The World Bank Mainstreaming Sustainable Cattle Ranching (P104687) REPORT NO.: RES36448 DOCUMENT OF THE WORLD BANK RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF MAINSTREAMING SUSTAINABLE CATTLE RANCHING APPROVED ON MARCH 16, 2010 TO COLOMBIAN CATTLE RANCHING ASSOCIATION (FEDEGAN) AGRICULTURE LATIN AMERICA AND CARIBBEAN Regional Vice President: Axel van Trotsenburg Country Director: Ulrich Zachau Senior Global Practice Director: Juergen Voegele Practice Manager/Manager: Preeti S. Ahuja Task Team Leader: Luz Berania Diaz Rios The World Bank Mainstreaming Sustainable Cattle Ranching (P104687) I. BASIC DATA Product Information Project ID Financing Instrument P104687 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 16-Mar-2010 31-Jan-2020 Organizations Borrower Responsible Agency Colombian Cattle Ranching Association (FEDEGAN) Colombian Cattle Ranching Association (FEDEGAN) Project Development Objective (PDO) Original PDO The Project's Global Environment Objective is to promote the adoption of environment-friendly Silvopastoral Production Systems forcattle ranching in Colombia's Project areas, to improve natural resource management, enhance the provision of environmentalservices (biodiversity, land, carbon, and water), and raise the productivity in participating farms. Summary Status of Financing Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed TF-17041 05-Sep-2014 05-Sep-2014 05-Dec-2014 31-Jan-2020 20.70 18.34 2.36 TF-96465 06-Apr-2010 06-Apr-2010 02-Jul-2010 31-Jan-2018 7.00 7.00 0 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No The World Bank Mainstreaming Sustainable Cattle Ranching (P104687) I. SUMMARY OF PROJECT STATUS AND PROPOSED CHANGES The Colombia Mainstreaming Sustainable Cattle Ranching Project (P104687) has continued to display a strong performance. Progress towards achievement of PDO and Overall Implementation Progress (IP) have been consistently rated as Satisfactory in the last two Implementation Status and Results Reports (ISRs) . The US$7 million grant (TF096465) by the Global Environment Facility (GEF) has been fully disbursed and executed, and disbursement of the US$20.7 million grant (TF017041) by the UK Department of Business, Energy and Industrial Strategy (BEIS) has achieved 88.6 percent. The external auditing reports performed for both grants have been found acceptable to the Bank. The Project has no unresolved fiduciary, environmental, social or legal safeguard issues. An extension of the Project's closing date was approved by the Bank in January 2018, current closing date is January 31, 2020. This restructuring seeks to reallocate UK/BEIS grant (TF017041) proceeds among budget categories, to support expenses for payments to cattle ranchers for land used changes towards sustainable cattle ranching practices under the Natural Resource Payment Scheme (so called PES1-Biodiversity Scheme), as well as to cover for consultant services and operational expenses resulting from additional support to farmers during the Project's extension phase. The restructuring proposes to reallocate: US$276,808 to Category 1a (Contract Payments for Natural Resources PES); US$ 461,334 to Category 3 Consultants' Services; and US$59,146 to Category Operating Costs. The funds will be reallocated from deductions in the Categories: 1b Contract Payments for Carbon Sequestration PES (so called PES2- Carbon Scheme); Goods; and Non-consulting services & Training. The reallocated funds will cover the payments to farmers benefiting from PES1 Biodiversity Scheme, which has displayed very dynamic rates of land conversion, corresponding to 65 percent of the non-intensive silvopastoral systems implemented by the Project. On the other hand, the land conversion towards intensive silvopastoral systems suffered delays at the start which were aggravated by the impacts of climate events on established systems, therefore, expost payments to farmers under PES2-Carbon scheme (Category 1B Contracts PES2-Carbon) will be lower than expected. Furthermore, the two-year extension of the Project and a larger number of farmers engaged in the fourth call for beneficiary engagement has brought additional costs in the provision of technical assistance to farmers, including those associated with the hiring of regional teams. II. DETAILED CHANGES REALLOCATION BETWEEN DISBURSEMENT CATEGORIES Current Current Actuals + Proposed Disbursement % Ln/Cr/TF Expenditure Allocation Committed Allocation (Type Total) Category Current Proposed The World Bank Mainstreaming Sustainable Cattle Ranching (P104687) TF-17041- Contract Pymnt 001 Nat. Resources 833,192.00 685,096.71 1,110,000.00 100.00 100.00 Currency: PES USD Contract Pymnt Carbon Sequest. 612,000.00 0.00 248,140.00 100.00 100.00 PES Goods 2,445,461.00 1,931,204.85 2,304,924.00 100.00 100.00 Consultants' 9,622,336.00 6,761,694.48 10,083,670.00 100.00 100.00 Services NCS and TR 5,657,345.00 3,826,844.81 5,364,454.00 100.00 100.00 Operating Costs 1,529,666.00 1,195,019.89 1,588,812.00 100.00 100.00 Total 20,700,000.00 14,399,860.74 20,700,000.00