INTEGRATED SAFEGUARDS DATA SHEET
                                                       APPRAISAL STAGE
                                                                                              Report No.: ISDSA9251
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                         Date ISDS Prepared/Updated: 15-Aug-2014
                         Date ISDS Approved/Disclosed: 20-Aug-2014
                         I. BASIC INFORMATION
                            1. Basic Project Data

                            Country:          Mozambique                        Project ID:    P131965
                            Project Name:     Mozambique Conservation Areas for Biodiversity and Development Project
                                              (P131965)
                            Task Team         Claudia Sobrevila
                            Leader:
                            Estimated       18-Aug-2014                         Estimated   15-Oct-2014
                            Appraisal Date:                                     Board Date:
                            Managing Unit: GENDR                                Lending     Specific Investment Loan
                                                                                Instrument:
                            GEF Focal         Biodiversity
                            Area:
                            Sector(s):        General agriculture, fishing and forestry sector (40%), Central government
                                              administration (40%), Other industry (15%), Sub-national government
                                              administration (5%)
                            Theme(s):         Biodiversity (30%), Rural non-farm income generation (30%), Environmental
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                                              policies and institutions (25%), Other environment and nat ural resources
                                              management (10%), Climate change (5%)
                            Is this project processed under OP 8.50 (Emergency Recovery) or OP No
                            8.00 (Rapid Response to Crises and Emergencies)?
                            Financing (In USD Million)
                            Total Project Cost:      46.32           Total Bank Financing:               40.00
                            Financing Gap:            0.00
                              Financing Source                                                                    Amount
                              BORROWER/RECIPIENT                                                                     0.00
                              International Development Association (IDA)                                           40.00
                              Global Environment Facility (GEF)                                                      6.32
                              Total                                                                                 46.32
                            Environmental B - Partial Assessment
                            Category:




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                         Is this a            No
                         Repeater
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                         project?

                         2. Project Development Objective(s) / Global Environmental Objective(s)
                            A. Project Development Objective(s)
                            To increase the effective management of conservation areas and enhance the living conditions of
                            communities in and around these areas
                            B. Global Environmental Objective(s)
                            To increase the effective management of conservation areas and enhance the living conditions of
                            communities in and around these areas
                         3. Project Description
                         I. Project Context

                         Mozambique is located on the east coast of Africa, bordering six countries. With an area of 800,000
                         square kilometers, the country is richly endowed with natural resources (arable land, forests,
                         fisheries, water and mineral resources).

                         Mozambique is one of the poorest countries in the world with approximately 70% of its 22.9 million
                         people living and working in extreme poverty (<US$2/day). In 2007, 38% of the population was
                         undernourished and only 42% had access to an improved water source. The country ranks 178 out of
                         187 in the UNDP’s Human Development Index (2013), the lowest in southern Africa. Over 70% of
                         the population live in rural areas and are dependent on subsistence agriculture.

                         After emerging from a protracted fifteen-year civil war, Mozambique achieved impressive GDP
                         growth rates that averaged approximately 8% between 1993 and 2010, and slightly decreased to
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                         7.4% in 2012. Annual GDP growth is expected to be around 8.5% by 2015. The real GDP per capita
                         almost doubled since 1992, making Mozambique one of the best performing countries over the past
                         two decades among African oil importers.

                         The country is receiving a significant influx of direct foreign investments. In 2013 the Centre for
                         Investment Promotion (CPI) approved US$4.2 billion for 515 projects, with US$ 569.7 million
                         relating to domestic investment and US$ 2.2 billion to shareholders and loans. Overall, the industrial
                         sector has generated greater interest by investors, followed by agriculture and agro-industry,
                         transport and communications, services, tourism and hospitality, construction and fisheries.

                         This rapid economic growth has not translated into rural poverty reduction in recent years. The
                         2008-09 household survey suggests that the response of poverty reduction to economic growth has
                         weakened and the geographical distribution of poverty continues to be concentrated in the rural
                         areas, mostly in the center and northern part of the country, with high rates of poverty along the coast
                         line.

                         Sectoral and institutional Context

                         Mozambique’s Conservation Areas contain a wide diversity of habitats including montane,
                         woodland, wetland and coastal/marine ecosystems. Mozambique has over 5,500 plant species, 222


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                         mammal species, and 600 bird species. A high number of these species are endemic. Its coastline is
                         unique in the East African Marine Region in terms of the quality, diversity and species richness,
                         including some of the most spectacular coral reefs in the world. Some of the most important
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                         biodiversity areas are adjacent to Conservation Areas (CAs) in neighboring countries. These areas
                         often play an important role in protecting wildlife corridors for both marine and terrestrial species,
                         for example of whale sharks and African elephants.

                         Mozambique’s system of CAs has two purposes: to conserve ecosystems, wild habitats, biological
                         diversity and natural re sources for the benefit of present and future generations; and secondly, to
                         contribute to the development and the social-economic well-being of Mozambicans, particularly the
                         poor communities that live nearby. It is currently made up of seven National Parks, ten National
                         Reserves, seventeen controlled hunting areas (coutadas) and two Community Reserves. The
                         currently gazetted CAs cover 18.5 million hectares, which represent 23% of the country's land
                         surface. Annex 10 presents a map of all CAs in the country, including those targeted by the MozBio
                         project. The expansion of the CAs network in recent years was the result of government's
                         commitment to the international agreements (e.g. as signatory to the Convention on Biological
                         Diversity and CITES) and support from its development partners. The recent creation of new CAs (e.
                         g. Ponta d'Ouro Marine Reserve, Lake Niassa Reserve, Magoe National Park and five new coutadas)
                         and the improvement in the management effectiveness of some CAs is the result of the successful
                         partnership between the government and many key national and international players over the past 15
                         years, including among others, the World Bank, IFC, GEF, AfD, KfW and USAID.

                         Conservation Areas have been generating income to the national economy and to local communities,
                         albeit not at the level they could. The declared revenue generation from tourism (including both non-
                         consumptive tourism and sports hunting) in CAs almost tripled from 2012 to 2013, from around US$
                         1 million in 2012 to almost US$ 3 million in 2013 (Rylance, 2014). The revenues from Coutadas
                         increased by nearly 500% in this period, particularly because of a significant increase in the price of
                         licenses and abate tickets (applied in 2013) as well as the commencement of a number of new
                         Coutadas. However, the revenue currently captured from tourism and hunting is largely insufficient
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                         to finance the management of CAs. In addition, the levels of re-investment of Park-generated
                         revenues are very low. As a result, CAs are still heavily dependent on donor funding and
                         mechanisms to contribute to financial sustainability are sorely needed.

                         Poverty rates are extremely high across the population living within and around CAs. More than 70%
                         of Mozambique’s poor live in rural areas and poverty is particularly acute along much of
                         Mozambique’s coast and in the drier central and southern regions where the vast majority of the
                         population is considered poor. It is these areas where the majority of the country’s CAs are located.
                         Many CAs are characterized by high forest cover and high poverty rates, especially those in the
                         central and the northeast coastal regions of the country, or harbour important marine resources.
                         These forests and marine areas supply basic needs for large numbers of people and strengthening
                         their condition could provide opportunities for the rural poor to move out of poverty.

                         Conservation Areas are an important source of livelihood to rural populations and their contribution
                         to poverty reduction can be increased. National legislation mandates that the benefits arising from the
                         use of CAs should be shared with local communities (currently 16% of overall income generated
                         from the fees collected by the CAs) . Nevertheless, the implementation of this policy has been ad hoc
                         and faced challenges since the fees collected by the National Tourism Institute (INATUR) are first
                         sent to the Treasury in Maputo, then back to the CAs to be shared with the communities, which
                         results in significant delays and lack of transparency. Communities are often not well organized to

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                         manage these resources in a transparent way and to allocate them to longer-term development goals.
                         Communities also benefit directly from employment in tourism establishments, and indirectly
                         through the development of local businesses supplying tourism operations (Moye & Nazerali 2010).
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                         Finally, communities also benefit from the environmental services (water, biodiversity) and goods
                         (hunting) supported by CAs.

                         Conservation, tourism and poverty and interlinked. Tourism and other conservation-oriented income-
                         generating activities create incentives towards conservation among local communities and local
                         governments, which in turn reduces the pressure on natural resources. Tourism, provision of vital
                         ecosystem services, and infrastructure are three mechanisms that have been identified as linking both
                         forest and marine protected areas to poverty alleviation. Nature-based tourism, in particular, has
                         been widely touted for its potential to deliver positive results for the poor. Recent research provides
                         strong evidence for this link in diverse developing country contexts. Nature-based tourism links the
                         conservation and poverty reduction objectives of CAs by providing an economic alternative to
                         unsustainable use of natural resources, as well as a direct economic incentive to maintain the natural
                         ecosystems and their biodiversity. Other benefits from CAs to local communities, such as sharing the
                         CA entrance fees with surrounding communities, also improve their living standards while directly
                         contributing to conservation. Finally, improved infrastructure for CAs management and tourism can
                         also lead to jobs, improved market access, and delivery of health services and educational
                         opportunities.

                         Tourism is an important source of revenue to conservation, growth, and rural poverty reduction in
                         Mozambique. The direct contribution of travel and tourism to Mozambique’s GDP in 2013 was
                         MZN13.9 billion (3.2 % of GDP). This was expected to reach MZN 26.3 billion in 2024. This is a
                         result of the economic activity generated by hotels, travel agents, airlines and other passenger
                         transportation services (excluding commuter services), and activities of the restaurant and leisure
                         industries directly supported by tourists. Between 2007 and 2013, tourism arrivals to Mozambique
                         increased by 15 % annually from about 1.3 million to almost 2 million (generating estimated receipts
                         of US$231 million in 2011). Arrivals are projected to continue to increase at about 8 % annually to
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                         reach 3 million in 2017.

                         Targeted policies need to be put in place to ensure that environmentally-sustainable pro-poor tourism
                         is achieved. This should include training and credit targeted at local communities and incentives for
                         the private sector to employ local labor. Tourism directly, and through linkages to transport,
                         agriculture, food, retail, financial services, and construction sectors, offers compelling job creation
                         and economic growth opportunities, particularly to rural population, which directly contributes to the
                         reduction of rural poverty. Tourism’s impact on poverty is linked to the fact that the sector: (i)
                         employs more unskilled labor than other sectors; (ii) can be based on cultural and natural resources
                         which the poor possess and personify; and (iii) benefits tourists and residents alike when
                         infrastructure is upgraded.

                         Some of Mozambique’s terrestrial and coastal CAs have high potential to contribute to the growth in
                         tourism. Nature-based and sustainable coastal tourism are expected to be the largest growth areas in
                         the coming decades (World Travel and Tourism Council, 2014). Tourism is already the third largest
                         investment sector in Mozambique, with investments concentrated on coastal CAs.

                         Growth in the tourism sector faces significant barriers. The country is still highly uncompetitive in
                         the international tourism market. In the overall country rankings for tourism competitiveness,
                         Mozambique ranked 125th out of 140 countries in 2013, an improvement of 3 places since the last

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                         edition in 2011 (Blanke and Chiesa, 2013). This low competitiveness is mainly the results of the
                         poor infrastructure development, low basic services in the country, high domestic air fare costs and
                         unclear government procedures for the private sector to invest. Nature-based tourism, particularly the
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                         terrestrial CAs, is also affected by reduced charismatic wildlife populations (if compared to
                         neighboring countries) as a result of the country’s long civil war.

                         The GoM is actively addressing these barriers. In April 2003, the GoM adopted a National Tourism
                         Policy and Implementation Strategy (NTPIS), which aimed to develop and promote tourism both as a
                         major industry and as a tool to alleviate poverty. A Strategic Plan for Tourism Development in
                         Mozambique (2004 -2013) was prepared in October 2004, which targeted over 4 million tourists a
                         year (SPDTM, 2004). The 2014 - 2024 Strategic Plan is currently being prepared by the Ministry of
                         Tourism to build on achievements to date, and should be ready by the end of 2014. It places strong
                         emphasis on nature-based tourism, and highlights the coastal CAs as those with the highest potential
                         for increased tourism.

                         Despite their potential to contribute to national growth and poverty reduction, Mozambique’s CAs
                         still face various threats. These include illegal mining and logging, agricultural encroachment, illegal
                         hunting (especially of elephants) and overfishing. The overall estimated costs of environmental
                         degradation inMozambique, amounted to nearly US$370 million in 2009 (MICOA, 2009). Of this,
                         some US$50 million per annum comprises depletion of the natural resource base (soil degradation
                         and deforestation).

                         Wildlife poaching is a particularly challenging threat to conservation. As elsewhere in the region,
                         Mozambique has not escaped the poaching onslaught for ivory. Over the last 5 years there has been a
                         5 – 6 fold increase in the number of elephant deaths as a result of poaching. Ivory is often
                         transported out of the country either through its porous borders or through airports and ports.. The
                         causes that have led to these high levels of poaching and illegal trade are complex. Some factors
                         include poverty at the local level, governance at the national level, weak control capacity at the
                         Conservation Area level (Mozambique has approximately one scout per 315 km2 which is 6 times
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                         lower than the recommended patrol effort) and the demand for ivory and rhino horns at the global
                         level (Madyo Couto, 2014) .

                         CAs are not financially sustainable at present. They are funded primarily from four sources: i)
                         Annual government budget allocation; ii) Other government allocation, including special grants; iii)
                         Internal revenue generating activities, such as tourism; and iv) Donor funding provided by
                         development partners. Donor funding accounts for 80% of current CAs revenue requirements, which
                         is estimated at US$ 20.8 million / year (UNDP, 2010). Tua and Nazerali (2010) estimated that only
                         1% of total revenue requirements for CAs were provided by the central government, mainly for
                         operational expenses. Internal revenue generating activities still only cover a small portion of the
                         financial requirements for CAs, even though it is increasing and still has significant untapped
                         potential. The main potential sources of revenue-generating activities in CAs include: i) User fees
                         (such as entry fees, accommodation, fishing fees, guided tours and diving fees); ii) Fees from
                         licenses for use of natural resources (timber concessions, live game sales and hunting concessions);
                         iii) Income from nature-based tourism concessions; and, iv) Income from fines and auction sales of
                         confiscated goods (predominantly timber).

                         MozBio Program – A Platform to promote Conservation, Growth and Poverty Reduction
                         The GoM has requested WB assistance to implement the MozBio Program - an ambitious long-term
                         Program that brings biodiversity conservation, tourism development and poverty reduction together.

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                         The MozBio Program should serve as a platform to address the threats to the conservation of
                         Mozambique’s natural capital, take full advantage of the potential tourism growth in Mozambique,
                         and contribute to the reduction of the high poverty levels around CAs. This MozBio Program draws
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                         from the lessons of the previous Trans Frontier CAs (TFCA) Program .

                         Mozambique's institutions and policies for CAs and tourism development need to be strengthened
                         and implemented effectively. The institutional and policy framework for tourism development to
                         manage Mozambique's CAs system, built with the support of TFCA II, are still quite new and require
                         significant technical assistance and support to ensure that the new laws, policies and institutions are
                         fully implemented. Additional rules and regulations need to be developed. Furthermore, most
                         terrestrial CAs do not yet have sufficiently attractive products, or a level of public infrastructure, to
                         scale up tourism. With insufficient and unpredictable budget and low human resources capacity,
                         most of these CAs lack the effective management regime and much needed infrastructure
                         investments for tourism development. Communities are not adequately trained and organized to
                         benefit from CAs and nature-based tourism. Tourism development requires improved basic
                         infrastructure and access to areas with potential tourism attraction, improved tourism investment
                         promotion and facilitation and clear and simplified tourism licensing and registration procedures.

                         The MozBio Program will address these challenges through six strategic pillars (Table 1). i)
                         Strengthening the policy and legal framework for CAs; ii) Strengthening the institutional and human
                         resources base for conservatio n in Mozambique in particularly MITUR, ANAC, Biofund and
                         MICOA; iii) Developing financial sustainability of CAs through innovative funding mechanisms
                         (such as operatilizaing Biofund’s endowment fund and tapping into the potential of biodiversity and
                         carbon offsets); iv) Improving the management effectiveness of CAs; v) Increasing the contribution
                         of CAs to poverty reduction and strengthen community participation in CA management, as a
                         strategy to promote conservation; and; vi) Increasing the contribution of CAs to economic growth
                         through nature-base tourism programs and activities. The MozBio Program will focus on marine or
                         coastal CAs which have most potential to generate revenues from tourism, and will broaden the
                         options of nature-based tourism products to sport hunting (including community-managed hunting
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                         areas). The MozBio Program will be financed with GoM’s resources and support from various
                         donors (AFD, KFW, USAID, international NGOs, among others).

                         The WB will provide support to the MozBio Program through a ‘Series of Projects (SoP)’. MozBio
                         Phase 1, presented in this Project Appraisal Document (PAD), will be a four-year project with a
                         focus on increasing revenues from nature-based tourism and on promoting rural poverty reduction by
                         sharing the revenues from tourism and promoting conservation-oriented livelihood opportunities.

                         MozBio 1 will implement the new institutional framework for conservation in Mozambique, with a
                         strong emphasis on building the capacity of the recently-established CAs Management Agency
                         (ANAC) and the Biodiversity Foundation (Biofund), while strengthening the management of key
                         CAs with the highest potential for generating revenue and reducing poverty in rural communities.
                         The project will promote nature-based tourism by improving regulations, strengthening government
                         capacity and promoting the sector. The project will also finance sorely needed infrastructure and
                         some of the recurrent costs of existing CAs to ensure they can attract tourism and manage
                         biodiversity adequately. Finally, project will strengthen communities’ rights to land and resources
                         and promote livelihood alternatives to local communities, such as improved agricultural methods
                         (such as climate smart agriculture techniques), community forest management and non-timber forest
                         products management and sustainable fisheries.



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                         MozBio 1 is expected to create the foundations for future MozBio Program phases. Potential future
                         phases of the SoP would draw on lessons from the MozBio project. They would extend financial and
                         technical support to other CAs (including support to further infrastructure development) and scale up
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                         the support to local communities, particularly by providing more technical and financial support to
                         scale up those income-generating activities shown to be viable in Phase 1.

                         II. Project Description

                         The project will be implemented through five components.

                         Component 1: Institutional Strengthening for CAs Management (US$8.9 million IDA and US$3.2
                         million GEF). The objective of this component is to improve the capacity of ANAC, Biofund and
                         MICOA to develop and influence conservation and tourism policies and regulations, strengthen
                         coordination and management of the national CAs system and critically endangered species
                         conservation, increase the financial sustainability of CAs and tourism revenues, improve monitoring
                         and evaluation systems and support communication strategies.
                         (i)     Strengthening of ANAC: This subcomponent would support the provision of equipment,
                         technical assistance and training required within ANAC to improve the management of conservation
                         areas and nature-based tourism development.
                         (ii)    Strengthening of Biofund: This subcomponent would support the consolidation of Biofund
                         through, inter alia the: (a) capitalization of the Endowment Fund; and (b) operationalization of
                         Biofund through the provision of equipment, financing of operating costs and technical assistance,
                         including the design and implementation of a fundraising strategy involving innovative funding
                         mechanisms (ie. Biodiversity offsets) and sources.
                         (iii)   Strengthening national CITES Secretariat: This subcomponent would support proper
                         implementation of the CITES Convention requirements to improve wildlife management through the
                         provision of technical assistance and training to the CITES Secretariat within MICOA.

                         Component 2: Promotion of Tourism in CAs (US$2.2 million IDA). The objective of this component
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                         is to increase revenues and the number of beneficiaries from tourism-related economic activities in
                         CAs. The component will provide support to ANAC and selected public-private institutions to
                         address several barriers to nature-based tourism development and to promote sports hunting
                         management and revenues generation in Mozambique. It will finance the provision of training and
                         technical assistance including the development of a business plan and strategy to FEMOTUR,
                         advisory services for the establishment of a management system for revenues collected by the CAs
                         and for tourism and sport hunting statistics, marketing and promotion activities, development of
                         incentives to reducing GHG emissions in the tourism sector, analytical studies for purposes of
                         informing tourism and sport hunting planning at national and destination level, development of
                         tourism master and hunting areas plans and land availability studies, organization of public-private
                         fora to manage and coordinate tourism and sport hunting.

                         Component 3: Improving CAs Management (US$15.3 million IDA). The objective of this
                         component is to strengthen the management of key CAs , and wildlife surveys and monitoring
                         through the provision of training, equipment including hardware and software, carrying out of works
                         including housing and road repairs and maintenance, technical assistance including for the
                         development of business and management plans and financing of operating costs to improve park
                         management and tourism development and carrying out of surveys to assess the status of wildlife
                         populations in-terrestrial and marine environment, including: (a) bi-annual national aerial surveys of
                         elephant range; (b) bi-annual national surveys of key marine environment; (c) a survey to establish

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                         national status and distribution of lions and leopards; and (d) a survey to establish national status and
                         distribution of hippos and crocodiles.
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                         Component 4: Piloting Sustainable Community Livelihoods around CAs (US$7.0 million IDA, US
                         $3.1 million GEF). The objective of this component is to improve and strengthen natural resource-
                         based livelihoods of communities living in and surrounding the CAs through the following:
                         (i)      Support the enabling conditions for sustainable management of natural resources by local
                         communities. This subcomponent would support the provision of technical advisory services and
                         equipment to conduct land demarcations, natural resource mappings and legal registration, carrying
                         out of training of local communities on decision-making, accountability, transparency, local
                         governance, business planning and management, use and management of funds, partnerships with the
                         private sector and use of information technology. It will also support the carrying out of capacity
                         building programs for the design and implementation of Subprojects.
                         (ii)     Promote sustainable livelihoods within and around CAs. This subcomponent would provide
                         support to the design and implementation of Subprojects.
                         (iii)    Promote sustainable forest management within and around selected CAs. This subcomponent
                         would support: a. Reduction of deforestation within and around two selected CAs: Quirimbas
                         National Park and Gile National Reserve through the carrying out of activities related to agroforestry,
                         conservation agriculture, promotion of non-timber forest products and environmental education; b.
                         Promotion of energy efficient charcoal making kilns.

                         Component 5: Project Management, Monitoring and Evaluation (US$4.7 million IDA) + Project
                         Preparation Advance (US$1.9 million).
                         The component would provide support for managing and coordinating the Project and building its
                         procurement, financial and safeguards management, monitoring and evaluation capacity through the
                         provision of technical advisory services, carrying out of training, acquisition of goods, and Operating
                         Costs.
                          4. Project location and salient physical characteristics relevant to the safeguard
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                         analysis (if known)
                         The project areas have been selected: Maputo Special Reserve, Ponta do Ouro Partial Marine
                         Reserve, Quirimbas NP, Bazaruto NP, Pomene NR, Limpopo NP and Marromeu NR and 4
                         surrounding Coutadas, Zinave NP, Banhine NP, Chimanimani NR, Gile NR and Malhazine NR.
                          5. Environmental and Social Safeguards Specialists
                         Cheikh A. T. Sagna (GURDR)
                         Paulo Jorge Temba Sithoe (GENDR)

                          6. Safeguard Policies                Triggered? Explanation (Optional)
                          Environmental Assessment OP/         Yes             MozBio is rated as a Category B project due to
                          BP 4.01                                              the site specific nature of its foreseen social and
                                                                               environmental impacts. Project environmental
                                                                               and social impacts will largely result from
                                                                               construction civil works of essential and
                                                                               necessary facilities, which will include
                                                                               administrative buildings, small bridges and access
                                                                               roads in selected conservation areas. The
                                                                               construction of these facilities is expected to



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                                                                     produce localized adverse environmental and
                                                                     social impacts that are minimal to moderate.
                                                                     Since details of project footprint are unknown at
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                                                                     this point, the Borrower has prepared an
                                                                     Environmental and Social Management
                                                                     Framework (ESMF) that includes a draft
                                                                     Environmental and Social management plan
                                                                     (ESMP) for managing impacts. The ESMF sets
                                                                     forth basic social and environmental principles
                                                                     and prerogatives to be followed when details of
                                                                     the project are known during project
                                                                     implementation. It also includes a social and
                                                                     Environmental Screening Form (ESSF), alongside
                                                                     of its environmental and social check-list (ESCL),
                                                                     that will be applied on all subproject proposals to
                                                                     guide the application of any additional safeguards
                                                                     instruments. In addition, the ESMF includes a set
                                                                     of social and environmental clauses (ESC) to be
                                                                     embedded in all concessionaire and/or contractor
                                                                     contracts for compliance on safeguards during
                                                                     project implementation. Finally, the ESMF
                                                                     provides additional guidance on the adequate
                                                                     protection and management of Natural Habitats/
                                                                     Forests, as well as “Chance Finds” to be applied
                                                                     when such an encounter occurs. The ESMF was
                                                                     prepared and has been disclosed both in-country
                                                                     and at the InfoShop prior to project appraisal.
                         Natural Habitats OP/BP 4.04   Yes           The project activities will largely take place
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                                                                     within conservation areas of important natural
                                                                     habitats. The ESMF provides mitigation measures
                                                                     to ensure effective compliance with the policy
                                                                     requirements.
                         Forests OP/BP 4.36            Yes           Project activities may affect forest ecosystems
                                                                     within conservation areas, including their buffer
                                                                     zones. Additionally, livelihood activities might be
                                                                     developed to improve forest management in the
                                                                     buffer zones of the selected project's conservation
                                                                     areas. The ESMF provides mitigation measures to
                                                                     ensure effective compliance with the policy
                                                                     requirements.
                         Pest Management OP 4.09       Yes           The livelihood activities supported under the
                                                                     Component 4 could support agricultural sub-
                                                                     projects that may use minimal amounts of agro-
                                                                     chemicals. A PMP was prepared and consulted
                                                                     upon and has been publicly disclosed both in-
                                                                     country and at the InfoShop prior to appraisal.



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                            Physical Cultural Resources OP/     Yes              It is possible that the project will affect or involve
                            BP 4.11                                              physical cultural resources. The ESMF has made
                                                                                 some provision to use “Chance Finds” approaches
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                                                                                 to ensure adequate handling of such encounter
                                                                                 during project implementation.
                            Indigenous Peoples OP/BP 4.10       No               There are no Indigenous Peoples in the project
                                                                                 area.
                            Involuntary Resettlement OP/BP      Yes              MozBio is rated as a Category B project due to
                            4.12                                                 the site specific nature of its foreseen social and
                                                                                 environmental impacts. In limited cases, the
                                                                                 Project will fund activities leading to the
                                                                                 restriction of access for local communities (within
                                                                                 and/or neighboring) to wildlife resources in
                                                                                 national parks and/or in legally designated
                                                                                 protected areas in the targeted provinces/districts
                                                                                 of Mozambique, the policy is, therefore,
                                                                                 triggered. . The project does not involve land
                                                                                 acquisition leading to involuntary resettlement.

                                                                                 Consequently, as guided by the Bank involuntary
                                                                                 resettlement policy (OP/BP 4.12), Borrower has
                                                                                 prepared a Process Framework (PF) amply
                                                                                 consulted upon built-on the past TFCA
                                                                                 experience and international standards. The
                                                                                 document has been quality reviewed by the
                                                                                 project safeguards specialists and approved by the
                                                                                 Bank (RSA). The PF was prepared and has been
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                                                                                 publicly disclosed both in-country and at the
                                                                                 InfoShop before project appraisal.
                            Safety of Dams OP/BP 4.37           No               The project does not involve dams.

                            Projects on International        No                  N/A
                            Waterways OP/BP 7.50
                            Projects in Disputed Areas OP/BP No                  N/A
                            7.60

                         II. Key Safeguard Policy Issues and Their Management
                             A. Summary of Key Safeguard Issues
                            1. Describe any safeguard issues and impacts associated with the proposed project. Identify
                              and describe any potential large scale, significant and/or irreversible impacts:
                              MozBio is been rated as a Category B project due to the site specific nature of its foreseen social
                              and environmental impacts that are likely to be caused by the construction of facilities within the
                              Conservation areas as well as livelihood initiatives that the project will finance. The project will
                              finance no activity that may result in major land use changes or natural habitats transformation;
                              but rather avoid or mitigate, to the maximum possible, ongoing natural habitats transformation and
                              unplanned coastal land development. Strengthening the conservation areas of Mozambique could


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                          in the long run influence more positive infrastructure and private sector development in MozBio
                          prone zones. Without this project, development could lead to the expansion of tourism nodes,
                          population increase, and in-migration. These trends are already being observed in certain coastal
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                          areas. The challenge will be to ensure that the project induces positive change, and encourages
                          sustainable pro-poor and environmentally and socially friendly tourism.

                          MozBio triggered six social and environmental safeguards policies, namely: OP/BP 4.01-
                          Environment Assessment; largely because of small civil works in conservation areas; OP/BP 4.04
                          -Natural Habitats and OP/BP 4.36 - Forestry; because the project will intervene in sensitive natural
                          habitats, including forest and in coastal mangrove areas); OP4.09 - Pest Management since the
                          project intends to support livelihoods support activities which may include small-scale farming
                          that may require the minimal use of chemicals; OP/BP 4.11 – Physical Cultural Resources, as most
                          CAs have sites of archaeological importance and beautiful scenery that could be discovered and
                          negatively impacted in the absence of any tangible mitigation measure; and OP/BP 4.12 -
                          Involuntary Resettlement; because there are thousands of families still living inside the
                          conservation areas (i.e. Quirimbas national park : Over 200,000 people) and the project will limit
                          access to wildlife resources and other type of products/assets from communities which they are
                          still harvesting for livelihood sustainability purpose. The project does not involve land acquisition
                          leading to involuntary resettlement.

                           Compliance with the World Bank Safeguards policies and preparation of supportive safeguards
                           documents built on the positive experience of and lessons learnt from the previous project (TFCA).
                         2. Describe any potential indirect and/or long term impacts due to anticipated future activities
                           in the project area:
                           The physical interventions of MozBio Project could result in environmental and social impacts
                           that would be influenced by the sensitivity of the area (within or in the surroundings of the
                           conservation area). The likely environmental and social impacts could include:
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                          Environment issues: Soils erosion/pollution with solid wastes, pesticides, leakage or spill of
                          hazardous materials; Water resource pollution due to the discharge of fertilizers, nutrients,
                          different chemicals to be used for pest management, civil works, oil spills, etc.; Air quality
                          pollution by dust generated from the various construction/rehabilitation and project operations as
                          by pollutant (including greenhouse gases) emissions from vehicles, machinery (including diesel
                          generators); Noise pollution: generated from the various activities during civil works as well as
                          during some project operations; Vegetation clearance for construction/rehabilitation activities,
                          tourism and community development projects; Fauna and landscape disturbance during
                          construction and operation activities.

                          Social issues: Restriction to access to CAs: economic displacement of PAPs; employment
                          opportunities for local communities; Conflicts due to cultural disturbance by “foreigners” or
                          influx; Public health issues with increase spread of diseases (STI, HIV/AIDS, and waterborne
                          diseases; Public safety: accidents with vehicles/machinery and pedestrians, especially during
                          construction phase; Health & Safety of construction workers(inappropriate safety measures);
                          Cultural heritage disturbance (destruction or disturbance of cemeteries, sacred sites or sites with
                          archaeological, historical or aesthetic value); etc.

                          The ESMF includes lists of potential impacts and mitigation measures to be implemented for
                          infrastructure & construction works, agriculture, livestock, fisheries and tourism activities to be


                                                                     Page 11 of 15
                           reviewed during the subprojects conception in order to include specific mitigation measures in
                           planning and design phases to ensure environmental and social sound designs, as well as during
                           construction and operation phases to avoid or minimize to the maximum possible any adverse
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                           impacts.
                         3. Describe any project alternatives (if relevant) considered to help avoid or minimize adverse
                           impacts.
                           In March 2014, a new Conservation Law was approved by the Council of Ministers. This new
                           Law creates new categories of CAs that allows for the presence of human populations within
                           certain CAs, as long as their presence is not incompatible with their good management and
                           standing. The regulation of this Law will be drafted in the next year to determine the detailed
                           procedures and guidelines to work with local communities that live inside conservation areas.
                           MozBio will support this process and ensure that best international practices are adequately used
                           in drafting the regulation. Once the regulation and its Directive (implementation Guidelines) are
                           approved, the legal status of the Conservation Areas (strict conservation vs. sustainable use) is
                           expected to be revised once the management plans of the CAs are updated (in fact, all CAs have
                           participatory management plan). The presence of population within the CAs will be an important
                           element to be considered during the update of the management plans. At the end of the process,
                           the government will know if resettlement will be necessary in a few cases.

                           Given these circumstances, MozBio will finance no involuntary resettlement in the targeted
                           Conservation Areas. MozBio will be rather supporting participatory regazetting of conservation
                           areas, promoting conservation-friendly community development initiatives, by strengthening
                           community-based natural resources management organizations, promoting alternative livelihoods
                           (with due consideration to women, youth, elderly, handicaps and other vulnerable groups),
                           promoting public-private-community partnership around conservation-related business. This aims
                           to reduce the pressure from communities within and around conservation areas on these areas'
                           resources, and reduce potential conservation-livelihood sustainability conflicts.
                         4. Describe measures taken by the borrower to address safeguard policy issues. Provide an
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                           assessment of borrower capacity to plan and implement the measures described.
                           The TFCAU Unit has been implementing TFCA II for six years. This previous project is a
                           safeguard category B which triggered the Environmental Assessment (OP/BP 4.01), Natural
                           Habitats (OP/BP 4.04) and Involuntary Resettlement (OP/BP 4.12). These safeguards are
                           governed by the Environment and Social Management Framework (ESMF), a Process Framework
                           (PF) and a Resettlement Policy Framework (RPF) prepared in 2005. Under Phase II, all
                           construction contracts prepared ESIAs and site specific Environmental and Social Management
                           Plans (ESMP), following the Mozambique environmental legal requirements the ESMF as per
                           Bank’s safeguard policies. Some Sub-projects, for example tourism lodges and camps involve
                           minor constructions activities and required an ESIA. These have been prepared ESIA that have
                           been approved by MICOA before the construction is done.

                          The Bank has been supervising the quality of this work and has found it to be moderately
                          satisfactory. This Phase II project has been managing the environmental impacts of the
                          infrastructure projects in a moderately satisfactory manner and the government team was trained in
                          that regards. In the MozBio Phase 1 project, unlike in TFCA I and II, a team of Social and
                          Environmental Safeguards Specialists will be established within the Project Implementation Unit
                          within ANAC. The Safeguards Specialists, comprised of one Social Scientist and one
                          environmental Scientist will be hired/designated by MITUR/ANAC to focus on the tangible
                          implementation of Social (including gender, you and vulnerable groups dimensions) and

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                           Environmental recommendations of the safeguards instruments prepared by the borrower for
                           MozBio, namely ESMF, PMP and PF. In addition, the two Safeguards Specialists will work
                           directly with a Community Liaison Officer (CLO) on each CA who will ensure timely follow up
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                           with their respective communities. These CLOs will work locally with SDAE (Serviços Distritais
                           da Administracao Estatal – the District administration services which locally represent MICOA) at
                           the district level. The two Safeguards Specialists (including the CLOs) will be adequately trained
                           on World Bank Social and Environmental Safeguards policies, and will work in tandem with both
                           MICOA (for compliance with national regulations) and the World Bank safeguards specialists (for
                           compliance with Bank safeguards policies). After project launch, the Safeguards Specialists will
                           draw from the safeguards documents to elaborate a short Safeguards Action Plan (SAP) and a
                           Gender Action Plan (GAP) to underline actions to be taken to ensure safeguards and Gender
                           compliance of MozBio. Prior to any supervision mission, the Safeguards Specialists will elaborate
                           an executive summary of the status of safeguards implementation to be shared with Bank
                           safeguards team. These will be ground-truthed during field visits and consequently, as part of the
                           Aide memoire, a set of key recommendations will be given to the PIU/ Safeguards Specialists for
                           easy follow up thereafter. The same routine will be maintained and fostered throughout the project
                           lifecycle to ensure adequate safeguards compliance.

                           In compliance with the triggered safeguards policies, the Borrower has prepared and amply
                           consulted upon four corresponding safeguards instruments, namely the ESMF, PMP and PF. These
                           have been quality reviewed by the Bank social and environmental safeguards specialists and
                           approved by the regional safeguards advisor (RSA). All safeguards instruments have been publicly
                           disclosed both in-country and at the InfoShop prior to project appraisal.
                         5. Identify the key stakeholders and describe the mechanisms for consultation and disclosure
                           on safeguard policies, with an emphasis on potentially affected people.


                         B. Disclosure Requirements
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                         Environmental Assessment/Audit/Management Plan/Other
                           Date of receipt by the Bank                                       01-Aug-2014
                           Date of submission to InfoShop                                    15-Aug-2014
                           For category A projects, date of distributing the Executive
                           Summary of the EA to the Executive Directors
                         "In country" Disclosure

                           Comments:
                          Resettlement Action Plan/Framework/Policy Process
                           Date of receipt by the Bank                                       01-Aug-2014
                           Date of submission to InfoShop                                    15-Aug-2014
                         "In country" Disclosure

                          Comments:
                          Pest Management Plan
                          Was the document disclosed prior to appraisal?                     Yes
                          Date of receipt by the Bank                                        01-Aug-2014


                                                                    Page 13 of 15
                           Date of submission to InfoShop                                      15-Aug-2014
                         "In country" Disclosure
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                           Comments:
                         If the project triggers the Pest Management and/or Physical Cultural Resources policies, the
                         respective issues are to be addressed and disclosed as part of the Environmental Assessment/
                         Audit/or EMP.
                         If in-country disclosure of any of the above documents is not expected, please explain why:
                         N/A
                         C. Compliance Monitoring Indicators at the Corporate Level
                         OP/BP/GP 4.01 - Environment Assessment
                          Does the project require a stand-alone EA (including EMP)          Yes [   ]   No [   ]   NA [   ]
                          report?
                          If yes, then did the Regional Environment Unit or Practice         Yes [   ]   No [   ]   NA [   ]
                          Manager (PM) review and approve the EA report?
                          Are the cost and the accountabilities for the EMP incorporated     Yes [   ]   No [   ]   NA [   ]
                          in the credit/loan?
                         OP/BP 4.04 - Natural Habitats
                          Would the project result in any significant conversion or          Yes [   ]   No [   ]   NA [   ]
                          degradation of critical natural habitats?
                          If the project would result in significant conversion or           Yes [   ]   No [   ]   NA [   ]
                          degradation of other (non-critical) natural habitats, does the
                          project include mitigation measures acceptable to the Bank?
                         OP 4.09 - Pest Management
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                          Does the EA adequately address the pest management issues?         Yes [   ]   No [   ]   NA [   ]
                          Is a separate PMP required?                                        Yes [   ]   No [   ]   NA [   ]
                          If yes, has the PMP been reviewed and approved by a                Yes [   ]   No [   ]   NA [   ]
                          safeguards specialist or PM? Are PMP requirements included
                          in project design?If yes, does the project team include a Pest
                          Management Specialist?
                         OP/BP 4.11 - Physical Cultural Resources
                          Does the EA include adequate measures related to cultural          Yes [   ]   No [   ]   NA [   ]
                          property?
                          Does the credit/loan incorporate mechanisms to mitigate the        Yes [   ]   No [   ]   NA [   ]
                          potential adverse impacts on cultural property?
                         OP/BP 4.12 - Involuntary Resettlement
                          Has a resettlement plan/abbreviated plan/policy framework/         Yes [   ]   No [   ]   NA [   ]
                          process framework (as appropriate) been prepared?
                          If yes, then did the Regional unit responsible for safeguards or   Yes [   ]   No [   ]   NA [   ]
                          Practice Manager review the plan?
                         OP/BP 4.36 - Forests



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                             Has the sector-wide analysis of policy and institutional issues   Yes [    ]   No [   ]   NA [   ]
                             and constraints been carried out?
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                             Does the project design include satisfactory measures to          Yes [    ]   No [   ]   NA [   ]
                             overcome these constraints?
                             Does the project finance commercial harvesting, and if so,        Yes [    ]   No [   ]   NA [   ]
                             does it include provisions for certification system?
                            The World Bank Policy on Disclosure of Information
                             Have relevant safeguard policies documents been sent to the       Yes [    ]   No [   ]   NA [   ]
                             World Bank's Infoshop?
                             Have relevant documents been disclosed in-country in a public     Yes [    ]   No [   ]   NA [   ]
                             place in a form and language that are understandable and
                             accessible to project-affected groups and local NGOs?
                            All Safeguard Policies
                             Have satisfactory calendar, budget and clear institutional        Yes [    ]   No [   ]   NA [   ]
                             responsibilities been prepared for the implementation of
                             measures related to safeguard policies?
                             Have costs related to safeguard policy measures been included     Yes [    ]   No [   ]   NA [   ]
                             in the project cost?
                             Does the Monitoring and Evaluation system of the project          Yes [    ]   No [   ]   NA [   ]
                             include the monitoring of safeguard impacts and measures
                             related to safeguard policies?
                             Have satisfactory implementation arrangements been agreed         Yes [    ]   No [   ]   NA [   ]
                             with the borrower and the same been adequately reflected in
                             the project legal documents?
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                         III. APPROVALS
                            Task Team Leader: Name: Claudia Sobrevila
                            Approved By
                            Regional Safeguards Name:                                                  Date:
                            Advisor:
                            Practice Manager/   Name:                                                  Date:
                            Manager:




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