Ministry of agriculture and ministry of public works smallholder tree crop revitalization support project



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Introduction




background

The Government of Liberia is exploring the feasibility of a World Bank supported agricultural development project, the principal objective of improving the income opportunities of poor farmers by a combination of rehabilitating unproductive farms, undertaking replanting and new planting programs, facilitating future replanting and development programs, and improved financing mechanisms and institutional arrangements. The proposed Smallholder Tree Crop Revitalization Support Project (STCRSP) has been identified in response to this request.


The main characteristics of the Liberian tree crop sector at present are the old age of plantations and their low productivity. There have been no significant replanting activities for the last twenty five years due to the war, and a large proportion of the country’s tree crop plantations are now at the end of their productive life, necessitating replanting. The main constraint to the implementation of a large scale replanting program, particularly for smallholders, is the lack of long term credit. This situation is consistent with the experience in other tree crop producing countries in Asia or Africa, where commercial banks are generally reluctant to provide long term credits to farmers for tree crops mainly due to the crops’ long gestation period (7 years for rubber, 3-4 years for oil palm and cocoa), the perceived high credit risk and the lack of collateral.

The proposed project description

The proposed project will be the first, preparatory stage of a long term pro-poor growth program focused on developing the tree crop sector. Specifically, it will be aimed at preparing future large scale tree crop replanting and development programs by testing different replanting and new planting models and associated financing and implementation mechanisms, and strengthening the capacity of key public and private sector/civil society institutions involved in tree crop development. At the same time, the proposed project will seek to have a short term impact on farmers’ revenues by supporting the rehabilitation of both immature and mature smallholder tree crop farms, which will generate additional revenues that farmers could subsequently use towards financing of replanting, thereby at least partially alleviating financing constraints.



Objectives

The proposed project objective is “to increase poor tree crop farmers’ income opportunities by rehabilitating unproductive farms and supporting tree crop replanting and new planting and by supporting preparation activities toward the future development of the tree crop sector and effective smallholder participation”. The proposed project will be the first, preparatory stage of a long term pro-poor growth program focused on developing the tree crop sector. The target group will be poor smallholders in the main country’s tree crop producing counties, with particular attention given to the participation of women.


The proposed project will contribute to national and local revenues through increased foreign exchange from tree crop exports and will directly benefit smallholder households through increased incomes from the rehabilitation of their tree crop farms. It will directly support Government of Liberia (GoL)’s policy for economic revitalization, based on the promotion of export oriented economic growth, through consolidating the role of the private sector, while also facilitating rural development, increasing rural incomes, and contributing to poverty reduction. Furthermore, the proposed project is also aligned with Ministry of Agriculture’s (MoA) priority of achieving a viable and sustainable Tree Crop Sector within the Liberia Agriculture Sector Rehabilitation Program (LASIP) under the framework of the Comprehensive Africa Agriculture Development Program (CAADP).
The objective of this Consultancy is to develop an environmental and social management framework (ESMF) aimed at ensuring that adverse environmental and social impacts of the Project will be avoided or, where unavoidable, will be mitigated or offset, in response to the five World Bank safeguards policies1 triggered by the proposed project as well as the laws, regulations and procedures of the Government of Liberia.

Project Scope

The proposed project will follow a two pronged approach:

rehabilitating existing mature and immature small tree crop farms, which will have a short-term impact by generating additional revenues that farmers could subsequently use towards financing of replanting; and

supporting tree crop replanting and new plantings, using different models and associated financing and implementation mechanisms, while strengthening the capacity of key public and private sector/civil society institutions involved in tree crop development, with the aim of laying out the foundations for future smallholder tree crop development programs. It will be implemented over a period of four years in several districts of the country’s main tree crop producing counties.




Proposed Project Components

The project proposed will include three components as follows:


Component 1 - Tree Crop Revitalization
Sub-Component 1.1 - Cocoa/Coffee Revitalization: The component will be implemented in two of the country’s main cocoa & coffee producing counties: Bong and Nimba. The component will be aimed at

rehabilitating existing smallholder cocoa and coffee farms2, according to two different models:

(a) the low model input which consists of under brushing, weeding, pruning, reducing the shade without applying fertilizers but for cocoa this model will include the application of limited amounts of fungicides and insecticides; and

(b) the high input model for cocoa will consist of under brushing, weeding, pruning, reducing the shade and regular applications each year of fungicides and insecticides together with the high application of fertilizers – for coffee no agro-chemicals will be included.

supporting new plantings of cocoa as there are good market prospects and comparative advantage for cocoa in northern Liberia;

to a lesser extent, rehabilitating existing smallholder coffee farms, as it will generate much less income than cocoa; and

promoting improved cocoa/coffee marketing and value addition, including small scale processing (into cocoa butter or cocoa liquor and coffee powder) using adapted technologies.
This will include: the development of village nurseries and the maintenance of seed gardens, complementarily with other ongoing initiatives:

supporting the organization and strengthening of farmers’ groups (farmers’ associations [FOs]and cooperatives) dealing with bulking, marketing and primary processing; the provision of training and technical and management advice to smallholders and their organizations;

the construction (or rehabilitation) of warehouses and installation of solar dryers and procurement of quality control equipment (at section FOs, clan cooperatives and district cooperatives levels); the establishment of pilot processing plants at district level (including access to working capital) at district level; and

limited feeder road rehabilitation and related small bridges and drainage structures, wherever it is critical to provide access to groups of farms (indicatively 100 km).


The various crop models (rehabilitation with low or high input, replanting, and new planting) could be implemented simultaneously or during subsequent years on the same farm. It will depend on the available labor and financial resources as well as the condition of the trees.
This component will be implemented in partnership with NGOs and nongovernmental service/input providers, under contracting arrangements to be determined during project preparation. Since most cocoa farmers are also coffee farmers, the same implementing agency will deal with these crops jointly. Farmers will provide their own labor for the rehabilitation or planting operations. Thus little external financing will be required for rehabilitating cocoa/coffee farms under the low input model (tools package). Implementation of the high input model, however, will require the financing of inputs (mainly fertilizers and fungicides) through credit, which will be extended in kind by specialized input retailers. The supplier will be paid by farmers in cash or in cocoa/coffee beans. The project will support the installation of such retailer(s) and/or the first year credit requirements.
Sub-Component 1.2 – Smallholder Oil Palm Revitalization: This component will be implemented using two models: a) an out-grower model in partnership with a Concession/primary processor (Equatorial Palm Oil) in Grand Bassa and b) the Smallholder Plantation in Grand Gedeh in partnership with the NGO Alternative Enterprises International and private sector service input providers under contract.
The component will be aimed at:

rehabilitating old smallholder oil palm farms, which will consist in clearing the undergrowth (under brushing), weeding around the trees and between the rows, and applying fertilizers (potentially higher levels in model a’’ that in model ‘b’;

supporting replanting of smallholder oil palm;

supporting the organization of farmers’ groups and the provision of training and technical advice to small farmers;

limited feeder road rehabilitation (access roads and related small bridges and drainage structures) wherever it is critical to provide access to groups of farms (indicatively 30 km); and

the promotion of small scale processing facilities for farmers’ run plantations where no mills are present and/or facilitate access to small scale processing technology and finance for interested private investors (SMEs), in collaboration with commercial banks and guarantee or equity funds.


Farmers will provide their own labor and only a small grant will be needed for procuring a tools package for oil palm rehabilitation (credit under the out growers model). Replanting will require the financing of land preparation (felling old palms) and inputs (mainly seedlings and fertilizers) through credit. The project will finance the provision of extension services facilitation services in support of farmer group establishment and training, credit for land preparation and input provision for replanting, small scale processing facilities and the rehabilitation of small infrastructure. Smallholder credit and cost recovery mechanisms are still to be determined.

Sub-Component 1.3 – Smallholder Rubber Revitalization: The component will be implemented in the counties of Montserrado, Margibi, Bong and Maryland. The component will be aimed at:

supporting replanting of existing smallholder rubber farms;

new planting targeting smallholders who already have some rubber plots as well as newcomers in the sector, particularly women and youth;

the provision of training and technical advice to smallholders (including for tapping techniques) and supporting the organization of farmers’ groups in rubber growing areas; and

limited feeder road rehabilitation and farm access roads development (and related small bridges and drainage structure), wherever it is critical to provide access to participating farms (indicatively 90 km).
The component will be implemented in partnership with the Concessions (primary processors) through out-grower type arrangements. Only the high input model will be supported, and will be based on the use of high quality stumps and of fertilizers during the immature period. Under such model, each participating rubber farm will be developed according the same technical standards as the Concession employs. Farmers will provide their own labor for replanting and planting operations. Replanting and new planting will require the financing of land preparation, labor (under the high input model only) and inputs (mainly fertilizers) through credit. A grant element will be introduced to lower the establishment cost (planting year), particularly the seedlings costs.
Component 2 – Institutional Capacity Building and Preparation of Future Large Scale Smallholder Tree Crop Development Programs:
Sub-component 2.1: Institution building. The component will aim at:

Capacity building of Ministry of Agriculture (MoA) and Cooperative Development Agency (CDA) staff will target technical staff involved in the project planning, coordination and monitoring and evaluation (M&E), both at Headquarters (HQ) and county level. A training of trainers (ToT) approach will be used. A rapid assessment of staff skills and training needs will be carried out. Training will tackle the following domains: economic development and empowerment of FOs/cooperatives; financial management and procurement; policy and project design; agronomic issues related to tree crops; computer literacy; training of FO facilitators.

Support to MoA County offices. The project will contribute to the strengthening of the six targeted County Agricultural Offices (CAC) in order that these effectively exercise their promotion, planning, coordination and M&E role of projects’ activities in their respective county. This will include: field allowances to carry out sensitization or supervision activities; a contribution to procuring the necessary field equipment or transport means (motorbikes); and associate running costs of the CAC office.

Support to CDA. Similarly, as the CDA has a key role to play in the promotion of FOs/cooperatives, the project will strengthen CDA’s operational capacity to deliver its services through its current five offices at county level. This will include support for: procuring necessary transport means and office equipment for field offices and associate running costs; and field allowances for HQ and field offices staff in order to deliver training, business development and managerial advice to FOs/Cooperatives.

Support to the Land Commission at county level. The project will complement ongoing support received by the Land Commission in order that its county offices could adequately expedite the issuance of land titles or deeds to participating smallholders. That will include: support to carrying out land surveys; and a contribution to the equipment of county offices, operating costs and field allowances.

Support to adaptive tree crops research. Proposed activities will be linked to the tree crops sector and could cover: the establishment and maintenance of seed gardens (cocoa & coffee), in collaboration with other ongoing programs; refurbishing facilities for soil testing, germplasm production, biological analyses, etc.; support to adaptive research on tree crops, including socio-economic issues; training of scientists up to Masters or Doctorate level if needed; exchange visits to neighboring countries and regional agricultural research institutions; and scientific coaching and organizational advice through national and international consultants.

Support to the MoA Program Management Unit (PMU)3. The project will contribute to the setting-up and effective performance of the PMU, of which the STCRSP coordination team will be part. This will encompass a contribution to the staffing of top managers of the PMU (PMU Manager, Financial Advisor, and Procurement Advisor) and associated operating costs of the PMU.
Sub-component 2.2: Preparing future large scale smallholder tree crop development programs. This will include:

the preparation and validation of Master Plans for all targeted tree crops. Plans will detail strategic options for development, scope, detailed activities, operational modalities, costing, as well as phasing. During this process, a national tree crops database including a GIS system will be established to better reflect the current situation of tree crops at national and county levels (acreage, number of farmers, size of farms, status of trees, localization, etc.);

the elaboration and validation of a National Policy/Strategy for Farmers Organizations and Cooperatives development: this will comprise technical assistance from a specialized international consultant, setting up and support to a core country drafting team, and organization of validation workshops; and

the preparation of a large scale smallholder tree crop development program encompassing the following activities: mid-term review of the proposed STCRSP; detailed feasibility studies, notably building upon the strategic options and conclusions of the adopted tree crops master plans; and final evaluation of the STCRSP to make sure lessons learned from phase I will be integrated in the larger scale program.


Component 3 - Project Coordination, Management, Monitoring and Evaluation.
Sub-component 3.1: Strategic Planning and Coordination and Implementation support. This will comprise two main groups of activities:

Support to Steering Bodies. That will include: the organization of project launching workshops at county and national level; supporting regular coordination meetings at County level (under the responsibility of the CAC) assembling representatives from all stakeholders involved in the agricultural sector and particularly in tree crops development; an operational support to the National Project Steering Committee; and

Support to the Project Coordination Unit (PCU). The coordination, management, monitoring and evaluation of project activities will be under the responsibility of a specific team, to be established within and reporting to MoA central Project Management Unit (PMU). The team will include a limited number of highly qualified and motivated staff, consisting of a project coordinator, one or two specialists (agronomist or agro-economist, capacity building specialist), finance, M&E, procurement and administration staff, to be selected on a competitive basis. The responsibilities for financial management and procurement, however, will be located under the Project Financial Management Unit (PFMU) in Ministry of Finance (MoF), until the capacity of the PMU is assessed as being adequate. It will encompass: a contribution to the staffing costs of the PCU (Project coordinator; Planning and M&E officer; Institution development officer; Agri-business officer; Information, education, communication and knowledge sharing officer, Accountant; and administrative support staff); the procurement of necessary transport means and of computer/office equipment; staff training and exchange visits; office operating costs of the PCU; the installation of a project accounting and management software and of management control tools; and short term technical assistance in key areas relevant to project implementation.
Sub-component 3.2: Monitoring and Evaluation (M&E) and Knowledge Sharing. Under that sub-component, the following activities will be supported: the establishment of the project M&E system to integrated within the overall PMU’s and MoA’s M&E systems; carrying out necessary baseline studies per project site and/or per thematic area; annual participatory planning and evaluation workshops with beneficiaries and other stakeholders at county and district levels; the elaboration of a communication and knowledge sharing strategy for the overall PMU and for the STCRSP; development of various communication and knowledge sharing tools using various medias (newspapers, radio, television, internet, etc.) and targeting different publics (smallholders, private sector, donors, general public, etc.).




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