The World Bank Sustainable Land Management Project (P085621) REPORT NO.: RES27301 DOCUMENT OF THE WORLD BANK RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF SUSTAINABLE LAND MANAGEMENT PROJECT APPROVED ON JUNE 7, 2013 TO CHILEAN AGENCY FOR INTERNATIONAL COOPERATION (AGCI) ENVIRONMENT & NATURAL RESOURCES LATIN AMERICA AND CARIBBEAN Regional Vice President: Jorge Familiar Calderon Country Director: Alberto Rodriguez Senior Global Practice Director: Karin Erika Kemper Practice Manager/Manager: Paul Jonathan Martin Task Team Leader: Stavros Papageorgiou The World Bank Sustainable Land Management Project (P085621) ABBREVIATIONS AND ACRONYMS AGCI – Chilean Agency for International Cooperation CONAF- National Forestry Corporation CRI – Corporate Results Indicators ENCCRV – National Strategy on Climate Change and Vegetation Resources GEF – Global Environmental Facility INDAP – National Agricultural Development Institute MINAGRI – Ministry of Agriculture MTR – Mid-Term Review PIU – Project Implementation Unit REDD+ - Reduced Emissions from Deforestation and Forest Degradation SAG - Agriculture and Livestock Service SLM – Sustainable Land Management UCCSA – Climate Change and Environmental Services Unit (under CONAF) UNCCD- United Nations Convention to Combat Desertification UNFCCC – United Nations Framework Convention on Climate Change The World Bank Sustainable Land Management Project (P085621) BASIC DATA Product Information Project ID Financing Instrument P085621 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 07-Jun-2013 15-Aug-2019 Organizations Borrower Responsible Agency Chilean Agency for International Cooperation (AGCI) National Forestry Corporation (CONAF) Project Development Objective (PDO) Original PDO The project’s Global Environment Objective (GEO) is to develop a national framework for sustainable land management to combat landdegradation, mainstream biodiversity into national policies, and protect forest carbon assets. Summary Status of Financing Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed TF-15104 05-Nov-2013 09-Dec-2013 22-May-2014 15-Aug-2019 5.86 1.48 4.38 TF-55521 02-Sep-2005 02-Sep-2005 02-Sep-2005 31-Dec-2007 .28 .28 0 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No The World Bank Sustainable Land Management Project (P085621) I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING Overall Project Status. The Project experienced significant delays in start-up activities, affecting the pace of implementation and disbursements, particularly with regards to Component 2 – Sustainable Land Management Pilot Projects (representing more than 60% of total project financing). As a result, Progress towards Achievement of the Project Development Objective (PDO) and Overall Implementation Progress are rated Moderately Unsatisfactory (MU), turning this into an Actual Problem Project. The main reason for the delays in implementation is due to continuous changes in Project coordination during the beginning of the Project, leading to discontinuity in the structure of the Project Implementation Unit (PIU) and the technical approach among components. This was recognized by the National Forestry Corporation (CONAF, for its acronym in Spanish) in August 2016 when it took an important action consolidating project management under a single technical coordinator under the Head of the Climate Change and Environmental Services Unit (UCCSA, for its acronym in Spanish), which is in charge of the rest of the Bank’s forest sector portfolio in the country. The new management team of the PIU has conducted a review of the implementation strategy for all components with an emphasis on Component 2, and has developed detailed Implementation Plans for each Strategic Pilot Area based on in- depth planning exercises with CONAF’s regional offices, signaling their intention to launch the pilot activities in the regions before the end of 2017. Progress under the rest of the Project Components has been satisfactory. At the same time, there has been a lack of clarity with respect to the amount of Counterpart Funding available for the implementation of the Project Components, and in particular for Sustainable Landscape Management (SLM) activities under Component 2, which was set at an ambitiously high level during project preparation. This, together with the lag in project implementation, requires a revision of the Project’s targets in the Results Framework (specifically, PDO indicator 2 targeting 100,000 hectares of subprojects to be implemented, and related Intermediate indicators) and amount of Counterpart Funding available for the Project, to what can realistically be achieved during the remaining timeframe of implementation. To date (13 June 2017) only US$1.48 million (25%) of the US$5.86 million Grant has been disbursed, mainly due to the fact that the implementation of Subprojects under Component 2 has not been initiated. The new implementation strategy is expected to address this issue, and CONAF has confirmed that all resources will be used by the closing date and no extension is needed. Disbursement projections are being reviewed as part of the Restructuring based on the remaining timeframe of implementation, but no changes in the allocation of proceeds among Components has been requested. Upgrade of Progress toward PDO and overall Project Implementation will be considered following Restructuring and confirmation of progress with field implementation under Component 2. In this regard it is important to note that in their Mid-Term Review (MTR) the client has detailed how the National Strategy on Climate Change and Vegetation Resources (ENCCRV, for its acronym in Spanish) meets the PDO of developing a national framework for sustainable land management (as detailed below), although little progress has been made to date in meeting the target for the land area under sustainable land management practices, which is an outcome indicator. Table 1: History of Project Ratings in the Implementation Status & Results Report (ISR) The World Bank Sustainable Land Management Project (P085621) ISR 1 ISR 2 ISR 3 ISR 4 ISR5 ISR 6 ISR 7 Apr 12, Dec 1, Jun 23, Dec 18, Jun 30, Oct 27, Mar 13, 2014 2014 2015 2015 2016 2016 2017 Progress towards Achievement of PDO S S S MS MU MU MU Overall Implementation Progress (IP) S S S S MS MU MU Financial Management S S S MS S S S Project Management S S S MS MU MS MS Counterpart Funding S S S S S S MU Procurement S S S MS MS MS MS Monitoring and Evaluation S S S S MS S MS Rationale for restructuring. The main objective of the proposed restructuring is a scale down of the results targets for Component 2 and the level of Counterpart Funding available for the Project, due to the delay in implementation encountered and the fact that both were set at ambitious levels during project preparation. The new management under the PIU has revised the project targets with a focus on Component 2 (mainly number of hectares of subprojects and beneficiaries in the five pilot areas) and identified the mix of available silvo-agricultural and environmental instruments to be applied as Counterpart Funding under the ongoing operation through the development of detailed Implementation Plans in collaboration with its regional offices. As part of the proposed Restructuring, the Task Team has reviewed and updated the Results Framework indicators and targets accordingly and adjusted them to the remaining timeframe of project implementation and current level of Counterpart Funding, as well as the Project Financing Plan and Component Costs. No extension of the closing date is foreseen based on the updated disbursement projections provided by the client. The proposed restructuring also updates the project’s risk rating to better reflect its current status as an Actual Problem Project. The proposed changes do not affect the achievement of the project‘s PDO or Global Environment Objective (GEO), which is to develop a national framework for sustainable land management to combat land degradation, mainstream biodiversity into national policies, and protect forest carbon assets. CONAF, as the national focal point to the UNFCCC1 for REDD+2 and the UNCCD3, as well as the administrator of the country’s Natural Protected Areas System (SNASPE), has been developing the National Strategy for Climate Change and Vegetation Resources (ENCCRV) as an integrated framework for improving existing and developing new rural incentive programs in the agriculture and forest sector to tackle the issues of land degradation, climate change mitigation and adaptation, and biodiversity conservation in an integrated way. The client 1 United Nations Framework Convention on Climate Change 2 Reducing Emissions from deforestation and forest degradation 3 United Nations Convention to Combat Desertification The World Bank Sustainable Land Management Project (P085621) MTR report explains in detail how the ENCCRV meets the PDO in all its aspects (land degradation, biodiversity, and forest carbon) and can be counted as the National SLM framework. The Project is also still relevant under the strategic approach that the Bank is undertaking to support Chile’s forestry sector with a coordinated set of technical assistance, investment, and results-based operations. II. DESCRIPTION OF PROPOSED CHANGES This Restructuring Paper proposes to: (i) make modifications to the Results Framework to more realistically reflect anticipated project achievements (including the incorporation of Corporate Results Indicators); (ii) revise the Financing Plan and Component Costs to reflect updated estimates of Counterpart Funding that have a direct impact on Project results (GEF funding among components is not revised); (iii) update the Disbursement schedule to correct the lag in disbursements due to implementation delays under Component 2; and, (iv) update the Risk Assessment to reflect the Project’s current status as an Actual Problem Project. i) Results Framework. The PIU developed a new implementation strategy for each of the project components (detailed in the client MTR report), mainly for Component 2, based on detailed Implementation Plans for each Strategic Pilot Area. As a result, the target values of Component 2 have been adjusted to the remaining timeframe of project implementation and current level of Counterpart Funding, while qualitative indicators of other Components have been better defined to improve their measurability. Detailed changes are included in the following table. Original PDO Changes Original Revised Definition Baseline Current Target Rationale Indicator Definition Indicator 1: No change For purposes of No change. Data No Yes Yes The development Development of an the project, the source and of the National effective national National methodology: The Strategy for Climate framework to Framework for indicator will be Change and mitigate land Sustainable Land considered met when Vegetation degradation, which Management the National SLM Resources includes means the Framework is (ENCCRV, for its biodiversity interlinked presented to and acronyms in mainstreaming and elements, approved by the Spanish), launched protection of forest including national Ministerial Council on in November 2016 carbon assets. programs, which Sustainability. and approved by support the the Ministerial objective of Council on ameliorating land Sustainability, degradation counts as the and/or National desertification. Framework for The framework Sustainable Land would be flexible Management as it so as to add or jointly addresses remove elements the issues of land to improve its degradation and function and desertification, The World Bank Sustainable Land Management Project (P085621) efficiency over climate change time or changing mitigation (REDD+) conditions. and adaptation, while promoting biodiversity conservation. Indicator 2: Revised: Land Successful Successful piloting of 0 ha 0 ha 30,000 ha Revised wording of Reduced land area under piloting of a a demand driven SLM indicator and degradation in 5 sustainable collaborative SLM approach for definition to focus target areas landscape approach for reducing land on application of through the management reducing land degradation SLM practices at application of practices (CRI) degradation demonstrated on sites through a restoration and demonstrated on approx. 30,000 ha, demand-driven SLM. approx. 100,000 through individual approach and ha through sub-projects on adopting use of the individual sub- individual or Corporate Results projects in 5 pilot community Indicator (CRI). The areas. landholdings in 5 target value was pilot areas. adjusted based on a detailed assessment developed by Regional Technical Assistance Teams. Indicator 3: Revised: Land degradation Land degradation and No No Yes Revised wording of Improved capacity Improved and sustainable sustainable land indicator for clarity to monitor impacts capacity to land management management and more detail and results through monitor SLM at monitoring monitoring system is added to the the development of the national system is on line operational and definition to better a decision support level. and supporting supporting decision define system for effective decision making making at the policy measurability. A SLM monitoring and at the policy level. level through regular new intermediate early warning generation of indicator will be system for land monitoring reports. added for degradation. Data source and Component 3 to methodology: This capture the indicator will be development of an considered met when early warning the first monitoring system for land reports on land degradation as part degradation and of the overall climate change are monitoring system. made available and shared with relevant decision-making bodies. Indicator 4: No change Improved Improved capacity for No No Yes Revised definition Increased capacity for institutional to improve management and institutional mainstreaming of measurability and coordination mainstreaming of SLM along with focus on the capacity for SLM along with improving cross- operationalization mainstreaming SLM improving cross- sector coordination, of interinstitutional into the sector especially between SLM coordination institutional coordination, CONAF, SAG, INDAP, mechanisms. The architecture of the especially MMA and local Project has Ministry of between CONAF, governments. established a Agriculture. SAG, INDAP, Data source and National-level SLM The World Bank Sustainable Land Management Project (P085621) MMA and local methodology: This Advisory Group governments, as indicator will be (Resolution 1233; demonstrated considered met Dec 2014), while through applying through the the establishment SLM through establishment and of Regional SLM existing and new operation (i.e. at Management instruments and least biannual and Councils is in programs in documented progress. In eligible areas, meetings) of a addition, an Intra- designing and National SLM Ministerial implementing Advisory Group, Committee on programs and Regional SLM Climate Change has replicating project Management been established activities. Councils, and other and is operational interinstitutional within MINAGRI. coordination platforms. Intermediate Changes Original Revised Definition Baseline Current Target Rationale Indicators Definition Indicator 1.1: Revised: A detailed No change. Data No No Yes Minor change in Assessment of Assessment of assessment of source and wording and existing MAG and proposed existing MINAGRI methodology: This definition for instruments that adjustments to rural indicator will be clarity. The promote ecosystem existing and development considered met University of Chile restoration and future MAG programs, among through a report is under contract to future services for instruments others, in the providing the produce a detailed their use in SLM. (incentive context of their detailed assessment. assessment of programs) and potential for existing MINAGRI regulations that supporting SLM, instruments (SLM promote including their incentives ecosystem strengths and programs) with restoration and weaknesses, and recommendations protection for recommendations for reforms use in National for reforms. expected by June SLM framework. 2017. Indicator 1.2: Revised: Priority Classification of Classification of No Yes Yes Minor change in National-level areas identified geographic geographic locales wording and priority area for SLM locales nationwide for SLM definition for network for Framework. nationwide for purposes, based on clarity. CONAF has Framework SLM purposes, their land prepared a Land determined. based on their degradation status, Degradation vulnerabilities climate change Neutrality Report and potential. mitigation potential, which serves as a and biodiversity national baseline considerations. identifying priority Data source and areas affected by methodology: This land degradation, indicator will be desertification and considered met drought, at the through one or more municipal level maps identifying the under the UNCCD. proposed locales. It has also developed a Forest Reference Level under the UNFCCC which identifies the areas with the The World Bank Sustainable Land Management Project (P085621) highest climate change mitigation potential. Indicator 1.3: Revised: Development, Development and No No Yes Minor change in Eligibility criteria Eligibility criteria validation and validation of wording and established for SLM established for refined eligibility eligibility criteria for definition for activities to be activities to be criteria for participation in clarity. CONAF is funded through a implemented participation in activities to be elaborating a National under the SLM government- implemented under document Framework. Framework. supported the SLM Framework. specifying eligibility sustainable land Data source and criteria for management methodology: This beneficiary activities under indicator will be identification and the new considered met when selection for SLM framework the eligibility criteria activities under the approach. are approved y the ENCCRV. National SLM Advisory Group. Indicator 1.4: Indicator 1.4: Climate Change No change. Data No Yes Yes The prioritization Mainstreaming No change. mitigation and source and and eligibility Climate Change adaptation are methodology: This criteria for area Issues. incorporated into indicator will be identification and eligibility criteria considered met participation in SLM for SLM activities. through a clear activities under the reference to climate ENCCRV is based on change mitigation climate change and adaptation in the mitigation and eligibility criteria for adaptation criteria the National SLM (among others such framework. as land degradation and biodiversity). Indicator 1.5: Revised: Proposal for Proposal for revised No No Yes Revised wording Mainstreaming SLM Alignment of revised procedures of and definition of into Existing existing procedures for existing and future indicator to focus Instruments. instruments application to, MINAGRI instruments on alignment of with SLM and allocation of in line with the existing MINAGRI Framework. MINAGRI National SLM instruments and instruments for framework. approaches with SLM. Data source and SLM Framework. methodology: This The detailed indicator will be assessment of considered met existing MINAGRI through a report programs (under including the revised Indicator 1.1) will procedures. include a proposal for revised procedures for application to, and allocation of MINAGRI instruments for SLM activities under the ENCCRV. Indicator 2.1: Direct Revised target. Direct No change. Not a 0 0 1.573 The target value project beneficiaries are core indicator was revised based beneficiaries (core people or groups anymore. on a detailed indicator). who directly assessment The World Bank Sustainable Land Management Project (P085621) derive benefits developed by from an Regional Technical intervention. Assistance Teams. Please note that this indicator requires supplemental information. Supplemental Value: Female beneficiaries (percentage). Based on the assessment and definition of direct project beneficiaries, specify what proportion of the direct project beneficiaries are female. This indicator is calculated as a percentage. Indicator 2.2 No change. Based on the No change. Not a 0 0 25 The target value Female assessment and core indicator was maintained beneficiaries (%) definition of anymore. based on a detailed (core). direct project assessment beneficiaries, developed by specify what Regional Technical percentage of the Assistance Teams. beneficiaries are female. Indicator 2.3: No change. Strategic plans for No change 0 0 5 Indicator is on Strategic Plans for each of the five track. CONAF has SLM for Pilot Areas. strategic pilot developed a areas to promote template for the holistic and long- development of term land-use Strategic Plans for planning at the the five Pilot Areas landscape level, covering a total of over around 1.7 1.7 million ha. million ha total. The plans will identify priority locales for SLM interventions (or intervention areas), land capability for both productive and conservation concerns, as well as environmental considerations, such as The World Bank Sustainable Land Management Project (P085621) ecosystem connectivity, to promote a balanced and sustainable approach to rural development and land management. Indicator 2.4: Revised: Land degradation Land degradation No No Yes Minor change in Degraded Areas Degraded Areas characterized by characterized by class wording and Identified and Identified and class and type in and type in the definition to Categorized in 5 Categorized in the 5 strategic Strategic Plans for remove the Pilot Areas (at the Strategic Pilot pilot areas over a each Pilot Area numeric target Strategic Level). Areas. total area of covering a total area from the indicator. approx. 1.7 of approx. 1.7 million The Strategic Plans million ha. ha. will include a chapter identifying and characterizing degraded lands in the five Strategic Pilot Areas covering 1.7 million ha. Indicator 2.5: Land Dropped This indicator n/a 0 ha 0 ha 100,000 This indicator is a area where measures the ha duplication of PDO sustainable land land area that as Indicator 2, which mgt. practices were a result of the will be replaced by adopted as a result Bank project the corporate of project (core). incorporated results indicator and/or improved “Land area under sustainable land sustainable management landscape practices. This management indicator can practices”. track progress Therefore, it is toward removed. sustainability at farm scale and at landscape scales within agro- ecological zones, watersheds, or basins. The baseline value for this indicator is expected to be zero. n/a New: Indicator Number of farms 0 0 235 Farm-level plans 2.5: Number of that have are a key farm level plans developed a long- intervention developed in term farm-level strategy of the Strategic Pilot plan (at least 5 Project promoting Areas. years) in the an integrated and Strategic Pilot long-term plan at Areas, in line with the farm level the National SLM which aligns the The World Bank Sustainable Land Management Project (P085621) framework, as a required SLM result of the activities with project. existing MINAGRI instruments over the long term. Indicator 2.6: Dropped Outreach, n/a 0 0 60 Dropped as Producer training training, duplication of events on best demonstration Indicators 2.11- practices for SLM activities and 2.13. and biodiversity awareness mainstreaming. building to inform producers, communities and stakeholders about the project benefits and SLM techniques. Indicator 2.7: New Revised target. This indicator This indicator 0 ha 0 ha 12,600 ha Revised definition areas outside measures the measures the to improve protected areas number of number of terrestrial measurability. The managed as terrestrial hectares outside target value will be biodiversity-friendly hectares outside protected areas revised based on a (ha) (core). protected areas where, as a result of detailed where, as a result the World Bank assessment of the World Bank operation, the site is developed by operation, the managed at least in Regional Technical site is managed at part to obtain Assistance Teams. least in part to biodiversity gains. For obtain this project, it will biodiversity gains. measure the area of land outside of protected areas that is managed as part of a conservation corridor. Indicator 2.8: Revised target Tons of CO2e No change 0 tCO2e 0 tCO2e 1,087,131 No change. The Amount of tons of sequestered tCO2e target value was CO2e sequestered through project revised based on a through project investments in detailed investments over 5 the forest sector assessment years. as attributed to developed by afforestation, Regional Technical reforestation and Assistance Teams, improved and calculated management of through the FAO forests. Ex-Act tool. Indicator 2.9: Area Revised target This indicator No change 0 ha 0 ha 570 ha No change. The restored or measures the target value was re/afforested land area based on a detailed (corporate results targeted by the assessment indicator). Bank intervention developed by that has been Regional Technical restored or Assistance Teams. reforested/ afforested. The baseline value is expected to be The World Bank Sustainable Land Management Project (P085621) zero. Indicator 2.10: Revised target This indicator No change 0 ha 0 ha 7,530 ha No change. The Forest area brought measures the target value was under management forest land area, revised based on a plans (core). which, as a result detailed of Bank assessment investments, has developed by been brought Regional Technical under a Assistance Teams. management plan. This includes production and protection forests as well as other forests under sustainable management. The baseline value is expected to be zero. Indicator 2.11: Revised target This measures the No change 0 0 1.000 No change. The Forest users trained number of forest target value was (corporate results users and revised based on a indicator). community detailed members that assessment have received developed by capacity building Regional Technical through training Assistance Teams. as a result of the project. The baseline value is expected to be zero. Indicator 2.12: Revised target This measures the No change 0 0 250 No change. The Forest users trained number of female target value was – Female (core). forest users and revised based on a community detailed members that assessment have received developed by capacity building Regional Technical through training Assistance Teams. as a result of the project. This indicator captures a sub-group of indicator 2.7. Indicator 2.13: Revised target This measures the No change 0 0 300 No change. The Forest users trained number of ethnic target value was - Ethnic minority and revised based on a minority/indigenous indigenous forest detailed people (core). users and assessment community developed by members that Regional Technical have received Assistance Teams. capacity building through training as a result of the The World Bank Sustainable Land Management Project (P085621) project. This indicator captures a sub-group of indicator 2.7. Indicator 3.1: Revised: Design of a Design and establish No No Yes Revised wording National monitoring National system to (i) a monitoring system and definition of system for SLM monitoring identify to measure progress indicator for clarity designed. system for SLM environmental with the National and improved designed and conditions which SLM Framework, by measurability. The operational. could lead to land identifying and methodologies degradation and quantifying advances developed by desertification in land degradation CONAF for the Land (and scenario and desertification at Degradation modeling), (ii) the national level. Neutrality under identify and Data source and the UNCCD and the quantify advances methodology: The ongoing in degradation system will be improvements and considered incorporated in desertification, operational once a related monitoring and (iii) measure monitoring report for systems with the impacts of the National SLM ENCCRV provide mitigation efforts framework is the elements for from the SLM generated. meeting the revised activities. indicator definition. New: Indicator n/a Design and establish No No Yes New indicator, as a 3.2 Early an early warning result of revised warning system system to identify PDO indicator 3. for land environmental degradation conditions which designed and could lead to land operational. degradation and desertification. Data source and methodology: The system will be considered operational once a monitoring report is generated for the Strategic Pilot Areas. Indicator 4.1: SLM Revised: Training events No change 0 0 60 Revised wording to Training Training (national, regional reflect target provided to and local audience and national, agencies) to purpose (to regional and promote inter- promote inter- local agencies to sectoral sectoral promote inter- coordination coordination). sectoral needed for SLM coordination on and biodiversity SLM mainstreaming. implementation. Indicator 4.2: No change Curriculum No change. Data No No Yes Indicator is on University-level development and source and track. CONAF has course on SLM and teaching a methodology: The contracted biodiversity university-level course is completed University Mayor to mainstreaming course on SLM for and the learning carry out a Masters The World Bank Sustainable Land Management Project (P085621) developed and professionals and outcomes have been course on Climate taught. technicians. validated through Change and Native participant Vegetation which certifications issued includes a SLM by a higher education module. institution. Indicator 4.3: Public Revised: Annual Annual public No change. Data No No Yes Revised wording of outreach program. public outreach outreach program source and the indicator and program. for SLM and methodology: definition to focus biodiversity Development of a on the frequency mainstreaming multi-annual public (annual) of the underway outreach program public outreach through media, which will be program. CONAF is fairs, and public monitored through currently carrying training events project out a series of during each year implementation. public outreach and of project. communication activities related to the ENCCRV which will be systematized in an Outreach Program document. ii) Counterpart Funding. During project preparation a large amount of Government support was anticipated as Counterpart Funding for the implementation of the project, at a ratio of 9:1 (Total Project Cost: US$63,863,636; of which US$58,000,000 Counterpart Funding; and US$5,863,636 GEF). However, this amount was set at overly ambitious level. As part of the restructuring, the PIU has developed a revised detailed assessment of the level of Counterpart Funding for each Project Component for the remaining timeframe of implementation. The detailed assessment is included in the client MTR report, while a summary is provided in the following table. GEF financing Counterpart funding TOTAL Project Components US$ % US$ % US$ 1. National Sustainable Land Management Framework 469.221 15% 2,764,409 85% 3,233,630 2. SLM Pilot Projects 3.912.015 36% 7,084,890 64% 10,996,905 3. SLM Monitoring and Evaluation System 541.600 10% 4,968,547 90% 5,510,197 4. Institutional Capacity Building 463.000 33% 931,821 67% 1,394,821 5. Project Management 477.800 26% 1,356,424 74% 1,834,224 Total costs 5.863.636 25.5 17,106,092 74.5 22,969,728 The World Bank Sustainable Land Management Project (P085621) iii) Disbursement Projections. Disbursement projections have also been updated and adjusted to the remaining timeframe of project implementation (see table at the end of the Restructuring Paper). No reallocation of proceeds or extension of the closing date has been requested. iv) Risk Assessment. As part of the restructuring, the Project’s risk rating has been revised upwards to better reflect the projects status as an Actual Problem Project. The following table provides the updated SORT risk ratings compared to the latest ISR, while changes are explained further below. SYSTEMATIC OPERATIONS RISK-RATING TOOL (SORT) Risk Category Last ISR Current Rating Political and Governance Low Substantial Macroeconomic Low Low Sector Strategies and Policies Low Moderate Technical Design of Project or Program Low Low Institutional Capacity for Implementation and Sustainability Low Substantial Fiduciary Low Low Environment and Social Moderate Moderate Stakeholders Low Low Other n/a n/a Overall Low Substantial  Political and Governance: Low to Substantial. The increase in the risk rating is based on the reduced level of counterpart funding available for the project, indicating a potentially decreased political commitment to the development objectives of the operation after several administrations (project preparation started in 2008), which could also undermine the political decisions required for successful implementation (including any possible regulatory adjustments, and allocation of financial resources). This risk is mitigated by a detailed assessment of the actual level of counterpart funding available to the project for the remaining timeframe of implementation (incorporated though the proposed restructuring), and will be closely monitored during supervision missions.  Sector Strategies and Policies: Low to Moderate. The increase in risk rating is based on the high degree of inter- sectoral coordination needed for achieving the development results of the operation (sustainable land management). While the project is managed by CONAF, the contribution of other agencies of the Ministry of Agriculture (MINAGRI) which are much bigger and stronger in the sector (such as the Agriculture and Livestock Service -SAG, for its acronym in Spanish- and the National Agricultural Development Institute -INDAP, for its acronym in Spanish) is critical for the successful implementation and sustainability of the project. This risk will be mitigated by strengthening the inter-sectoral coordination mechanisms established by the project, such as the National SLM Advisory Group and the Regional SLM Committees. The World Bank Sustainable Land Management Project (P085621)  Institutional Capacity for Implementation and Sustainability: Low to Substantial. The increase in risk rating is based on the implementation delays that the project has faced thus far, particularly with regards to Component 2, which were mainly due to the constant change in overall management responsibilities among institutions and within CONAF. The project’s implementation arrangements are further complicated by the need to establish strong coordination mechanisms with the regional teams which are responsible for implementing the SLM subprojects. This risk is mitigated by assigning management responsibility to a single unit within CONAF (i.e. the Climate Change and Environmental Services Unit – UCCSA), which has also delegated the subproject implementation planning process to the regional offices, strengthening their ownership of the project.  Overall: Low to Substantial. The overall project risk rating is increased to substantial to incorporate the updated assessment of the previous risk categories and to reflect its current status as an Actual Problem project. III. SUMMARY OF CHANGES Changed Not Changed Change in Results Framework ✔ Change in Components and Cost ✔ Change in Disbursement Estimates ✔ Change in Systematic Operations Risk-Rating Tool ✔ (SORT) Change in Implementing Agency ✔ Change in Project's Development Objectives ✔ Change in Loan Closing Date(s) ✔ Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Change in Disbursements Arrangements ✔ Change in Safeguard Policies Triggered ✔ Change of EA category ✔ Change in Legal Covenants ✔ Change in Institutional Arrangements ✔ Change in Financial Management ✔ Change in Procurement ✔ The World Bank Sustainable Land Management Project (P085621) Change in Implementation Schedule ✔ Other Change(s) ✔ Change in Economic and Financial Analysis ✔ Change in Technical Analysis ✔ Change in Social Analysis ✔ Change in Environmental Analysis ✔ IV. DETAILED CHANGE(S) RESULTS FRAMEWORK Intermediate Indicators IO_IND_TABLE Assessment of and proposed adjustments to existing and future MAG instruments (incentive programs) and regulations that promote ecosystem restoration and protection for use in National SLM framework. Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Valu No No Yes Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Priority areas identified for SLM Framework. Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Valu No Yes Yes Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Eligibility criteria established for activities to be implemented under the SLM Framework. Unit of Measure: Yes/No Indicator Type: Custom The World Bank Sustainable Land Management Project (P085621) Baseline Actual (Current) End Target Action Valu No No Yes Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Mainstreaming Climate Change Issues Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Valu No Yes Yes No Change e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Alignment of existing instruments with SLM Framework. Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Valu No Yes Yes Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Direct project beneficiaries Unit of Measure: Number Indicator Type: Custom Baseline Actual (Current) End Target Action Valu 0.00 0.00 1573.00 Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Female beneficiaries Unit of Measure: Percentage Indicator Type: Custom Supplement Baseline Actual (Current) End Target Action Value 0.00 0.00 25.00 No Change The World Bank Sustainable Land Management Project (P085621) Strategic Plans for SLM for Pilot Areas Unit of Measure: Number Indicator Type: Custom Baseline Actual (Current) End Target Action Valu 0.00 0.00 5.00 No Change e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Degraded Areas Identified and Categorized in Strategic Pilot Areas. Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Valu No No Yes Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Land area under sustainable landscape management practices Unit of Measure: Hectare(Ha) Indicator Type: Corporate Baseline Actual (Current) End Target Action Valu 0.00 0.00 100000.00 Marked for Deletion e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Producer training events on best practices for SLM and biodiversity mainstreaming Unit of Measure: Number Indicator Type: Custom Baseline Actual (Current) End Target Action Valu 0.00 0.00 60.00 Marked for Deletion e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 New areas outside protected areas managed as biodiversity-friendly (ha) Unit of Measure: Number Indicator Type: Custom The World Bank Sustainable Land Management Project (P085621) Baseline Actual (Current) End Target Action Valu 0.00 0.00 12600.00 Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Amount of tons of CO2e sequestered through project investments over 5 years Unit of Measure: Number Indicator Type: Custom Baseline Actual (Current) End Target Action Valu 0.00 0.00 1087131.00 Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Area restored or re/afforested Unit of Measure: Hectare(Ha) Indicator Type: Custom Baseline Actual (Current) End Target Action Valu 0.00 0.00 570.00 Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Area re/afforested Unit of Measure: Hectare(Ha) Indicator Type: Custom Breakdown Baseline Actual (Current) End Target Action Value 0.00 0.00 3464.00 Marked for Deletion Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Forest area brought under management plans Unit of Measure: Hectare(Ha) Indicator Type: Corporate Baseline Actual (Current) End Target Action Valu 0.00 0.00 7530.00 Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 The World Bank Sustainable Land Management Project (P085621) Forest users trained Unit of Measure: Number Indicator Type: Custom Baseline Actual (Current) End Target Action Valu 0.00 0.00 1000.00 Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Forest users trained - Female Unit of Measure: Number Indicator Type: Custom Breakdown Baseline Actual (Current) End Target Action Value 0.00 0.00 250.00 Revised Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Forest users trained - Ethnic minority/indigenous people Unit of Measure: Number Indicator Type: Custom Breakdown Baseline Actual (Current) End Target Action Value 0.00 0.00 300.00 Revised Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 National monitoring system for SLM designed and operational. Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Valu No No Yes Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Training provided to national, regional and local agencies to promote inter-sectoral coordination on SLM implementation. Unit of Measure: Number Indicator Type: Custom The World Bank Sustainable Land Management Project (P085621) Baseline Actual (Current) End Target Action Valu 0.00 0.00 60.00 Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 University-level course on SLM and biodiversity mainstreaming developed and taught Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Valu No No Yes No Change e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Annual public outreach program. Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Valu No No Yes Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Early warning system for land degradation designed and operational. Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Valu No No Yes New e Date 09-Dec-2013 22-Sep-2016 15-Aug-2019 Number of farm level plans developed in Strategic Pilto Areas. Unit of Measure: Number Indicator Type: Custom Baseline Actual (Current) End Target Action Valu 0.00 0.00 235.00 New e Date 09-Dec-2013 22-Sep-2016 19-Aug-2019 The World Bank Sustainable Land Management Project (P085621) Global Environment Objective Indicators GEO_IND_TABLE Development of an effective national framework to mitigate land degradation, which includes biodiversity mainstreaming and protection of forest carbon assets. Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Valu No Yes Yes No Change e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Land area under sustainable landscape management practices Unit of Measure: Hectare(Ha) Indicator Type: Custom Baseline Actual (Current) End Target Action Valu 0.00 0.00 30000.00 Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Improved capacity to monitor SLM at the national level. Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Valu No No Yes Revised e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 Increased management and coordination capacity for mainstreaming SLM into the institutional architecture of the Ministry of Agriculture. Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Valu No Yes Yes No Change e Date 09-Dec-2013 03-Feb-2017 15-Aug-2019 The World Bank Sustainable Land Management Project (P085621) COMPONENTS Current Proposed Current Proposed Cost Action Cost Component Name Component Name (US$M) (US$M) National Sustainable Land National Sustainable Land 4.80 Revised 3.23 Management Framework Management Framework SLM Pilot Projects 38.90 Revised SLM Pilot Projects 10.99 SLM Monitoring and Evaluation SLM Monitoring and Evaluation 9.60 Revised 5.51 System System Institutional Capacity Building 5.40 Revised Institutional Capacity Building 1.40 Project Management 4.90 Revised Project Management 1.83 TOTAL 63.60 22.96 DISBURSEMENT ESTIMATES Change in Disbursement Estimates Yes Year Current Proposed 2006 0 0 2007 0 0 2008 0 0 2009 0 0 2010 0 0 2011 0 0 2012 0 0 2013 0 0 2014 0 0 2015 1050000.00 500000.00 2016 1300000.00 294209.90 2017 1300000.00 689365.16 2018 1390000.00 2815961.50 2019 820000.00 1550752.65 The World Bank Sustainable Land Management Project (P085621) 2020 0 13346.79 SYSTEMATIC OPERATIONS RISK-RATING TOOL (SORT) Risk Category Rating at Approval Current Rating Political and Governance  Substantial Macroeconomic  Low Sector Strategies and Policies  Moderate Technical Design of Project or Program  Low Institutional Capacity for Implementation and  Substantial Sustainability Fiduciary  Low Environment and Social  Moderate Stakeholders  Low Other Overall  Substantial