River.

1.2 UNEP conducted an internal PIR meetingto discuss, and exchange experiences betweenUNEP staff on the implementation of UNEP�sGEF funded activities. The PIR focusedparticularly on UNEP�s experiences in projectpreparation, planning, and subsequentimplementation as well as lessons learned. Inaddition, each project task manager preparedindividual PIR reports that detailed theexperiences and lessons learned in projectimplementation for their projects. As of 30 June,1998, UNEP�s GEF portfolio consisted of 20 fullsize projects of which six projects entered thework program in the Pilot Phase and 14 projectswere approved by the Council in GEF1. Of these20 projects, there are seven projects in bio-diversity, four projects in climate change, fiveprojects in international waters, three projectsdealing with stratospheric ozone depletion andone project dealing with cross-cutting issues.

1.3 All UNEP GEF financed projects endorsedinto the GEF Work Program before June 30,1996, have been committed (i.e., internallyapproved by UNEP). In addition, all UNEP GEFfinanced projects that were committed beforeSeptember 1997 had begun disbursements byJune 30, 1998.

1.4 For the 1998 PIR, eight projects had beenunder implementation for more than one year asof June 30, 1998. The project �Capacity

Building and Infrastructure: Participation inthe Assessment, Methodology Development,and other Activities of the IntergovernmentalPanel on Climate Change (IPCC)� has beenofficially closed prior to July 1997 and thuswas not included in this year�s PIR. TwoUNEP projects: �Country Case Studies onSources and Sinks of Greenhouse Gases� and�Country Studies on Climate Change Impactsand Adaptation Assessments� wereoperationally completed in GEF FY 98 andhave been included in this year�s PIR exercise.

2 SUMMARY PERFORMANCE AND LESSONS

LEARNED OVERVIEW

2.1 Performance of GEF projects relativeto comparable non-GEF projects - length oftime from formal IA approval to firstdisbursement; analysis of disbursementhistory

Given the need for expedited procedures forboth Enabling Activities and Medium-SizedProjects, UNEP undertook a process that hasmodified its internal procedures for projectsfalling under these categories so that the lengthof time from formal IA approval to firstdisbursement has now been reduced from anaverage of four months down to two weeks.For full size projects and PDF Bs, length oftime from formal IA approval to firstdisbursement is approximately two weeks.

2.2 Ratings of Implementation Progressand accomplishment of development and/orglobal environmental objectives

On average, UNEP projects covered duringPIR 98 had a rating of (S) for ImplementationProgress. The ratings for regional and globalprojects were greatly influenced by the leveland effectiveness of coordination andmobilization of the many institutions andindividuals participating in project design andimplementation. This factor had a significantimpact on the projects� rate of implementationand in turn, on achievement of global


72

environmental objectives and should not beaddressed at the expense of reaching globalenvironmental objectives.

With respect to the accomplishment ofdevelopment and/or global environmentalobjectives, the average rating was (HS).UNEP�s projects relating to biodiversity andclimate change planning (the BiodiversityCountry Studies, the Biodiversity DataManagement project, the Global BiodiversityAssessment, the Country Studies on Sourcesand Sinks of Greenhouse Gases, theEconomics of Greenhouse Gas Limitationsand the Country Studies on Climate ChangeImpacts and Adaptation), have proven to beinstrumental in building national capacity fordeveloping national strategies for biodiversityand climate change mitigation and adaptation.These projects have also provided countrieswith the necessary scientific knowledge forplanning. Methodological tools for theseexercises were refined based on the countries�needs and have helped to ensure that countries

have the necessary guidance for carrying outsuch national planning exercises. The resultsachieved can also be used to measure progressat the global level by supporting the efforts ofthe GEF and Conventions on BiologicalDiversity and Climate Change in comparablyassessing progress of countries towards reachingparticular global environmental objectives. Forthe �Strategic Action Programme for theBinational Basin of the Bermejo River,� the mainglobal environmental and development objectivesare to identify priority transboundary concernsand needs within the Basin and to assist indeveloping a watershed approach for integratingenvironmental and development concerns intothe planning programs of the Governments ofArgentina and Bolivia. Towards reaching theseobjectives, the project has completed its basicdata gathering activities and partialimplementation of the demonstration projects.Assessment of the demonstration projectperformance and integration and analysis of datawith a view to extracting strategic issues isproceeding.

Project Title GEF Allocation(US $ millions)

Cofinancing(US $ millions)

Total Cost(US $ millions)

1. Support to the Preparation of Biodiversity Country Studies Phase I

5 M 1.3 M 6.3 M

2. Biodiversity Data Management Capacitation in Developing Coun- tries and Networking Biodiversity

4 M 1.4 M 5.4 M

3. Support to the Preparation of Biodiv. Country Studies Phase II

2 M 0.4 M 2.4 M

4. The Global Biodiversity Assessment 3.3 M 0.3 M 3.6 M5. Country Case Studies on Sources and Sinks of Greenhouse Gases

4.5 M 1.8 M 6.3 M

6. Strategic Action Programme for the Binational Basin Of The Bermejo River

3.2 M 2.7 M 5.9 M

7. Country Studies on Climate Change Impacts and Adaptation Assessments

2 M 2.0 M

8. Economics of Greenhouse Gas Limitations - Establishment of a Methodological Framework for Climate Change Mitigation Assessment

3 M 0.27 M + 1.0 M inassociated

projects

3.27 M

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2.3 Risk assessments for projects reviewed

The most common risk in projects implementedby UNEP is the complexity of coordination andmobilization of the large number of institutionsand individuals, from several countries, whobring their distinct expertise and experiences toproject design and implementation. As a result,UNEP projects on average have achieved anaverage rating of (S) on the rate of projectimplementation. The duration of regional andglobal projects tends to be longer than that forsingle country projects, often due to the needfor managing the participation of a large numberof organizations. However, UNEP�s experienceshows that the effectiveness of such projects inproviding a mechanism for technical assistanceand exchange of experiences between countriesoutweighs the risks. This case was clearlydisplayed in the Enabling Activity exercisewhere individual country projects replaced theglobal umbrella project approach and thenneeded an individual �support programs� fortechnical assistance for both biodiversity andclimate change enabling activities.

2.4 Leveraging Additional Resources and Actions

While UNEP has acquired cofinancing for itsprojects, it should be noted that paragraphs 299and 300 of the GEF Overall Performance Studyrecognized that UNEP is not a funding agency,stating that it was not reasonable to expectsubstantial co-financing from the organization.

In addition to leveraging financial resources andin-kind contributions, UNEP projects resultedin leveraged action for the benefit of the globalenvironment:

• The Biodiversity Country Studies projecthas resulted in an agreed need for NationalBiodiversity Strategies and Action Plans. Italso led to the Biodiversity DataManagement Project.

• The Biodiversity Data ManagementProject catalyzed the formulation ofBiodiversity Information ManagementSystems for some of the participatingcountries as well as information systemsfor National Park Systems. Severalcountries are now starting to implementtheir National Biodiversity DataManagement and Information ActionPlans. This will further help countrieskeep track of their biodiversity status,actions taken to address threats, andcoordinate activities being undertaken atnational and regional levels thus avoidingduplication. The Biodiversity DataManagement Project is also facilitatingcountries� implementation of the Clear-inghouse Mechanism of the CBD. Inaddition, the tested methodology tools andreference material produced forbiodiversity information management arebeing used by other countries to carry outtheir National Institutional Surveys.

• The Global Biodiversity Assessment(GBA) has resulted in a compilation andanalysis of the level of knowledgeworldwide on biodiversity. It has provideda standard scientific reference on the mainissues of biodiversity, helping policy-makers, scientists, and non-governmentalorganizations contribute better to theconservation and management of theplanet�s biological wealth. The assess-ment identified critical scientific issueson which consensus or disagreementexists as well as gaps in currentknowledge, providing a firm basis forfurther scientific work. The level ofleveraging brought about by this projecthas not been estimated although it hasbeen confirmed that a wide variety ofscientific organizations and donorinstitutions are using the data to providethe necessary background for initiativesthey are undertaking. Many of these


74

organizations have initiated action toaddress the gaps identified through theGBA process.

• The Country Case Studies on Sources andSinks of Greenhouse Gases project andthe project on Economics of GreenhouseGas Limitations-Establishment of aMethodological Framework for ClimateChange Mitigation Assessment haveleveraged actions by countries to developNational Climate Change MitigationStrategies based on data collected in theseprojects. The Sources and Sinks projectprovided the required greenhouse gasinventory data with which countries candetermine where action would provide themost effective result. The Economics ofGHG Limitations project helped countriesto determine where such action is morecost-effective. In general, these two proj-ects have leveraged further action bycontributing to the common methodolo-gical basis for national communications,as required by the UNFCCC. While thework on methodologies is still underdevelopment by SBSTA, the meeting inJuly 1997 of SBSTA established a workprogram on methodologies relevant for theUNFCCC as well as the national communi-cation process. The UNEP GEF projects,complemented by the regular activities ofUNEP/UCCEE in the area of mitigationanalysis have been recognized as the mainefforts in this area and follow-up actionsare proposed as part of the methodologieswork programme endorsed by SBSTA. Inaddition, the guidelines are beingdistributed to a number of countries whichare in the process of preparing their firstnational communication, and the interestin guidance material and support issignificant. More than 100 draft guidelineshave been distributed so far. The twoprojects have also been instrumental inassisting countries in the process ofintegrating environmental and specificallyclimate change concerns with national andregional development priorities.

The Economics of Greenhouse GasLimitations project also leveraged theparticipation of additional countries fromother capacity building projects financedfrom non-GEF sources. As a result, themethodological guidelines were tested by 15countries instead of the original eight. Inaddition, non-GEF sources of cofinancingwere used to undertake two workshopswhich were organized back to back with arelated World Bank meeting, thus makingmore cost effective use of resources.

• The Country Studies on Climate ChangeImpacts and Adaptation Assessmentsleveraged action has leveraged theimplementation of National Climate ChangeAdaptation Plans by some countries. Inaddition, the project was associated with aseries of additional projects in whichfunding was leveraged from non-GEFsources to enable additional countries tocarry out national adaptation and impactassessments. As a result, a handbook toassist countries with using testedmethodologies was further refined and hasbeen serving as a reference guide foradditional countries seeking to carry outtheir climate change impact and adaptationassessments.

• The Bermejo River Basin project has put inplace measures that will leverage furtheraction by developing opportunities for theestablishment of financial incentives, privatesector investment, and cost recovery inenvironmental management. The project isleveraging action by instilling a high levelof community and producer involvementand buy-in with the aim of replicatingproject experiences from its demonstrationactivities. It is also leveraging actiontowards the conservation of biologicaldiversity in the territory between Baritu andTariquia natural protected areas byevaluating the legal and biological feasibilityof a biological corridor which will result inthe formation of joint policies to address thesituation. In addition, revolving loan

75


financing is being provided from federalsources to help farmers mitigate humanpressures on the natural resources in thearea.

2.5 Building Recipient Capacity

All UNEP projects reviewed for PIR 98 hadsome level of capacity building at national level.In some projects, there were significant capacitybuilding components which contributed to theaccomplishment of project objectives:

• The Biodiversity Country Case Studyprojects� (Phases I and II) primary objectivewas the building of national capacity toreview the status of their biodiversity andidentification of basic needs for effectiveconservation and sustainable use ofbiodiversity. The projects resulted in theestablishment of National Biodiversity Unitsthat included government, non-govern-mental institutions, and the scientificcommunity and which now continues to playa strong role in the formulation of NationalBiodiversity Strategies. By building up theknowledge base of the countries on the statusand level of biodiversity at national level,as well as strengthening the institutionalbase for this activity, the projects have builtthe capacity of countries to prepare theirNational Biodiversity Strategies and ActionPlans;

• The Biodiversity Data Management Projecthad the objectives of the strengthening ofnational mechanisms and institutions foraccess to and dissemination of nationalbiodiversity information, the enhancementof existing ability and skills to utilize therelevant technologies and know-how in datamanagement, and the development oflinkages with national, regional, and globalnetworks and its exchange and management.As noted in the independent evaluation ofthe project, the development of nationalBDM capacity and biodiversity datamanagement skills were considered

outstanding achievements of the project.The independent evaluation of the projectalso concluded that it has raisedawareness of biodiversity issues throughits workshops. As a result, the project hasbuilt in-country capacity that hassupported national policies onbiodiversity and provided a framework forcontinued improvements in biodiversitydata management in the future;

• The Global Biodiversity Assessment(GBA) has helped strengthen a networkof scientific experts during itsimplementation as a result of bringingtogether scientists from a wide variety ofdisciplines. The assessment is nowproviding the necessary knowledge basefor policymakers, scientists, and non-governmental organizations and donororganizations by acting as acomprehensive and scientifically basedreference tool relating to the status ofknowledge on biodiversity, thus linkingscience with national policy and decisionmaking;

• The Country Case Studies on Sources andSinks of Greenhouse Gases arranged forseveral institutions to provide technicalassistance to specific countriesundertaking case studies. A networkbetween participating African countrieswas also catalyzed as a result of theproject and has enabled countries toexchange experiences and lessonslearned. In addition, the project builtcountry capacity to develop nationalstrategies for reducing greenhouse gasemissions. The data and methodologyadvanced by this project has contributedto the knowledge-base ability ofgovernments to develop national policiesand technologies that could minimizegreenhouse gas emissions;

• One of the main objectives of the projecton Economics of Greenhouse Gas


76

Limitations - Establishment of aMethodological Framework for ClimateChange Mitigation Assessment was toenhance institutional capacity in theparticipating countries and in theparticipating regional �centres ofexcellence.� The regional workshops heldin April and May 1998 show that it isevident that the project activities haveimproved the capabilities of the nationalteams. This development is the result of anumber of different activities includingtraining workshops, technical assistance,extended research stays at UCCEE orLBNL, and working on the project activi-ties and having the opportunity to interactwith other teams involved in the sameprocess. All national teams are organizedthrough the national climate change focalpoint institution;

• The capacity building objectives of theproject on Country Studies on ClimateChange Impacts and AdaptationAssessments were: to advance in-countryscientific and technical understanding ofthe adverse effects of climate change; tostrengthen the capacity to address climatechange issues in the countries wherecountry case studies are conducted; and todevelop networks among countriesparticipating in the studies and otherinternational/national experts working inthe field of impacts and adaptation. Indeed,one of the Performance Indicators was�The extent of enhanced capacity in thefour countries including technicalcapability, public awareness, and politicalinterest� which has already increasedduring the implementation of the project.In addition, the project has produced the�UNEP Handbook on Methods for ClimateChange Impact Assessment and AdaptationStrategies� which is expected to serve as avaluable technical resource for othercountry study teams developing climatechange impact and adaptation assessments

as part of their country�s NationalCommunications under the UNFCCC.

For all the projects above using the umbrellacountry study approach, it was noted thatthis type of an approach enabled countriesto share experiences, lessons learned, andbest practices. This was an ideal mechanismfor building in-country capacity andfacilitated the effective implementation ofproject activities and achievement of globalenvironmental objectives.

• The Strategic Action Programme for theBinational Basin of the Bermejo River isbuilding recipient country capacity byincreasing governments awareness onenvironmental problems in order for themto incorporate environmental concerns intopolicy development plans, institute changein development practices to includeenvironmental sustainability and reducetransboundary impacts. In addition, dataacquisition that will be part of the trans-boundary analysis and will form the basisfor the determination of strategic actions tobe proposed in the SAP is helping thecountries build up the necessary knowledgebase. This will enable them to integrateenvironmental considerations into decision-making concerning the management of thebasin.

2.6 Stakeholder Involvement

In accordance with UNEP�s approved policy onpublic involvement in its GEF related activities,UNEP ensures that all projects involve a broadspectrum of stakeholder participation in thedevelopment and implementation of projects:

• On UNEP�s biodiversity projects, guidelinesused in national biodiversity planningexercises were developed by a multi-disciplinary teams of experts worldwide andwere revised and further improved based onfeedback from national stakeholders familiar

77


with their practical application at a nationallevel. At the country level, UNEP�s nationalbiodiversity planning exercises (the CountryStudies projects and the Biodiversity DataManagement) were carried out by nationalexperts and institutions with minimuminvolvement of external consultants andonly upon the request of nationalinstitutions. The biodiversity planningexercises involved a broad range ofinstitutions including universities, researchcentres, NGOs, various governmentaldepartments, and members of the scientificcommunity in each country. The GlobalBiodiversity Assessment (GBA) hasprovided an independent scientific forum fordiscussing the state of knowledge onbiodiversity, thereby strengthening linksamong the scientific community on thistopic. Further, the GBA project is presentlypreparing a stand-alone volume from theperspective of traditional knowledge onbiodiversity and the relationships betweencultural and scientific biodiversity that hasinvolved an extensive consultative andparticipatory process with indigenous andlocal communities.

• The implementation of UNEP�s climatechange projects has involved national teamscomprised of the national climate changefocal points, relevant government insti-tutions, government-designated researchinstitutions, and NGOs with overallcoordination resting with the government.Where government institutions areresponsible for project implementation,local research institutions and/or NGOs areinvolved in providing technical assistance.It was noted that the most effective approachto the implementation of these types ofprojects was the use of multi-disciplinaryteams of experts from several nationalagencies, research institutions, and NGOs.

• In International Waters, one of the maincomponents of the Bermejo River Basin

project is focused on public participation.The objective involves helping bothArgentina and Bolivia institute a systemof public consultation on theimplementation and development projectsof general interest in the basin, so that theyare environmentally sustainable andsocially acceptable. One of thePerformance Indicators of the project isthe establishment of a public participationsystem. The project seeks to involve theBasin communities in practical, �handson� type involvement in the identificationand field testing of remedial measures, aswell as in a dialogue process. As a result,actions formulated through the SAPprocess will have the advantage ofbenefiting from actual communityinsights and experiences, and of beingacceptable to the communities assustainable alternatives to presentlydestructive practices. The project has alsomade excellent efforts to integrate thework program elements with community,municipal, and provincial programs.

2.7 Experiences, Insights and Lessons Learned during the Past Year

2.7.1 Applicable Lessons and Unre- solved Issues from PIR 1997

UNEP staff allocate a significant amount oftime to the Annual GEF ProjectImplementation Review and other parallelGEF processes relating to monitoring,evaluation, and financial reporting. Aprominent issue in this year�s UNEP PIR wasthat of identifying what role therecommendations from the ImplementingAgencies� PIRs could play in improving GEFproject design, development, and eventualperformance. Several issues arising from the1997 PIR do not seem to have been adequatelyaddressed by the GEF in the course of the pastyear. The following are some of the issuesthat still remain unresolved:


78

1. Need for improved information flow:Since the last PIR, there has been someprogress in improving the informationflow between Implementing Agencies,which is critical for promoting inter-agency coordination and collaboration.The agreement on annual portfolioplanning meetings between the GEFSecretariat and the ImplementingAgencies as well as between theImplementing Agencies themselves willgo a long way towards improvinginformation flow particularly in regard toupstream planning. More strategic use ofthe inter-agency focal area task forces ina manner similar to the IWTF is alsodesirable in the biodiversity and climatechange task forces for more effectivecoordination of activities in the GEFpipeline and portfolio.

2. Defining �country-driven�: Whilesome attempts have been undertaken sincePIR 97 to clarify the understanding ofcountry-driven, misconceptions still arisewhen regional or global projects aresubmitted for GEF financing. Theexperience is that differing definitions arebeing used in these circumstances whererecommendations from governments atinter-governmental meetings, particularlyon issues which governments choose toimplement actions in a regional or globalcontext, are construed as not being ofnational priority. There is therefore stilla need to better define the concept ofcountry driven.

3. Use of tools in guiding GEF projectdevelopment via a multi-countryproject approach: UNEP�s experiencein developing guidelines for inventoryingbiodiversity or greenhouse gas inventorieshas shown that a multi-country projectapproach enables countries to share theirexperiences and have direct involvementin the evolution and refinement of the

guidelines for these activities. This, in turn,helps to provide countries with the guidanceneeded to carry out these activities in a highquality manner. The necessity for develop-ing tools, such as guidelines, methodologies,etc., for guiding implementation of certainkey activities in the GEF needs to berecognized. These include the need forguidelines for the development of morestandardized Transboundary DiagnosticAnalyses (TDAs) and Strategic ActionPrograms (SAPs) in international waters soas to ensure a high quality of projects acrossthe board.

4. Need for training and technicalbackstopping for certain activities:Experience has shown that shifting from amulti-country global umbrella projectapproach to an individual country projectapproach with activities dealing with thesame issue has constrained the provision oftechnical support to governments. This isparticularly prevalent in cases whereprojects have common groups of activitiesin new and emerging issues. In some cases,separate projects had to be developed toprovide the needed technical support suchas in the UNDP/UNEP Climate ChangeNational Communications Support and theBiodiversity Planning Support Programs.

5. The multi-country/global umbrella projectapproach also enabled cross-learningbetween countries based on their individualexperiences in dealing with the same issues.This facilitates the exchange of �lessonslearned,� which is now considered animportant element in the GEF. In addition,this approach proved to be more costeffective in that training could be bundledtogether for several countries. Since the lastPIR, there does not seem to be muchprogress in the GEF in considering thebenefits of the multi-country global umbrellaapproach for dealing with certain issues andthe need for pooling financial resources

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together from individual country projects forcross-cutting activities between countriessuch as for training and technicalbackstopping. Using the multi-country/global umbrella project approach is animportant vehicle for involvement of andcollaboration among government agenciesand other stakeholders. It would also enablethe GEF to build on what has proved to haveworked as an ideal mechanism thataccounted for a large measure of initialproject success.

6. Delays in the project cycle: Given that theattainment of written national OperationalFocal Point (OFP) endorsements for multi-country projects can cause a considerabledelay in the project cycle, the GEFImplementing Agencies should be able tosubmit multi-country projects to the GEFSecretariat without necessarily having allnational OFP endorsements. This isparticularly the case when dealing with thepriorities defined by intergovernmentalforums since this is a formal agreementbased on the national priorities of theparticipating governments. The problemoften lies within a country�s internalbureaucratic requirements rather than aproject not being considered a nationalpriority. Although the relevant governmentagency has been involved in the project fromthe design phase and confirms the activityto be a national priority, delays in OFPendorsement have sometimes held upsubmission and review of the project. The1997 UNEP PIR had recommended that, tomaintain the required pace of the projectcycle, it should be possible for theImplementing Agencies to submit multi-country projects to the GEF Secretariatwithout having all the endorsements on thecondition that any remaining nationalendorsements would be obtained beforefinal approval of the project and providedthe Implementing Agency demonstrates thatthe project is indeed a national priority foreach country involved.

7. Inadequate financing limits for PDFimplementation in a multi-countrycontext: Several issues such as thosepertaining to transboundary naturalresources can only be effectively handledin a multi-country context. The 1997 PIRnotes that it is extremely difficult todevelop a high quality project with PDFB funding restricted to US$350,000 orless, particularly for regional projects thatcomprise of at least seven and in somecases 20 countries.

8. Time frame constraints for PDFimplementation in a multi-countrycontext: The time required to developconsensus at a regional multi-countrylevel is considerably long particularly incomparison to individual country projectsand can often take more than the GEFrequirement for international waters PDFBs of 18 months. When artificially tightdeadlines for project implementation areimposed, experience has shown thatgovernments are pressured to hireconsultants to produce a particular output,at the expense of institutionalstrengthening and adequate planning.Given the extra time required to developconsensus at a regional multi-countrylevel and the need to ensure that projectquality is not forsaken at the expense ofquickly producing a given output, theperiod for PDF implementation ofregional and global projects needs to beextended.

9. Use of the GEF QOR: It has been notedthat the new format for the QOR hasslightly improved and its bi-annualprinting is more appropriate for the kindof project management and financialinformation currently being sought.However, an issue that still remainsunresolved from the last PIR is that theinformation provided on projects does notallow one to always clearly identify theactual site, collaborating organizations�


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roles or other implementation details of agiven project. Some project descriptionsare still too vague. Recognizing the limitson information which could be includedin the printed GEF Operational Report,the GEF could examine the possibility ofthe agencies posting an up-to-date intra-GEF database on the GEF web site. Thesecould be most useful in carrying outsearches on the GEF Portfolio regardingkey issues or identifying specific sites orareas where intervention is already beingundertaken.

10. Evaluating the impacts of the GEF:While the GEF has embarked on effortsto evaluate the impact of the GEF on theglobal environment, there is still a needto evaluate the impacts of GEF projectstwo to three years after project completionin order to truly determine the overallimpact the GEF has actually had on theenvironment and to determine thesustainability of its activities on theground.

11. In-country coordination: Since the 1997PIR, experience has shown that there is aneed to strengthen coordination betweengovernment agencies in countries in orderto have effective preparation andimplementation of projects. Moreattention needs to be given to empoweringthe GEF Operational Focal Points todischarge their responsibilities.

2.7.2 Additional Experiences, and Lessons Learned in FY 98

1. Project Level Issues

To be addressed on a broader GEF-wide basis:

• The need for projects having a capacitybuilding component was consideredimportant for effective implementation ofall projects;

• Performance Indicators for projects stillneed to be improved;

• Streamlining reporting requirements of theGEF is still needed;

• Recommendations resulting from individualproject evaluations should be addressed bythe GEF; the current perception is thatevaluations of projects and other reportingrequirements are simply generating morepaper rather than feeding into the overallevolution of GEF strategies and policies;

To be addressed within IA:

• The feasibility of having a ProjectPreparatory Advance (PPA) similar toUNDP should be examined. It could assistUNEP in further streamlining its projectcycle and expedite project implementation;

• As noted in the Final Evaluation of theBiodiversity Data Management project, mid-term meetings bringing together countryrepresentatives and others directly involvedin the project can be crucial to the successof projects.

2. OP Level Issues

The requirement that projects must fall withinonly one or two of the GEF OperationalPrograms within the Biodiversity and ClimateChange focal areas is proving to be animpediment towards implementation ofguidance of CBD and UNFCCC recommend-ations to the GEF. Indeed, COP recommend-ations to the GEF from both Conventions requirean integrated and comprehensive approach toaddressing key environmental issues. There istherefore a need for adopting an approach thatallows a selected number of projects to cut acrossthe GEF Operational Programs so that moreintegrated and comprehensive planning and

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research activities can be taken on globallyimportant environmental issues and problems.

3. Broader Portfolio Level Issues

The effective implementation of projectsrequires a stronger base of Enabling Activities.The absence of basic elements or knowledgebase for addressing key environmental problemscould affect the sustainability of investment andcapacity building projects. Therefore, it isnecessary to broaden Enabling Activities toinclude such basic building blocks as nationallegislation,and biodiversity information systems.

4. Key Trends in the GEF Portfolio

As the GEF portfolio grows, there is a need forthe GEF as a whole to maintain a holistic andstrategic view of its portfolio. More integratedplanning is still needed. While National andRegional Strategies/Action Plans should guideproject selection, there is a need to ensure thatthe global perspective on priority areas andglobal environmental problems is maintained.This requires a more integrated approach toplanning. It is therefore not enough to look athow the portfolio is doing within the borders ofonly the Operational Programs, but also to lookat the portfolio from the perspective of it meetingCOP guidance. In this regard, there is a concernthat the GEF in the biodiversity portfolio isputting most of its emphasis on in-situconservation at the expense of addressing otherrelevant COP guidance.

3. PROJECT REPORTS

3.1 Status Reports on Projects Slow to Move to Implementation

None of UNEP�s GEF financed projects fallunder the category of �slow� projects definedas projects not formally approved within twoyears of GEF allocation or projects that havenot begun disbursements within nine monthsof IA approval.

3.2 Individual Project Reports

Individual project reports of the projectscovered under this exercise are attached to thisdocument. As in PIR 1997, the last two half-annual reports and the individual Annual PIRreports for each project are attached.

Conclusions

While the PIR can be a useful exercise inidentifying the common problemsexperienced in project development andimplementation and in providingrecommendations for removing thesebottlenecks, it should nevertheless be notedthat when recommendations resulting fromsuch exercises are not addressed adequately,the practical usefulness of the GEF PIR doesget questioned. It is important that the lessonsarising from the PIR be integrated in themanagement of GEF operations to facilitatemore effective processes for development andimplementation rather than becoming amechanical exercise.


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1. For the second year, the PIR wasintegrated into the Bank�s ARPP (AnnualReview of Portfolio Performance). The ARPPprocess began in June 1998 with country-andsector-specific reviews undertaken by theBank�s regional operational units. Generalportfolio analysis began in mid-July 1998when supervision reporting OperationsInformation System (OIS) data were frozen,and culminated with a report to the Bank�sBoard of Executive Directors in September1998.

2. The methodology for assessing projectperformance in FY98 follows that of theARPP. Projects are rated individually on theirImplementation Progress (IP) and likelyachievement of Development Objectives(DO). Portfolio health is measured inaccordance with the concept of projects atrisk, which includes both actual and potentialproblem projects. Actual problem projects arethose for which IP and/or DO are judged tobe unsatisfactory or highly unsatisfactory.Potential problem projects are those whichalthough rated �satisfactory� by staff, facerisks historically associated withunsatisfactory performance as evidencedthrough sub-ratings for factors such ascounterpart funding, project managementperformance, financial management, etc. Arealism index1 is used to identify over-

optimism in ratings (characterized by a lowrealism index) and a proactivity index whichindicates the timeliness with which actions aretaken to upgrade, restructure, or close problemprojects (a high or rising proactivity index isdesirable). The Bank also monitors a numberof factors relating to portfolio management andimpact that are verified expost. These are the�disconnect� or differences in assessmentbetween current and ex post evaluations ofproject outcomes and in inconsistencies betweenoverall ratings and sub-ratings, and the share of�satisfactory outcomes� which is based on theBank�s Operations Evaluation Department(OED) confirmation that a project has concludedsatisfactorily. Both disconnect analysis andreview of outcomes for the GEF portfolio areexpected to begin in FY99, once OED reviewscompletion reports for those GEF operations thathave closed in previous fiscal years.

Portfolio Size and Composition

3. The portfolio analysis which follows makesreference to three different views of the portfolio.The Bank-GEF portfolio includes all approvedprojects directly managed by the Bank, as wellas those managed by the IFC and IDB(paragraphs 4,5,6,7,11) which are �executingagencies� that have arrangements with the Bankas Implementing Agency in accordance with theGEF Instrument. The Bank-managed portfolio

APPENDIX C.3

WORLD BANK-GEF PORTFOLIO


THE IMPLEMENTATION REVIEW PROCESS

1 The ratio of actual problem projects to total projects at risk.

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is comprised of those operations approved andmanaged by the Bank: it is this portfolio that isused in comparator analysis with the WorldBank�s portfolio performance results (i.e. fordisbursement performance, projects at risk, etc.)to ensure comparability of results (seeparagraphs 10,14,15). The FY98 PIR Group ismade up of all projects in the Bank-GEFportfolio that have been under implementationfor at least 12 months as of June 30, 1998 (seeparagraphs 9,15).

4. Through end-June 1998, the GEF Councilhad approved for inclusion in GEF WorkPrograms a total of 118 World Bank, IFC, IDB,and ADB-managed projects with correspondinggrant resources of US$1,226.6 million. Of these,six projects were dropped and three were dividedinto two projects in response to country anddesign needs, leaving a net total of 115 projects.Bank, IFC, and IDB managements had approved93 of these projects as of June 30, 1998, for atotal commitment value of US$917 million.

5. Eighteen operations valued at US$211.5million were approved by the Bank and IFCmanagements during FY97. This represents anincrease of 11 percent in terms of number ofprojects and 30 percent in terms of commitmentvalue in the Bank-GEF portfolio as of the endof FY97. Nine projects exited the portfolioduring the year.2 Twenty-one GEF1 projectswere awaiting Bank, IFC, and ADB managementapproval as of end-June 1998. As the oneremaining Pilot Phase project was droppedduring the year, only GEF1 projects awaitapproval by the Bank and Executing Agencies.

6. The Europe & Central Asia Regioncontinues to have the largest number of projects(26 projects or 28 percent) in the portfolio, andAsia (East and South) continues to have thelargest volume of commitments ($307.1 million

or 34 percent). During FY98, LAC hasexperienced an acceleration in growth in termsof new projects (five new projects or 39percent increase to the LAC portfolio), withglobal operations of the IFC realizing thelargest growth in new commitments ($60million or a nearly threefold increase to IFC�sportfolio).

7. Biodiversity remains the focal area withthe greatest number of projects (45 projectsor 48 percent) as well as highest value ofcommitments ($371.2 million or 40.5percent). In FY98, biodiversity was also thefastest growing focal area in terms of bothnumber of new projects (11 projects) andcommitments ($61.1 million).

8. In FY97, the average age of a project inthe Bank-GEF portfolio was 2.9 years. Asecond year of major portfolio expansion hasreversed the aging trend, so that average ageof a project in the FY98 portfolio has declinedto 2.5 years. This rejuvenation of the portfoliomay make year-to-year comparisons ofperformance problematic, as project age ishighly correlated to appearance ofimplementation issues/problems. Five of theoldest projects exited the portfolio duringFY98, but the average age of those projectswas only about 4.5 years. Most GEF projectswere completed within their originallyenvisaged implementation period or, in caseswhere extension was necessary, with anextension of one year or less. For the Bankas a whole, the average age of active projectsis 3.5 years, and 15 percent of investmentoperations are 15 years or older. The shorterreal project life for GEF operations may resultfrom the narrower scope and more focuseddesign of the operations and/or more decisiveactions by project executors or Banksupervision teams.

2 Three projects reported in the various PIR as having closed during FY97 were extended after the end ofthe FY and either closed in FY98 or are yet to close. In line with the Bank�s practice, projects that closedduring the fiscal year under review are included in all analyses.


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PORTFOLIO PERFORMANCE

9. Of the approved projects, one IDB, fourIFC, and 71 Bank-managed GEF grants wereeffective and active as of end-June 1998.Sixty-two of the related projects have beenunder implementation for more than 12months and are therefore included in the FY98PIR Group (see Annex: Bank-GEF Projectsincluded in the FY98 PIR).

Disbursements

10. Aggregate disbursements during FY98 forall 71 effective Bank-managed grants totaled$73 million, representing an increase of 34percent over cumulative disbursements at end-FY97. This is slightly less than FY97aggregate disbursements ($74.5 million). Thedisbursement ratio3 experienced a precipitousdrop to 14.4 percent from 18.9 percent inFY97, largely due to substantial newcommitments in recent years: 41 percent ofthe value of the Bank-managed portfolio wascommitted in FY97 and FY98. Thedisbursement ratio for the Bank as a wholehas remained at 19 percent for the last twoyears, however, growth in the Bank�s portfoliohas stabilized in terms of the number ofprojects and nominal commitments and hascontracted in terms of real commitments whilethe Bank-managed GEF portfolio continuesto grow robustly (22 percent growth in numberof projects and nominal commitments inFY98). Bank-managed GEF grants disbursedare equivalent to 32 percent of grantcommitments, about the same level as inFY97. Total disbursements rose substantiallyin the Bank overall portfolio in FY98, drivenby the massive quick-disbursing loans forfinancial crisis support in Asia: the

considerable increase in non-investment lendingleads to non-comparability of the disbursement/commitment ratios of the Bank and Bank-managed GEF portfolios this year.

11. The aggregate disbursed amount for theBank-GEF portfolio totaled US$75.7 million inFY98 compared to US$ 75.6 million for FY97.The cohort of 18 Pilot Phase projects withdisbursement lags of 50 percent or overcompared to original disbursement estimates,has been reduced to only six projects due torevision of disbursement schedules to reflectgreater realism in implementation, efforts toredress the underlying problems (often relatedto procurement) that hindered normaldisbursement, and project closings, both asanticipated and in advance through cancellation.Analysis of disbursement trends indicate that thestagnation in annual disbursements results froma combination of (1) a substantial decrease inthe disbursements originating from the group ofinfrastructure and trust fund projectscharacterized by large, �lumpy� disbursements(these represented 62 percent, 66 percent, 46percent, and 26 percent of annual disbursementsrespectively for the years FY95-98) as many areeither just beginning (IFC investment funds) orapproaching the end of project life (IW and CCinfrastructure operations); (2) the Asia financialcrisis (five Indonesia and one Thailand operationrepresenting $71.6 million in commitmentsdisbursed only $2.7 million in FY98); and(3) the late entry into the portfolio of large IFCinvestment funds that had not begun to disbursebefore the end of FY98.

12. Most operations entering the portfolio inFY98 became effective (i.e., met conditionsprecedent to disbursing) within four months oftheir approval, sustaining the positive trendestablished under GEF1. Two projects required

3 The ratio of net disbursements during the year to the undisbursed balance at the beginning of that year. Toavoid overstating performance, the Bank calculates the ratio by excluding Trust Fund projects (Bhutan TrustFund, Peru Protected Areas Trust Fund, Uganda MBIFCT, Brazil Biodiversity Fund, Restructured MexicoProtected Areas that disbursed their entire balances at the time of grant effectiveness).

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more than nine months to be effective, althoughfor the IFC�s Terra Capital Fund, achievingeffectiveness in 11 months (in this casecapitalization of the Fund) is well above thenorm and should be seen as very goodperformance in light of the difficult situation inworld financial markets. Both projects are noweffective and disbursing normally.

Implementation Performance andAchievement of Development Objectives

13. The Bank�s approach to assessingImplementation Performance and achievementof Development Objectives is summarized inparagraph 2 above.

14. Twelve of the 80 projects in the Bank-managed portfolio (representing 15 percent interms of number of projects and 21 percent interms of commitments) received unsatisfactoryratings for either IP, DO, or both, and are thusincluded in the �problem projects� category.The corresponding percentage for FY98 for theBank�s overall portfolio is 17 percent in termsof number of projects and 15 percent in termsof commitment value. It should be noted thatthree of the new entry �problem projects� inthe East Asia portfolio were designated as suchprimarily due to the Asia crisis.

15. In the FY98 PIR group of 62 projects, nineof the Bank-managed and one IDB-managedproject (16 percent in terms of number ofprojects) are designated as problem projects(these results are less affected by the Asiaportfolio performance). This compares witheight problem projects in the FY97 PIR group(49 projects) and one in the FY96 PIR group(34 projects). For projects that have receivedunsatisfactory ratings in the ImplementationProgress area, the most recurrent problems arein the areas of poor project management,procurement (poor planning, bureaucraticdelays, weak recipient capacity), anddisbursement.

16. The number of potential problem projectsin both the Bank-managed portfolio and FY98

PIR group is five for FY98. The total numberof projects at risk (actual plus potential or 17projects) represents 21 percent (17.5 percentcorrected for Asia performance) of the Bank-managed portfolio in terms of number ofprojects and 23 percent in terms ofcommitments, compared with 21 percent and23 percent respectively, for the Bank overallportfolio. Performance of the GEF portfoliois comparable to that of the Bank as a whole.

Portfolio Management

17. The trend in the Bank�s indicators ofactive portfolio management are givingindications that GEF-supported operations areprogressively better integrated in the portfoliomanagement practices of the regions. Arealism ratio of 71 percent is somewhat higherthan the Bank�s overall realism index (68percent), but must be interpreted with cautiongiven the very small number of projects inthe �at risk� category. The proactivity ratioat 40 percent is showing steady improvementover the past (25 percent in 1997), but shouldstill be considered inconclusive due to smallsample size as it is based on upgrade of fourout of ten projects that were in problem projectstatus last fiscal year.

MAIN FINDINGS AND LESSONS LEARNED FROM

THE PIR GROUP

Sustainability and Replicability

18. Beginning with the Pilot Phase, everyGEF project addressed the basis forsustainability of the project activities at theend of �project life.� A review of the originalsustainability discussions indicates that issuesthat thwart sustainability were well known andanalyzed for each project. This review alsoshows that issues and solutions tend to clusterby focal area as discussed in separateparagraphs below. However, one factor wascited in nearly every focal area as being key:institutional sustainability was seen to belinked to capacity building efforts undertakenwithin the project. As the discussion in


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paragraph 37 on effectiveness in buildingrecipient capacity indicates, additional workon capacity building impact will be needed toensure this linkage is effective.

19. Sustainability in Biodiversity. Threeareas for intervention were identified to ensurethat biodiversity activities would besustainable, and thus were addressed in thedesign of nearly every project: (1) publicawareness including participation wasincluded to ensure social sustainability;(2) capacity building was provided for toensure institutional sustainability as notedabove; and (3) a renewable source of revenuewas anticipated to ensure financialsustainability. With regard to financialsustainability, the main sources of revenuetargeted were: (i) government budget; (ii) eco-nomically sustainable activities under theprogram; (iii) special taxes and levies; and(iv) special mechanisms, particularly trustfunds.

20. Dependence on government budgets(general revenue) has proven to beproblematic. Late or non-provision ofcounterpart funding has been cited as aproblem, making the budget a less-than-reliable contributor to sustainability: eventhose projects for which government fundinghad been forthcoming in a timely and reliableway have proven susceptible to unforeseencrises. As sustainable activities are justbeginning in a number of countries that haveused this approach, extensive experience islacking from which to draw conclusions. Thedialogue leading to government implement-ation of taxes and levies has proven to be along one, with only Ecuador achieving successat this point in time. Ironically, within thelong group of projects that cited conservationtrusts and similar mechanisms, only India,Laos, and Bolivia have pursued this avenue,and only Bolivia has been able to design andinitiate a trust fund during project life. TheEastern Carpathian Foundation, probablyundercapitalized initially, has supported someimportant activities, but is far from ensuring

funding for comprehensive management of thetransboundary area it is intended to sustain. Thebody of knowledge on experience with othertrust funds does, however, indicate that they area contributor to sustainability, provided assetsare prudently managed and the institution is well-conceived and managed.

21. Sustainability and International Waters.International waters projects approachsustainability through (1) consensus buildingamong nations that must cooperate regardingshared water bodies and (2) studies of variouscost recovery and financial incentives forsubsequent implementation by governments. Innearly all cases, activities initiated in the projectsare intended to be followed by downstreamactions requiring substantive additional support.With the exception of creating a durableconsensus (most projects claim success in thisdomain, or at least in bringing together partiesthat had not previously cooperated effectively),a sustainability test is most appropriately appliedto the follow-on activities.

22. Sustainability and Climate Change.Climate change projects, drawn largely from thePilot Phase, view sustainability in terms of:(1) creating a favorable enabling environmentthrough appropriate policy and regulatoryframeworks, (2) developing able institutionsthrough capacity building, and (3) increasingsources of domestic finance to support newendeavors. �Policy/regulatory framework� wasthe factor cited most often in CC projects,particularly those promoting demand sidemanagement and introduction of newtechnologies, although the precise elements of�policy� needed to ensure sustainability were notalways spelled out. Pricing was clearlyidentified to be the key factor to sustainincentives for obtaining more efficient use ofenergy resources (e.g., reducing leaks in gasdelivery systems), to ensure financial viabilityof power entities or to encourage conversionfrom high carbon fossil fuels to gas. Increasingdomestic finance (greater availability throughintermediaries) was cited as the key element ofenergy efficiency projects with high replicabilitypotential.

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23. Where policy or regulatory frameworks havebeen adjusted to accommodate newtechnologies, opening of new markets has beenobserved in some cases during project life. Asseen in wind and bagasse projects, even thoughthe original physical objectives of a project werenot achieved, other private and public ventureswere stimulated by creation of supportive policyframeworks. Standard project life appears to betoo short to fully document effects of pricingchanges as these often occur gradually over time:subsidy/discount reductions have only begun insome cases, so that a firm foothold is not yetdiscernible.

24. Sustainability and ODS Reduction/Phaseout. ODS projects relate sustainabilityto the enterprises supported remaining inbusiness and continuing to use ozone-freetechnologies. Enterprise financial failure andbacktracking have not been issues for theprojects that have been completed. Upstreamdue diligence review of candidate companies, astandard practice for all ODS sub-projects, isseen to be the key to ensuring financialsustainability, as is the selection of appropriatecost-effective technologies.

25. Sustainability and Private SectorInterventions through Intermediaries. TheSME program proposes two indicators ofsustainability: (1) ability of intermediaries torepay and (2) intermediaries obtaining non-GEFfunding to carry on activities similar to thosesupported by the SME program. There arecurrently no repayment issues under the PilotPhase SME, but many sub-projects are still notfully mature. A forthcoming evaluation of SMEwill look at availability of additional financingin greater detail.

26. General Observations

(1) Few biodiversity projects can achievesustainability in the timeframe of a singleproject (3-5 years): a longer time horizon(15-20 years) is more appropriate to workthrough the complex institutional, policy,human resource development, and financing

issues required for sustainability. Thefirst biodiversity intervention shouldprovide a solid foundation for the futureand lay out the vision for achievingsustainability, supported by realisticobjectives and indicators for success.Newer delivery mechanisms designed forlong-term intervention (such as the Bank�sAdaptable Program Loan [APL]) may bemore suitable to projects supportingprotected areas and conservationprograms.

(2) Chances of achieving financingsustainability for biodiversity projectscould be increased by combining sourcesof finance, (budget, taxes, levies, trustfund), rather than focusing on a singlesource. Even sources deemed reliablehave proven to have limitations(government budgets in times of crisis,difficulties in increasing trust fundcapital).

(3) Similar to biodiversity projects, climatechange projects requiring substantivepolicy and regulatory reforms may alsobenefit from greater realism in thetimeframe needed to achieve sustain-ability. While many projects showhopeful signs at the end of their life,legislative changes, price adjustments andwithdrawal of financial incentives areoften only beginning to impact at end ofproject life.

CROSS-CUTTING ISSUES

Leveraging

27. A Competitive Environment LeveragesPrivate Finance and Local Action. Whetherseen as �leverage,� �catalysis,� or �synergy,�GEF-supported operations give rise to avariety of complementary and downstreamactions in a competitive environment. Themost successful results are seen in climatechange operations: under India AlternateEnergy, success of the windfarm power


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industry has attracted additional external anddomestic sources leading to major expansionof installed capacity; Hungary EnergyEfficiency will give rise to new ESCOs;Mexico HELP has inspired the Federal EnergyCommission to pursue new support forreplacement of CFLs; and under the TunisiaSolar Water Heating Project, a robustcompetitive market is created by five differentbrands of equipment that are now produced,with three constructed locally, while installedcapacity has increased markedly throughprivate actions. Perhaps the most notablelesson with respect to leveraging andcompetition is the relative speed with whichthe �leveraged� actions give results in acompetitive environment.

28. Effective Institutions. As noted in theEvaluation of Conservation Trust Funds,CTFs emerge as very effective in leveragingadditional financial resources forconservation. Peru PROFONANPE, BoliviaSNAP, Mexico FMCN, and Bhutan BTF areamong the CTFs that have attracted additionalofficial resources. While relatively younginstitutions with limited track records, mosthave highly qualified staff and sound decision-making structures that instill confidence.

Project Effectiveness in Building RecipientCapacity

29. Expectations Suited to the Project Life.The term �capacity building� evokes thebroadest array of approaches imaginable tohelp new and current practitioners operatedifferently: these approaches includeeverything from use of local traditions indrama and storytelling to convey informationkey to changing community behavior, to anupgrade in curriculum of an existinginstitutions, to international conferences.However, few projects in the PIR group state

clearly what the impact of their capacity buildingactivities is in other than quantitative terms. Arelatively short investment project life may makethe critical qualitative changes more difficult toassess. Even in cases where specific technicaltraining is completed and the training programis deemed replicable, it will undoubtedly beyears before the training can be correlated toeffective results. Projects need to better identifythe desired qualitative impacts of capacitybuilding activities and when these will beobserved. It should be expected that many ofthe capacity building benefits will fall outsideof project life. In such cases, provision shouldbe made for monitoring and evaluation by therecipient institutions.

New Features of Stakeholder Involvement

30. Making Stakeholder Representatives MoreEffective. Projects in nearly all focal areas havemade substantial progress in includingrepresentatives of key stakeholder groups indesign activities as well as on formal bodies thathave direct input into implementation decision-making activities. For biodiversity projects,communities are most often the stakeholderswho gain representation given the impact ofproject decisions on buffer zone or protected areamanagement. While formal stakeholderrepresentatives have been successful in giving avoice to communities and safeguarding theirinterests, they are not always as effective as theycould be in ensuring that information on thebroader mandate and activities of their decision-making body are communicated back to thestakeholders they represent. Projectsincorporating community representation shouldtherefore ensure that stakeholder representativesunderstand the need for fully informing theircommunities and that they have the means to doso, through training and support for informationdissemination.

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31. Women and Renewable Energy. Renewableenergy projects, particularly those aimed atincreasing usage of efficient light bulbs, show astrong participation rate by women, as designand execution decision-makers as well as�beneficiaries� supporting new technologies.Women, particularly in Eastern Europeancountries, participate in energy institutions asboard members, administrators, and managers.They represent consumer federations that have

supported the move to greater efficiency(Poland) and were viewed in India ascandidates for entrepreneurial opportunitiesin solar PV. In the Mexico High EfficiencyLighting Project, participant surveys revealedwomen are the household decision-makers forchoice of light bulbs. In light of this evidence,design of renewable energy projects shouldemphasize strong gender focus.

project performance report 1998

Documents

evaluation of experience

project leadership

coastal management projects

overview of projects

portfolio highlights

gef portfolio analysis

overall gef portfolio

conservation trust funds