Republic of Armenia


Nov 9, 2013 (4 years and 8 months ago)





1. Country:
Republic of Armenia

2. Focal Area:
Biological Diversity

3. Operational Program:
OP#3 Forest Ecosystems and OP#4 Mountain Ecosystems

4. Project Title:
Natural Resources Management and Poverty


5. Total Cost:
US$ 17 Million (IDA/GEF)

6. PDF Request:

7. In
kind contributions:
US$ 14,000 Government,
US$ 65,000 (PHRD grant, effective/ EU

8. Requesting Agency: The World Bank

9. Executing Agency:
ent of Armenia;

Implemented by the Ministry of Nature Protection

10. Duration:
16 months (November 2000 to December 2001)



Project objectives

The project development objective is to improve management of the natura
l resource base in (soil,
water, forest, fishery, and biodiversity) that would enhance sustainable economic growth of poor
rural communities located in priority watersheds. In particular, the project will: (a)
develop and
implement participatory micro
ershed management plans in selected local communities; (b)
support implementation of on
site technical packages that would promote conservation of
biodiversity and natural resources while generating also economic benefits to local communities (i.e.
d farming practices, pasture management systems, and reforestation); and (c) strengthen the
capacity of local institutions responsible for natural resources management and moderate conflicts
between various resources users.

The global development objecti
ve of the project is to conserve ecosystems of global biodiversity
significance through involvement of local communities, in partnership with state and local
governments. The project will take an
integrated ecosystem management approach to preserve
ersity resources with global significance, while supporting local economic development and
environmental management goals.

Global significance

The project has the potential to address local and global environmental issues such as land
, protection/conservation of plant and animal biodiversity and improving carbon
sequestration by providing support for (i) establishment of diversified traditional and alternative land
use systems to enhance sustainability; (ii) development of integrated r
ange land production and
grazing management; (iii) development of alternative fodder sources, and (iv) in situ conservation of
flora and fauna population in the project area. Improvement/rehabilitation of vegetation cover
including forests and conservation

of biodiversity shall be achieved through direct involvement of
local population and local stakeholders

The project provides a comprehensive response to national biodiversity and ecosystem conservation
priorities through measures for sustainable use of
biological and natural resources. Besides multiple
environmental benefits the project is expected to generate short
term economic benefits which would
maintain the interest of local communities to continue with sustainable natural resources management
ivities even after the end of the project. Through targeting important national biodiversity
conservation goals the project will generate global benefits extending to recovery of forest and
mountain steppe habitats, protection of endemic flora and fauna.

The project will contribute to more
effective regional collaboration towards conserving biological resources in the Lesser Caucasus. It is
expected that in the long run the resource management approaches could be replicated beyond the
targeted districts
on a national scale using the implementation experience accumulated during the
project, contributing thus to larger scale conservation of biodiversity resources.


Armenia is situated in the meeting zone of the Caucasian, Iranian and Medite
rranean flora and fauna
regions and has a territory of 29,000 sq. km which contains extremely diverse natural landscapes and
ecosystems. It is a mountainous country with only 28 percent of land area located below 1,500 m
elevation. Armenia’s habitats con
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Some of the threatened vertebrates include mouflon

(Ovis orientalis gmelinii
wild goat (
, marbled polecat (
Vormela peregusna),
European otter (
Lutra lutra),
brown bear

manul (
Felis manul),
ammergeier (
Gypaetus barbatus
), imperial eagle (
Aquila heliaca
great bustard (
Otis tarda
), little bustard (
Tetrax tetrax
), and Caucasian black grouse (
). Large portion of endemic plant and animal species are available only in this land as
genetic resources
The territory of Armenia is also located in the crossways of migratory ways of

The project area will include a variety of mountain, forest, meadows and steppe ecosystems in
Gegharkunik and Tavoush districts, which host a significant share of the country’s biodiversity
resources. Specifically, forests in these districts have sig
nificant role in fauna conservation and for
creation of transboundary wildlife corridor between Armenia and Georgia. Two main protected areas
in the geographic area of the project are the Sevan National Park (1,500 and Dilijan State
Preserve (290 s Specifically, Lake Sevan National Park harbors unique alpine lake ecosystem
and its littoral habitats. Dilijan National Reserve is a unique forest ecosystem preserving many
endangered species in southern Caucasus which are dependent on broad
d forests for their
existence. In addition the area is rich for its cultural heritage amenities, which together with unique
ecosystems carries significant potential for developing eco

and natural heritage tourism. Currently
these protected areas are aff
ected by pressure from illegal economic activities. The proposed project
for the first time provides resources and technical assistance backed up by strong Government
commitment to address in an integrated manner issues like weak institutional capacity, l
ack of
enforcement and inefficient management in the two protected areas.

Main Sector Issues
. Environmentally sustainable development will become one of the main
challenges in the years to come when Armenia struggles to find its way out from the economic

In Gegkarkunik and Tavoush districts economic difficulties during the past decade have exacerbated
unsustainable use of land resources as a result of natural soil erosion, lack of rotation and generally
poor farming practices. Currently more tha
n half of the arable land in the project area is moderately
to severely eroded. Overgrazing is a serious issue in the project areas, which has caused significant
changes in both vegetation and species composition in steppe and meadow ecosystems. Illegal
cutting in forests for timber and fuelwood on steep slopes has accelerated soil erosion process, which
causes negative environmental impacts both locally and in downstream areas. Altogether some 10%
of the forest cover has been lost since the beginning of

transition. Pressures on the environment and
biodiversity resources are expected to increase as gradual degradation of rural infrastructure (i.e.
irrigation systems, rural roads, energy supply) and decreasing purchasing power of rural population,
d with recent natural disasters (i.e. drought) may further increase pressures on marginal
lands and forests.

Root Causes
. The main root causes of biodiversity loss are closely related to overall economic crisis
since the beginning of transition which h
as increased the number of people who depend on utilization
of natural resources for their livelihoods. In addition, natural resource degradation is closely linked
to prevailing poverty levels. This is especially the case of protected areas in Gegharkhun
ik and
Tavoush where root causes for biodiversity losses are grazing pressure and poaching of resources by
the population which is largely involved in subsistence agriculture. Other root causes of
environmental degradation are related to: (i) lack of inte
rsectoral coordination and participatory
approach in natural resource use; (ii) weak institutional and enforcement capacity of regulatory
agencies; (iii) limited access to financial resources and technical advice needed for more sustainable
management of a
rable and pasture lands; (iv) lack of alternative income generating activities in rural
areas; and (v) lack of public awareness of sustainable management of natural and biodiversity

Approach to Address Issues.

The project will address these is
sues and root causes of degradation of
natural resources by pursuing conservation of biodiversity through development of integrated
ecosystem management approaches at the local micro
catchment levels with direct involvement of
local communities. It will p
rovide opportunity to test new innovative mechanisms to encourage local
government and community support for biodiversity conservation through developing appropriate
economic incentives for sustainable use of natural resources. Coordination of project act
ivities with
going World Bank projects in Armenia, and activities carried out by other donors (UNDP Agri
biodiversity Conservation Project) allows to take a broader approach to address crosscutting issues
such as mitigation of rural poverty, lack of int
sectoral cooperation and public awareness.
Development of participatory, community based institutions and project management mechanisms
will be key elements of the project. The design of the project has evolved as a natural outcome of the
National Env
ironmental Action Plan (NEAP) and National Biodiversity Strategy and Action Plan and
aims to provide support to following up on the government commitment for protecting biodiversity
and improve rural living standards through promoting sustainable managemen
t of natural resources.

Project Description and Components


Project Description.

The project will offer new opportunities for poverty reduction in rural areas by supporting sustainable
productive activities targeted to reduce pressures on e
nvironmentally sensitive areas and productive
natural resource base in selected watersheds. As such, the project is expected to contribute to raising
local incomes by introducing sustainable agriculture practices, while protecting globally and
important biodiversity resources, nature and cultural heritage values. The project will
support the cooperative efforts of affected communities and authorities in Tavoush and Gegkarkunik
districts to integrate new knowledge into their routine management p
ractices and will lead them how
to apply ecosystem management concepts in specific field situations

B. Preparation Approach and Components
. The project will take an ecosystem approach to natural
resources management where conservation activities will beco
me an integral part of the management
of specific natural resources. The project is being conceived as highly participatory, both in design
and execution. Participation of both beneficiaries and implementing institutions is expected to
engage them in a d
ialogue, which will synthesize user group’s interest and environmental concerns.
Participation will result in heightened sense of local ownership and appreciation of nature assets,
which is necessary and logical prerequisite for implementation of conserva
tion activities whose
benefits are beyond local interest. Participation framework that defines broad development interests
of communities will assist to develop and measures at relatively low overall cost. Specifically, the
project will build the local c
apacity to absorb the project investments. Project components include:

(a) Participatory watershed management US$ 7.0 mill (IDA/GEF).

This component will finance
improved social and technical approaches of natural resources management in selected micro

catchment areas. Investments will be provided to implement
technical packages that would increase
the productivity of farmlands, control soil erosion and stop the degradation of pasturelands.
and technical assistance would be provided on partici
patory planning, multi
level consensus building
and technical aspects for sustainable management of natural resources
before technical packages
were implemented at the farm level.

At the community level, emphasis will be given to strengthen
those key area
s needed to effectivel y implement the project

dispute resolution over the use of
natural resources, participatory planning and decision

(b) Forest management US$ 4.5 mill (IDA/GEF).
The component will provide direct payments or
kind compensati
on (seeds, fertilizers, rehabilitation of infrastructure etc.) for local communities
and individual households for undertaking reforestation activities as agreed in the work programs.
Sustainable economic growth would be stimulated by arranging of mid

arrangements with rural households and transferring of responsibility for implementation of agreed
works (e.g. responsibility for rehabilitation/ planting for x hectares and years). Regional and local
administrations will play an important rol
e in the selection of pilot areas and in organizing the
implementation of agreed work programs. In addition the project would cover the cost of necessary
international and local experts who would assist in the implementation of the activities and training

activities; purchase of necessary equipment for the implementation of the planned activities; and
expenses related to the training courses for selected forestry personnel. In addition the project would
provide assistance in the development of National Fo
rest Program (NFP) and strengthening of State
Forest Administration.

(c) Protected area management and biodiversity conservation US$ 4.5(IDA/GEF).

T h i s
c o m p o n e n t w i l l s u p p o r t o n
s i t e p r o t e c t e d a r e a m a n a g e m e n t w i t h g l o b a l e n v i r o n m e n t a l s i g n i f i c a n c e
t h r o u g
h t a k i n g a n e c o s y s t e m a p p r o a c h t o p r o m o t e b i o d i v e r s i t y c o n s e r v a t i o n a t t h e w a t e r s h e d l e v e l.
S p e c i f i c a l l y, t h e c o m p o n e n t w o u l d s u p p o r t s
t r e n g t h e n i n g o f t h e m a n a g e m e n t o f L a k e S e v a n N a t i o n a l
P a r k a n d D i l i j a n S t a t e R e s e r v e. T h e a c t i v i t i e s w i l l i n c l u d e t h e i
n v e n t o r y o f b i o d i v e r s i t y r e s o u r c e s
a n d h a b i t a t s; d e v e l o p m e n t o f m a n a g e m e n t p l a n s a n d l a n d u s e z o n i n g; t r a i n i n g f o r p a r k s t a f f;
f i n a n c i n g o f b a s i c m o n i t o r i n g e q u i p m e n t; a n d i m p r o v e m e n t o f b a s i c n a t u r e t o u r i s m i n f r a s t r u c t u r e
( i.e. h i k i n g t r a i l s, v i s i t o r c e n t
e r s, a n d i n f o r m a t i o n b o a r d s ).
I n a d d i t i o n, t
h e p r o j e c t w o u l d f i n a n c e
m e c h a n i s m s f o r a d o p t i o n o f b i o d i v e r s i t y c o n s e r v a t i o n a n d s u s t a i n a b l e u s e p r i n c i p l e s a d a p t e d t o l o c a l
e x p e r i e n c e a n d d e v e l o p i n c e n t i v e s c h e m e s t o u s e t r a d i t i o n a l v a r i e t i e s b y t h e l o c a l c o
m m u n i t i e s. T h e
p r o j e c t w o u l d p r o v i d e b o t h t r a i n i n g a n d t e c h n i c a l a s s i s t a n c e a c t i v i t i e s a s w e l l a s f u n d s f o r p i l o t
p r o j e c t s t o d e m o n s t r a t e t r a d i t i o n a l a p p r o a c h e s t o b i o d i v e r s i t y u s e.

( d ) P r o j e c t c o o r d i n a t i o n a n d m a n a g e m e n t U S $ 1.0 m i l l. ( I D A ).

Thi s comp
onent woul d
f i nance t echni cal assi st ance t o devel op pr oj ect management and f i nanci al management
capaci t y, and woul d f und f i nanci al ser vi ces, t r ai ni ng, vehi cl es, equi pment, and oper at i ng cost s
of a Pr oj ect Impl ement at i on Cor e Uni t wi t hi n t he Mi ni st r y of Nat
ur e Pr ot ect i on and i t s l ocal
t echni cal suppor t uni t s i n t he t wo l ocat i ons.

Fi nanci ng

The Government recognizes the significance of environmental problems in Armenia but
they are not considered a national priority for public expenditure. The project is
designed as a fully
blended IDA/GEF investment operation and the whole project is expected to generate increased
income overtime. GEF grant financing is sought to finance the initial incremental cost for promoting
integrated ecosystem management and is ex
pected to yield multiple environmental benefits. During
preparation project
financing arrangement would aim at fair cost and risk sharing to reflect the
expected local and global environmental gains.

The requested technical assistance will facilitate

and possibly leverage donor partnership financing
for specific conservation activities. Without international support Armenia ecosystems will continue
to suffer from habitat change and destruction, over use of biological resources, land degradation and
oil erosion, unsustainable timber and fuel wood harvesting.

Implementation Arrangements.

The proposed project will be implemented over a period of five
years. The
Ministry of Nature Protection would be responsible for project oversight and
on the project activities in coordination with the Ministry of Agriculture and other
stakeholder agencies and beneficiary groups. Forest management and protected areas activities
will be the responsibility of the Department of Forestry (Hyantar) and the D
epartment of
Protected Areas, respectively within the MoNP. The project would develop mechanisms to
strengthen cooperation among all relevant central and local Government structures to ensure
effective implementation of activities at the local level. Par
tnerships between NGOs, research
organizations and communities groups would be used in planning and implementation of
level activities. The implementation of the project will build on NGO experience and
existing community arrangements.

A Proje
ct Implementation Core Unit located in the Ministry of Nature Protection and its local
technical/implementation units would supervise and provide technical advice for the implementation
of the project. In order to facilitate preparation, institutional coo
rdination and decision
making for
project preparation activities Project Preparation Unit (PPU) and the Project Preparation Steering
Committee (PPSC) have been established. The PPSC is a consultative body which membership
includes representatives of relev
ant sectoral ministries and regional authorities. It is expected that the
PPSC will consult with local research institutes and NGOs as appropriate.

PDF Block B Outputs

The expected outputs of this PDF Block B grant will form the basis of a GEF proj
ect document for
submission to GEF Council and will include:


Management plan, guidelines and investment plans for the Lake Sevan National Park and Dilijan
State Preserve
, based on innovative and cost
effective integrated ecosystem management approache.

plans will include habitat conservation activities linked to PA management plans and based on
land use consistent with biodiversity conservation, and professional development and training in
integrated eco
system management, and public education and aware
ness activities;


Comprehensive assessment of planning capacity, policy and institutional issues

recommendations for a framework to facilitate participatory implementation and accommodate the
needs of local communities;


Public Participation Plan

ing partnership with local communities living within or adjacent
to the Lake Sevan National Park and Dilijan State Preserve for planning and implementation of
ecosystem management activities. The plan will include mechanisms for conflict resolution among
resource users;


Training Plan

for the institutions responsible for project implementation activities;


Detailed Investment Package

for the Protected Areas and Biodiversity Conservation project
component coherent with the investment plans of the Participat
ory Watershed Management and
Forest Management project components; and


Implementation Plan

with monitoring and evaluation arrangements consistent with the overall
project implementation framework and specific monitoring indicators verifying the on

benefits in
statistical and qualitative measurement terms and project impacts.



Armenia ratified the Convention on Biological Diversity (CBD) in May 1993.
Recognizing the
importance to contribute to the international effort to mitigate greenh
ouse gas emissions Armenia
also ratified the UN Framework Convention on Climate Change (UN FCCC) in May 1993. In order
to fulfil the basic provisions of these conventions Armenia has undertaken a commitment to
contribute to international objectives by dev
eloping two national projects (i) First National Report to
CBD and Biodiversity Strategy and Action Plan, and (ii) Country Study on Climate Change, which
were funded by GEF. As a result, Armenia has identified at national and regional level natural
tems and spheres of activity which are most vulnerable to climate changes effects and
ecological consequences that need to be addressed through practical actions. The proposed project is
directly linked to the efforts of the Government of Armenia to addre
ss national and global priorities
by reversing land degradation, enhancing biodiversity and to contribute to international efforts to
improve carbon sequestration..

This project is consistent with the GEF Operational Program #3 on Forest Ecosystems and O
P #4 on
Mountain Ecosystems. It is based on the priorities identified in the biodiversity chapter of the NEAP
(1998), and in the Biodiversity Strategy and Action Plan (1999) and which are covered by the GEF
operational strategy for biological conservation
. The project will support

conservation and
sustainable bidiversity use in the Transcaucasus region. Proposed re
vegetation measures have
potential to contribute to the global effort to mitigate anthropogenic releases of carbon dioxide. It
nds to COP III guidance by promoting capacity building, especially for local communities;
promoting conservation and sustainable use through adaptive management of forest landscapes, and
meets the objectives of other international conventions. The project

is complementary to the
proposed GEF/UNDP medium sized national project for In
situ Conservation and Sustainable Use of
biodiversity now under preparation. This project is designed as a demonstration project to
provide technical support for developi
ng a mix of in
conservation activities of agro
and land race and to develop a legislative and management framework for conservation and

fertilization between the proposed project and the UNDP demonstration project
will b
e sought during preparation and implementation to reinforce the project design.
This project
will also build on the work carried out by other donors active in Armenia such as UNEP, UN
USAID, and SIDA in the area of environmental protection and natur
al resources use.

National and International support

The Government of Armenia has identified its broad environmental priorities and its specific
biodiversity conservation objectives, in the recent National Environmental Action Program (NEAP,
and the Lake Sevan Action Plan (LSAP, 1998). The Government has requested the World
Bank assistance both technical and financial in support to their effort to design and implement the
project to which high priority is attached. The proposed project build
s also on the recommendations
and priorities specified in the :


Biodiversity Strategy and Action Plan (BSAP, 1999) of Armenia identifies the need to
improve and implement natural resources management systems relating to biodiversity
conservation at th

level. It also gives high priority to sustainable development
through integration of biological resource management into development of local
communities and to reduce the rural poverty levels; and


Armenia Forest Sector Development Strategy pr
epared with the assistance of UN
identifies challenges to sustainable forestry in Armenia, and the need to broaden the mandate
to provide better protection to forest biodiversity. The strategy identifies the need for
integration of biodiversity conser
vation to forest management activities, which is consistent
with the GEF biodiversity conservation objectives.

Recognizing the importance to promoting sustainable development in rural areas through improved
management of natural resources the Ministry of N
ature Protection has signed a letter of endorsement
(see attached) requesting PDF Block B grant money as critical for the preparation of the project. At
national level the Government has built a consensus to the proposed project approach which has
lized in the establishment of a Project Preparation Steering Committee with broad
participation of central and local stakeholders. The project has been approved for entry in the
pipeline of GEF funded projects by the GEF Secretariat. In view of the tight

preparation schedule the
PDF B grant resources are critical to the preparation of the project.


The project would promote rehabilitation of ecosystems and conservation and sustainable use of
biodiversity of the Transcaucasus, an ar
ea that has been identified as one of the 200 globally
important ecoregions for terrestrial biodiversity. By rehabilitating local natural resources production
base and providing alternative income generating opportunities to rural population t
he project wi
generate significant global benefits through recovery of critical forest and mountain steppe habitats,
protection of endemic flora and fauna in southern Caucasus area. The project will contribute to more
effective regional collaboration towards conserv
ing biological resources, and will complement the
objectives of the Bank/ GEF Georgia Protected Areas Development Project.

This project is consistent with the GEF Operational programs: Mountain Ecosystems and Forest
Ecosystems. Through an integrated ecosy
stem management approach the project aims at enhancing
biological diversity in ecosystems where main threats arise from deforestation, illegal logging,
poaching on plans and animals, unsustainable grazing and agricultural practices. It responds to COP
I guidance by promoting a comprehensive and cross
sectoral approach to implementing the
Convention on Biological Diversity, and by promoting capacity building, especially for NGOs;
promoting conservation and sustainable use through adaptive management of f
orest landscapes, and
meets the objectives of other international conventions.

The project is consistent with Article 8 (

conservation) of the convention on biological
diversity as it will support protection, management and extension of protected a
reas in a region of
internationally important biodiversity; promote environmentally sound and sustainable development
of local communities living within or adjacent to protected areas, with a view to assuring more
effective protection of these areas; promo
te recovery of threatened species through the development
and implementation of plans and management strategies; and will support maintenance of viable
populations of threatened and endangered species within and beyond protected area boundaries.

project is consistent with Agenda 21 and guidance from the COP since it will promote
conservation, management and sustainable use of threatened and endangered species; strengthen the
involvement of local communities and build partnerships at the local, nat
ional and regional levels,
promote cost effective measures to conserve biodiversity, including economic incentives and
alternative livelihood opportunities for local communities, develop revenue generating activities such
as nature and cultural heritage ba
sed tourism.

The PDF B Grant is critical for continuing with the preparation of the project biodiversity
conservation activities given the severe shortage of public funding in Armenia. It would be difficult
to find any alternative funds for project pre
paration in a situation where the budget of the Ministry of
Nature Protection barely covers the staff salaries and operating expenses. No funds have been
allocated for monitoring of the state of environment, collection of baseline data, establishment of
atural resources and biodiversity inventories and applied research.

The PDF B Grant enables to carry out necessary project preparation studies and develop
implementation plans for GEF co
financed project components. The PDF Grant will also make an
ant contribution in developing project preparation and implementation capacity at the central
and local levels. Finally, the Grant will improve information exchange about the importance of
biodiversity resources in Armenia and strengthen collaborative eff
orts between foreign and local
experts in developing effective biodiversity conservation approaches.

Timetable and Budget

The Project Concept Document has been approved by the Bank sector and country management on
January 6, 2000 and reflects the

agreed concept of the IDA/GEF funded project at an early stage of
Project preparation is expected to be completed prior to pre
appraisal scheduled for
May/June 2001.
A Project Concept Note has been prepared and was approved by GEFSEC on J
10, 2000 and the project has been approved for pipeline entry. The activities to prepare the proposed
project will commence upon approval of this funding application. A project preparation mission is
planned for end October 2000. The mission will a
gree with the Government of Armenia on the
institutional arrangements for the use of the PDF
B funds and will assist the Government in
developing necessary terms of reference for hiring local and international consultants. Draft Project
aisal Document and Project Implementation Plan are expected to be completed
prior to appraisal of the project in and submitted for GEF Council approval in early 2002.

This implies the following project processing timetable:



of Project Concept Note

July 10, 2000

Approval of PDF
B Grant Proposal

November 2000

Project Preparation Mission

November 2000

Project Pre
Appraisal Mission

May 2001

Project Appraisal Mission

September 2001

Submission to GEF Council

January 2002

The estimated itemized costs and necessary budget to carry out the grant activities are as follows:

Preparation Costs US$’000

Cost items


GoA in


financing PHRD/EU


Protected Area Management and
Biodiversity P





Planning, Policy Development and
Institutional Capacity Assessment





Preparation of the Public
Participation Plan





Professional development and
training needs





investment plan





Coordination Workshop




Project Coordination and Travel











World Bank User

B Grant.doc

07/28/00 10:59 AM