FP136: Resilient Landscapes and Livelihoods Project

Ethiopia | International Bank for Reconstruction and Development and International

Development Association (World Bank) | Decision B.26/02

21 August 2020
Project/Programme title: Resilient Landscapes and Livelihoods Project

Country(ies): Ethiopia

Accredited Entity: World Bank

Date of first submission: 2018/06/22

Date of current submission 2020/03/19

Version number [V.000]

 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 0 OF 96

Contents

Section A PROJECT / PROGRAMME SUMMARY

Section B PROJECT / PROGRAMME INFORMATION

Section C FINANCING INFORMATION

Section D EXPECTED PERFORMANCE AGAINST INVESTMENT CRITERIA

Section E LOGICAL FRAMEWORK

Section F RISK ASSESSMENT AND MANAGEMENT

Section G GCF POLICIES AND STANDARDS

Section H ANNEXES

Note to Accredited Entities on the use of the funding proposal template

• Accredited Entities should provide summary information in the proposal with cross-
reference to annexes such as feasibility studies, gender action plan, term sheet, etc.
• Accredited Entities should ensure that annexes provided are consistent with the details
provided in the funding proposal. Updates to the funding proposal and/or annexes must be
reflected in all relevant documents.
• The total number of pages for the funding proposal (excluding annexes) should not
exceed 60. Proposals exceeding the prescribed length will not be assessed within the usual
service standard time.
• The recommended font is Arial, size 11.
• Under the GCF Information Disclosure Policy, project and programme funding proposals
will be disclosed on the GCF website, simultaneous with the submission to the Board,
subject to the redaction of any information that may not be disclosed pursuant to the IDP.
Accredited Entities are asked to fill out information on disclosure in section G.4.

Please submit the completed proposal to:

fundingproposal@gcfund.org
Please use the following name convention for the file name:
“FP-[Accredited Entity Short Name]-[Country/Region]-[YYYY/MM/DD]”
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 1 OF 96

A
PROJECT/PROGRAMME SUMMARY
A.1. Project or A.2. Public or private Public
Project
programme sector
If the funding proposal is being submitted in response to a specific GCF Request for Proposals,
A.3. Request for indicate which RFP it is targeted for. Please note that there is a separate template for the
Proposals (RFP) Simplified Approval Process and REDD+.
Not applicable
Check the applicable GCF result area(s) that the overall proposed project/programme targets.
For each checked result area(s), indicate the estimated percentage of GCF budget devoted to it.
The total of the percentages when summed should be 100%.
Mitigation: Reduced emissions from: GCF contribution:
☐ Energy access and power generation: Enter number%
☐ Low-emission transport: Enter number%
☐ Buildings, cities, industries and appliances: Enter number%
A.4. Result area(s) ☒ Forestry and land use: 100%

Adaptation: Increased resilience of:

☒ Most vulnerable people, communities and regions: 70%
☒ Health and well-being, and food and water security: 30%
☐ Infrastructure and built environment: Enter number%
☐ Ecosystem and ecosystem services: Enter number%
Direct beneficiaries:
834,000 Households (4.2
million people) facing food,
land tenure and water
insecurity in climate
5,621,615 t CO2 eq over 5 vulnerable rural
years watersheds
A.5. Expected mitigation A.6. Expected adaptation
Indirect beneficiaries: Total
impact impact population of the targeted
43,800,000 t CO2 eq over
25 years area – close to 26,200,000
people.
Direct: 4.0%
Indirect: 25.0%

A.7. Total financing (GCF

296,237,602 USD
+ co-finance)
Large (Over USD 250
165,237,592 USD A.9. Project size
million)
A.8. Total GCF funding Choose an item.
requested For multi-country proposals,
please fill out annex 17.
Mark all that apply and provide total amounts. The sum of all total amounts should be consistent
with A.8.
A.10. Financial
instrument(s) requested ☒ Grant 58,063,337 USD ☐ Equity Enter number
for the GCF funding ☒ Loan 107,174,255 USD ☐ Results-based
☐ Guarantee Enter number payment Enter number

A.11. Implementation Start: 07-Oct-2020; End:

period
A.12. Total lifespan 25 years
07-Oct-2025
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 2 OF 96

A
This is the date that the
Refer to the AE’s safeguard
Accredited Entity obtained/will
policy and GCF ESS
A.13. Expected date of obtain its own approval to
Standards to assess your FP
implement the project/ A.14. ESS category
AE internal approval category.
programme, if available.
6/15/2020 B
A.15. Has this FP been A.16. Has Readiness or
submitted as a CN Yes ☒ No ☐ PPF support been used Yes ☐ No ☒
before? to prepare this FP?
A.17. Is this FP included A.18. Is this FP included
in the entity work Yes ☐ No ☐ in the country Yes ☐ No ☐
programme? programme?
Does the project/programme complement other climate finance funding (e.g. GEF, AF,
A.19. Complementarity CIF, etc.)? If yes, please elaborate in section B.1.
and coherence
Yes ☐ No ☒
If not the Accredited Entity, please indicate the full legal name of the Executing
Entity(ies) and provide its country of registration and ownership type. Note that there
can be more than one Executing Entity. Also indicate if an Executing Entity is the
National Designated Authority. Refer to the definition of Executing Entity in the
A.20. Executing Entity Accreditation Master Agreement.
information
The Federal Democratic Republic of Ethiopia, represented by the Ministry of Finance
and acting through the Ministry of Agriculture.

A.21. Executive summary (max. 750 words, approximately 1.5 pages)

 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 3 OF 96

A
Provide an executive summary of the project/programme including:
1. Climate change problem
2. Proposed interventions
3. Climate impacts/benefits

1. Climate Change Problem

Impact of Climate Change on Land Degradation

In the highlands of Ethiopia, climate change is expected to increase both annual precipitation and seasonal variability
in rainfall, increasing soil erosion by 7-10% per year and, in the more extreme scenarios, possibly by as much as 40-
70% per year by 2050. Conservative estimates suggest that partly as a result of this increased soil erosion, climate
change will reduce agricultural crop productivity in Ethiopia by 5 -10 % by 2030 1. Land degradation in Ethiopia has
proceeded at an alarming rate and will be increasingly aggravated by climate change. From 1981 to 2003, 296,812
km2 (29.7 million ha) of land has been degraded, affecting a population of 20.65 million, approximately one in five
people in Ethiopia.

Vulnerability of the agriculture sector and community livelihoods to climate change impacts

The intersection of land management, rights, and use forms the key development issue for millions of rural Ethiopians
facing water insecurity, food insecurity, land tenure insecurity, and livelihood insecurity – all amplified by climate
variability and change as described above. Climate impacts in Ethiopia are felt primarily through water stress, which is
affected by land use and degradation that undermines watershed function. In Ethiopia, the estimated cost of land
degradation is 2-3% of GDP, before accounting for downstream effects, such as increased flood risk.

Exposure of farmers to land degradation

Since the 1970s, the Government of Ethiopia has recognized the problem of land degradation as a major challenge to
the country’s growth and stability. Studies have shown that land degradation has cost the country 2-3 percentage points
in agricultural GDP each year. Due to its impact on agricultural productivity alone, soil erosion currently costs the
economy of Ethiopia about $305 million per year. Based on Ethiopia’s experience to date, the cost of inaction to address
land degradation is estimated to be 4.4 times greater than the cost of preventative action through (SLM). 2

Impacts of Climate Change and Variability on farmer livelihoods

Climate variability such as the droughts and floods described above already negatively impacts livelihoods in
Ethiopia. This will aggravate the impacts of climate change, which are broad in scope and could be severe. Estimates
suggest climate change may reduce Ethiopia’s GDP up to 10 % by 2045, primarily through impacts on agricultural
productivity. These changes would aggravate existing social and economic challenges.

Recently, the impact of climate change on crop yields in Ethiopia was investigated in a report published by IFPRI. 3
Overall, the simulated net effects of increases in average rainfall and higher average temperatures are relatively
small. However, the authors note that there is growing evidence that weather outcomes, particularly rainfall, are likely
to become more variable in the future, which could lead to substantial effects on crop production and household
welfare (as well as on livestock) due to extreme events – droughts, floods, or extremely high temperatures.

Crucially, the models employed in the simulations do not take into account the impact of climate change on land
degradation, while noting that in many parts of the country land degradation is already reducing yields. Climate
change is likely to accelerate the levels of land degradation and soil erosion. As described in more detail in Annex A.7
and Annex A.8, recent analysis by the Water and Land Resource Centre (WLRC) of Addis Ababa University using
soil loss equations calibrated using historical station data from two monitoring stations within the project area in
conjunction with the IPCC’s RCP4.5 scenario for 2050, show that soil erosion is expected to increase by 7-10% per
year and, in the more extreme scenarios, could increase by as much as 40-70% per year by 2050 due to climate
change in the absence of interventions to improve land management 4. As a result, conservative estimates suggest
that climate change will reduce agricultural crop productivity in Ethiopia by 5 -10 % by 2030.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 4 OF 96

1 Refer to Annex A.7., Annex A.8 and Bai, Z. G., Dent, D. L., Olsson, L., & Schaepman, M. E. (2008), “Global assessment of land degradation and improvement. 1. Identification by
remote sensing”. Wageningen, The Netherlands: International Soil Reference and Information Centre (ISRIC).
2 Gebreselassie et al. (2016).
3 Dorosh, P. and Minten, B. (eds.), 2019, Ethiopia’s agri-food system: Past trends, present challenges, and future scenarios, Ethiopia Strategy Support Program (ESSP), IFPRI
4 Based on recent analysis by the Water and Land Resource Centre (WLRC) of Addis Ababa University
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 5 OF 96

A
The direct impacts on crop productivity could in turn lead to impacts on prices, production, and consumption and on
per capita calorie consumption and child malnutrition. Climate change, therefore, complicates efforts to increase food
production and improve food security 5.

Sensitivity of rural communities to the impacts of climate change

Sensitivity to climate change and variability is high in the proposed project communities. More than 80% of Ethiopians
are engaged in subsistence rain-fed agriculture and farms are already under significant climate stress. These
populations are highly dependent on the performance of productive landscapes for income, energy, food, building
materials, and water. Furthermore, agriculture accounts for most jobs and about 40% of output and exports. Low
adaptive capacity contributes to high vulnerability in the proposed project communities. Most of the targeted
watersheds are situated in regions that have relatively low adaptive capacity. As one study of vulnerability in the
Tigray Region concluded, districts most vulnerable to climate change and variability overlapped with districts with the
most vulnerable populations; climate vulnerability was inextricably linked to social and economic development.[8]
Households that are short of basic economic and social resources clearly lack the means to undertake adaptive

measures or respond to climate shocks.

2. Proposed Interventions/Summary of Project

The objective of the Project is to improve climate resilience, land productivity and carbon storage and increase access
to diversified livelihood activities in selected rural watersheds.

The Project consists of the following parts to be carried out in select Regions of Ethiopia:

Part 1. Investment in Green Infrastructure and Resilient Livelihoods

Provide support for the restoration of degraded landscapes in selected watersheds and help build resilient
livelihoods through the following program of activities:

(a) Land Restoration and Watershed Management: Implementation of sustainable soil and water conservation
practices in line with Multi-Year Development Plans (“MYDPs”) in watersheds, including land rehabilitation measures
and establishment of green infrastructure (including rehabilitation through biological and physical conservation
measures that ensure reduced surface run-off and soil erosion, as well as improved land productivity, resulting in
enhanced crop and livestock production) through, inter alia: soil and water conservation measures, gully rehabilitation,
establishment of green corridors, area closure management and use, establishment of plantation blocks, and
enrichment of degraded pasture and rangeland;
(b) Climate-Smart Agriculture: Enhance the livelihood resilience of beneficiary households in restored micro
watersheds by implementing context-specific Climate-Smart Agriculture (“CSA”) activity packages comprising one or
more of the following: farm water and soil moisture management, integrated soil fertility and soil health management,
crop development and management, and environmentally-friendly livestock production through feed development and
management; and
(c) Livelihood Diversification and Connection to Value Chains: Further increase livelihood resilience by diversifying
livelihoods, and helping ensure livelihood sustainability by better connecting products with value chains in selected
watersheds through a program of activities, including provision of technical assistance and grants to Common Interest
Groups (“CIGs”) and financing activities that facilitate private sector engagement in Project-supported value chains
directly or through primary cooperatives and/or coop unions.

Part 2. Investing in Institutions and Information for Resilience

Enhance institutional capacity and improve information for better decision-making in supporting resilient
landscapes and diversified rural livelihoods in the Project area through the following program of activities:

(a) Capacity Building, Information Modernization and Policy Development: Provision of technical assistance, at the local
government level, to implement the Project and build capacity to sustain land and water management practices in
watersheds, including financing of selected staff positions, financing of technical vocational education and training,
development of data management plan, piloting of new technologies for information modernization (such as the use of
electronic tablets for gathering geospatial information and the use of unmanned aerial vehicles for land certification
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 6 OF 96

mapping), and development and application of a regulatory framework for the establishment of WUAs and community
A
bylaws guiding land-use practices, and strengthening the Land Administration System; and
(b) Impact Evaluation, Knowledge Management and Communication: Carry out impact evaluations of (i) the bio-
physical outcomes of MoA’s SLM Program, and (ii) the productivity gains associated with the climate-smart agriculture
interventions supported by the Project, establish a geospatial knowledge platform accessible to planners and
stakeholders, and develop and implement a strategic communication program to inform and mobilize communities, and
to enhance Project visibility and transparency among all actors.

Part 3. Land Administration and Use

Strengthen land tenure and the land administration system in Project areas and improve incentives for
beneficiary communities to invest in sustainable landscape management through the following: (a) in the micro-
watersheds targeted under Part 1 of the Project, improving the land tenure security of rural households and groups
through land certification and administration (including issuance of Second Level Landholding Certificates (“SLLCs”) to
households, and targeted landless youth will receive communal land certificates, inputs, and extension services in
exchange for land restoration), and (b) enhancing local level land use planning and support innovations in landscape
certification systems (including providing support for participatory local land use planning and the rollout of the National
Rural Land Administration Information System (“NRLAIS”).

Part 4. Project Management and Reporting

Provision of support for Project management and reporting, including financing of Operating Costs and
implementation of Project fiduciary aspects, including financial management, procurement, environmental and social
safeguards, and monitoring and evaluation and reporting.

3. Climate Benefits

The proposed project is designed to create resilient landscapes and livelihoods for vulnerable rural populations in
Ethiopia. The Resilient Landscapes and Livelihoods Project (RLLP) will improve climate resilience, land productivity
and carbon storage, as well as improve access to diversified sources of income in selected vulnerable rural major
watersheds in Amhara, Benishangul Gumuz, Gambella, Oromiya, SNNP and Tigray. The project scales up initiatives
with demonstrated climate value and co-benefits within the Sustainable Land Management Program (SLMP), and it
pilots new innovations. Proposed interventions target rural livelihood productivity and resilience through sustainable
land management, low-emission resilient agriculture practices, enhanced land tenure, gender-sensitive livelihood
initiatives which contributes to removing barriers to women’s ownership of and control over assets and improving
voice and agency, and the strengthening of value chains for long-term program durability.

The RLLP will contribute to climate resilience in 210 major watersheds with 8-12 micro-watersheds per major
watershed. The beneficiaries of RLLP include the entire population of the selected watersheds, estimated at 4.2
million people, or 834,000 households. The project interventions are also expected to lead to a GHG emissions
reduction of 43.9 million tons CO2eq due to carbon sequestration as a result of improvements to grasslands and
agriculture. 152 watersheds will be supported by IDA and MDTF (Contribution by Government of Norway), 18
watersheds by the anticipated contribution to MDTF by the Government of Canada, and 40 watersheds by GCF.

The executing entity is the Federal Democratic Republic of Ethiopia. The GCF Proceeds will be channeled through
the World Bank and will be made available to the Federal Democratic Republic of Ethiopia. The World Bank will enter
into a grant agreement and a loan agreement with the Federal Democratic Republic of Ethiopia, represented by MoF
and acting through MoA for the implementation of the GCF Funded Activity.

5 Mahoo H, Radeny M, Kinyangi J, Cramer L, eds. 2013. Climate change vulnerability and risk assessment of agriculture and food security in Ethiopia: Which way forward?
CCAFS Working Paper no. 59. CGIAR Research Program on Climate Change, Agriculture and Food Security (CCAFS).
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 7 OF 96

B
PROJECT/PROGRAMME INFORMATION
B.1. Climate context (max. 1000 words, approximately 2 pages)
Climate change problem: Describe the climate change problem the proposal is expected to address. Describe the
mitigation needs (GHG emissions profile) and/or adaptation needs (climate hazards and associates risks based on
impacts, exposure, and vulnerabilities) that the proposed interventions are expected to address. Also describe the
most likely scenario (prevailing conditions or other alternative) that would remain or continue in the absence of the
proposed interventions. Include baseline information. The methodologies used to derive such information, including
the mitigation and adaptation needs, should be included in the feasibility study.

Context: In describing the mitigation and/or adaptation needs, briefly describe the target region/area of the proposed
interventions including information on the demographics, economy, topography, etc.

Related projects/interventions: Also describe any recent or ongoing projects/interventions that are related to the
proposal from other domestic or international sources of funding, such as the Global Environment Facility, Adaptation
Fund, Climate Investment Funds, etc., and how they will be complemented by this project/programme (e.g. scaling
up, replication, etc.). Please identify current gaps and barriers regarding recent or ongoing projects and elaborate
further how this project/programme complements or addresses these.

Ethiopia is an LDC that is among the most vulnerable to climate change and variability: it is exposed to severe climate
impacts, its economy is highly climate-sensitive, and its adaptive capacity is low. In the ND-GAIN country index,
Ethiopia ranks 163 out of 181 countries in terms of climate readiness. While the poverty headcount has fallen from 55.5
% to 26.7 % from 2000-2016 6, these gains are very fragile in a changing climate. Resilient agriculture is a high priority,
as agriculture accounts for 41% of GDP, 85% of all employment and nine of the top ten export commodities by value 7.

Climate Change and Variability in Ethiopia

Ethiopia has a long history of having to cope with extreme weather events. Rainfall is highly erratic and typically falls
in the form of intensive convective storms spawned by the country’s varied topography. Over the past three decades,
Ethiopia has experienced countless localized drought events and seven major droughts, five of which have been
associated with famines. Climate varies significantly between and even in each one of the Ethiopian regions. Most of
the recent drought and food crisis events have been geographically concentrated in two broad zones of the country,
with the eastern and northern parts of the country being the most vulnerable. For example, rainfall variability and
associated droughts have been major causes of food shortages and famine in the Tigray region in the north of the
country.

There are numerous observed changes in Ethiopia’s climate 8. The most prominent observed climate change trend has
been a tendency towards lower rainfall during the main growing seasons (March–May and December–February). A
decline in rainfall of 15% on average has been associated with anthropogenic Indian Ocean warming. While floods
have historically never been a major economic hazard in Ethiopia, in recent years there has been significant socio-
economic disruption due to flooding, e.g. in 1997 and 2006.

Most global climate models project an increase in precipitation in both the dry and wet seasons. Climate scenarios
based on the ISP2a emissions scenario run by a suite of Global Climate Models (GCMs) are broadly consistent in
indicating increases in annual rainfall for Ethiopia as a whole. These increases are largely a result of increasing rainfall
during the ‘short’ rainfall season (October-December) in southern Ethiopia. October-December rainfall is projected to
increase between 10 and 70% on the average over Ethiopia. These changes will lead to an increase in heavy rains
and floods. The temperature will very likely continue to increase for the next few decades at a rate similar to that seen
in recent years. The projected increases in the inter-annual variability of precipitation in combination with the warming

6 WB database, for Poverty headcount ratio at $1.90 a day (2011 PPP)

7 CRGE (2014)
8 Climate Risk and Adaptation Country Profile: Vulnerability, Risk Reduction and Adaptation to Climate Change - Ethiopia,

World Bank, 2011. Downloaded from: http://countryadaptationprofiles.gfdrr.org

 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 8 OF 96

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will likely lead to increases in the occurrence of droughts. Figure 1 depicts changes in precipitation and temperatures
during the previous century and under projections beyond the year 2040.

Figure 1 Observed and predicted changes in precipitation and temperature in Ethiopia 9

In the highlands, climate change is expected to result in an increase in both annual precipitation and seasonal variability
in rainfall.

Incremental costs of climate change

The supporting document “Technical Note to modeling soil loss” (Annex A.8) estimates change in soil erosion due to
climate change in RLLP Project Watersheds. Results indicate that soil erosion is expected to increase by 7-10% per
year and, in the more extreme scenarios, could increase by as much as 40-70% per year by 2050 in the absence of
interventions to improve land management that builds resilience to the impacts of climate change. Under business-
as-usual, the Sustainable Land Management (SLM) program estimates that a total of about 670 watersheds need
approximately $2.7 million each in investment to prevent soil erosion i.e. $1.8 billion of total investment in Ethiopia
(see Annex A.9. “Cost of watershed development interventions”). Conservatively assuming that (a) climate change
could increase annual soil erosion by 50% (b) 1:1 relationship between increase in soil erosion and investment cost
to build climate resilience, we expect that $904 million would be the incremental investment cost to prevent increased
soil erosion due to climate change across all 670 watersheds in Ethiopia ($1.35 million of incremental cost of climate
change per watershed). This cost would further increase in watersheds that are highly vulnerable to climate change
since community contributions are likely to be less than regular SLM programs due exposure of beneficiaries to
severe soil loss.

Both climate smart agriculture and sustainable land management are packages of measures in which several
practices are implemented concurrently at the appropriate time and scale to achieve the triple win of climate change
adaptation, climate change mitigation and increases in yields resulting in increased climate resilient livelihood. Hence
it is not possible to identify the scope of GCF financing on the basis of differentiation between development activities
and climate change activities. GCF is requested to finance RLLP activities in watersheds that are highly vulnerable to
climate change. In order to identify such watersheds, a vulnerability analysis was undertaken in which 192 10 RLLP
major watersheds were ranked by highest to lowest annual soil loss per hectare due to precipitation changes by 2050
under RCP 4.5 scenario (see Annex A.12.) compared to current levels. Top 40 of these watersheds were selected for
GCF financing. IDA will finance RLLP activities in remaining 152 watersheds.

9 Keller, M. (2009) Climate Risks and Development Projects. Assessment Report for a Community-Level Project in Guduru,
Oromiya, Ethiopia
10 Details of Co-financing from Government of Canada were not available during this analysis, hence 18 Watersheds

supported by it were not considered

 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 9 OF 96

B
Vulnerability of the agriculture sector and community livelihoods to climate change impacts

The intersection of land management, rights, and use forms the key development issue for millions of rural Ethiopians
facing water insecurity, food insecurity, land tenure insecurity, and livelihood insecurity – all amplified by climate
variability and change as described above. Climate impacts in Ethiopia are felt primarily through water stress, which is
affected by land use and degradation that undermines watershed function. In Ethiopia, the estimated cost of land
degradation is 2-3% of GDP, before accounting for downstream effects, such as increased flood risk.

Exposure of farmers to land degradation

Since the 1970s, the Government of Ethiopia has recognized the problem of land degradation as a major challenge to
the country’s growth and stability. Studies have shown that land degradation has cost the country 2-3 percentage points
in agricultural GDP each year. Due to its impact on agricultural productivity alone, soil erosion currently costs the
economy of Ethiopia about $305 million per year. Based on Ethiopia’s experience to date, the cost of inaction to address
land degradation is estimated to be 4.4 times greater than the cost of preventative action through (SLM). 11

From 1981 to 2003, 296,812 km2 (29.7 million ha) of land has been degraded, affecting a population of 20.65 million
(Bai et al. 2008), 12 approximately one in five people in Ethiopia. Approximately 27 million ha or almost 50% of highland
areas (which make up about 45 % of the total land area), is considered to be significantly eroded. Of this area, 14
million ha are seriously eroded, with over 2 million ha beyond reclamation. It is estimated that some 30,000 ha are lost
annually as a result of soil erosion. 13 For the highland areas, erosion rates have been estimated to average 35
tons/ha/yr, while the estimated rate from the croplands is 130 ton/ha/yr. This has led to the conclusion that almost half
of Ethiopia’s annual soil losses come from the land under cultivation, even though this land covers only 20% of the
country. 14

Figure 2 shows the distribution of annual precipitation in Ethiopia. According to this mapping exercise, the majority of
planned watershed restoration was conducted in areas with high levels of precipitation. These areas are highly exposed
to erosion.

11 Gebreselassie et al. (2016).

12 Bai, Z. G., Dent, D. L., Olsson, L., & Schaepman, M. E. (2008), “Global assessment of land degradation and
improvement. 1. Identification by remote sensing”. Wageningen, The Netherlands: International Soil Reference and
Information Centre (ISRIC).
13 Berry Leonard (2003) Land Degradation in Ethiopia: Its Extent and Impact
14 Ibid.
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 10 OF 96

Figure 2. Annual precipitation distribution in Ethiopia

Impacts of Climate Change and Variability on farmer livelihoods

Climate variability such as the droughts and floods described above already negatively impacts livelihoods in
Ethiopia. This will aggravate the impacts of climate change, which are broad in scope and could be severe. Estimates
suggest climate change may reduce Ethiopia’s GDP up to 10 % by 2045, primarily through impacts on agricultural
productivity. These changes would aggravate existing social and economic challenges.

Recently, the impact of climate change on crop yields in Ethiopia was investigated in a report published by IFPRI.
Overall, the simulated net effects of increases in average rainfall and higher average temperatures are relatively
small. However, the authors note that there is growing evidence that weather outcomes, particularly rainfall, are likely
to become more variable in the future, which could lead to substantial effects on crop production and household
welfare (as well as on livestock) due to extreme events – droughts, floods, or extremely high temperatures.

Crucially, the models employed in the simulations do not take into account the impact of climate change on land
degradation, while noting that in many parts of the country land degradation is already reducing yields. Climate
change is likely to accelerate the levels of land degradation and soil erosion. As described in more detail in Annex A.7
and Annex A.8, recent analysis by the Water and Land Resource Centre (WLRC) of Addis Ababa University using
soil loss equations calibrated using historical station data from two monitoring stations within the project area in
conjunction with the IPCC’s RCP4.5 scenario for 2050, show that soil erosion is expected to increase by 7-10% per
year and, in the more extreme scenarios, could increase by as much as 40-70% per year by 2050 due to climate
change in the absence of interventions to improve land management. As a result, conservative estimates suggest that
climate change will reduce agricultural crop productivity in Ethiopia by 5 -10 % by 2030.
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 11 OF 96

The direct impacts on crop productivity could in turn lead to impacts on prices, production, and consumption and on
B
per capita calorie consumption and child malnutrition. Climate change, therefore, complicates efforts to increase food
production and improve food security.

Sensitivity of rural communities to the impacts of climate change

Sensitivity of rural communities to the impacts of climate change

Sensitivity to climate change and variability is high in the proposed project communities. More than 80% of Ethiopians
are engaged in subsistence rain-fed agriculture and farms are already under significant climate stress. These
populations are highly dependent on the performance of productive landscapes for income, energy, food, building
materials, and water. Furthermore, agriculture accounts for most jobs and about 40% of output and exports. Low
adaptive capacity contributes to high vulnerability in the proposed project communities. Most of the targeted watersheds
are situated in regions that have relatively low adaptive capacity. As one study of vulnerability in the Tigray Region
concluded, districts most vulnerable to climate change and variability overlapped with districts with the most vulnerable
populations; climate vulnerability was inextricably linked to social and economic development. 15 Households that are
short of basic economic and social resources clearly lack the means to undertake adaptive measures or respond to
climate shocks.

Adaptive capacity and barriers to change

Adaptive capacity in rural communities is low. Root causes are a combination of geo-climatic conditions (inherently
fragile soils, undulating terrain, and highly erosive rainfall) and anthropogenic factors.

Baseline BAU with climate change Alternative

Poor cropland management Current farming practices Soil conservation measures are
practices: The farming system, such as frequent tillage (re)introduced, preventing increased
particularly in the highlands, is and limited soil land degradation as a result of
dominated by subsistence cereal conservation practices will climate change (Activity 1.1.1, 1.1.2)
crops, which provide little ground lead to increasingly severe
cover when the most erosive rains impacts as the climate
occur (June-August). This system changes, reducing
often requires frequent tillage and agricultural yields.
pulverization of the soil, rendering it
more susceptible to erosion.
Furthermore, limited soil
conservation practices and the
breakdown of traditional restoration
measures, such as shifting
cultivation, contribute to land
degradation.

Rapid depletion of vegetation As the climate changes Promotion of efficient cookstoves

cover: Household energy needs and erosion increases, reduces deforestation, enabling
are predominantly supported by land in deforested areas maintenance of vegetation cover
wood and other biomass, causing will be further degraded. even under the harsher conditions
an unprecedented level of resulting from climate change
deforestation. The loss of (activity 1.31., WB funded)
vegetation cover has been further Seeds for climate resilient crop
exacerbated by agricultural varieties, improved farm tools,
expansion and livestock grazing. fertilizer and other inputs are used by
As a result, land has been stripped farmers to increase the productivity
of vegetative biomass, exposing it of agriculture, reducing the need for
to high levels of soil erosion. agricultural expansion into land
Average deforestation rates range made marginal as a result of climate

15 Gebrehiwot, T. and A. van der Veen (2013). Climate Change Vulnerability in Ethiopia: disaggregation of Tigray Region. In

Journal of Eastern African Studies, Vol. 7, Issue 4: 607.

 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 12 OF 96

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from 1% to 1.5% annually, a high change (Activity 1.2.1)
rate for a low forest cover country. Free grazing decreases, enabling
Historically, Ethiopia was about recovery of vegetation even in the
40% forested. By 2005, forest harsher conditions resulting from
cover had been reduced to 2.4%, or climate change
3.3. million ha, of high forests.

Poor livestock management: As climate change leads to Livestock feed is grown and free
Ethiopia has one of the largest increased erosion, current grazing is decreased, ensuring
livestock populations in Africa, with practices of free grazing, grazing of land is in line with the
more than 53 million cattle. Only 25 using crop residues to feed reduced carrying capacity in the face
% of cattle graze in rangelands, livestock and using of climate change (Activity 1.2.1)
while the remaining 75 % graze in manure for fuel lead will Improved management practices in
the highlands, leading to serious worsen the impact of grazing areas are introduced,
overgrazing in areas that are climate change on land decreasing this need to use crop
already under high pressure. degradation. residues to feed livestock and
Because the country has a free enabling the maintenance of soil
grazing system, there is no organic matter and nutrients even
incentive for cattle holders to apply under conditions of climate change.
improved management practices in (Activity 1.1.1)
grazing areas. The scarcity of Promotion of efficient cookstoves
grazing land and livestock feed has reduces the need to use cattle
forced the widespread use of crop manure for fuel, meaning manure is
residues to feed livestock. available to build up soil organic
Removing these crop residues for matter, reducing the impact of
feed and utilizing cattle manure for increasing erosion as a result of
fuel further reduces the soil’s climate change (Activity 1.3.1)
organic matter and nutrients. This
breach in the soil nutrient cycle
seriously depletes soil quality,
increases erosion, and eventually
reduces soil productivity.

Insecure land tenure system: Users of land held under Rural cadastral survey conducted
Ethiopia is Africa’s tenth largest insecure tenure continue with the help of drones (Activity
and second most populous to favor short-term 3.1.1)
country. Its rugged topography exploitation of land Land is registered and certified,
makes it difficult to conduct rural resources, even when providing users with the secure land
cadastral surveys of millions of climate change leads to an tenure needed in order to invest in
rural properties and hundreds of increasing need for long- building climate resilience (Activity
thousands of land parcels within a term conservation 3.2.1)
short period of time. Shortcomings measures in order to
in infrastructure also hinder the prevent deleterious
implementation of rural cadastral impacts
surveys. At the same time, there
exists a pressing need to register
and certify rural lands so that users
can be secured and good
governance and rural development
can be promoted and upheld. In the
past, land tenure insecurity caused
by frequent land redistribution
encouraged farmers in Ethiopia to
favor short-term exploitation of land
resources over long-term
conservation, further contributing to
land degradation and low farm
productivity.
SLMP-I and SLMP-II have The inclusion of climate RLLP will scale up the introduction of
supported some watersheds in resilience in SLM activities climate resilience to smallholder
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 13 OF 96

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transitioning to sustainable land has been piloted, but not farmers within the framework of
management, but activities to yet introduced at scale sustainable land management.
graduate from project-based RLLP will put in place the conditions
support are still needed. Further for sustainable implementation of
attention to the creation of resilient resilience building activities
livelihoods is still needed. subsequent to the cessation of
project based support through
support to the creation of resilient
livelihoods (Sub-component 1.2)
The PSNP supports food-insecure Climate change will RLLP will support climate resilient
communities, aiming to achieve endanger the newly food food security of communities
food security secure status of graduating from the PSNP and
communities graduating prevent a return to food insecurity of
from the SNP these communities as a result of
climate shocks
The AGP 2 promotes value chain In the absence of activities RLLP will work synergistically with
development and private sector to build climate resilience, the AGP-2 to create climate resilient
engagement value chains and the value chains and a resilient private
private sector are sector. AGP-2, as a mainstream
vulnerable to the impacts government program, will continue to
of climate change support communities to maintain the
progress made in RLLP after project
end.
The ATA supports some activities In the absence of activities RLLP will work synergistically with
that can contribute to resilience to build climate resilience, the ATA to create climate resilient
such as the introduction of improvements due to ATA livelihoods
warehouses and Common Interest initiatives are vulnerable to
Groups` the impacts of climate
change
Other donors support activities In the absence of activities RLLP shall work with other donor
aiming at improving food security to build climate resilience, funded projects in those areas where
and livelihoods in rural Ethiopia all progress made as a activities overlap to ensure activities
result of other donor are complementary and result in
funded activities is climate resilient progress
vulnerable to the
damaging impacts of
climate change
The GCF financed project The MoFEC project will RLLP will work closely with this
“Responding to the increasing risk increase the climate project to ensure that targeted
of drought: building gender- resilience of water supplies communities have comprehensively
responsive resilience of the most in the targeted areas. It addressed the two major factors of
vulnerable communities” is being targets a different sector vulnerability to climate change –
implemented by MoFEC from RLLP, which focuses water supply and agricultural
on resilient land use and productivity.
agriculture.

Barriers to change and the interventions to mitigate the barriers:

Barriers to change Intervention
Limited awareness of the increasing impact of poor Improved knowledge management and communication
farming and land management practices on water (Activity 2.2.2) with both planners and communities,
resources and soil fertility as the climate changes supported by data collection and information sharing
(Activity 2.1.2)
The potential of land use planning to enhance resilience The on-going local-level participatory land-use planning
is untapped due to weak or absent land use planning exercise at kebele level is extended within the major
watersheds of RLLP with the help of TA for consultation
workshops (Activity 3.3.2).
Extension workers and policy makers lack awareness Capacity building of extension workers and policy
and technical expertise in climate resilient agriculture makers equips them with the awareness and technical
(CSA) practices. As a result planning and implementation expertise to support farmers in increasing their climate
of measures to increase the resilience of agriculture is resilience
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insufficient Robust impact evaluation, knowledge management and
communication establish the conditions for national
scaling-up of SLM for climate change adaptation and
mitigation (Activity 2.1.1)
Lack of soil cover necessary for climate resilience Mulching and cover crops is part of the package of
measures for soil moisture and soil fertility management
in CSA (Activity 1.2.1)
Insecure land tenure prevents investments in climate Outputs 3.1 and 3.2 of the project will initiate a program
resilience for the provision of second level land certificates to
vulnerable, land insecure groups (WB funded)
Maintaining soil quality under conditions of climate The need for using crop residues as feed is reduced due
change by using crop residues and manure is impossible to improved management of grazing areas and feed
due to competing uses production. Improved cookstoves (WB funded activity)
will reduce the need for fuel. Soil fertility improvement is
part of the CSA package of activities (Activity 1.2.1)
Lack of cash prevents farmers from continuing with the Support for resilient livelihoods and income opportunities
practices introduced as part of the project after project (Activity 1.3.1 and 1.4.1)
end
Smallholder farmers are unfamiliar with practices that are SLM and CSA packages are introduced, including:
part of Sustainable Land Management and climate improved seeds for climate resilient crops, improved farm
resilient agriculture tools, fertilizer and other inputs adapted to changed
climatic conditions (Activity 1.1.1 and 1.1.2, 1.2.1)
Fragmentation, duplication and inefficiency of resilience Improved coordination reduces duplication, increases
building actions due to limited coordination among efficiency and ensures comprehensive support to
institutions, sectors, programs and projects that aim to increase the resilience of smallholder farmers (Activity
support smallholder farmer 2.1.1, 2.1.3)

Adaptation needs

Recent experience in Ethiopia has shown that a combination of better natural resource management and resource
rights, jobs and livelihood enhancements, and gender outreach throughout targeted major watersheds can address the
threats posed by land degradation and climate change. Effects of landscape restoration include a range of resilience-
related results, including increased soil moisture and soil fertility important for higher and less variable crop yields,
improved water availability, and increased carbon sequestration – all of which are high priorities for the government.

Much progress has been made by the government and thousands of local communities in addressing these challenges
through proven investment packages under the Government of Ethiopia’s SLM Program, with financing from the World
Bank and other Development Partners (DPs). To bring these benefits to additional rural communities affected by land
degradation, and to help Ethiopia meet its national targets for resilience and low carbon growth, while achieving middle
income status in less than 10 years as planned under the Government’s Second Growth and Transformation Plan
(GTP-2), this work requires greater scale, further innovation, and improved cross-sectoral coordination.

The cost of the investment required to address current levels of land degradation is estimated at $800 million to over
$2 billion, with approximately 670 watersheds needing approximately US$2.7 million each in investment to prevent soil
erosion (see Annex A.9. “Cost of watershed development interventions”). Thus, the incremental investment in (SLM)
required to build resilience to climate change could easily reach hundreds of millions of dollars. Conservatively
assuming that (a) climate change could increase annual soil erosion by 50% (b) 1:1 relationship between increase in
soil erosion and investment cost to build climate resilience, we expect that $904 million would be the incremental
investment cost to prevent increased soil erosion due to climate change across all 670 watersheds in Ethiopia ($1.35
million of incremental cost of climate change per watershed). The request for less than US$ 180 million in GCF funding
for this project is at the conservative end of cost estimates.

The RLLP Objective against the baseline: outcomes and impact that the project aims to achieve

The proposed project will draw on Ethiopia’s decade of experience in addressing the root causes to scale-up tried and
tested interventions. To help address barriers to the ongoing maintenance of restored landscapes, the project will
introduce transformative support for resilient livelihoods and income opportunities.

Though significant results have been achieved over the years, much remains to be done. SLMP initiatives have allowed
Ethiopia to pilot activities to address the root causes of land degradation in the country. However, no matter how
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 15 OF 96

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efficient, they were also a learning process. The RLLP project is a cross-cutting initiative that would scale up and
improve the SLMP experience, implement lessons learned from previous activities, and significantly improve adaptive
capacity of targeted areas. The project aims to scale up the number of restored watersheds, while also improving the
ones already restored and creating an enabling environment, which will lead to productivity, resilience and overall
development of livelihoods. The RLLP is a multidisciplinary project which will link together all relevant sectors in order
to improve the resilience of livelihoods to the highest possible extent.

CSA measures will preserve restored land and will stop reversion to an erosion-sensitive state. These measures will
also significantly increase the adaptive capacity of livelihoods, as they will introduce agrotechnical measures specifically
designed to adjust to conditions outlined in climate scenarios, thus maintaining food security. The acquisition of
processing equipment and storage facilities, as well as training to farmers and establishment of value chains will add
value to goods produced through CSA. All of these activities will enhance adaptive capacity and reduce the exposure
of participating communities to climate change.

This proposed project aims to:

• Increase the resilience of a total of 210 major watersheds located in the Ethiopian Highlands. Watersheds
supported under SLMP-I will receive technical assistance to graduate from project-based support, while
investments in SLMP-II watersheds will allow completion of their MYDPs. In addition, 57 new watersheds were
selected based on criteria set out in the Ethiopia Strategic Investment Framework for Sustainable Land
Management (ESIF), prioritized based on extent and severity of land degradation.
• Complete the implementation of Sustainable Land and Water Management (SLWM) practices by rural
smallholders and communities under Multi-Year Development Plans (MYDPs) in SLMP-II watersheds and
scale up these proven interventions to 57 additional watersheds (average 10,000 ha each) that are vulnerable
to climate variability and change, recurrent drought and floods, and land degradation. The implementation of
SLWM will increase resilience to sudden onsets and long –term climatic changes now and in the future. This
is crucial in order to increase food security through preservation of the land, which is very exposed and sensitive
to climate change impacts, especially in Ethiopia.
• CSA interventions under RLLP will be implemented in 135 watersheds that have already been supported with
landscape restoration during SLMP I and II. SLMP-II piloted CSA in 70 micro-watersheds. As a result of the
lessons learned from this pilot, MoA is now ready to implement CSA at scale and the RLLP, with the GCF
support, will increase the number of micro-watersheds implementing CSA to 370. The implementation of CSA-
specific measures is crucial in order to achieve sustainable agricultural production in the climate change
impacted areas. They will enhance productivity and adaptation capacity of the livelihoods, as well as food
security.
• Beyond physical and biological measures, the Sustainable Land Management Projects (SLMP-I and SLMP-II)
have promoted livelihood diversification and income-generating activities. About 1,446 Self-Help Groups
(SHGs) supported by SLMP-II are engaged in apiculture, poultry, sheep and goat fattening, and vegetable and
fruit farming, and have contributed to the reduction of pressure on the watersheds’ natural resources through
the promotion of improved cook stoves. Improved cookstoves, while using the same type of fuel as baseline
cooking technologies (which is mostly wood), reduce the amount of fuel needed. In areas in which some or all
of the fuelwood used is nonrenewable due to overexploitation of local forests, the introduction of improved
cookstoves reduces GHG emissions. In Ethiopia, the fraction of non-renewable biomass used is 88% (as
determined for CDM projects). Hence, the introduction of improved cookstoves will reduce GHG emissions.
Based on a review of the SLMP-II experience, RLLP will expand and strengthen these interventions through
stronger engagement with the private sector (PS). This will result in a reduced exposure and sensitivity to
climate change impacts onto Ethiopian agriculture. A detailed framework for private sector engagement under
RLLP is presented in Annex B.1.
• Contribute to Ethiopia’s long-term goal of achieving a carbon neutral economy by increasing carbon stocks in
biomass and organic soil, as well as through the promotion of low carbon household energy technologies. Case
studies across regions in Ethiopia indicate that Soil and Water Conservation (SWC) measures can significantly
increase organic carbon content in soil. Soil carbon depletion rates from erosion alone range from 0.02 to 0.97
tons/ha/yr in Ethiopia. Effective land restoration can play a major role in the sequestration of organic carbon
that is lost due to poor land management practices. Soil carbon sequestration with the adoption of restoration
measures is projected to potentially account for 0.41 tonnes CO2-eq. per hectare per year associated with rain-
fed cropland and 0.63 tonnes per hectare per year on Ethiopian rangeland. Reforestation through assisted
natural regeneration will further contribute to the mitigation of carbon emissions, at an estimated rate of 0.92
tonnes of CO2-eq. per hectare annually.
• The project will enhance production and management of and access to relevant environmental, crop, livestock,
forest, weather and geospatial information for land use decision making and disaster risk reduction at the levels
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 16 OF 96

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of major watersheds, community watersheds, and farms. Furthermore, it will provide support for developing
relevant policies, regulations, and by-laws, including for the establishment of watershed associations.
• The project will improve the legal land tenure security of rural households and groups through land certification
and administration, and it will expand and enhance local level land use planning and innovations in landscape
certification models.

A mechanism and supporting elements to allow watersheds to “graduate” from project-based assistance and then
continue sustainable management of restored landscapes through normal government mechanisms is built in to RLLP.
Under SLMP-II, beneficiaries established community watershed teams to discuss natural resource problems and
opportunities and to plan and implement interventions on the ground in an empowered, participatory manner. Under
RLLP, support will be provided to create Watershed User Associations (WUAs), which would be legal entities capable
of sustaining participatory watershed management when project-based support ends. In addition to establishing WUAs,
RLLP will also prepare watersheds for graduation through (i) building local government capacity to design and manage
SLWM interventions, (ii) strengthening incentives for investment in sustainable land management through land
certification, and (iii) improving returns to sustainable productive activities by forging connections to value chains.

It is expected that without the proposed project, land use will continue on its current path while being subjected to
negative and progressively more severe climate change impacts. Negative climate change impacts will further influence
livelihoods due to insufficient adaptive capacity in project areas. Production yields will decrease while farmers will face
increased input costs. Non-agricultural land in the watershed will also continue to deteriorate without the project due to
soil erosion as well as overuse of common land through grazing livestock and firewood collection. This will put a further
strain on local populations, who derive their livelihood from forests, woodlands, and surrounding areas. Downstream
from the project area, continued land degradation will also affect areas and households through increased flood risk
and sedimentation of irrigation dams.

Baseline projects

In addition to the GCF funded MoF project mentioned above, there are several other projects that are been
implemented in the RLLP areas from which RLLP could benefit. RLLP will seek to establish synergies and avoid
duplication of activities with these other projects.

GoE/WB Second Agricultural Growth Program (AGP-2)

AGP-2 currently operates in some woredas where there are SLMP-2 rehabilitated watersheds. They have
implemented interventions to enable irrigation in some woredas. AGP-2 is engaged in support to key livestock and
crop value chains (VCs), and is supporting productivity improvement, processing, storage/warehousing, market
development in these VCs. AGP-2 and RLLP are implemented by same major donor (WB) and GoE ministry (MoA),
and they are expected to have additional geographic overlap in the four main regions. In terms of value chain
development and private sector engagement, RLLP will seek to harmonize as many methodologies and activities
with AGP-2 as possible.

USDA Feed Enhancement for Ethiopian Development (FEED) II/III Project

FEED II is improving incomes and food security through improved availability, access and utilization of livestock and
poultry feed. FEED III has been approved, will begin soon and will be in operation until at least 2020. Some woredas
in which FEED II operates include SLMP I/II rehabilitated watersheds, and there promises to be even more
geographic overlap in RLLP and FEED III. FEED II/III is seeking to exponentially expand their forage development
and has the funds and technical personnel to do so. RLLP will seek to actively collaborate and pilot linking and
contributing to activities in some of the overlapping woredas.

USAID Feed the Future Ethiopia (FtFE) Value Chain Activity (VCA)

The overall project objective of this initiative is to improve agricultural productivity and the commercialization of
smallholder agriculture in the Tigray, Amhara, SNNP and Oromia regions. They support development of 6 major VCs
– chickpeas, coffee, maize, dairy, meat and live animals and poultry. VCA is finalizing their selection of woredas to
target, but they are expected to have significant geographical overlap with SLMP/RLLP.

Agricultural Transformation Agency (ATA)

ATA has completed construction of 44 warehouses in Tigray, Amhara, Oromia and SNNP regions, and it is eager to
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 17 OF 96

facilitate and ensure the best possible use of these warehouses. The locations of these warehouses coincide with
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woredas in which SLMP-2 currently has rehabilitated watersheds and with woredas with new RLLP watersheds.
Enterprising Common Interest Groups (CIGs) from SLMP-2 watersheds with RLLP support could assume management
of selected warehouses.

B.2. Theory of change (max. 1000 words, approximately 2 pages plus diagram)
Describe the theory of change and provide information on how it serves to shift the development pathway towards a
low-emission and/or climate resilient direction. Provide the diagram of the theory of change (approximately 1 page).

The theory of change should include any barriers (social, gender, fiscal, regulatory, technological, financial,
ecological, institutional, etc., as relevant) that need to be addressed. Use a results chain of inputs, activities, outputs,
outcomes, and impact statements, and identify the how and why of causal relations to deliver the project’s expected
results.

This integrated package of activities is the result of the extensive experience gained in previous projects and is
essential to achieving paradigm shift. In order to achieve catalytic impact, it is essential to address all the root causes
of land degradation, which include (i) poor cropland management practices, (ii) rapid depletion of vegetation cover,
(iii) poor livestock management, and (iv) an insecure land tenure system. This approach grows out of the project’s
theory of change: by delivering more productive, secure and resilient livelihoods to local communities and by
establishing the institutional framework needed to support maintenance of restored landscapes over the long term
through watershed associations and local governments, the RLLP will lead to a durable shift towards SLM in the
degraded watersheds of the Ethiopian highlands. A piecemeal approach in which only some of the drivers of
degradation are addressed might lead to temporary, local improvement but would not lead to a sustained, widespread
shift towards resilience for poor Ethiopian farmers. Figure 3 shows an illustration of this Theory of Change.

Figure 3. Illustration of Theory of Change

RLLP presents important opportunities for scaling-up and replication. While government and development partner
interest in SLM in Ethiopia remains high, a crucial barrier to achieving the level of investment required to restore all
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 18 OF 96

degraded watersheds nationally is the need to demonstrate a strategy for the long-term maintenance of these
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restored, newly productive, resilient, low emission landscapes. By building policy, institutional and market incentives
for long-term SLM and by investing in robust impact evaluation, knowledge management and communication, RLLP
will establish the conditions for national scaling-up of SLM for climate change adaptation and mitigation. In the shorter
term, replication of the successes of RLLP interventions can also be expected in neighboring watersheds, a process
that has already been demonstrated to dramatic effect in the ongoing SLM program as a result of informal
dissemination of improved land and water management practices. Such informal dissemination can go far towards
enabling scaling up and replication, since once they are introduced many of the project’s activities depend on
community participation for their success rather than on the private sector or formal financing.

B.3. Project/programme description (max. 2000 words, approximately 4 pages)

Define the project/programme. Describe the proposed set of components, outputs and activities that lead to the
expected Fund-level impact and outcome results. Components should reflect the project/programme level outcomes.

This should be consistent with the financing by component in section C.2, the results and performance indicators
provided in section E.5, and the implementation timetable in annex 5.

Referring to the feasibility study, describe why this set of interventions was selected instead of alternative solutions
and how the project/programme can help unlock the needed support in a sustainable manner. Also identify trade-offs
of the selected interventions, if applicable.

For Enhanced Direct Access (EDA) proposals and projects/programmes with financial intermediation (loans or on-
granting), describe the selection criteria of the sub-project and types.

The proposed project will significantly enhance the resilience of the target populations’ livelihoods to climate change
impacts. The proposed interventions will enhance the resilience of interventions in the government’s ongoing SLM
program through an integrated package of activities and scale up the program while targeting the watersheds and
communities that are most vulnerable to climate change. Figure 4 below indicates areas of the country that need
SLM interventions, those that have already received support and areas that will receive support for the first time in
RLLP.
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 19 OF 96

Figure 4 Watersheds mapped by areas needing SLM treatment

Project interventions include soil and water conservation (SWC) structures, reforestation and assisted natural
regeneration, as well as low-emission and climate-resilient agriculture practices. The scaling-up of SLM for climate
change adaptation and mitigation will be complemented with (i) transformational investments in income
opportunities, resilient livelihoods, and the productive value chains associated with SLM, designed to strengthen
incentives for communities to maintain restored landscapes; (ii) Cofinance for the promotion of low carbon
household energy solutions; and (iii) land tenure.

The RLLP will be implemented through four integrated components: 1. Green infrastructure and resilient livelihoods;
2. Investing in institutions and information for resilience; 3. Rural land administration and use; and 4. Project
management and reporting. Taken together, the activities in these components will achieve the project’s objective
of creating resilient landscapes and livelihoods for vulnerable rural populations in Ethiopia. Component 1 forms the
core of the project in that it includes the activities directly implementing sustainable land management and
agricultural practices. Component 1 also includes cofinanced activities addressing household energy services.
These activities are essential to change the development pathway of rural Ethiopia to one in which land use is
climate resilient. Non-sustainable use of biomass for cooking is one of the main drivers of deforestation and
degradation in Ethiopia. The key interventions proposed in national policy include improved land use, diversified
bioenergy options for cooking, and improving the efficiency of fuel production and use. The Environment Policy also
makes the link between sustainable land management and controlled harvest of forest resources, with specific
actions proposed including the promotion of technologies to reduce the use of fuelwood. In short, if cooking
practices are unchanged then unsustainable harvesting of wood for fuel will continue, undermining progress in
resilient land use made through the introduction of sustainable land management and agriculture.

Component 2 will create institutions and build capacity that will enable the interventions introduced in Component 1
to be sustainably implemented even after watersheds graduate from project-based support. Component 3 deals
specifically with the barrier of weak tenure rights. The provision of security of tenure to smallholder farmers is
essential to motivating to implement the new practices that will be promoted by RLLP. Without clear tenure and
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 20 OF 96

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strong land use planning it is likely that interventions introduced by the proposed project will be abandoned once
project support ends. Finally, project management activities are covered by Component 4.

This integrated package of activities is the result of the extensive experience gained in previous projects and is
essential to achieving paradigm shift. In order to achieve catalytic impact, it is essential to address all the root
causes of land degradation, which include (i) poor cropland management practices, (ii) rapid depletion of vegetation
cover, (iii) poor livestock management, and (iv) an insecure land tenure system. This approach grows out of the
project’s theory of change: by delivering more productive, secure and resilient livelihoods to local communities and
by establishing the institutional framework needed to support maintenance of restored landscapes over the long
term through watershed associations and local governments, the RLLP will lead to a durable shift towards SLM in
the degraded watersheds of the Ethiopian highlands. A piecemeal approach in which only some of the drivers of
degradation are addressed might lead to temporary, local improvement but would not lead to a sustained,
widespread shift towards resilience for poor Ethiopian farmers.

Scale of the project, identification of targeted project area and beneficiaries

In terms of the scale of the project, the World Bank is confident that the benefits of implementing the interventions
included in the project at the relatively large scale proposed outweigh the risks. A number of factors mitigate these
risks, key among them being that the project builds on experience gained by the World Bank and the Federal
Democratic Republic of Ethiopia during previous and ongoing projects. The proposed project benefits from the
lessons learned over many years of projects aimed at sustainable land management, poverty alleviation and
increasing the sustainability of agriculture in Ethiopia, and in particular the SLMP projects. These lessons led to the
creation of the institutions that RLLP will build upon such as bottom-up watershed planning and self-help groups as
well as the approach to CSA described in Annex A.3 in which a number of packages of activities are combined to
achieve the triple goals of adaptation, mitigation and livelihood development.

For the Executing Entity, RLLP activities will come on top of activities with a budget of $316 million that are already
disbursed or committed for SLMP, which are managed or coordinated by MoA. For both the sums already spent or
committed and for the co-financing the World Bank provides to RLLP, the World Bank has conducted risk analysis
and identified mitigation actions that resulted in the decision by the World Bank to commit its own funds to the
project. The valuable experience gained during implementation of SLMP-II, as well as the significant Recipient-
executed and Bank-executed resources allocated in the past five years for coordination and capacity building efforts
are expected to be instrumental to improve or identify viable measures to address all the risks.

Total needs were a major consideration in deciding on the scale of the proposed project. Soil degradation is an
ongoing problem that is becoming more severe with every passing year. There are significant costs related to
inaction – the longer we wait to address the problem, the worse it will get, and the more expensive it will be. To
achieve sufficient momentum for scaling up and replication, countrywide implementation is essential. The targeted
watersheds for this project were selected with inter-regional equity in mind. A total of 210 major watersheds are
included in RLLP, averaging approximately 10,000 hectares each. Out of these, 135 watersheds are those already
targeted by SLMP-I and II. In these watersheds RLLP will implement only innovative climate resilient activities that
were not included in SLMP. 57 watersheds included in RLLP are new to the implementation of (SLM) measures.
The process for the selection of these new watersheds to be targeted by the project is summarized in Section E.4.1
and described in full in Annex A.1.

In order to achieve the aims of the project – achieving restored, productive and low emission landscapes, the
project will work with the communities that are using these landscapes. Hence, beneficiaries are selected at the
community level and the direct beneficiaries are individuals who are living within a project watershed. The members
of these communities are vulnerable smallholder farmers, who are very sensitive and highly exposed to climate
change impacts. The total population within the project area is 4.2 million people or 834,000 households (with an
average of 5 persons per household). Evidence based data driven implementation and planning will ensure that
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interventions benefit smallholder farmers. Detailed bio-physical information for new watersheds, including individual
landholdings, will be collected during the Multi-Year Plan (MYP) preparation of each watershed. Local level
participatory land use planning teams at woreda and kebele levels would ensure that interventions benefit the
smallholder farmers. The baseline study report for 90 watersheds of SLMP II found that the average land holding
was only 1.338 ha. Agro-ecologically, watersheds above the altitude of 2300 meters and lowland areas between
500 and 1500 metres, have an average land holding of only 0.83 ha and 2.082 ha respectively. Furthermore, about
4.2% of the households have no land at all (3.5% of male and 6.5% of female headed households), 10.6% have
less than a quarter of a hectare and 21.9% less than a hectare.

The experience of previous phases of the project has shown that there is a high willingness to participate by
populations of the proposed intervention areas. The World Bank has tracked community contributions during the
second phase of SLMP implementation. Translated into monetary terms, the cumulative community contribution in
the four budget years from 2014/15 until 2018/19 was 23.5% of the total financial utilization of the project, equal to
about USD 27 million. The most important contributions by the population were in the implementation of soil and
water conservation measures on both communal land and farmland and community forest management.

The project components and activities are described below. Implementation will be guided by the recommendations
and supporting studies that comprise the feasibility study. These documents provide guidance on which technology
alternatives should be selected depending on local circumstances. Quantitative information on numbers of
beneficiaries and areas benefiting from each activity, as well as a breakdown of funding between GCF and co-
finance is provided in the detailed budget in Annex K.1.

Component 1. Green Infrastructure and Resilient Livelihoods

This component will greatly increase the adaptive capacity to climate change of the target population by scaling up
proven sustainable land and water management practices. These practices will be introduced to rural smallholders
and communities in watersheds vulnerable to climate variability and change, recurrent drought and floods and land
degradation. Three complementary approaches form the core of this Component: (i) land restoration through
sustainable land management, predominantly targeting communal lands, in which physical and biological
interventions are made to prevent erosion and restore degraded land; (ii) a standardized approach to low-carbon
resilient agriculture, which targets private lands; and (iii) support for income opportunities and resilient livelihoods,
which is designed to provide incentives for maintaining restored landscapes. The project will work through
government development agents in the Bureaus of Agriculture at the local level, which will mobilize and support
communities, providing them with continuous training.

This component will complete the adoption of Sustainable Land and Water Management (SLWM) practices by rural
smallholders and communities under MYDPs in SLMP-II watersheds, and it will scale up these proven interventions
to 57 additional watersheds (average 10,000 ha each) that are vulnerable to climate variability and change,
recurrent drought and floods, and land degradation. Activities will include financing SLWM interventions on
communal and individual lands (with differentiated levels of community contribution), as well as supporting
infrastructure such as green corridors linking fragmented forests, and community roads designed to optimize water
harvesting. Proven SLWM practices that will be implemented include: soil and water conservation infrastructure
such as terraces, water harvesting trenches, check dams, small reservoirs, and other civil works; soil fertility and
moisture management; assisted natural regeneration, enclosures plus livestock land use rationalization,
intercropping, low tillage, gully reclamation, establishment of grazing corridors, watering points and wells, and sylvo-
pastoral management strategies. Government Development Agents (DAs) in the Bureaus of Agriculture will
mobilize and support communities and receive continuous training to ensure high-quality advice and extension
services.
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B
The specific technological solutions implemented under Subcomponent 1.1 and 1.2 in each watershed will be
determined using a participatory community-based approach. The approach used is described in the Community
Based Participatory Watershed Management Guideline[1]. The community-based participatory approach will identify
the most appropriate technologies that respond to the unique needs of each individual watershed included in the
RLLP. This approach will result in a number of benefits, including improved community ownership and engagement,
as well as ensuring that expected results are achieved and sustained. More information is provided in Section F.2.

During the participatory planning communities first present the problems they have (problem analysis) and
depending on the availability of labor and finance they prioritize interventions based on the Community Based
Participatory Watershed Development Guidelines (CBPWDG). Once prioritized and agreed the plan is approved by
woreda responsible office (office of Agriculture). The procedures are clearly presented in the Community Based
Participatory Watershed Development Guideline, excerpts of which are provided in Annex A.2

The objectives of this component will be achieved through the implementation of the following sub-components: (i)
Land restoration and watershed management; (ii) Climate-smart agriculture; and (iii) Livelihood diversification and
connections to value chains.

Sub-component 1.1 Land Restoration and Watershed Management

Sustainable Land Management activities will be funded by IDA and MDTF in watersheds identified for IDA funding
(budget of USD 55.9 million) and by GCF in watersheds identified for GCF funding (budget of USD 100 million).

Afforestation-Reforestation-Green Corridor - Activities will be funded by IDA and MDTF only in watersheds identified
for IDA funding (budget of USD 1 million).

This sub-component will focus on the implementation of land rehabilitation measures and establishment of green
infrastructure through biophysical land and water conservation measures. These measures are required primarily
for the rehabilitation of communally-owned degraded forest, pasture and woodlands, but also for privately cultivated
lands, as well as to enable and maintain agricultural production in harsh climate conditions which are exacerbated
by climate change. One key objective of this sub-component will be to create benefit streams to the communities in
the targeted micro watersheds from increased ecological services and land productivity, mainly through productive
use and management of landscapes resources. In addition to the proven practices applied during SLMP-II, this sub-
component will also introduce the establishment of green corridors, which will further reduce erosion, enhancing
watershed restoration, and increase ecological connectivity.

The objective of the sub-component will be achieved through biological and physical conservation measures that
ensure reduced surface run-off and soil erosion, as well as improved land productivity, resulting in enhanced crop
and livestock production. The following activities will be supported:

• Soil and water conservation measures on communal and privately cultivated lands: biological and physical
soil and water conservation measures/practices such as construction of terracing, check dams, water
harvesting (e.g. trenching), reseeding, re-vegetating, etc. will be implemented on degraded communal and
farmlands;
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 23 OF 96

B
• Gully rehabilitation: Cost efficient biophysical gully restoration techniques such as sandbag check dams,
sediment storage dams and gabion-check dams will be applied. Productive use and management of the
rehabilitated gullies will be supported, such as for forage, fruit and fuel wood production;
• Establishment of green corridors: Planting suitable, preferably native, tree species along rivers/streams and
all-weather roads connecting forest patches in the watersheds. Post plantation management support
including tending, hoeing and soil moisture conservation will be carried out. Green corridors will also be
established along gully offsets to ensure stability and productive use of the land;
• Area closure management and use: assisted natural regeneration through restrictions on free grazing,
enrichment planting, soil fertility improvement and moisture retention will be implemented in communal
areas and/or privately managed degraded bush and woodlands. Cost efficient management practices of
enclosures will include supporting local communities in the preparation and execution of participatory use
and management plans of enclosed areas, including forage cut-and-carry arrangements;
• Establishment of plantation blocks: Reforestation and afforestation of degraded forest and shrub/bush lands
with a diverse range of tree and shrub species that can be used as a source of food, feed and energy, and
enhance fertility of the soil. Planting of appropriate tree seedlings including economically valuable species,
and post-plantation management practices such as tending and watering in moisture stressed areas,
hoeing and weeding during early stages will be carried out to ensure survival of the planted seedlings; and
• Enrichment of degraded pasture and rangeland: Planting and reseeding of appropriate forage species
including fodder crops in degraded pasture and rangelands to increase productivity and improve the value
of feed for grazing animals. Management of unpalatable invasive species will also be undertaken in pasture
and rangelands to ensure optimum forage production.

Suitable rehabilitation interventions for each micro-watershed are determined based on the particular agro-
ecological conditions and incorporated in a MYDP, developed through a participatory process, utilizing the technical
parameters and procedures established in the Community Based Participatory Watershed Development Guidelines
(CBPWDG, 2005) developed by MoA, and currently being updated. MYDPs already exist for SLMP-II watersheds,
but they will be developed under the RLLP for the watersheds that have not yet been addressed.

Supported by the Zonal, Regional and National Platforms (see details in Annex 2), implementation of MYDPs is
undertaken jointly at the woreda and kebele levels through the Woreda Watershed Development Committee
(WWDC), the Kebele Watershed Development Committee (KWDC), and the beneficiary communities. Together with
the Development Agents (DA) and Community Facilitators, the WWDC and KWDC assist communities in: (i)
developing annual work plans and budgets for submission to the Regions for endorsement and integration into the
Regions’ work plans and budgets; (ii) facilitating community participation in watershed planning and rehabilitation;
(iii) identifying training needs; (iv) monitoring and evaluation; and (v) dissemination of experiences and results. This
sub-component will also provide resources for local expertise to be contracted to provide technical assistance to
WWDCs, KWDCs and beneficiary communities in planning and implementing their SLM interventions. The
operational details for the planning, design, and implementation of MYDPs will be planned during implementation. A
guideline has been developed that will be used for this: “Exit Strategy and Performance Assessment for Watershed
Management (ESPAWM) – A Guideline for Sustainability” (see Annex L.3.).

The alternative technologies and practices selected for Sustainable Land Management are:

• Physical soil and water conservation measure on farmlands

• Physical soil and water conservation measures on communal lands including degraded hillside, shrub land
and pastureland
• Gully control measures including gully wall reshaping, check dam and retaining wall construction
• Pitting and planting of multi-purpose trees on degraded lands
• Model plantation blocks with native tree species
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 24 OF 96

Additional alternative technologies and practices selected under this sub-component include:
B
• Afforestation
• Reforestation
• Green corridor creation
• Multiyear development plans
• Watershed management and use plans
• Watershed user associations

Sub-component 1.2 Climate Smart Agriculture

Activities will be funded by IDA and MDTF in watersheds identified for IDA funding (budget of USD 18.5 million) and
by GCF in watersheds identified for GCF funding (budget of USD 15 million).

Interventions under this sub-component will aim at enhancing the livelihood resilience of beneficiary households
through Climate-Smart Agriculture (CSA) interventions in all eligible micro watersheds assisted by the project. The
improved adaptation of restored watersheds to variable rainfall patterns and adverse climatic events, combined with
reduced degradation-related risks (achieved through sub-component 1.1), will provide suitable conditions for
beneficiaries to adopt improved, climate-smart farming practices and diversify and/or intensify their current
production systems. For this, technical and financial assistance will be provided to stabilize soils and increase
fertility; improve water retention, harvesting and infiltration; increase biomass (and carbon) accumulation; and
promote the adoption of climate-smart tillage and production practices in farm plots and home gardens. The
introduction of such practices is needed to ensure agricultural productivity in coming decades given expected
climate change impacts as described in section C.2.

This sub-component will build on the achievements of sub-component 1.1, such as improved water run-off retention
and infiltration, gully and degraded hillside stabilization, and enhanced biomass production. This connection to the
biophysical restoration of the landscape is important, as it will help ensure that unsustainable agricultural practices
do not reverse prior restoration measures. In this way, agricultural activities become fully integrated into the
watershed/landscape restoration approach and contribute towards the goal of climate resilient watersheds. The
ongoing pilot of CSA within SLMP-II and lessons from international experience indicate that CSA cannot be
achieved by a single measure or practice. In order to achieve the triple wins of adaptation, mitigation and increased
production, technical and financial assistance will be provided to implement context-specific packages of CSA
activities. The primary set of technologies for CSA that have been selected for use in the project are described in
the manual for Climate Smart Agriculture (Annex A.3) (see also Section F.2 Technical Evaluation for more
information). The following CSA activity activities are based on the manual for CSA which outlines 4 work/activity
packages, will be supported under this sub-component:

• Farm water and soil moisture management (based on Work/Activity Package 1 of CSA manual): This will
include in situ soil moisture management practices such as improved tillage, mulching/permanent soil cover
and water harvesting including construction of cut-off/on drains and road water harvesting. Provision of
improved farm tools/machineries for moisture conservation tillage will be considered under this activity;
• Integrated soil fertility and soil health management (based on Work/Activity Package 2 of CSA manual):
Various soil fertility management practices such as improved compost making including bio-slurry, vermi-
compost and manure management (including bio-digestors); lime and gypsum application for acidic and
alkaline soils respectively; promotion of tree-food crop-livestock systems (agro-forestry practices); and crop
rotation and legume intercropping will be integrated as a package and promoted based on local conditions
and farmers indigenous knowledge and commitment;
• Crop development and management (based on Work/Activity Package 3 of CSA manual): Access to better
performing crops (drought and disease resistant) will be supported based on local-level adaptive research
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 25 OF 96

and crowd-sourcing by farmers over a wide range of crop varieties (both local and improved cultivars).
B
Integrated pest and disease management, including post-harvest management, will be implemented to
minimize crop yield losses. Productive use of increased soil moisture through production and management
of high value crops, such as vegetables and fruits, will also be part of this activity package. Improved farm
tools and machinery such as line planters, tillage and harvesting equipment will also be tested to improve
the efficiency and effectiveness of the cropping system; and
• Environmentally-friendly livestock production through feed development and management (based on
Work/Activity Package 4 of CSA manual): High quality and quantity forage in pasture and along farm
boundaries, gullies and back yards will be a priority to minimize dependence on crop residue as livestock
feed, and to ensure increased use of biomass for soil fertility improvement. Efficient use livestock feed
resources through feed treatment and improvement of feeding troughs will also be implemented to reduce
losses. Appropriate integration of agro-sylvo-animal husbandry practices will be introduced at the
homestead level based on the needs of local farmers and the suitability of local conditions. Practicing an
integration of multi-purpose food and tree cropping with livestock rearing at the homestead can improve the
fertility and organic matter content of soils and increase crop yields and household food security.

CSA interventions under RLLP will be implemented in micro-watersheds that have already been supported with
landscape restoration during SLMP I and II. The following set of criteria was used to select eligible micro-
watersheds: (i) at least 75 % of the watershed restoration plans completed; (ii) community agreement on controlled
grazing enforced; (iii) forage development partly implemented; (iv) farmland covering more than 50 % of the micro-
watershed area; (v) access to functional farmers training centers (FTCs); (vi) adjacent to SLMP-II CSA pilot
watersheds; (vii) local knowledge or traditional practice of multi-cropping system; and (viii) commitment of
community and kebele watershed teams.

Consistent with existing limitations, the operational unit for CSA interventions in eligible micro-watersheds will be
groups of organized farmers and their corresponding contiguous farm plots. The number of groups and farm plots
will be determined during the planning phase based on the budget allocated to the woreda for CSA. CSA groups
will be organized by the DAs assisted by woreda experts. In each group, the number of members should ideally
range between 20 and 30 farmers. These groups will constitute the equivalent of the Common Interest Groups
(CIGs) promoted by AGP, which will prepare results-oriented subproject proposals, integrating packages of goods,
small works, services and/or operating costs) for RLLP financing. The project will provide required input to the CSA
interest groups to improve efficiency of the farming practice. The operational procedures –including procurement
methods--for the implementation of the CSA subcomponent of the project are included in the existing CSA Field
Manual, developed by SLMP-II and to be updated for RLLP.

CSA is knowledge intensive and entails moving toward an agro-ecological approach, but these changes are
necessary to increase resilience to climate change. Project practitioners will therefore need to extend their support
to beneficiaries beyond the planning phase and provide technical assistance throughout the entire adoption cycle.
The workload of the local technical unit will therefore include resources to: (i) conduct periodic visits to the plots of
farmers implementing CSA practices, (ii) establish demonstration or testing plots, and (iii) organize and conduct
dissemination activities such as field days and farmer exchange visits. Equally important, the regional structure
should be capable of providing technical backstopping to DAs through periodic joint field visits, on-farm refresher
training, as well as assistance in planning and conducting demonstration activities.

CSA technology testing and demonstration activities, as well as collaboration with research and academic
institutions, will also be a part of CSA implementation. Farmer Training Centers (FTC) or similar structures will be
identified and utilized at the watershed level for these activities, while contributions by research and academic
institutions for the identification of appropriate technologies and practices will be implemented through the
establishment of a CSA Innovation Platform.
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 26 OF 96

B
The alternative technologies and practices selected are:

• Soil moisture management including drainage and cutoff drains in micro-watersheds

• Agroforestry
• Disease and drought resistant crops
• Improved farm machines/tools (handheld harvester, ripper, line planter, mechanical weed slasher)
• Compost making
• Organic/biofertilizer
• Improved livestock feeding troughs including feed treatment materials

The RLLP promotes Climate Smart Agriculture, including the use of mulch, cover crops and minimum tillage, which
also seeks to minimize the application of agrochemicals. The combination of CSA activities and the implementation
of the integrated pest management plan included in the ESMF will reduce vulnerability to pest and disease impacts.
The resulting improved crop production together with the provision of high-yielding and disease tolerant seeds will
support efforts to minimize the use of pesticides and agro-chemicals in the project area.

RLLP resources will not be used to purchase pesticides, herbicides, biocides, or GMO and Patented Hybrid Seeds.

Sub-component 1.3 Livelihood Diversification and Connections to Value Chains

Activities will be funded by IDA and MDTF in watersheds identified for IDA funding (budget of USD 6.1 million) and
by GCF in watersheds identified for GCF funding (budget of USD 28 million). Activities for the promotion of high
performing cookstoves will be funded only by IDA and MDTF in watersheds identified for IDA funding (budget of
USD 0.5 million). No GCF funds will be requested for activities related to the promotion of high performing
cookstoves.

This sub-component includes innovative activities that will enhance the sustainability of the resilient, improved
livelihoods created as a result of the activities in sub-components 1.1 and 1.2. The generation of sustainable
improved incomes for the vulnerable smallholder farmers targeted by the project will enable them to maintain the
rehabilitated watersheds. Without the activities in this sub-component there is a risk that poverty will lead the
beneficiaries to return to previous, unsustainable practices after the project ends, reversing the gains made through
the introduction of sustainable land management and climate smart agriculture.

The activities include advisory services and investment to improve access to and implementation of climate resilient
livelihood diversification. These activities will help address the issue of landless/jobless youth/women and the
resulting increased stress on the natural resource base and its potential to reduce climate risks. A number of
potential interventions have been identified. Examples include support to women-managed local enterprise
development, vocational training, processing equipment and CSRPs, facilitation of access to markets, technology
and trade and a suite of other initiatives to incentivize private-sector engagement. It will also finance activities that
facilitate private sector engagement in RLLP-supported value chains directly or through primary cooperatives and/or
coop unions, as well as direct investment in landscape restoration through PES, CSR or volunteer/good citizenship.
In addition, this sub-component will provide small, seed-fund grants to SHGs, CIGs and/or WUAs to launch or
expand productive, processing and storage activities, based on an analysis of what the markets will purchase, and
therefore what will increase incomes of households and sustainability of the rehabilitated watersheds. Finally, the
WB will support co-financed activities aimed at creating a market for improved cookstoves (funding from GCF is not
being requested for this activity). Non-sustainable use of biomass for cooking is one of the main drivers of
deforestation and degradation in Ethiopia. If cooking practices are unchanged then unsustainable harvesting of
wood for fuel will continue, undermining progress in resilient land use made through the introduction of sustainable
land management and agriculture. Reducing demand for fuelwood is critical to maintaining restored landscapes in
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 27 OF 96

B
project communities. In addition, as heating and cooking efficiency improves, use of manure and crop residues for
cooking and heating decreases, allowing these materials to be used on fields to enhance soil fertility.

MoA has drafted eligibility criteria for choosing watersheds and commodities eligible for value chain. For example,
the followings are criteria for watershed selection: Sense of ownership of communities’ watersheds managing
team. i.e., Capacity, experience and commitment of (CWT, KWT, WTC &WSC,). - Watersheds aligned with GIZ-
SURED support. - Existence of other private sector support programs. -Rehabilitation status of watersheds:
coverage area of rehabilitated land in watersheds; soil fertility that is suitable for high value commodities; availability
of alternative water sources. - Accessibility to all weathered roads and other infrastructure development. -
Accessibility for Market linkages and reliability of commodity supply. - Accessibility to inputs providers, extension
services deliveries and financial institutions. - Widely existence of proactive community and lead farmers (MHH and
FHH) to accept for new innovations, technology, etc. – Whether RLLP is providing support for CSA. -Unemployment
status of the community/ies within the watersheds.

RLLP is only (a) providing in-kind support such as warehouses and equipments and (b) organizing awareness,
training and workshops for various groups. No sub-loans or sub-grants will be made to any groups or individual
beneficiaries.

Innovation for climate resilient livelihood diversification and private sector development

These activities will focus on private sector development (PSD) in RLLP rehabilitated community watersheds.
Product processing and bulking capacity will be developed that will enable sustainable, environmentally friendly
livelihoods, thus increasing incomes, which in turn will lead to the maintenance of rehabilitated watersheds and
improved food security in the face of climate change. Without appropriate infrastructure and facilitated linkage of the
private sector, newly developed livelihood interventions will diminish and eventually fail, causing households to
revert to previous harmful practices and removing the incentive for maintenance of rehabilitated climate-smart
watersheds, leaving them exposed to risks driven by climate change. If watershed communities produce high-
quality, semi-processed products for bulk purchase by the private sector, they will encourage the private sector to
go the “last mile” to these watershed communities even though lower-quality, unprocessed and unbulked
commodities might be closer at hand.

Processing Equipment and Training: Activities will support the shared purchase of and training on key agricultural
processing equipment, which will increase the value of crops produced through climate smart agriculture (CSA) and
livestock products produced through intensive, environmentally friendly methods by watershed
communities/households. Such equipment may include the following: Forage processing mills, grain threshers,
weighing scales, grain mills, processing sheds, dairy processing equipment, poultry and egg processing equipment,
bamboo processing equipment and tools, and vegetable storage/transport containers.

Heavy equipment is not included in the list of eligible equipment. The use and maintenance of eligible equipment is
delineated in the bylaws and governance structures of CIGs, cooperatives, self-help groups, female groups to which
equipment may be made available.

Community Storage Receipts Programs: The project will foster the development of community storage receipts
programs (CSRPs) in RLLP rehabilitated watersheds by building warehouses or other types of storage facilities and
training community organizations to develop and maintain CSRPs. One of the major barriers to the implementation
of resilience building measures by farmers is lack of cash. Once the project is completed and concessional finance
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 28 OF 96

B
is no longer available, farmers will need cash in order to be able to continue practices introduced by the project
such as the use of improved seeds, improved farm tools, fertilizer and other inputs. The CSRP will provide
immediate cash to poor farmers, improving their food security and ability to pay for other necessities as well as
allowing them to improve productivity by investing in agricultural inputs such as seeds, fertilizer and other inputs
through their available income. The CSRP approach will be managed by organized CIGs/Watersheds Associations
or cooperatives which have legal personality to sign contracts, access loans from MFIs or FIs and management
capacity as compared to fragmented farmers with weak management capacity and difficulty of accessing loans from
MIFIs or FIs due to lack of confidence , weak financial management and difficulty of collection/repayment, could not
present collateral. Such initiative has never been tested under SLMP-1 and SLMP-2. But WB financed initiative
such as the AGP initiated such approach using CIGs.

These CSRPs will store commodities in demand by the private sector that will be weighed and valued according to
expected market price at the proposed time of sale and labeled accordingly. The producer will then receive a
receipt for the commodity and 50% of the expected purchase price from the CSRP manager, and the commodities
will be stored carefully and properly until the time of sale. After the commodities are sold, the producer will receive
the other portion of the proceeds based on the actual sales price and a small deduction for the cost of the service.

Crop and other value chain commodities will vary according to watershed conditions with primary commodities
integrated in the Ethiopian Commodity Exchange Trading System such as coffee, sesame, red-kidney beans, white
pea bean, green mung bean, chickpeas, soybeans, wheat, maize. The watersheds identified for interventions have
agro-ecologies that are suitable for most of the commodities mentioned above. Additionally, domestic demand for
teff, barely, fava beans, honey, and spices will inform the selection of value chains to be supported.

CLIMATE INDUCED RISK: The CSRP will support the establishment of stores sufficient to mitigate
temperature/moisture, frost due to climate change and related pests/insects, which might adversely impact the
quality and value of the crops. CSRP: These stakeholder groups will be overseen by the respective cooperative,
union, or watershed user association which have legal standing in Ethiopia to sign contracts and access financing.
CSRP Management: Based on their legal standing and capacity, cooperatives, unions, or watershed user
associations will manage the CSRPs. CIGs and SHGs will subscribe as members to participate in CSRP schemes.

SLMP-I and SLMP-II EXPERIENCE: The CSRP-related initiative was not tested during the SLMP-1 and SLMP-2.
However, the Ethiopia Agricultural Growth Program (AGP) provides lessons and experience regarding CSRP that
have been integrated in the RLLP. Other programs such as the Ethiopian Commodity Exchange
(http://www.ecx.com.et) have also generated relevant experience and capacity in SLMP-I and SLMP-II-supported
watersheds

The cooperatives/watershed user associations and the CIGs will be responsible for developing the management
and business structure of the CSRP. Primary management responsibilities will be held by cooperatives or
watershed user associations. The coops/watershed associations would set price that accommodates such price
risks when designing their bylaws and marketing strategy. The CSRP supports farmers to overcome their
immediate problems, among others. The CSRPs is chiefly applicable to agricultural products which are subject to
fluctuating price within the harvest and lean seasons. The System is an important and effective tool for creating
liquidity and easing access to credit. It also offers additional benefits such as smoothing the supply and prices in the
market, improving smallholder farmers’ incomes, and reducing food losses. The system can play dominant role in
the development of the overall agricultural sector, by permitting smallholder farmers to hold food back to the lean
season, allowing them to access markets on more equitable terms, and enhancing the efficiency of the entire
commodity chain. The CSRP has legal personality and can enter into agreement with the farmers.
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 29 OF 96

B
There will be a strong emphasis on the formation, strengthening of and support to activities of the CIGs under this
sub-component because these semi-formal groups, which may transition to either primary cooperatives or
enterprises, are currently the main community-level organizational unit used for AGP-2 activities, and they are
governed by MoA-approved guidelines, including requirements for organization, planning and financing. This sub-
component will provide resources for local expertise to be contracted to provide technical assistance to support
beneficiary communities in forming CIGS, and in planning and implementing income-generating activities and
investments to strengthen connections to local value chains.

In the co-financed support of livelihood diversification, emphasis will be given to the establishment of CIGs/SHGs
for the production and marketing of improved cook stoves. These groups not only provide an alternative source of
income, but they also deliver multiple co-benefits, including time savings for women and girls in fuelwood collection,
health improvements through reduced household air pollution, and reduced pressure on local biomass resources
through improved household energy efficiency. As heating and cooking efficiency improves, use of manure and
crop residues for cooking and heating decreases, allowing these materials to be used on fields to enhance soil
fertility.

Initial support for livelihood diversification and connections to value chains will target beneficiaries in watersheds
that have already begun or completed implementation of their MYDPs, where support for CSA is being provided
and support from AGP and/or other PS-oriented development activities will complement RLLP efforts. This will
facilitate success at this pilot level and allow for any needed adjustments before scaling up these activities in later
years of the project. In addition to SHGs and CIGs at the watershed and/or woreda level, stakeholders involved in
this sub-component include primary cooperatives and their unions, Cooperative Agencies at various administrative
levels, the Rural Saving and Credit Associations (RuSACos), private sector enterprises and their sectoral
associations, and Woreda Offices of Agriculture, Water, Mineral and Energy. For the production of improved
cookstoves, the Woreda office of Cooperative Promotion will: (i) support organization of CIGs/SHGs to produce
energy efficient cook stoves and promote improved cook stoves (ICS) host demonstrations at local markets and
other local level gatherings; (ii) through the Bureau of Energy, Water and Mineral, provide technical experts to
conduct training for the producer groups; and (iii) provide beneficiaries/consumers support in establishing local
channels of finance (such as traditional savings groups - ekub).

Potential maladaptation risks with initial commodity processing are mitigated through the design of the project. The
project promotes sustainable land management on all land belonging to the target watersheds. Hence, even if
agricultural production expands as a result of the development of markets for commodities, the expanded
production will also use the climate smart agriculture measures that have been introduced. In addition, agricultural
production on lands already in use will increase substantially, leading to a decrease in the need for new agricultural
land. Land mapping (the cadaster will have information on agricultural land) as well as issuing land certificates will
prevent uncontrolled expansion of agricultural land, as only those with land certificates will be eligible to participate
in the market. Sustainable land management will ensure that there is no further deforestation in the targeted areas
(which are already highly deforested and degraded). Furthermore, the establishment of green corridors and
elimination of free grazing will contribute to the preservation of the non-agricultural land, while at the same time
enhancing forest cover and preventing deforestation. RLLP will support SLM practices to limit free grazing in project
areas including activity packages that address sustainable livestock production, through feed development and
integrated agro-silvo-pastoral practices. The creation of information platforms and provision of technical assistance
will also reduce the risk of maladaptation, as information and outreach will result in increased awareness and
improvements in local livelihoods.

High-performing cookstove technologies

The activities supported were identified and selected based on the results of the study “Assessment of Household
Energy Options in RLLP Intervention Areas” that is included as Annex A.4 to this proposal. The WB will support a
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set of activities aimed at reducing the use of fuelwood, which is one of the major drivers of deforestation and
degradation. Reducing demand for fuelwood is critical to maintaining restored landscapes in project communities.
Activities include the establishment of improved cookstove production enterprises, provision of technical and
business training to the enterprises, introduction of alternative fuels production including efficient charcoal
production, and the creation of consumer awareness of the advantages of using improved cookstoves and new
fuels. Details on the technologies that will be promoted and on awareness raising activities planned are provided in
the assessment report of household renewable and energy efficient technologies options. The project will lead to
the creation of viable businesses producing efficient cookstoves and consumer awareness of the benefits of using
them, as well as encouraging rural saving groups to support improved cookstove purchases. The activities will be
supported by the Regional Energy Bureaus, who will subsequently introduce similar activities to areas under their
remit that are not covered by RLLP.

The alternative practices selected under sub-component 1.3 include support to:

• Common Interest Groups (CIGs)

• Climate resilient livelihood diversification including promotion of improved cookstoves, cultivating fruit trees,
bamboo handicrafts, beekeeping, etc
• Self-Help Groups (SHGs)
• Cooperatives
• Unions
• Watershed User Associations (WUA)
• community storage receipts programs (CSRPs)
• Enterprises to manufacture, promote and sale fuel saving cookstove and alternative cooking fuels
• Formal and traditional saving groups for the purchase of RE/EE products

Component 2. Investing in Institutions and Information for Resilience

The objective of this component is to enhance institutional capacity and improve information for better decision-
making in supporting resilient landscapes and diversified rural livelihoods in the project area, both for the duration of
the project and after project completion.

This component will build capacity at the local government level (woreda and kebele) for (i) planning and managing
SLWM interventions, and (ii) managing the land certification process. This will include piloting of new technologies
for information modernization at the local level, including the use of electronic tablets for gathering geospatial
information, and the use of Unmanned Aerial Vehicles (UAVs – or drones) for land certification mapping. Tablets
and UAVs will be the property of the project (i.e. MoA) and would be provided to development agents and the
woreda focal persons in the project watersheds for mapping and monitoring. The device setup, training, and support
provided will be tailored to meet the conditions and realities faced in field environment (i.e. off-line data collection,
accessories (protective case, solar charger, etc.), guidance materials, technical and trouble-shooting support).

RLLP intends to monitor all watersheds using UAV. The current capacity within the PCU is classified as low to
moderate and is improving. For example, under RLLP the addition of a database manager as key personnel to
support data management. The use of UAV’s is currently limited in Ethiopia due to GoE security concerns and the
lack of a policy governing their use in general. The PCU with assistance from WB is currently supporting efforts to
develop guidelines on the use of UAVs that would ultimately support monitoring efforts more broadly and with fewer
restrictions. Despite the restrictions, to data the PCU has been a leader in the use of UAVs to support project
activities as demonstrated by receiving permission to use UAVs to collect imagery for parcel demarcation under the
land administration component. The PCU will need to further improve the quality and efficiency with which M&E
data are collected and analyzed with additional expertise to manage the UAV monitoring component.
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Support for policy development under this component will focus on the regulatory framework for Watershed User
Associations (WUAs), community bylaws guiding land-use practices, and strengthening the Land Administration
System. This regulatory framework, once established, will continue to support resilient land use after project
completion. To strengthen the evidence base for sustainable land management decision-making, this component
will include a bio-physical impact evaluation of SLWM interventions, to be conducted through a partnership
arrangement between the MoA, the Water and Land Resource Centre of Addis Ababa University, and the Ethiopia
Development Research Institute’s Environment and Climate Research Center. This will complement a livelihoods
impact evaluation of SLWM interventions to be conducted in parallel led by the Gender Innovation Lab of the World
Bank’s Africa Region. When completed, these evaluations will be available to interested parties in Ethiopia and the
region wishing to institute or improve SLWM. This component will also provide resources to manage the knowledge
generated through these and other assessments of SLWM, and to communicate the lessons learnt to a broad
audience, including local governments and communities, relevant research institutions and Government agencies,
as well as Development Partners.

This component’s objectives will be achieved through the implementation of the following sub-components: (i)
capacity building, information modernization and policy development, and (ii) impact evaluation, knowledge
management and communication.

Sub-component 2.1. Capacity Building, Information Modernization and Policy Development

Activities will be funded by IDA and MDTF in watersheds identified for IDA funding (budget of USD 7.9 million) and
by GCF in watersheds identified for GCF funding (budget of USD 16.15 million).

This sub-component will build capacity at local government level to implement RLLP, and to sustain SLWM
interventions after watershed graduation from project-based support. To achieve this, the sub-component will
finance accountants to support the head of the Woreda office of Agriculture (WoA) and a focal person in each
participating woreda, and part-time community facilitators at the kebele level (5 community facilitators for in each
major watershed). To help build the capacity necessary for an effective land administration system, this sub-
component will also provide technical assistance for training in this field.

This sub-component will support information modernization to coordinate data collection and information sharing at
all levels and under all components of the project so that this information is well organized, properly documented
and accessible. As part of this effort, a data management plan will be developed that specifies how all data used or
created during the course of RLLP will be documented, stored and otherwise managed. The use of electronic
tablets to collect information on project activities and results, combined with appropriate survey and mapping
software, will improve the quality and timeliness of data collection and reduce the effort needed to compile, review,
and generate the necessary reports. This framework will facilitate access to information and support timely
feedback to the local level.

This sub-component further supports the use of aerial vehicles (UAVs)/drones to generate high-quality and timely
aerial imagery data to support planning, monitoring, and land certification. Under this initiative, the drones will be
operated by several teams of trained operators who will travel to the project sites. During the course of RLLP each
micro-watershed will be re-visited twice each year at appropriate intervals to generate visual and multi-spectral
images of the program areas. At each stage the processed imagery will be shared with the woreda and local field
staff for the purpose of assisting in planning, monitoring progress and updating implementation plans. The data and
materials produced will also be used to support M&E and will serve as a source of information and data for
subsequent analysis. Detailed technological specifications and budget have been elaborated including the technical
requirements for the drones, all associated equipment and spare parts, operating costs for the duration of the
project. The use of the drones is intended for the collection of information and data that will be available for long-
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 32 OF 96

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term use and for project planning and monitoring. The project will work with the Information Network Security
Agency (INSA) and the Ethiopian Aviation Authority to ensure all necessary permits are obtained.

Policy development under this sub-component will focus on the regulatory framework required for the establishment
of Watershed User Associations (WUAs), crucial for sustainability of SLWM interventions, frameworks for reward
and incentive schemes such as Payments for Environmental Services (PES), as well as community byelaws guiding
land-use practices, and strengthening of the Land Administration System.

In developing the framework for WUAs, the Project will work closely with regional governments for its application in
establishing WUAs. This work will commence with reviewing of the environmental legislation that relates to the use
and management of Ethiopia’s natural resources (soils, forestry, grassland, water, wildlife, etc.). The manual for
CSA will be used to proceed and enhance this activity. RLLP will give high attention to the opportunities of
engagement of private sector (PS) in all development activities of the project. The first objective of PS engagement
in RLLP is, to attract the PS to invest in RLLP interventions. The second objective is to create and increase income
streams & diversified livelihoods for the communities in a sustainable manner through the promotion of inclusive
business and value chain/partnership relationship based on profitability principles.

Sub-component 2.2 Impact Evaluation, Knowledge Management and Communication

Activities will be funded by IDA and MDTF in watersheds identified for IDA funding (budget of USD 5.1 million). No
GCF funding is requested for this sub-component.

Impact evaluations (IEs) will use rigorous research methods to look at specific interventions under RLLP, assess
the contribution of these to development goals and provide robust evidence of SLM impact. Project funding will
focus on the evaluation of bio-physical impacts, which will be conducted in coordination with a livelihoods impact
evaluation to be led by the Gender Innovation Lab of the World Bank’s Africa Region, financed separately. The bio-
physical impact evaluation will examine the response of the environment to SLWM interventions, considering
parameters such as peak and base surface water flows, groundwater levels and recharge rates, sediment loads,
and remotely sensed information on vegetation cover and soil moisture. For the purposes of this evaluation, the
project will extend the existing partnership between MoA, the Water and Land Resource Center of Addis Ababa
University, and the Environment and Climate Research Centre of EDRI, and will aim to build new partnerships with
relevant international research organizations. IEs are expected to be completed within the Implementation
Period (five-years) and the MOA will procure service providers for such purposes. The IE’s disclosure will be
subject to WB’s access to information policies.

In addition to the bio-physical IE and the livelihoods IE an evaluation of climate-smart agriculture will also be
conducted. Due to the complexity of the evaluations the details of their implementation are still under development
and will be further elaborated in the terms of reference, acceptable to the World Bank. Basic design of the IEs is
expected to be as follows: the livelihoods IE is expected to involve random assignment. The biophysical IE will
involve a 2-stage sampling where in the first stage a stratified selection of watersheds to be treated will be
performed and in the second stage watersheds will be paired with a suitable comparison watershed (outside project
watersheds). This is being done to increase the explanatory power of the evaluation given the large cost associated
with each watershed monitored. The CSA evaluation is expected to follow a treatment-control comparison
methodology and the potential for randomized assignment within the CSA micro-watersheds is being explored. In
any case, the sampling of treatment and control will be randomized.

To build a solid and effective knowledge management system both for the project and the SLM program in Ethiopia,
this sub-component will establish a geospatial knowledge platform that combines information from a variety of
project and other sources and packages it in a format that is accessible to planners and stakeholders at the
national, regional, and local levels. This activity will build upon the work being done by WLRC under SLMP II to
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 33 OF 96

develop a web-based knowledge management system. By enabling farmers to improve their planning the platform
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will decrease their exposure to climate change related risks.

A strategic communication program will be developed and implemented under this sub-component to inform and
mobilize communities, enhance project visibility and transparency among all actors, support efforts to scale-up SLM
and CSA practices, and build support for the land certification program. Strategic guidelines for the implementation
of the Knowledge Management and Communication (KMC) program have been developed following a rapid KMC
needs assessment. The guidelines include viable options of knowledge management, knowledge sharing and
communication with effective channels, techniques, tools and key messages that address the communication and
knowledge management needs of beneficiaries, stakeholders, partners and actors at various level. While following
those guidelines, implementers will have room to elaborate, modify and adapt additional communication and
knowledge management interventions to meet the overarching goals and specific objectives outlined in this sub-
component. The identified overarching goals are: 1) to build and coordinate a strong knowledge base contributing to
the effective promotion, reporting and scaling up of SLM within Ethiopia; and 2) to inform and mobilize local
communities, strengthen consultation/ participatory development models, and enhance transparency in program-
supported activities. The specific objectives of the KMC program are to: a) Support scaling up efforts and adoption
of SLM and CSA practices; b) Help evidence based planning and reporting through enhanced information flow
among institutions and coordination of monitoring and evaluation; c) Enhance the program visibility among all actors
thereby attract new development partners and insure the buy-in of the government; d) Sustain the outcomes of SLM
practices through awareness raising campaigns. This includes relevant activities in components 1 and 3 such as
land certification. The guidelines include means of verification to evaluate the effectiveness of the activities
implemented within the KMC program.

Possible activities include:

i. knowledge identification, capturing, validation and packaging annually to support scaling up efforts, build
capacity of user groups, youth groups, DAs and FTCs (experiential knowledge, best practice and synthesis
of explicit knowledge products from various sources such as the geo-spatial knowledge platform, the CSA
Innovation Platform, model watershed, etc.);
ii. strengthening and enhancing functionality of existing FTCs and SLM information centers at woreda level
and establishing info centers in new woredas;
iii. outreach activities (i.e. production of printed, audio and video materials to be used as supporting tools
during workshops and events, and media tours for journalists and PR officers of relevant regional bureaus
to show project results);
iv. knowledge sharing/networking events (i.e. annual SLMP Knowledge fair); and
v. advocacy activities to support private sector engagement, policy development and other key initiatives for
RLLP effective implementation (i.e. organization of Stakeholders Workshops).
vi. grassroots level behavioral change campaign targeted to major/critical watersheds, based on preliminary
research to define appropriate media (drama, storytelling, etc.) and effective messengers (i.e.
community/religious leaders) and gauged throughout the duration of the program through a mix of
qualitative/quantitative research methods (FGDs, community level meetings, survey);
vii. public information awareness activities on land registration and cadastral surveys, land laws and
procedures and conflict resolution mechanism, and to explain the benefits of (formalized) rentals and unlock
the blockage set by cultural norms, emphasizing that temporary land renting does not imply abandonment
and formalized rental contracts do not result in land being expropriated.

Component 3. Rural Land Administration and Use

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Activities will be funded by IDA and MDTF in watersheds identified for IDA funding (budget of USD 26.0 million). No
GCF funding is requested for this component.

As indicated under the root causes section above, land tenure insecurity caused by frequent land redistribution in
the past has encouraged farmers in Ethiopia to favor short-term exploitation of land resources over long-term
conservation, contributing to land degradation and declining productivity. The objective of this component will be to
strengthen the land administration system that secures tenure rights, optimizes land use, and empowers land-users
to invest sustainably in productive landscapes. This component will be funded entirely by co-finance. No funding
from GCF is being requested for this component. Refer to detailed budget (Annex K.1.).

Component 3 will provide security of tenure to smallholder farmers through Second Level Landholding Certification
(SLLC) as an incentive to increase the adoption of SLWM technologies and practices. The on-going SLLC exercise
at kebele level will be extended to all kebeles within the watersheds targeted by RLLP, with resources provided for
orthophoto production and para-surveyors for field level data acquisition, and data encoders for office level data
management. It will support the use of low-cost, fit-for-purpose surveying and mapping technologies including drone
aerial mapping and mobile mapping using tablets as appropriate. Activities to be supported will include (i)
orthophoto base map preparation, (ii) adjudication of land rights and demarcation of parcel boundaries on the field
map, (iii) scanning, geo-referencing and digitization of parcel boundaries and attributing information, (iv) public
display for validating parcel (shape and size) and landholders’ information, (v) parcel map and Landholding
Certificate preparation, production, authentication and issuance, and (vi) procurement of equipment, materials and
consumables for cadaster and land registration activities. Matching funds to complete woreda level coverage of
SLLC will be sought from State governments and development partners.

This component will also extend the on-going local-level participatory land-use planning exercise at the kebele level
within the major watersheds in the RLLP. Technical assistance will be provided to support consultation workshops
for land-use plan development at the kebele level and to connect these consultations to the larger land-use
planning exercises underway at the regional and national levels.

This component will also support the rollout of the NRLAIS in RLLP woredas that do not overlap with other land
administration support projects. In Gambella, the project will support the installation and roll out of the NRLAIS both
at the regional and woreda levels, as none of the development partners have interventions in Gambella. NRLAIS
will provide security, transparency, maintenance of the land information with enhanced data management
functionality and usability at woreda level in an efficient, effective, spatially integrated and sustainable manner. It will
also equip the regional and federal authorities with an adequate tool to produce and avail statistical data on rural
land tenure and land use that facilitate evidence based monitoring and ensure a coordinated and consistent
approach to the development of policies, legislations, standards, models and research to enhance sound land
governance across the country.

At the woreda and kebele levels, implementation of this component will be undertaken jointly by the Woreda Office
of Land Administration and Use (WoLAU) through the Kebele Administration Offices, the Kebele Land
Administration and Use Committee (KLAUC), the Land Administration and Use DAs, and the communities. Field
teams will be contracted, trained and deployed, each comprising a team leader, a para surveyor, a data recorder, a
digitizer, and a Woreda GIS expert and a supervisor, to facilitate and undertake the field and office level land
certification activities. Woreda and kebele land use teams will anchor the preparation of Participatory Local Land
Use Plans. At the Regional and Zonal levels, the Bureau of Land Administration and Use (BoLAU) and related
agencies will lead the implementation of this component of the project with support from the Regional RLLP PCU.
At Federal level, the Land Administration and Use Department (LAUD) in the MoA will be the main focal point for
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 35 OF 96

policy, planning, and implementation guidance to RLLP Regions and Woredas. A NRLAIS rollout support unit
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established at regional and federal levels will provide technical assistance for this activity.

Synergies with interventions on land administration support from other development partners have been identified.
These include the Responsible and Innovative Land Administration in Ethiopia Project (REILA 16) being implemented
by Finland and the Land Investment for Transformation Project (LIFT) 17 being implemented by the UK Department
for International Development (DFID). These two projects together with RLLP will spatially synergize efforts on the
national roll-out of the NRLAIS and distribution of SLLCs. Further discussions with DFID will identify possible
support to the Rural Land Administration and Use Department (RLAUD) to: (i) expend their economic
empowerment interventions to adjacent RLLP woredas to maximize benefits of land certification; and, (ii) complete
SLLC in kebeles outside of watershed boundaries in RLLP woredas. Close coordination with other development
partners (e.g. GIZ, USAID) will build on experience from SLMP-II and will be ensured through the G7 Donor
Working Group on Land. 18

Component 4. Project Management and Reporting

Activities will be funded by IDA and MDTF in watersheds identified for IDA funding (budget of USD 11.5 million) and
by GCF in watersheds identified for GCF funding (budget of USD 6.09 million).

The objective of this component is to effectively consolidate plans and budget, implement and report on project
activities with due diligence and integrity.

This component will finance the operational costs of Regional Project Coordination Units (RPCUs) in MoA and
Regional State Bureaus of Agriculture. In total, there will be 7 RPCUs – one in MoA and one in each of the regions
in which the project will be implemented (Amhara, Oromia, Tigray, SNNP, Beneshangul/Gumuz, and Gambella).
These RPCUs will carry out all fiduciary aspects of project implementation including financial management,
procurement, environmental and social safeguards, Monitoring & Evaluation (M&E), sector coordination of
investment targeting and policy harmonization, and donor coordination structures. The project will support a
modernized M&E system for collecting, managing and analyzing activity data and achievements. A tablet-based
system of data collection that incorporates tools for capturing spatially explicit activities and area treated will be
integrated into the project-wide strategy for the modernization of information management outlined under sub-
component 2.1. The enhancements and functionality incorporated into the M&E system will improve the quality and
accuracy of data while at the same time serving as a platform for providing feedback to the local level on progress,
which will support improved decision-making.

16 REILA II is a 4.5-year project with a total budget of € 7.81 million. The project aims to: 1) Improved regional LA and increased and
certified land tenure security for land users (in 6 woredas in Benishangul Gumuz and 11 Woredas in Amhara region) and NRLAIS rollout; 2)
Improved capacity for federal and regional LA for planning, management and coordination, and for accurate and efficient land surveying;
and 3) Improved supply of skilled manpower to the LA sector.
17 LIFT operates in four regions (Oromia, Amhara, SNNR, and Tigray) with a total funding of £ 63 million. LIFT aims to support the
Government of Ethiopia in the provision of map based land certificates to farmers and assist them to fully benefit from increased investment
and productivity through the development of the rural land market and its supporting operations.
18 In 2013, the Governments of Ethiopia, the United Kingdom, the United States of America, and the Federal Republic of Germany announced
an agreement to enter a land country partnership to work together to improve rural land governance for economic growth and to protect
the land rights of Ethiopians. The partnership was envisioned to build on existing programs and serve as a vehicle for increased coordination
and collaboration among the Government of Ethiopia and its development partners. Since then the WBG has been an active member of the
G7 Land Partnership through its active operations managed under ENR portfolio such as SLMP, OFLP, and CRGE TA.
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Reporting at the federal, regional, woreda and community levels will aim to ensure sound tracking of progress
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information (activity/output level results), to evaluate information from a variety of sources relevant to outcome-level
results, and to promote learning and adaptive management. The outputs under this activity include: (i)
implementation of a new Results Based M&E Plan based on clear guidance on what to collect and how to collect it
(indicator protocols); (ii) a well-functioning MIS system; (iii) improved capacity of stakeholders in M&E; and (iv)
improved quality of information collected.

Scale of the project, identification of targeted project area and beneficiaries

In terms of the scale of the project, the World Bank is confident that the benefits of implementing the interventions
included in the project at the relatively large scale proposed outweigh the risks. A number of factors mitigate these
risks, key among them being the fact that the project builds on experience gained by the World Bank and the
Federal Democratic Republic of Ethiopia, acting through MoA, during previous and ongoing projects. The proposed
project benefits from the lessons learned over many years of projects aimed at sustainable land management,
poverty alleviation and increasing the sustainability of agriculture in Ethiopia, and in particular the SLMP projects.
These lessons led to the creation of the institutions that RLLP will build upon such as bottom-up watershed planning
and self-help groups as well as the approach to CSA described in Annex A.3 in which a number of packages of
activities are combined to achieve the triple goals of adaptation, mitigation and livelihood development.

For the Executing Entity, RLLP activities will come on top of activities with a budget of $316 million that are already
spent or committed for SLMP, which are managed or coordinated by MoA. For both the sums already spent or
committed and for the co-financing the World Bank provides to RLLP, the World Bank has conducted risk analysis
and identified mitigation actions that resulted in the decision by the World Bank to commit its own funds to the
project. The valuable experience gained during implementation of SLMP-II, as well as the significant Recipient-
executed and Bank-executed resources allocated in the past five years for coordination and capacity building efforts
are expected to be instrumental to improve or identify viable measures to address all the risks.

Total needs were a major consideration in deciding on the scale of the proposed project. Soil degradation is an
ongoing problem that is becoming more severe with every passing year. There are significant costs related to
inaction – the longer we wait to address the problem, the worse it will get, and the more expensive it will be. To
achieve sufficient momentum for scaling up and replication, countrywide implementation is essential. The targeted
watersheds for this project were selected with inter-regional equity in mind. A total of 210 major watersheds are
included in RLLP, averaging approximately 10,000 hectares each. Out of these, 135 watersheds are those already
targeted by SLMP-I and II. In these watersheds RLLP will implement only innovative climate resilient activities that
were not included in SLMP. 57 watersheds included in RLLP are new to the implementation of (SLM) measures.
For GCF financing, 40 watersheds out of 192 were identified based on their vulnerability to climate change 19. The
process for the selection of these new watersheds is described in full in Annex A.1.

In order to achieve the aims of the project – achieving restored, productive and low emission landscapes, the
project will work with the communities that are using these landscapes. Hence, beneficiaries are selected at the
community level and the direct beneficiaries are individuals who are living within a project watershed. The members
of these communities are vulnerable smallholder farmers, who are very sensitive and highly exposed to climate
change impacts. The total population within the project area is 4.2 million people or 834,000 households (with an
average of 5 persons per household). Evidence based data driven implementation and planning will ensure that

19 Details of Co-financing from Government of Canada were not available during this analysis, hence 18 Watersheds

supported by it were not considered

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interventions benefit smallholder farmers. Detailed bio-physical information for the 57 new watersheds, including
individual landholdings, will be collected during the Multi-Year Plan (MYP) preparation of each watershed Local
level participatory land use planning teams at woreda and kebele levels would ensure that interventions benefit the
smallholder farmers. The baseline study report for 90 watersheds of SLMP II found that the average land holding
was only 1.338 ha. Agro-ecologically, watersheds above the altitude of 2300 meters and lowland areas between
500 and 1500 meters, have an average land holding of only 0.83 ha and 2.082 ha respectively. Furthermore, about
4.2% of the households have no land at all (3.5% of male and 6.5% of female headed households), 10.6% have
less than a quarter of a hectare and 21.9% less than a hectare.

Beneficiaries are categorized as direct and indirect. The direct beneficiaries are individuals who are living within a
project watershed. The members of these communities are vulnerable smallholder farmers, who are very sensitive
and highly exposed to climate change impacts. The primary beneficiaries of the project will be the rural households
on degraded land, facing land tenure and water insecurity in selected watersheds. Indirect beneficiaries include: (i)
communities adjacent to Project intervention areas adopting SLM and CSA practices through demonstration effects,
as observed under SLMP-II; (ii) private sector participants and end-consumers in value chains targeted by the
Project; (iii) households outside Project areas benefiting from the creation of land certification capacity at woreda
and regional level; (iv) recipients of capacity building at all levels of government, as well as in national partner
organizations; and (v) communities outside Project areas benefiting from groundwater recharge, reduced flooding,
and lower sediment loads, as a result of SLM interventions. Women will be specifically targeted to ensure that they
fully participate in Project benefits through a variety of mechanisms, including: (i) required participation of women in
Community Watershed Teams (CWTs), Kebele Watershed Teams (KWTs), Kebele Land Administration and Use
Committees (KLAUCs), and Watershed User Associations (WUAs); (ii) provision of joint land certificates to married
couples, and individual land titles for women in Female-Headed Households; (iii) promotion of women’s
participation in Common-Interest Groups (CIGs) for income-generating activities; and (iv) targeted support for the
production and marketing of improved cook-stoves, bringing health gains and time-savings that benefit women in
particular. Make note that beneficiaries for Income generating activities are selected by the community watershed
teams. The team has criteria for selecting such as the beneficiary should be the poorest of the poor, able to
contribute to the project, refrain from doing negative harm to environment for example degradation of forest through
charcoal making.

The experience of previous phases of the project has shown that there is a high willingness to participate by
populations of the proposed intervention areas. The World Bank has tracked community contributions during the
second phase of SLMP implementation. Translated into monetary terms, the cumulative community contribution in
the four budget years from 2014/15 until 2018/19 was 23.5% of the total financial utilization of the project, equal to
about USD 27 million. The most important contributions by the population were in the implementation of soil and
water conservation measures on both communal land and farmland and community forest management.

The project components and activities are described below. Implementation will be guided by the recommendations
and supporting studies that comprise the feasibility study. These documents provide guidance on which technology
alternatives should be selected depending on local circumstances. Quantitative information on numbers of
beneficiaries and areas benefiting from each activity, as well as a breakdown of funding between GCF and co-
finance is provided in the detailed budget in Annex K.1.

B.4. Implementation arrangements (max. 1500 words, approximately 3 pages plus diagrams)
Provide a description of the project/programme implementation structure, outlining legal, contractual, institutional and
financial arrangements from and between the GCF, the Accredited Entity (AE) and/or the Executing Entity(ies) (EE)
or any third parties (if applicable) and beneficiaries.
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- Provide information on governance arrangements (supervisory boards, consultative groups among others)
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set to oversee and guide project implementation. Provide a composition of the decision-making body and
oversight function, particularly for Enhanced Direct Access (EDA) proposals.
- Provide information on the financial flows and implementation arrangements (legal and contractual) between
the AE and the EE, between the EE or any third party and beneficiaries. For EEs that will administer GCF
funds, indicate if a Capacity Assessment has been carried out. Where applicable, summarize the results of
the assessment.
- Describe the experience and track record of the AE and EEs with respect to the activities (sector and
country/region) that they are expected to undertake in the proposed project/programme.

Provide a diagram(s) or organogram(s) that maps such arrangements including the governance structure, legal
arrangements, and the flow and reflow of funds between entities.

Detailed Project Institutional and Implementation Arrangements

The organizational structure and arrangements acceptable to the World Bank for the implementation of the recently
completed SLMP-II will be maintained and strengthened for the execution of RLLP. Implementation will be carried
out at four levels: Federal, Regional (including Zonal), Woreda (district) and Kebele (sub-district). and decisions in
the meetings are subject to MoA concurrence.

The National SLM Steering Committee, chaired by the State Minister responsible for Natural Resources
Management in MoA, comprises high level representation from MoF, MoWIE, MEFCC and DPs. The Steering
Committee is responsible for the following tasks in the SLM project: (a) providing policy guidance, oversight and
overall supervision for project implementation; (b) reviewing and approving the consolidated annual work plan,
budget and procurement plan; (c) reviewing and approving the annual implementation performance report, and
overseeing the execution of any corrective actions that may be designed.

The National SLM Technical Committee is also chaired by the State Minister responsible for Natural Resource
Management in MoA. It is made up of senior technical staff from institutions such as MoA, MoWIE, MoF, MEFCC,
MoWCA (Ministry of Women and Children Affairs, the Ethiopian Institute for Agricultural Research (EIAR),
Cooperative Promotion Agency, development partners supporting SLM projects or initiatives, and civil society
organizations (non-governmental organizations) actively engaged in SLM activities. Generally, this body is
responsible for providing technical advice to MoA on SLM. Specific to RLLP, this Committee will provide technical
advice on the quality of implementation performance reports and special studies such as policy and legislative
drafts, financial and audit reports, documentation of best practices, and M&E reports.

The SLMP Project Coordination Unit (PCU) at MoA, which is staffed by 33 technical and fiduciary staff, will continue
to play the role of managing and facilitating the day-to-day implementation of the project. Specific tasks will include:
(a) consolidating regional annual work plans, budgets and procurement plans; (b) facilitating and supervising
implementation of work plans and corrective actions, safeguards instruments including management/mitigation
plans; (c) processing and procuring works, goods and services; (d) monitoring overall implementation progress,
safeguards instruments (and management/mitigation plans) and evaluating project impacts; and (e) preparing
progress reports. The Unit will maintain a team of experts including a National Project Coordinator, procurement
and financial management specialists, M&E expert and technical experts in diverse disciplines (including watershed
management, agronomy, forestry/agroforestry, land administration/land use planning, knowledge management &
communication, livelihoods, private sector development).
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 39 OF 96

Regional and Zonal level

B
Implementation of activities on the ground is supported by, among others, Regional steering and technical
committees. The Regional Steering Committees will be accountable and responsible for the execution of the annual
work plans developed by the local level implementers in the regions. At the Regional level, the Bureau of
Agriculture (BoA) and the Bureau of Land and Environmental Protection (BoLEP) will lead implementation of the
project in close collaboration with relevant public institutions. Serving as the link between the Federal, Zonal and
Woreda implementation entities, the BoA will review and consolidate annual work plans, budgets, procurement
plans submitted by the woredas. It will also review and approve implementation progress reports (including M&E,
financial, audits, safeguards, etc.) originating from the woredas. The project will finance a project coordinator, M&E
expert, accountant and procurement officer per region to assist the BoA and Woreda Office of Agriculture (WoA) to
implement the project on a day-to-day basis. Together, these will form a regional Project Coordination Unit for each
of the six Regions in which the project will be implemented (including Amhara, Oromia, Tigray, SNNP,
Beneshangul/Gumuz, and Gambella). At the Zonal level, the Zonal Agriculture Office (ZAO) will provide technical
support, extension services and M&E to a group of Woredas under its jurisdiction. The ZAOs will coordinate with
the WoAs to discharge their responsibilities. Moreover, RLLP shall provide opportunities to zonal implementing
entities to participate in the implementation of activities, draw lessons from the project and support scaling up of
SLM practices to wider landscapes. In addition to the existing government staff, RLLP will contract technical
advisors for specific outputs (such as preparation of MYDPs and WMUPs, establishment of WUAs, and preparation
of business plans for IGAs and value chain linkages) in 29 zones where RLLP will be implemented.

Woreda and Kebele levels

On-the-ground planning and execution of activities under the project will be undertaken jointly by WOA, the Kebele
Watershed Development Committee (KWDC), Development Agents (DAs) and communities. Accountants will be
recruited at woreda level to improve financial management capacities and reduce implementation risk. Thus, WoAs,
KWDCs and DAs will be assisting communities in: (a) developing annual work plans and budgets as well as
procurement plans for submissions to the BoAs for review and endorsement and integration into a Region’s annual
work/development plans and budgets; (b) facilitating and mobilizing community participation in watershed planning
and rehabilitation; (c) undertaking awareness campaigns and training; (d) participatory monitoring and evaluation;
(e) extension service delivery and dissemination of best-fit technologies and innovations, etc. Implementation of
Component 3, Rural Land Administration and Use, will be undertaken jointly by the WoLAU through the Kebele
Administration Offices, the Kebele Land Administration and Use Committee (KLAUC), the land administration and
use DAs and the communities.
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 40 OF 96

Figure 5 Implementation arrangements

 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 41 OF 96

B
The Project Implementation Manual (PIM) will set forth fiduciary requirements as well as project implementation
arrangements. Importantly, the PIM will clarify the implementation support and supervision roles and
responsibilities of the Regional Bureau of Agriculture (RBA), Woreda Office of Agriculture (WOA) and MoA. To
enhance the accountability and quality of deliverables and the functionality of the program coordination platform at
regional and woreda levels, project implementation arrangements acceptable to the WB and agreed by the MoA
and regional governments will be established to clarify accountability and targets at all levels of project
implementation. . This text is now added in FP in this section after Figure 5.

Roles and responsibilities of the World Bank

The World Bank as the Accredited Entity of the project will play an important role in programme supervision and
implementation. The WB will ensure that the RLLP is executed in line with the WB policies and procedures. The
WB’s roles and responsibilities regarding financial management and procurement are described below. More
detail, including a disbursement plan, is provided in section F.4. Financial Management and Procurement.

Financial management

Payments will be based upon an approved annual work plan and budget. To ensure transparency as well as to
enhance the level of disbursement under the RLLP, quarterly Interim Financial Reports (IFRs) follow international
reporting standards and are submitted promptly at the end of each quarter.

An external audit of the project will be conducted annually by the Supreme Audit Institution or an accredited private
audit firm. The audit will be conducted in accordance with Terms of Reference prepared by the EE and the objective
of the audit will be to ascertain whether project funds have been used for the intended purpose. The WB, as the AE,
is responsible for reviewing and providing a no objection for the recruitment of the auditor including no objection of
the ToR. The WB will verify that the audit is conducted in accordance with the International Standards on Auditing
and that appropriate actions based on the findings ensue. If necessary, the WB will issue corrective actions
throughout the execution of the RLLP.

The GCF Proceeds will be channeled through the World Bank and will be made available to the Federal Democratic
Republic of Ethiopia. The World Bank will enter into a grant agreement and a loan agreement with Ethiopia,
represented by MoF and acting through MoA for the implementation of the GCF Funded Activity. MoA is
responsible for overall Project implementation and accountable for the Funded Activity’s outcome indicators.

MoA will be working closely with MoF, the Ministry of Environment, Forest and Climate Change (MEFCC), the
Ministry of Water, Irrigation and Energy (MoWIE) and other relevant public sector agencies. Project implementation
is according to signed financing agreement(s) (Subsidiary Agreement(s)), procurement procedures, environmental
& social management framework and other applicable WB procedures. The WB’s project supervision covers
monitoring, evaluative review, reporting, and technical assistance activities.

Procurement

As the AE, the World Bank is responsible for ensuring that MoA has the necessary procurement capacity required
for the RLLP. To this end, The WB has conducted a procurement capacity and risk assessment of MoA (see Annex
L.1). The WB will be responsible for ensuring that procurement under the project will be carried out in accordance
with the WB’s Procurement Procedures.

Communities and individuals receive cash payments as an incentive to contribute labor in support of rehabilitation
works under sub-component 1.1 and 1.2. 41 ETB per Person Day (PD) is provided as labor incentive for
participation in rehabilitation work. RLLP will pay 20% of this labor incentive for rehabilitation work on private land
and 50% for rehabilitation work on communal land. The distribution of rehabilitation work needed across both types
of land cannot be determined Ex-Ante. However, if we consider an equal distribution for estimation purposes, it
means that RLLP will pay for 35% of the labor incentive. Based on this, we estimate that RLLP will pay in total
USD 40.4 million as labor incentive. The total number of beneficiaries in watersheds where rehabilitation work will
be undertaken is 3.27 million. Based on previous SLMP experience, typically 3 members out of 5 from each
household participate in rehabilitation work. This translates to 1.96 million beneficiaries receiving labor incentive
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 42 OF 96

under RLLP. Thus, the estimated amount of labor incentive paid per beneficiary by RLLP will be USD 20.61.
B
Please note that these are indicative estimates and may vary during implementation due to inflation and
operational factors such as participation of beneficiaries and change in intensity of rehabilitation work due
to extent of land degradation. We confirm that the activities under which labor incentive is provided are sub-
components 1.1 and 1.2.

B.5. Justification for GCF funding request (max. 1000 words, approximately 2 pages)
Explain why the project/programme requires GCF funding, i.e. Why is the project/programme not currently being
financed by public and/or private sector? Which market failure is being addressed with GCF funding? Are there any
other domestic or international sources of financing?

Explain why the proposed financial instruments were selected in light of the proposed activities and the overall financing
package. i.e. What is the coherence between activities financed by grants and those financed by reimbursable funds?
How were co-financing amounts and prices determined? How does the concessionality of the GCF financing compare
to that of the co-financing? If applicable, provide a short market read on the prevailing of the pricing and/or financial
markets for similar projects/programmes.

Justify why the level of concessionality of the GCF financial instrument(s) is the minimum required to make the
investment viable. Additionally, how does the financial structure and the proposed pricing fit with the concept of
minimum concessionality? Who benefits from concessionality?

In your answer, please consider the risk sharing structure between the public and private sectors, the barriers to
investment and the indebtedness of the recipient. Please reference relevant annexes, such as the feasibility study,
economic analysis or financial analysis when appropriate.

In terms of the requirement for GCF funding, there are two types of interventions in this project.

The first type of intervention involves scaling up demonstrated measures for SLM. In past activities, WB and the
GoE have laid the foundations for sustainable agricultural production and improvement of livelihoods. SLMP-I and
SLMP-II program activities have proved to be successful in restoring degraded lands and significant lessons have
been learned for further improvement of activities in the future.

With over 95% of agriculture output generated by smallholder farmers with average farm sizes between 0.5 and 2
hectares, the agricultural sector does not yet have the means to fund the introduction of SLM in all degraded
watersheds without concessional funding. The Ethiopian government is investing heavily in climate change
adaptation. Between 2007 and 2013, the government’s total investment in agriculture was around $1.1 billion, of
which around 40% ($0.4 billion) was from within the federal budget of the Ministry of Agriculture. 60% of the federal
budget ($0.3 bn) was spent on resilience activities related to addressing key climate risks. Around 80% of current
resilience spending ($0.2 bn) is on protecting the most vulnerable people in society through a program of safety
nets that provide income support and social assistance. However, due to the significant impacts of climate change
expected in Ethiopia and the vulnerability of most of the population, this investment will not be sufficient and GCF
funding is required to fully finance the incremental costs of climate change adaptation.

The government of Ethiopia has been investing successfully in the development of SLM. SLM practices address
both the short-term (erosion control, flood control) and the long-term goals of the government, which are part of
efforts to rehabilitate degraded areas through soil and water conservation measures. However, national resources
are insufficient to fund the remaining SLM investments required and additional funding is needed to finance the
required interventions in degraded watersheds. To date, the World Bank has supported these interventions through
concessional IDA credit. The loans requested from GCF for these investments are of a similar level of
concessionality as the IDA Credit. Highly concessional funding is appropriate due to Ethiopia’s status as a Least
Developed Country with a GDP per capita of $707 in 2017. In addition to SLM investments, GCF funding will also
be used to mitigate the risk and overcome the barrier of limited capacity to scale up the current coverage of SLM
activities. This risk includes the limited human resources to support beneficiaries in the planning and
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 43 OF 96

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implementation of complex interventions, the challenge of implementing a cost-effective M&E system, and the need
to strengthen coordination among institutions, sectors, programs and projects.

The GCF highly concessional funding, along with additional financing from IDA, MDTF and GoE, would build upon
previous SLM practices, taking into account lessons learned and introducing new activities in order to achieve
landscape restoration and establish green corridors. Activities would include land use rationalization, intercropping,
low tillage, gully reclamation, establishing grazing corridors, watering points and wells, and sylvo-pastoral
strategies. Large-scale landscape restoration is only achievable through GCF co-financing due to the nature and
scale of the needed investments. Land restoration lays the foundations for increased resilience to climate change
and mitigation capacity while it enables agricultural production.

The second type of intervention for which GCF funding is requested is that of measures intended to encourage the
adoption of Climate Smart Agriculture (CSA) practices and the development of strong value chains associated with
livelihoods based on SLM and CSA. By strengthening value chains linking livelihoods based on SLM and CSA
practices with the private sector, activities funded by GCF will contribute to the development of sustainable
livelihoods, providing incentives for maintaining SLM and CSA practices.

If correctly implemented, CSA helps increase yields while building farmer resilience and contributing to the
achievement of the NDC and several SDGs. Thus, CSA jointly addresses food security and climate change
adaptation and mitigation. The determining factors for effective CSA outcomes are the combination of practices
such as minimum tillage, crop residue management and crop rotation and intercropping. Challenges remain in the
implementation of this combination of practices, such as the need for a change of mindset of farmers, extension
workers and policy makers, competition for crop residue, lack of cover crops and lack of suitable technologies.
Concessional funding is needed in order to remove these barriers and create a culture and knowledge base within
which CSA can continue to be promoted by the extension services and implemented by farmers in future.

Without GCF involvement, Ethiopia cannot finance the proposed interventions. The national Climate Resilient
Green Economy strategy has called for annual spending of $7.5 billion to respond to climate change. With national
budgetary resources for climate-change relevant actions estimated to be in the order of $440 million per year and
international sources contributing tens of millions of dollars per year, there is a major financing gap. Poor access to
credit, high lending rates and an insufficient budget are not conducive to the investments required for handling local
climate change impacts. In addition, Ethiopia's Debt Sustainability Assessment recently changed the risk of debt
distress to high. Thus, GCF concessional financing, including a high degree of concessionality, is needed to ensure
improved resilience to climate change impacts and food security in Ethiopia.

Public goods include: management of communal land; externalities from soil erosion; and water-insecurity (risk of
droughts and floods). Market failures are found in the incomplete markets associated with: land-insecurity (lack of
defined land ownership); water-insecurity; and soil loss.

Improving management of non-cropland areas under communal use requires a public good approach. Livestock
grazing and firewood collection leads to deforestation and soil erosion on these communal lands (e.g. non-crop
land). Using private investments to improve resource management on communal lands is not possible unless all
costs and benefits can be internalized to a well-defined and functioning group of beneficiaries. Watershed
management is one approach to this, but it requires long-term public investments and capacity building beyond
what the private sector can do in the short term.

Soil erosion may lead to impacts outside the watershed management area (externalities). This means that costs
and benefits from the investment will be accrued by people outside the project area. There is no functioning market
for internalizing downstream negative effects and solving them with private sector investments or loans. Public
sector investment is required.
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 44 OF 96

B
Water-insecurity (risk of droughts and floods) are exacerbated by poor water/land management as well as climate
change. There are no functioning markets for pricing water and impacts of disasters especially if the future holds
greater risks. This is a market failure that requires public investments due also to the long-term solutions required to
improve resource management.

The impact of poor soil management is felt by farmers and downstream beneficiaries, but there is no market value
put on soil or the loss of soil. The solutions to reducing soil erosion require investments as well as short-term loss of
income and food production while benefits accrue in the long term. Some benefits will also accrue externally to the
project area. This is a market failure. In addition, the lack of land security prevents private sector investments from
being realized due to increased risk from unclear property rights. Providing land security is a public responsibility.

Without land-, water- and soil-security no amount of private investment can ensure sustainable resource
management in the future. This fits neatly with GCF’s stated innovation is to use public investment to stimulate
private finance. The incremental net benefits in the 40 watersheds at most risk from climate change target already
poor and vulnerable populations. The grant proportion is justified compared to a loan because the net benefits are
not expected to improve the fiscal position of the GoE including no additional tax revenue from these populations.

Without the Project intervention, beneficiaries both in the area and downstream will continue to struggle to
establish or maintain their livelihoods and it is expected that without the Project, land use will continue on its
current path. Continued soil erosion, water insecurity, and land insecurity leads to land degradation with direct
losses to those that rely on crop and livestock production and related industries for their livelihood. Production
yields will go down or farmers will have to increase their input costs, on e.g. fertilizer, to maintain current yields. In
the absence of storage facilities, farmers will continue to experience post-harvest losses. They will also be unable to
capture higher crop prices that are only obtainable a few months after harvest and in larger markets. Non-
agricultural land in the watershed will also continue to deteriorate without the Project due to soil erosion and
overuse of common land through grazing livestock and firewood collection. This will put a further strain on the
population who derive their livelihood from forests, woodlands, and surrounding areas. Downstream from the
project area, continued land degradation will also affect areas and households through increased flood risk and
sedimentation of irrigation dams.

Figure 6 illustrates how this analysis assumes a declining production without Project interventions due to soil
erosion. With Project interventions the yield loss is avoided and, for some production systems (crops, livestock, and
grassland), with-project yields increase over time. This yield increase is attributed to adoption of improved cultivars,
improved seeds, better animal breeds, land restoration, water management, and implementing climate smart
agricultural techniques. The sum of the two shaded areas in the Figure constitute the incremental benefit
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 45 OF 96

B
Figure 6 Illustration of incremental benefits

B.6. Exit strategy and sustainability (max. 500 words, approximately 1 page)
Explain how the project/programme sustainability (financial, institutional, social, gender equality, environmental) will
be ensured in the long run after project closure, including how the project’s results and benefits will be sustained.

Include information pertaining to the longer-term ownership, project/programme exit strategy, operations and
maintenance of investments (e.g. key infrastructure, assets, contractual arrangements). In case of private sector,
please describe the GCF’s financial exit strategy through IPOs, trade sales, etc.

Provide information on additional actions to be undertaken by public and private sector or civil society as a
consequence of the project/programme implementation for scaling up and continuing best practices.

The project will seek to ensure the long-term maintenance of restored landscapes through (i) an emphasis on
strengthening the value chains associated with sustainable agricultural practices in restored watersheds, designed
to build incentives for local communities to continue SLM practices, (ii) a focus on the provision of land-holding
certificates, to encourage investment in long-term landscape productivity, and (iii) policy an implementation support
for the establishment of watershed associations, combined with capacity building of local governments, to provide a
durable institutional framework SLM. For value chain connections including CSRPs – these investments will be
made through CIGs and cooperatives based on business plans that will include the identification O&M costs and
the revenues necessary to cover them, that will be generated through the connections to value chains

GCF funding will be used to enhance the climate resilience of and add innovative elements to the government’s
ongoing SLM program. Strong government ownership ensures long-term commitment to the promotion of SLM and
CSA practices, as part of the broader national goals of enhancing agricultural productivity, building resilience to
climate change, and achieving a carbon neutral economy. Specifically, MoF and MoA are committed to scaling up
and enhancing the success of the Government’s proven flagship SLM Program. Beyond this national commitment,
a particular focus of the RLLP is providing support for watersheds to graduate from development partner assistance
for SLM, such that maintenance of restored landscapes and CSA will become mainstreamed into local community
practices and local government functions. Component 2 of the proposed project will create institutions and build
capacity that will enable the CSA interventions to be sustainably implemented in watersheds that graduate from
project-based support. Spillover effects of successful SLM interventions have already been observed under the
ongoing program. For example, CSA pilot watersheds have been visited by farmers and extension workers from
adjacent areas and replicated through the government extension system. In addition to this spillover effect, the
RLLP will provide four specific forms of support for the graduation of watersheds:

• First, the principal emphasis of policy development under RLLP will be the establishment of a regulatory
framework for the creation of watershed associations, bringing together all stakeholders in restored
watersheds. This initiative will build on a pioneering effort in the Regional State of Amhara and will draw on
international best practice in this regard. In addition to providing the institutional framework required for
maintenance and further investment in SLM, the establishment of watershed associations is also designed
to leverage possible new sources of funding for SLM. This includes funding through Payment for
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 46 OF 96

Ecosystem Services (PES), such as payments for sustainable watershed management to deliver
B
downstream benefits, for example by reducing flooding and sediment loads affecting hydrological
infrastructure (such as reservoirs for hydro-electric power generation), as well as payments for groundwater
recharge from private sector entities dependent on reliable water supply;
• Second, support for capacity building and information modernization under RLLP will emphasize building
permanent capacity in local governments to plan, implement and manage investments in SLM and CSA;
• Third, the focus of RLLP on strengthening value chains associated with livelihoods based on SLM and CSA
practices is designed to strengthen incentives for communities and local governments to maintain and
expand these initiatives;
• Fourth, in Component 3 support for land-holding certification will help secure land tenure for smallholders,
enhancing income opportunities and promoting resilient livelihoods in the long term. Land tenure provides
incentives to maintain restored landscapes, to abandon destructive practices such as free grazing, and to
persevere with CSA practices.

Measures that will be taken to enhance institutional capacity for implementation and sustainability are: (i) continual
training on project management and monitoring at all levels, in coordination with the GIZ SURED project; (ii) project
implementation arrangements acceptable to the World Bank and agreed by the MoA and regional governments
clarifying accountability and targets at all levels; and (iii) coordination between development partners Technical
Committee on SLM.

Sustainability will be ensured through the creation of exit strategies for each participating watershed, based on the
guideline Exit Strategy and Performance Assessment for Watershed Management (ESPAWM) (see Annex L.3.),
which also covers operation and maintenance (O&M). Annex 1 of the ESPAWM provides a sample framework for a
watershed-specific exit strategy, including activities and milestones specifically for highland water and land
management projects in Ethiopia. This framework includes the development of an O&M plan for all infrastructure
financed by the project. Annex 1 of the ESPAWM includes pointers on ensuring the O&M of community service
facilities, which have not been considered as a part of watershed development plans in the past, and consequently
not covered in O&M plans. Annex 1 also indicates the importance of establishing utilization arrangements for
springs/shallow wells, guarding, user fees, community-level trainings for O&M and O&M of introduced improved
farm machinery.

By the end of the project period, all watersheds included in the project are expected to have completed a Multi-Year
Development Plan (MYDP) and those already supported under SLMP will receive assistance to graduate from
project-based support for SLM. To help ensure the sustainability of the SLM interventions, the Project will provide
support for the creation of Watershed User Associations (WUAs) in each graduating watershed to replace the
project-based Community Watershed Teams (CWTs) and Kebele Watershed Development Committees (KWDCs)
with a legally recognized institution for the ongoing planning and management of the watershed.

Watershed Management and Use Plans (WMUPs) adopted by WUAs will detail management and use for
graduating watersheds, outlining agreements to conserve and utilize the resources and establishing bylaws for
managing and implementing conservation activities and the distribution of benefits. The development of these
WMUPs is critical to ensure land resources are used and managed in a way that enhances absorptive and adaptive
capacity to climate change, promoting resilience broadly at the landscape level.

Ongoing monitoring of the success of SLM and CSA will be ensured at the local level through the RLLP’s support
for information modernization as part of local government capacity building. At the national level, the involvement of
MoA and national research organizations in the impact evaluation, knowledge management and communication
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 47 OF 96

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sub-component will help ensure long-term commitment to monitoring, evaluating and improving the performance of
these initiatives.

The loan component of the GCF financing will be provided on similar concessional terms as IDA financing, and
repayments will be managed by the Government of Ethiopia through similar mechanisms.
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C
FINANCING INFORMATION
C.1. Total financing
(a) Requested GCF funding Total amount Currency
(i + ii + iii + iv + v + vi + vii) 165.24 million USD ($)
GCF financial instrument Amount Tenor Grace period Pricing
(i) Senior loans 107,174,255 40 years 10 years 0%
(ii) Subordinated loans Enter amount Enter years Enter years Enter %
Enter % equity
(iii) Equity Enter amount return

(iv) Guarantees Enter amount Enter years

(v) Reimbursable grants Enter amount
(vi) Grants 58,063,337
(vii) Results-based payments Enter amount
Total amount Currency
(b) Co-financing information
131 million USD ($)
Financial Tenor &
Name of institution Amount Currency Pricing Seniority
instrument grace
Senior 0% senior
Loans million 36 years
IDA 100
USD ($) 5 years

Ethiopia Resilient Landscapes Enter% Options

and Livelihoods multi-donor Grant
million Enter years
trust fund (“MDTF”), 31
USD ($) Enter years
administered by the World
Bank as Trustee
Options Enter% Options
Enter years
Click here to enter text. Enter amount Options Enter years

Amount Currency
(c) Total financing
(c) = (a)+(b) 296.24 million USD ($)
Please explain if any of the financing parties including the AE would benefit from
any type of guarantee (e.g. sovereign guarantee, MIGA guarantee).

(d) Other financing Please also explain other contributions such as in-kind contributions including tax
arrangements and exemptions and contributions of assets.
contributions (max. 250
Please also include parallel financing associated with this project or programme.
words, approximately 0.5
page)

C.2. Financing by component

Please provide an estimate of the total cost per component and output as outlined in section B.3. above and
disaggregate by source of financing. More than one co-financing institution can fund a single component or output.
Provide the summarised cost estimates in the table below and the detailed budget plan as annex 4.

Component GCF financing Co-financing Co-financing

 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 49 OF 96

Indicative Amount Financial Amount Financial Name of Amount Financial

C Name of
cost million Instrument million Instrument Institutions million Instrument Institutions
million USD USD ($) USD ($) USD ($)
($)
57.51 Grants
Component 1. Green
222.5
Infrastructure and Resilient 65 15.5
Livelihoods 85.49 Senior
Loans

Component 2. Investing in Senior

29.65 16.15
Institutions and Information for Loans 6 7.0
Resilience Senior
IDA Grants MDTF
Loans
Component 3. Rural Land 26 0
20 6
Administration and Use

Component 4. Project 0.49 Grants

Management and Reporting
18.09 9 2.5
Senior
5.60
Loans

Indicative total cost (USD) 31

296.24 165.24 100

This table should match the one presented in the term sheet and be consistent with information presented in other
annexes including the detailed budget plan and implementation timetable.

In case of a multi-country/region programme, specify indicative requested GCF funding amount for each country in
annex 17, if available.

Component Sub-component GCF funding (USD) IDA (USD) MDTF (USD)

Sub-component 1.1. Land Restoration

and Watershed Management 100,000,000 49,000,000 6,941,189

Component 1. Green Sub-component 1.2. Climate Smart

Infrastructure and Agriculture 15,000,000 10,000,000 8,462,561
Resilient Livelihoods
Sub-component 1.3. Livelihood
Diversification and Connection to 28,000,000 6,000,000 96,250
Value Chain
Sub-component 2.1. Capacity building,
Component 2. information modernization and policy 16,149,572 3,000,000 4,879,380
Investing in development
Institutions and
Sub-component 2.2. Impact
Information for
Evaluation, Knowledge Management 0 3,000,000 2,120,620
Resilience
and Communication

Component 3. Rural
Land Administration 0 20,000,000 6,000,009
and Use
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 50 OF 96

C
Component 4. Project
Management and 6,088,020 9,000,000 2,500,001
Reporting

Total (excluding Accredited Entity Fee) 165,237,592 100,000,000 31,000,010

Total project financing includes the following sources of co-financing:

• International Development Association (IDA) loan: $100,000,000 concessional loan from IDA.
• Multi-donor trust fund (MDTF) grant: $19,000,000 from Norway and $12,000,0000 from Canada. Donor
contributions to the MDTF are in the respective currencies of the donor and are expected in tranches over the
life of the RLLP. Donor contributions to the MDTF are translated to United States dollars when the World
Bank receives the funds.

Grant vs Loan

The GCF loan will be applied across all sub-components funded by GCF except for some specific activities in Sub-
component 1.1 and Component 4 where GCF grant will be applied. Based on GCF's feedback emailed on November
18th, GCF stated that the grant portion should be in support of activities directly linked to the climate benefits.
Accordingly, considering the direct carbon sequestration associated with the set of activities and the need to build
gender-responsive resilience, following activities, listed below with their indicative estimates in brackets (actual
request is rounded off to $58 million), were selected for GCF grant funding:

Sub-component 1.1

• Construction of physical soil and water conservation measures on communal lands including degraded
hillside, shrub land and pastureland ($26,080,515)
• Pitting and planting of multi-purpose trees on degraded lands ($12,922,858)
• Establishment of model plantation blocks with native tree species ($2,268,510)
• Post plantation management of planted trees on communal lands ($ 15,856,773)
• Grass seeds for pastureland development ($ 450,313)

Component 4

• Gender mainstreaming ($ 484,368)

GCF loans are treated like IBRD/IDA loans and will be repaid in parallel following a repayment schedule to be
negotiated with GCF at Term Sheet and FAA stage. GCF loan is senior and not sub-ordinated.

C.3 Capacity building and technology development/transfer (max. 250 words, approximately 0.5 page)
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C.3.1 Does GCF funding finance capacity building activities? Yes ☒ No ☐
C.3.2. Does GCF funding finance technology development/transfer? Yes ☒ No ☒
If the project/programme is expected to support capacity building and technology development/transfer, please
provide a brief description of these activities and quantify the total requested GCF funding amount for these activities,
to the extent possible.

Component 2. Investing in Institutions and Information for Resilience

Activities will be funded by IDA and MDTF in watersheds identified for IDA funding (budget of USD 13.0 million) and
by GCF in watersheds identified for GCF funding (budget of USD 16.15 million).

The objective of this component is to enhance institutional capacity and improve information for better decision-
making in supporting resilient landscapes and diversified rural livelihoods in the project area, both for the duration of
the project and after project completion.

This component will build capacity at the local government level (woreda and kebele) for (i) planning and managing
SLWM interventions, and (ii) managing the land certification process. This will include piloting of new technologies for
information modernization at the local level, including the use of electronic tablets for gathering geospatial
information, and the use of Unmanned Aerial Vehicles (UAVs – or drones) for land certification mapping. Tablets and
UAVs will be the property of the project (i.e. MoA) and would be provided to development agents and the woreda
focal persons in the project watersheds for mapping and monitoring. The device setup, training, and support provided
will be tailored to meet the conditions and realities faced in field environment (i.e. off-line data collection, accessories
(protective case, solar charger, etc.), guidance materials, technical and trouble-shooting support).

Support for policy development under this component will focus on the regulatory framework for Watershed User
Associations (WUAs), community bylaws guiding land-use practices, and strengthening the Land Administration
System. This regulatory framework, once established, will continue to support resilient land use after project
completion. To strengthen the evidence base for sustainable land management decision-making, this component will
include a bio-physical impact evaluation of SLWM interventions, to be conducted through a partnership arrangement
between the MoA, the Water and Land Resource Centre of Addis Ababa University, and the Ethiopia Development
Research Institute’s Environment and Climate Research Center. This will complement a livelihoods impact evaluation
of SLWM interventions to be conducted in parallel led by the Gender Innovation Lab of the World Bank’s Africa
Region. When completed, these evaluations will be available to interested parties in Ethiopia and the region wishing
to institute or improve SLWM. This component will also provide resources to manage the knowledge generated
through these and other assessments of SLWM, and to communicate the lessons learnt to a broad audience,
including local governments and communities, relevant research institutions and Government agencies, as well as
Development Partners.

This component’s objectives will be achieved through the implementation of the following sub-components: (i)
capacity building, information modernization and policy development, and (ii) impact evaluation, knowledge
management and communication.

Sub-component 2.1. Capacity Building, Information Modernization and Policy Development

This sub-component will build capacity at local government level to implement RLLP, and to sustain SLWM
interventions after watershed graduation from project-based support. To achieve this, the sub-component will finance
accountants to support the head of the Woreda office of Agriculture (WoA) and a focal person in each participating
woreda, and part-time community facilitators at the kebele level (5 community facilitators for in each major
watershed). To help build the capacity necessary for an effective land administration system, this sub-component will
also provide technical assistance for training in this field.

This sub-component will support information modernization to coordinate data collection and information sharing at all
levels and under all components of the project so that this information is well organized, properly documented and
accessible. As part of this effort, a data management plan will be developed that specifies how all data used or
created during the course of RLLP will be documented, stored and otherwise managed. The use of electronic tablets
to collect information on project activities and results, combined with appropriate survey and mapping software, will
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improve the quality and timeliness of data collection and reduce the effort needed to compile, review, and generate
the necessary reports. This framework will facilitate access to information and support timely feedback to the local
level.

This sub-component further supports the use of aerial vehicles (UAVs)/drones to generate high-quality and timely
aerial imagery data to support planning, monitoring, and land certification. Under this initiative, the drones will be
operated by several teams of trained operators who will travel to the project sites. During the course of RLLP each
micro-watershed will be re-visited twice each year at appropriate intervals to generate visual and multi-spectral
images of the program areas. At each stage the processed imagery will be shared with the woreda and local field
staff for the purpose of assisting in planning, monitoring progress and updating implementation plans. The data and
materials produced will also be used to support M&E and will serve as a source of information and data for
subsequent analysis. Detailed technological specifications and budget have been elaborated including the technical
requirements for the drones, all associated equipment and spare parts, operating costs for the duration of the project.
The use of the drones is intended for the collection of information and data that will be available for long-term use and
for project planning and monitoring. The project will work with the Information Network Security Agency (INSA) and
the Ethiopian Aviation Authority to ensure all necessary permits are obtained.
Policy development under this sub-component will focus on the regulatory framework required for the establishment
of Watershed User Associations (WUAs), crucial for sustainability of SLWM interventions, frameworks for reward and
incentive schemes such as Payments for Environmental Services (PES), as well as community byelaws guiding land-
use practices, and strengthening of the Land Administration System.

In developing the framework for WUAs, the Project will work closely with regional governments for its application in
establishing WUAs. This work will commence with reviewing of the environmental legislation that relates to the use
and management of Ethiopia’s natural resources (soils, forestry, grassland, water, wildlife, etc.). The manual for CSA
will be used to proceed and enhance this activity. RLLP will give high attention to the opportunities of engagement of
private sector (PS) in all development activities of the project. The first objective of PS engagement in RLLP is, to
attract the PS to invest in RLLP interventions. The second objective is to create and increase income streams &
diversified livelihoods for the communities in a sustainable manner through the promotion of inclusive business and
value chain/partnership relationship based on profitability principles.

Sub-component 2.2 Impact Evaluation, Knowledge Management and Communication

Impact evaluations (IEs) will use rigorous research methods to look at specific interventions under RLLP, assess the
contribution of these to development goals and provide robust evidence of SLM impact. Project funding will focus on
the evaluation of bio-physical impacts, which will be conducted in coordination with a livelihoods impact evaluation to
be led by the Gender Innovation Lab of the World Bank’s Africa Region, financed separately. The bio-physical impact
evaluation will examine the response of the environment to SLWM interventions, considering parameters such as
peak and base surface water flows, groundwater levels and recharge rates, sediment loads, and remotely sensed
information on vegetation cover and soil moisture. For the purposes of this evaluation, the project will extend the
existing partnership between MoA, the Water and Land Resource Center of Addis Ababa University, and the
Environment and Climate Research Centre of EDRI, and will aim to build new partnerships with relevant international
research organizations.

In addition to the bio-physical IE and the livelihoods IE an evaluation of climate-smart agriculture will also be
conducted. Due to the complexity of the evaluations the details of their implementation are still under development.
Basic design of the IEs is expected to be as follows: the livelihoods IE is expected to involve random assignment. The
biophysical IE will involve a 2-stage sampling where in the first stage a stratified selection of watersheds to be treated
will be performed and in the second stage watersheds will be paired with a suitable comparison watershed (outside
project watersheds). This is being done to increase the explanatory power of the evaluation given the large cost
associated with each watershed monitored. The CSA evaluation is expected to follow a treatment-control comparison
methodology and the potential for randomized assignment within the CSA micro-watersheds is being explored. In any
case, the sampling of treatment and control will be randomized.

To build a solid and effective knowledge management system both for the project and the SLM program in Ethiopia,
this sub-component will establish a geospatial knowledge platform that combines information from a variety of project
and other sources and packages it in a format that is accessible to planners and stakeholders at the national,
regional, and local levels. This activity will build upon the work being done by WLRC under SLMP II to develop a web-
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based knowledge management system. By enabling farmers to improve their planning the platform will decrease their
exposure to climate change related risks.

A strategic communication program will be developed and implemented under this sub-component to inform and
mobilize communities, enhance project visibility and transparency among all actors, support efforts to scale-up SLM
and CSA practices, and build support for the land certification program. Strategic guidelines for the implementation of
the Knowledge Management and Communication (KMC) program have been developed following a rapid KMC needs
assessment. The guidelines include viable options of knowledge management, knowledge sharing and
communication with effective channels, techniques, tools and key messages that address the communication and
knowledge management needs of beneficiaries, stakeholders, partners and actors at various level. While following
those guidelines, implementers will have room to elaborate, modify and adapt additional communication and
knowledge management interventions to meet the overarching goals and specific objectives outlined in this sub-
component. The identified overarching goals are: 1) to build and coordinate a strong knowledge base contributing to
the effective promotion, reporting and scaling up of SLM within Ethiopia; and 2) to inform and mobilize local
communities, strengthen consultation/ participatory development models, and enhance transparency in program-
supported activities. The specific objectives of the KMC program are to: a) Support scaling up efforts and adoption of
SLM and CSA practices; b) Help evidence based planning and reporting through enhanced information flow among
institutions and coordination of monitoring and evaluation; c) Enhance the program visibility among all actors thereby
attract new development partners and insure the buy-in of the government; d) Sustain the outcomes of SLM practices
through awareness raising campaigns. This includes relevant activities in components 1 and 3 such as land
certification. The guidelines include means of verification to evaluate the effectiveness of the activities implemented
within the KMC program.

Possible activities include:

i. knowledge identification, capturing, validation and packaging annually to support scaling up efforts, build
capacity of user groups, youth groups, DAs and FTCs (experiential knowledge, best practice and synthesis of
explicit knowledge products from various sources such as the geo-spatial knowledge platform, the CSA
Innovation Platform, model watershed, etc.);
ii. strengthening and enhancing functionality of existing FTCs and SLM information centers at woreda level and
establishing info centers in new woredas;
iii. outreach activities (i.e. production of printed, audio and video materials to be used as supporting tools during
workshops and events, and media tours for journalists and PR officers of relevant regional bureaus to show
project results);
iv. knowledge sharing/networking events (i.e. annual SLMP Knowledge fair); and
v. advocacy activities to support private sector engagement, policy development and other key initiatives for
RLLP effective implementation (i.e. organization of Stakeholders Workshops).
vi. grassroots level behavioral change campaign targeted to major/critical watersheds, based on preliminary
research to define appropriate media (drama, storytelling, etc.) and effective messengers (i.e.
community/religious leaders) and gauged throughout the duration of the program through a mix of
qualitative/quantitative research methods (FGDs, community level meetings, survey);
vii. public information awareness activities on land registration and cadastral surveys, land laws and procedures
and conflict resolution mechanism, and to explain the benefits of (formalized) rentals and unlock the blockage
set by cultural norms, emphasizing that temporary land renting does not imply abandonment and formalized
rental contracts do not result in land being expropriated.
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D.EXPECTED PERFORMANCE AGAINST INVESTMENT CRITERIA
This section refers to the performance of the project/programme against the investment criteria as set out in the
GCF’s Initial Investment Framework.
D.1. Impact potential (max. 500 words, approximately 1 page)
Describe the potential of the project/programme to contribute to the achievement of the Fund’s objectives and result
areas. As applicable, describe the envisaged project/programme impact for mitigation and/or adaptation. Provide the
impact for mitigation by elaborating on how the project/programme contributes to low-emission sustainable
development pathways. Provide the impact for adaptation by elaborating on how the project/programme contributes
to increased climate-resilient sustainable development. Calculations should be provided as an annex. This should be
consistent with section E.2 reporting GCF’s core indicators.

In terms of the requirement for GCF funding, there are two types of interventions in this project. The first type of
intervention involves scaling up demonstrated measures for SLM. In past activities, WB and the GoE have laid the
foundations for sustainable agricultural production and improvement of livelihoods. SLMP-I and SLMP-II program
activities have proved to be successful in restoring degraded lands and significant lessons have been learned for
further improvement of activities in the future.

With over 95% of agriculture output generated by smallholder farmers with average farm sizes between 0.5 and 2
hectares, the agricultural sector does not yet have the means to fund the introduction of SLM in all degraded
watersheds without concessional funding. The Ethiopian government is investing heavily in climate change
adaptation. Between 2007 and 2013, the government’s total investment in agriculture was around $1.1 billion, of
which around 40% ($0.4 billion) was from within the federal budget of the Ministry of Agriculture. 60% of the federal
budget ($0.3 bn) was spent on resilience activities related to addressing key climate risks. Around 80% of current
resilience spending ($0.2 bn) is on protecting the most vulnerable people in society through a program of safety nets
that provide income support and social assistance. However, due to the significant impacts of climate change
expected in Ethiopia and the vulnerability of most of the population, this investment will not be sufficient and GCF
funding is required to fully finance the incremental costs of climate change adaptation.

The government of Ethiopia has been investing successfully in the development of SLM. SLM practices address both
the short-term (erosion control, flood control) and the long-term goals of the government, which are part of efforts to
rehabilitate degraded areas through soil and water conservation measures. However, national resources are
insufficient to fund the remaining SLM investments required and additional funding is needed to finance the required
interventions in degraded watersheds. To date, the World Bank has supported these interventions through
concessional IDA credit. The loans requested from GCF for these investments are of a similar level of concessionality
as the IDA Credit. Highly concessional funding is appropriate due to Ethiopia’s status as a Least Developed Country
with a GDP per capita of $707 in 2017. In addition to SLM investments, GCF funding will also be used to mitigate the
risk and overcome the barrier of limited capacity to scale up the current coverage of SLM activities. This risk includes
the limited human resources to support beneficiaries in the planning and implementation of complex interventions, the
challenge of implementing a cost-effective M&E system, and the need to strengthen coordination among institutions,
sectors, programs and projects.

The GCF highly concessional funding, along with additional financing from IDA, MDTF and GoE, would build upon
previous SLM practices, taking into account lessons learned and introducing new activities in order to achieve
landscape restoration and establish green corridors. Activities would include land use rationalization, intercropping,
low tillage, gully reclamation, establishing grazing corridors, watering points and wells, and sylvo-pastoral strategies.
Large-scale landscape restoration is only achievable through GCF co-financing due to the nature and scale of the
needed investments. Land restoration lays the foundations for increased resilience to climate change and mitigation
capacity while it enables agricultural production.

The second type of intervention for which GCF funding is requested is that of measures intended to encourage the
adoption of Climate Smart Agriculture (CSA) practices and the development of strong value chains associated with
livelihoods based on SLM and CSA. By strengthening value chains linking livelihoods based on SLM and CSA
practices with the private sector, activities funded by GCF will contribute to the development of sustainable
livelihoods, providing incentives for maintaining SLM and CSA practices.
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If correctly implemented, CSA helps increase yields while building farmer resilience and contributing to the
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achievement of the NDC and several SDGs. Thus, CSA jointly addresses food security and climate change
adaptation and mitigation. The determining factors for effective CSA outcomes are the combination of practices such
as minimum tillage, crop residue management and crop rotation and intercropping. Challenges remain in the
implementation of this combination of practices, such as the need for a change of mindset of farmers, extension
workers and policy makers, competition for crop residue, lack of cover crops and lack of suitable technologies.
Concessional funding is needed in order to remove these barriers and create a culture and knowledge base within
which CSA can continue to be promoted by the extension services and implemented by farmers in future.

Without GCF involvement, Ethiopia cannot finance the proposed interventions. The national Climate Resilient Green
Economy strategy has called for annual spending of $7.5 billion to respond to climate change. With national
budgetary resources for climate-change relevant actions estimated to be in the order of $440 million per year and
international sources contributing tens of millions of dollars per year, there is a major financing gap. Poor access to
credit, high lending rates and an insufficient budget are not conducive to the investments required for handling local
climate change impacts. In addition, Ethiopia's Debt Sustainability Assessment recently changed the risk of debt
distress to high. Thus, GCF concessional financing, including a high degree of concessionality, is needed to ensure
improved resilience to climate change impacts and food security in Ethiopia.

Without the Project intervention, beneficiaries both in the area and downstream will continue to struggle to establish
or maintain their livelihoods and it is expected that without the Project, land use will continue on its current path.
Continued soil erosion, water insecurity, and land insecurity leads to land degradation with direct losses to those that
rely on crop and livestock production and related industries for their livelihood. Production yields will go down or
farmers will have to increase their input costs, on e.g. fertilizer, to maintain current yields. In the absence of storage
facilities, farmers will continue to experience post-harvest losses. They will also be unable to capture higher crop
prices that are only obtainable a few months after harvest and in larger markets. Non-agricultural land in the
watershed will also continue to deteriorate without the Project due to soil erosion and overuse of common land
through grazing livestock and firewood collection. This will put a further strain on the population who derive their
livelihood from forests, woodlands, and surrounding areas. Downstream from the project area, continued land
degradation will also affect areas and households through increased flood risk and sedimentation of irrigation dams.

Figure 6 illustrates how this analysis assumes a declining production without Project interventions due to soil erosion.
With Project interventions the yield loss is avoided and, for some production systems (crops, livestock, and
grassland), with-project yields increase over time. This yield increase is attributed to adoption of improved cultivars,
improved seeds, better animal breeds, land restoration, water management, and implementing climate smart
agricultural techniques. The sum of the two shaded areas in the Figure constitute the incremental benefit

Figure 6 Illustration of incremental benefits

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D.2. Paradigm shift potential (max. 500 words, approximately 1 page)
Describe the degree to which the proposed activity can catalyze impact beyond a one-off project or programme
investment. Describe the following, if applicable:
• Potential for scaling up and replication
• Potential for knowledge sharing and learning
• Contribution to the creation of an enabling environment
• Contribution to the regulatory framework and policies
• Overall contribution to climate-resilient development pathways consistent with relevant national climate change
adaptation strategies and plans
The RLLP will scale up, transform and innovate through the government of Ethiopia’s ongoing SLM program.
Following the success of earlier SLM interventions, the RLLP represents a paradigm shift by focusing on building the
institutions and incentives necessary for long-term investment in, and maintenance of, restored landscapes that are
both resilient to climate change and sequester carbon. Transformative elements of the RLLP include (i) an emphasis
on strengthening the value chains associated with sustainable agricultural practices in restored watersheds, designed
to build incentives for local communities to maintain restored landscapes over the long term, (ii) a focus on the
provision of land-holding certificates, to encourage investment in long-term landscape productivity, and (iii) policy
support for the establishment of watershed associations, combined with capacity building of local governments, to
provide an institutional framework for long-term maintenance of restored landscapes.

The theory of change behind this package of interventions (as shown in the illustration below) is that by delivering
more productive, secure and resilient livelihoods to local communities and by establishing the institutional framework
needed to support maintenance of restored landscapes over the long term through watershed associations and local
governments, the RLLP will lead to a durable shift towards SLM in the degraded watersheds of the Ethiopian
highlands.

Such dissemination will be encouraged through awareness generating initiatives and training programs undertaken
under Component 2.1, including farmer to farmer experience exchange visits, field schools, and awareness raising
workshops (refer to Annex K.1. RLLP Detailed Budget). These activities will mobilize traditional self-help institutions
of the communities in the project woredas, which have already contributed immensely to effective Project
implementation and sustainability. For example, in all implementing regions and woredas, there are indigenous
institutions (such as “Idir”, “Yehager Shimaglewoch”, (Elders), religious fathers, “Maheber”, etc.), which have been
established by the community for different purposes and are also working for the successful implementation and
dissemination of SLM practices (refer to Annex D.1. RLLP Social Assessment). In addition, Ethiopian communities
are used to financing investments through rotating savings and credit associations (ROSCA) called ekub rather than
through the underdeveloped formal financial sector.

RLLP will be implemented by MoA, the ministry responsible for agriculture in the entire country. The ministry, working
together with WB and other donors, already has a clear history of scaling up – SLMP-II expanded the area included in
SLMP-I and RLLP will expand the project area further (see Figure 2). The Government of Ethiopia aims to introduce
sustainable land use practices for all agricultural land in the country and if RLLP is as successful as the preceding
SLM programs, there is every intention to continue the process of scaling up in the coming years. MoF and MoA are
committed to scaling-up and ensuring the long-term sustainability of the Government’s proven flagship SLM Program.

RLLP will also seek to identify innovative sources of SLM financing, including Payment for Ecosystem Services
(PES) from either (i) private sources with an interest in restored watersheds, as exemplified by the recent agreement
with Raya Brewery-BGI Ethiopia in the Tigray Region, or (ii) public sources such as municipalities and River Basin
Authorities with an interest in improved catchment management to extend the lifetime and productivity of hydrological
infrastructure, including for hydropower, irrigation and water supply. Further information on the project’s engagement
with the private sector is provided in Section E.5.3 and Annex B.1.

The knowledge generated and experience gained through implementation and evaluation of RLLP will also be
disseminated more broadly to inform the design of SLM interventions internationally.

D.3. Sustainable development (max. 500 words, approximately 1 page)

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Describe the wider benefits and priorities of the project/programme in relation to the Sustainable Development Goals
and provide an estimation of the impact potential in terms of:
• Environmental co-benefits
• Social co-benefits including health impacts
• Economic co-benefits
• Gender-sensitive development impact
The proposed interventions are designed to support climate change adaptation and mitigation, enhancing long-term
resource productivity while generating multiple social, environmental and economic co-benefits.

Environmental Benefits
Benefits from improved water management include increased soil moisture and reduced variability in response to
flood/drought conditions. Soil retention provides benefits both on-site in terms of soil quality and off-site in terms of
reduced erosion; it can be measured in terms of land savings or erosion prevention. Increased soil fertility is a
determining factor for higher and less variable crop yields. Increased vegetation cover also helps to prevent erosion
and improves downstream water quality, while simultaneously supporting biodiversity, which will be further enhanced
through investment in green corridors.

An illustration of the benefits that sustainable land management can provide in Ethiopia is provided by the Productive
Safety Net Program (PSNP). Under RLLP, a number of communities graduating from food-insecure status in newly
identified watersheds will transition from support under PSNP to join the SLM Program. The PSNP implements land
restoration and sustainable land management and mitigates nearly 3.4 million t CO2e per year (+/-20%), achieved by
sequestering carbon in biomass and soils.19 This equates to 1.5% of Ethiopia’s Nationally Determined Contribution
(NDC) to mitigation.20

Social and Economic Benefits

The principal direct set of benefits from the RLLP will be improved incomes and more resilient livelihoods of
vulnerable communities in degraded watersheds targeted by the project as a result of investments in SLM, climate
resilient livelihood diversification (including grain-, meat-, dairy-, and bamboo-processing; tree seedling nurseries;
manufacturing of improved cook stoves, production of improved environmental services; and private sector initiatives
for PES or CSR), value chain strengthening, and land-holding certification. These interventions are also expected to
deliver co-benefits, including: (i) health benefits of reduced exposure to household air pollution and of improved
nutrition due to a more varied food production, (ii) reduced time spent on biomass fuel collection through the use of
improved cookstoves, and (iii) enhanced infrastructure resilience as a result of reducing flooding and sediment loads.
Benefits from improved administration and tenure rights include conservation of protected areas, biodiversity and
tourism.

RLLP will support climate resilient food security of communities graduating from the PSNP and prevent a return to
food insecurity of these communities as a result of climate shocks, resulting in social and economic benefits for
vulnerable communities in the targeted watersheds. Through the PSNP, the immediate food needs of 8 million people
were met by improving land restoration and infrastructure, and smallholder farmers increased maize yields by an
average of 38%.21

Project-funded capacity building and institutional development at all levels have direct value in that they increase the
skill level in public sector institutions and enable them to work more efficiently in providing essential and enhanced
public goods and services. These institutional benefits are not quantified in the Economic and Financial Analysis
(EFA), but they are seen as critical to ensuring that the other benefits can be realized when it comes to building
productive alliances with access to agricultural financing, land, and other business enabling services.

According to a financial and economic analysis (EFA) of the RLLP, the estimated value of avoided soil erosion varies
between US$ 0.1 and US$ 0.3/tonne of soil depending on the gross marginal value land use (US$ 0.11/tonne of soil
represents non-cropland, while US$ 0.26/tonne is the value of avoided erosion for cropland).The Integrated Financial
and Economic Analysis conducted during project preparation estimates a farm-level gross margins increase of more
than USD 101/year/person, including the value of production used for home consumption, which is 1.2 times the
Food Poverty Line. When assuming 5 persons per household farm, the gross margin can increase to at least USD
101 per household member per year. To associate this result with a measure of absolute poverty, we use the
National Poverty Line for Ethiopia. The poverty line indicates the money required to afford the food covering the
minimum required caloric intake (Food Poverty Line) and additional non-food items. The improvement in farm gross
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margin is around 1.2 times the Food Poverty Line in 2018 terms (USD 85/person/year). This improvement is also
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about 63% of the total National Poverty Line (USD 162/person/year). Other representative farms are estimated to
capture higher growth in gross margins of up to USD 135/person/year. This is a direct measure of increased
resilience in the project area.

Gender Sensitive Development Impact

In addition to promoting women’s participation in community watershed committees, the RLLP will extend experience
under the ongoing SLM program to ensure women fully share in project benefits. In particular, women will continue to
be specifically targeted in the issuance of land-holding certificates, and in the design of support for income-generating
activities. Women and children will benefit disproportionately in the health and time-savings benefits of improved
cookstoves. To ensure that gender-specific lessons are learnt during implementation of the RLLP, a socio-economic
impact evaluation will be conducted by the World Bank’s Africa Region Gender Innovation Lab. Specific gender-
sensitive development impacts include:

• Strengthened implementation practices (planning, implementation and monitoring processes) for equitable
and meaningful participation of females and males in sustainable land restoration and water conservation
practices (50 % female representation in all stages)

• Integrated landscape management practices adopted by local communities based on practical and strategic
gender needs and priorities.

The SLMP-II has produced several gender-related benefits. For example, it had a positive influence on gender norms
and perceptions about women. Income generation through the SLMP-II was appreciated by women participants, who
pointed out that they have gained more respect from community members because of their increased self-reliance.
Another substantial impact was an increase in women’s self-confidence. There have been changes in attitudes about
women’s roles and capacity, and women have started to feel more confident and motivated to engage in IGAs and
climate smart agriculture. The land holding certification component also anticipates benefits by enhancing women’s
access to and control over one of the most important productive assets in a rural community: land. Land tenure will
address the strategic needs of women, such as economic empowerment, enhanced decision-making power, and
improved power relations in the household.

D.4. Needs of recipient (max. 500 words, approximately 1 page)

Describe the scale and intensity of vulnerability of the country and beneficiary groups and elaborate how the
project/programme addresses the issue (e.g. the level of exposure to climate risks for beneficiary country and groups,
overall income level, etc.). Describe how the project/programme addresses the following needs:
• Vulnerability of the country and/or specific vulnerable groups, including gender aspects (for adaptation only)
• Economic and social development level of the country and the affected population
• Absence of alternative sources of financing (e.g. fiscal or balance of payments gap that prevents government
from addressing the needs of the country; and lack of depth and history in the local capital market)
• Need for strengthening institutions and implementation capacity
Ethiopia’s Second National Communication identified the primary cause of vulnerability to climate variability and
change as a high dependence on rain-fed agriculture, which is sensitive to climate variability and change. Other
causes cited included under-development of water resources, low health service coverage, a high population growth
rate, low economic development, low adaptive capacity, inadequate road infrastructure in drought prone areas, weak
institutional structures, and lack of awareness.22

According to the vulnerability assessment in the SNC based on existing information and assessments, the most
vulnerable sectors to climate variability and change are agriculture, water and human health. In terms of livelihoods,
smallholder rain-fed farmers and pastoralists are found to be the most vulnerable. Ethiopia’s rural livelihoods are
highly dependent on the performance of the agriculture and forestry sectors, which are highly sensitive to climate
change. Over 80 % of the Ethiopian population lives in rural areas and are consequently highly dependent on the
performance of productive landscapes for income, energy, food, building materials, and water. Furthermore,
agriculture accounts for most jobs and about 40 % of output and exports, exacerbating exposure to the risks of
climate change, which include increased soil erosion and more frequent droughts and floods. The arid, semi-arid and
dry sub-humid parts of the country are affected most by drought.23
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Furthermore, the project regions exhibit low adaptive capacity, which increases vulnerability. Although it is not
possible to have an exhaustive list of indicators that assess adaptive capacity of a region due availability of
processed data for the proposed project regions, the indicators in Table 2 below relates directly to usage and quality
of water, energy and settlement, and indirectly to the level and quality of education and health facilities. For example,
the use of modern construction materials directly indicates the quality of settlements available to resist the physical
impacts of climate variation. The under 5-mortality rate, however, may indirectly indicate that health facilities are of
poorer quality, or that lower levels of supplementation and vaccinations are being provided.

Table 2 Adaptive capacity indicators in project regions24

The adaptive capacity indicators assessed above indicate that most of the targeted watersheds are situated in regions
that have relatively low adaptive capacity. The regions of Afar, Somali, Oromia, and Tigray, which have relatively high
poverty levels, are comparatively more vulnerable to climate change than other regions in the country.25 Institutional
capacity to respond to impacts in those areas is also low. One study assessed the flood risks and health-related
issues in the Gambella region of the country. It identified three critically important weaknesses, including a lack of
flood-specific policy, absence of risk assessment, and weak institutional capacity.26

A recent World Bank book examines the potential impact of climate change and climate policies on poverty reduction27.
It suggests that as a result of differences in exposure and vulnerability, natural disasters increase inequality and may
contribute to a decoupling of economic growth and poverty reduction. For instance, after Ethiopia’s 1984–85 famine, it
took a decade on average for asset-poor households to bring livestock holdings back to prefamine levels. Poor people
can become more resilient to shocks in agriculture thanks to trade and food reserves that can overcome local shortages
in times of need, better access of poor farmers to markets, and improved technologies and climate-smart production
techniques. Access to functioning markets, however, depends on better infrastructure and better institutions. For
instance, in Ethiopia, the incidence of poverty decreased by 6.7 % following farmers’ access to all-weather roads. Case
studies from Ethiopia provided in the book further suggest that the cost of a drought to households can increase from
zero to about $50 per household if support is delayed by four months, and to about $1,300 if support is delayed by six
to nine months. This rapid increase, which is due to irreversible impacts on children and distress sales of assets
(especially livestock), helps explain why most post-disaster responses have multiple stages. Typically, initial support is
delivered quickly—even at the expense of targeting and accuracy—and larger recovery and reconstruction efforts are
provided later with more emphasis on appropriate targeting. The authors conclude that providing resources for climate
risk analysis and project preparation and ensuring that financial instruments and resources are available for
development and poverty reduction investments can provide a window of opportunity before the impacts of climate
change materialize.28

Figure 6 shows the population density in Ethiopia as well as population density against all restored watersheds and
those planned by RLLP. This map shows that most of the restored and planned watersheds are located in densely
populated parts of the country.
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Figure 6 Population density in Ethiopia

By focusing on the most degraded watersheds in the Ethiopian highlands, the RLLP will target the communities most
vulnerable to climate change impacts. Under Component 1, sustainable soil and water conservation practices will
reduce exposure to climate-related impacts such as erosion and drought. Climate-smart agricultural practices will
reduce the sensitivity of the sector to climate change and variability, and livelihood diversification will reduce the
sensitivity of communities to impacts affecting the agricultural sector. Under Component 2, the capacity building and
information modernization activities will increase adaptive capacity at the local government level. Under Component
3, activities to secure land tenure for small-holder farmers will increase household resources and encourage the
adoption of SLMPs, which will reduce sensitivity to climate impacts and increase adaptive capacity through the
dissemination of adaptive measures across highly vulnerable regions. In addition, the roll-out of the NRLAIS under
this component will increase adaptive capacity at the regional and national level by introducing evidence-based
monitoring and ensuring a coordinated and consistent approach to the development of policies, legislation,
regulations, models and research to enhance sustainable land governance.

The project will work with the most vulnerable populations in the target areas. Detailed bio-physical information will be
used to prepare MYDPs for new watersheds. Local-level participatory land use planning teams at the woreda and
kebele level will ensure that interventions benefit smallholder farmers. The project also includes activities specifically
targeting the particularly vulnerable group of landless and jobless youth and women. In these activities, landless youth
will be provided with communal land certificates in exchange for land restoration. The project will also ensure that the
provision of landholding certification will be implemented in such a way that half of the title-holders will be women. This
will enable these groups to participate in agricultural production, as well as on the agricultural market, thus enhancing
their income opportunities.

D.5. Country ownership (max. 500 words, approximately 1 page)

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Please describe how the beneficiary country takes ownership of and implements the funded project/programme.
Describe the following:
• Existing national climate strategy
• Existing GCF country programme
• Alignment with existing policies such as NDCs, NAMAs, and NAPs
• Capacity of Accredited Entities or Executing Entities to deliver
• Role of National Designated Authority
• Engagement with civil society organizations and other relevant stakeholders, including indigenous peoples,
women and other vulnerable groups

The RLLP will build on and scale up the results of the two completed Sustainable Land Management Programs, SLMP-
I and SLMP-II. RLLP is also designed to be complementary to and avoid overlap with related government programs
such as the Productive Safety Net Program (PSNP), The Second Agricultural Growth Program (AGP 2), the Agricultural
Transformation Agency (ATA) and others. The diagram below summarizes the relationship of the RLLP to the most
important baseline projects, which are described further below.

Figure 2 Baseline projects

Baseline projects
The proposed project has been requested by the government of Ethiopia to both scale up the success of the ongoing
SLM program and introduce new, transformative and innovative elements. Ethiopia’s problem of land degradation
caused by erosion, drought, loss of vegetative cover, and unsustainable grazing and cultivation practices has led to the
development of official government programs for better land management. These programs have evolved from an
unsuccessful “top-down” approach to one that recognizes the importance of community participation in decision making,
not simply as a source of labor.

The Government developed, with support from the TerrAfrica partnership, the Ethiopia Strategic Investment Framework
for SLM. This investment plan anchored the establishment of the GoE’s programmatic approach to scaling up SLM.
Called the SLM Program, it provided the platform for convening and coordinating assistance from donors. When it was
developed, the SLM Program targeted 177 "high potential, food secure" watersheds. Before this programmatic
approach was undertaken by the GoE and partners, efforts to address land degradation were piecemeal and scattered
throughout the country.

Sustainable Land Management Program-I (SLMP-I)

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As part of the SLM Program, the World Bank/GEF-financed SLMP-I operation targeted 35 watersheds initially, later
expanding to 45. The initial target group was an estimated 500,000 beneficiaries, representing rural households living
in 35 large watersheds assisted by the project. These large watersheds, with an average size of about 8,500 ha, were
located in six Regional States of Ethiopia (Amhara, Oromia, Tigray, SNNP, Beneshangul/Gumuz, and Gambella). In
addition, through the capacity building activities of the project, technical staff at the central (Federal Ministry of
Agriculture and Livestock Resource, MoA), regional (Woreda) and district (Kebele) levels benefited from training and
improved working conditions. The project was declared effective in March 2009 and closed on schedule 4.5 years later
(September 2013) with no extensions.

Key conclusions of the final evaluation of SLMP-I were that the project's objectives were substantially relevant to the
country context and priorities. As part of the project, 45 participatory Watershed Management Plans and 613
community-based micro-watershed management plans were prepared. The area under sustainable land management
in the targeted watersheds increased from 86,892 ha to 209,926 ha by project closure. The Normalized Difference
Vegetation Index (NDVI), a measure of vegetation cover and a proxy measure for the reduction of land degradation,
increased in the project areas by 0.543 (9%) over baseline of 0.498 and soil carbon increased by 31% during the period
2009-2013. At appraisal, the project team estimated an overall Economic Rate of Return (ERR) of 10-17% and a
Financial Rate of Return (FRR) of 8-11%. The cost benefit analysis conducted at closure calculated an IRR that ranged
from 10.41% to 22.60%.

SLMP-II
SLMP-I was considered successful by the GoE, which committed to a larger follow-on project, SLMP-II, that aimed to
consolidate the SLM platform and expand the number of large watersheds assisted from 45 to 135. In SLMP-II MoA
continued to develop and implement the innovative, integrated and inclusive SLM Program that supports (i) efforts to
address land degradation and climate risks and productivity constraints through a landscape approach, and (ii)
contributes to growth in the agricultural sector in general. SLMP-II aimed at (i) further scaling up and consolidating the
pioneering efforts and achievements of the project, mainly through replicating the project’s assistance to 90 additional
watersheds; (ii) contributing to the consolidation and harmonization of MoA’s multi-donor SLM program; and (iii)
synergizing the project’s achievements in terms of reduced soil degradation and improved water management by
promoting a comprehensive livelihood improvement strategy anchored on “climate-smart” agricultural practices in
beneficiary farmlands, households, and communities.

In SLMP-II, natural and economic wealth was built on over 1.3 million hectares of degraded communal and smallholder
lands through an integrated package of activities in targeted watersheds that included: (i) management of natural
resources (soil and water conservation structures, agroforestry, participatory forest management, enclosures to reduce
free grazing and allow assisted natural regeneration, small-scale irrigation, water point development, climate-smart
technologies on household farmland, and land use planning); (ii) improved land rights through issuance of legal
landholding certificates to one million people, including women and landless youth; and, (iii) livelihoods support,
including for promotion of improved cookstove adoption that reduces fuelwood demand, women’s labour, and
respiratory illnesses.

Results from SLMP-II financing are well documented. During a major drought in 2015-16 there is some evidence that
water and food security in participating districts were strengthened compared to untreated areas. Degraded lands have
been brought back into production for local farmers, dry season base flow of streams and depth to water table are
improving, and protective vegetation cover was either maintained or expanded, as verified by remote sensing. In
addition, approximately 9 million tons of additional CO2eq have been accumulated in restored productive lands in
SLMP-II areas, a proxy for system function as well as a contribution to climate change mitigation. Smallholder farmers
regularly express how their identity and sense of place has also been restored through landscape restoration and
improved legal land rights. Many community members who were ready to migrate remained in their birthplace and were
able to afford to send their children to school. They were able to improve nutrition by producing vegetables and fruits
using small-scale irrigation, by diversifying through poultry, apiculture and woodlot production, and by increasing
livestock productivity through forage management.

Linkages with other government programs and projects

Flagship programs of the MoA include the Second Agricultural Growth Program (AGP) and the Productive Safety Net
Program (PSNP). PSNP is aimed at enabling the rural poor facing chronic food insecurity to resist shocks, create assets
and become food self-sufficient. It provides multi-annual predictable transfers, as food, cash or a combination of both,
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to help chronically food insecure people survive food deficit periods and avoid depleting their productive assets while
attempting to meet their basic food requirements. Under RLLP, a number of communities graduating from food-insecure
status in newly identified watersheds will transition from support under PSNP to join the SLM Program, while at the
other end of the SLM cycle a number of restored watersheds that benefitted from investments under SLMP-I and SLMP-
II will graduate from project-based SLM support to continue investment in sustainable, productive landscape
management through mainstream government programs.

With support from the Pilot Program for Climate Resilience and the BioCarbon Fund, the Bank is further supporting the
government’s Climate Resilient Green Economy (CRGE) Facility and four line ministries led by the Ministry of Finance
and Economic Cooperation (MoF) to implement a Multi-Sector Investment Plan (MSIP) for climate resilience in key
sectors, including agriculture, forestry, water resources, irrigation, and energy, in the context of resilient landscapes.

RLLP plans to work closely with the GCF financed project “Responding to the increasing risk of drought: building
gender-responsive resilience of the most vulnerable communities” that is being implemented by MoF. Progress in the
implementation of Component 1: Improved access to water to build a resilient livelihood and Component 2:
Management of Natural Resources for Sustained Water Availability of the MoF project will enhance the impact of
Component 1 of RLLP: Investment on Green Infrastructure and Resilient Livelihoods.

The link between the SLMP I and II, RLLP and the MoF project is quite close. As Section C.2, Paragraph 36 of the MoF
project proposal explains, “Project results will feed into other on-going national initiatives such as the IWRM projects
being implemented in the various watersheds, SLMP, AGP and REDD+ programs being implemented in the adjacent
Kebeles. This project could be considered as one of the few initiatives in Ethiopia that has put climate change in to
building the resilience of the communities. Whilst there are various ongoing national development programs and
projects, climate change has not been captured at the core of it. This program has been strategically designed to
address current and future water supply issues to the community as well as integrate initiatives and structural
adjustments to efficiently manage this resource.”

The creation of resilient landscapes and livelihoods as a result of RLLP will work synergistically with the improvement
in drought resilience of communities that will emerge from the MoF project to enhance resilience of the rural population
in Ethiopia to a degree that the participating projects could not achieve on their own.

National strategies

Ethiopia’s long-term goal is to ensure that climate change adaptation and mitigation are fully mainstreamed into
development activities. The proposed project is designed to be transformative, contributing to a number of key national
strategies, including Growth and Transformation Plan 2 (GTP-2), the Climate Resilient Green Economy (CRGE)
Strategy, and accompanying 2015 Climate Resilience Strategy for Agriculture and Forest, Ethiopia’s Nationally
Determined Contribution (NDC), the 2017 National Adaptation Plan to Address Climate Change, the Ethiopia SLM
Investment Framework, the emerging National Forest Sector Strategy and National REDD+ Strategy, as well as sector
strategies for energy, water, and agriculture.

The CRGE Strategy aims at developing a green economy and promoting greater resilience to climate change into a
single policy framework in support of its national development objectives. Some of the key objectives of the CRGE,
which this project supports, include improving crop and livestock production practices to improve food security and
increase farmers’ incomes while reducing emissions; and protecting and re-establishing forests for their economic and
ecosystem services, including as carbon stocks. This project will address crucial issues for the resilience of the
agricultural sector identified in the CRGE. It will also contribute to the National Adaptation Plan (NAP-ETH) launched
in September 2017. NAP-ETH aims to bring about transformational change in the country's capacity to address the
adverse consequence of climate change, focusing in particular on agriculture and forestry.

The project will also contribute to the climate, forest, water, energy, and land tenure targets in the Growth and
Transformation Plan 2 (GTP-2) as well as the forthcoming GTP-3. The institutions strengthened as a result of the project
will also contribute to the implementation of Ethiopia’s Strategic Investment Framework for Sustainable Land
Management (ESIF).
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The proposed project is also in line with the intention of Ethiopia to limit its net greenhouse gas (GHG) emissions in
2030 to 145 Mt CO2e or lower. Achieving this goal would mean a 255 MtCO2e (64%) reduction from ‘business-as usual’
(BAU) emission projections by 2030. The agriculture sector and REDD+ are targeted to reduce 88% of the volume of
GHGs.

Finally, the Policy Implementation Principles of the National Policy and Strategy on Disaster Risk Management (July
2013) include ‘decentralized and community-centered’ approach towards disasters and points out the importance to
‘forecast the hazard, analyze, and take early action’. The goal of the Environment Policy is to enhance the health and
quality of life of citizens and to promote sustainable social and economic development through the sound management
and use of natural, human made and cultural resources and the environment.

Alignment with NDC and NAPA

As a result of the development of the Climate Change National Adaptation Program of Action (NAPA) in 2007, Ethiopia
has made significant advances towards integrating climate change into national planning processes. The NAPA was
replaced in 2010 by the Ethiopian Program of Adaptation to Climate Change (EPACC), which calls for mainstreaming
climate change into decision-making at the national level. In September 2017 Ethiopia launched a 15-year National
Adaptation Plan which focuses on a number of vulnerable sectors including agriculture and forestry. This project is in
line with these documents and other government policy.

Ethiopia’s NDC states that adaptation initiatives to reduce vulnerability will be based on the country’s Climate Resilient
Green Economy Strategy (CRGE). The CRGE has informed the design of adaptation activities of the RLLP (see above).
Given that 80% of the population depends on agriculture for their livelihoods, increasing the resilience of agriculture is
a priority for Ethiopia. The SLMP is mentioned in the NDC as one of the adaptation actions that has already been
undertaken and that will contribute to building resilience to climate change. RLLP will contribute towards many of the
adaptation interventions identified in the NDC, which concentrate strongly on increasing the resilience of agriculture.
The adaptation intervention strategy identified in the NDC towards which RLLP contributes most strongly is “Enhancing
ecosystem health through ecological farming, sustainable land management practices and improved livestock
production practices to reverse soil erosion, restore water balance, and increase vegetation cover, including drought
tolerant vegetation.”. The project will also strongly contribute towards the actions “Improve and diversity economic
opportunities from agroforestry and sustainable afforestation of degraded forest areas” and “Enhance the adaptive
capacity of ecosystems, communities and infrastructure through an ecosystem rehabilitation approach in the highlands
of Ethiopia. Rehabilitation of degraded lands/forests will also increase resilience of communities, infrastructures and
ecosystems to droughts and floods.”. Ethiopia seeks to maximize the synergies between adaptation and mitigation,
especially involving agriculture and forests. RLLP will contribute towards two of the pillars for mitigation of GHG
emissions: “Improving crop and livestock production practices for greater food security and higher farmer incomes while
reducing emissions;” and “Protecting and re-establishing forests for their economic and ecosystem services, while
sequestering significant amounts of carbon dioxide and increasing the carbon stocks in landscapes;”.

Capacity of Accredited Entities and Executing Entities

Project financing will flow through MoF, which is mandated to mobilize both domestic and external resources for the
implementation of the Climate Resilient Green Economy (CRGE) Strategy. The Project will be implemented by
Federal Ministry of Agriculture (MoA).

Significant progress in remediation of degraded lands has been achieved in recent years by the Government of
Ethiopia and thousands of local communities largely through investment and technical assistance under MoA’s SLM
Program. MoA has been implementing the SLMP with World Bank support in six regional states by coordinating
investments from major donors and partners (IDA, Norway, Canada, Germany, GEF, LDCF) into a holistic and
coordinated landscape management framework. With financing from IDA through the SLMP-II, over 1.3 million
hectares of degraded communal and smallholder lands in selected watersheds is being converted into a sustainable
source of natural and economic wealth through an integrated package of activities. Working through Regional
Bureaus of Agriculture (BoAs) and woreda (equivalent to district) administrations over the last ten years, the SLM
Program has restored productivity in more than two million hectares of degraded watersheds in six regional states
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 65 OF 96

of the Ethiopian highlands. Up to now, the SLM Program has supported interventions in a total of 223 major
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watersheds, out of an estimated 700 that would benefit from SLM interventions.

The project is featured in the World Bank’s Country Partnership Framework (CPF) for FY 17-21 as a flagship
operation addressing the CPF’s resilience pillar, with a funding commitment from IDA-18 for US$100 million.

IDA financing has helped restore productive capacity and build resilient livelihoods in 135 highland watersheds
through an integrated package of activities that includes management of natural resources on more than half a
million hectares of degraded communal and smallholder lands. Through soil and water conservation structures,
enclosures to limit free grazing, and afforestation or reforestation of more than 80,000 hectares, these activities
have led to an average 9 % increase in vegetation cover in treated watersheds. Complementing these physical
interventions, IDA financing for the SLM Program has strengthened MoA’s support for land rights through the
issuance of landholding certificates to over 300,000 households, including more than 200,000 women who have
received titles either individually or jointly with their husbands, and more than 7,000 landless youth who have
received titles to communal holdings in exchange for restoring land. To further ensure that local communities derive
livelihood benefits from these investments, more than 130,000 smallholders in the targeted watersheds have
participated in income-generating activities under the SLM Program, including for improved cookstove adoption that
reduces fuelwood demand, women’s labor and respiratory illnesses.

SLMP-II benefitted from parallel financing from GIZ for Cluster Advisors who supported extension, technical
planning, and results reporting at woreda and kebele levels. The new GIZ program launched in 2018, Sustainable
Use of Resources for Economic Development (SURED), will play an important role in providing training for technical
assistance to be contracted under RLLP, as well as quality control of these services.

D.6. Efficiency and effectiveness (max. 500 words, approximately 1 page)

Describe how the financial structure is adequate and reasonable in order to achieve the proposal’s objectives,
including addressing existing bottlenecks and/or barriers, and providing the minimum concessionality to ensure the
project is viable without crowding out private and other public investments. Refer to section B.5 on the justification of
GCF funding requested as necessary.

Please describe the efficiency and effectiveness of the proposed project/programme, taking into account the total
financing and mitigation/ adaptation impact the project/programme aims to achieve, and explain how this compares to
an appropriate benchmark.

Please specify the expected economic rate of return based on a comparison of the scenarios with and without the
project/programme.

Please specify the expected financial rate of return with and without the Fund’s support to illustrate the need for GCF
funding to illustrate overall cost effectiveness.

Please explain how best available technologies and practices have been considered and applied. If applicable,
specify the innovations/modifications/adjustments that are made based on industry best practices.
Project co-financing is USD 131 million, bringing the co-financing ratio (total amount of co-financing divided by the
Fund’s investment in the project) to 0.79. In addition to this co-financing, parallel financing is provided by the
Government of Ethiopia, who will provide USD 10 million in kind, and by GIZ, which is providing USD 13 million in the
form of technical assistance. The project will leverage private sector and beneficiary contributions through activities
aimed at providing household energy solutions and strengthening value chains associated with SLM interventions.
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A detailed framework for private sector engagement under RLLP is presented in Annex B.1. This framework identifies
three major categories of partners. The first are partners with activities currently being supported by other funders.
RLLP will collaborate with existing private sector engagement activities in order to best utilize available funding and
avoid unnecessary duplication. The figure below shows the relationships between players in this category who can
support private sector engagement in the project. RLLP will facilitate these existing activities to extend their activities
to rehabilitated watersheds. The second category is made up of private enterprises who have the potential to buy
RLLP products or sell products that watershed households need. RLLP will engage with enterprises that already have
a base in or plan to focus on the geographical areas of rehabilitated watersheds. A strong example of this type of
opportunity is the MOU signed with Raya Brewery-BGI Ethiopia in Enda-Mohoni Woreda of South Tigray Zone. In the
final category are long-term opportunities for the private sector to begin to implement activities in the targeted
watersheds. RLLP will identify gaps and potential partners and suggest pilot collaborations, for example with
enterprises who may be interested in specific crop varieties that can be grown in the targeted watersheds.

Figure 7 RLLP Linkages from Diversified Livelihoods to Value Chains and Markets

Narrative and rationale for the detailed economic and financial analysis

To assess the ex-ante efficiency of the project investment, a cost benefit model is used. Annual cost and benefit flows
are estimated as the difference between without-project and with-project net benefits for direct beneficiaries (See
Annex E.1: Economic and Financial Analysis for more details). Efficiency indicators include the Economic Net
Present Value (ENPV) and the Economic Internal Rate of Return (EIRR), as well as impact on farm productivity,
household incomes, soil erosion, and GHG emissions. Based on available information compiled during preparation,
gross margins and representative farm models have been developed for selected cropland, non-cropland, and
livestock production in the project area. Additional net benefits are analyzed from establishing Community Storage
Receipts Program (CRSP) facilities.

In the counterfactual scenario without the Project, land use will continue on its current path. Continued soil erosion,
water insecurity, and land insecurity will result in land degradation. It is expected that climate change will exacerbate
soil erosion and water insecurity leading to direct losses to those who rely on crop and livestock production and
related industries for their energy use and livelihood. Production yields will go down or farmers will have to increase
their input costs, such as fertilizer use, to maintain current yields. In the absence of CSRP facilities, farmers will
continue to experience post-harvest losses. They will also be unable to capture higher crop prizes that are obtainable
a few months after harvest and in larger markets. Non-agricultural land in the watershed will also continue to
deteriorate without the Project due to climate change and soil erosion as well as overuse of common land through
livestock grazing and firewood collection. This will put a further strain on the population who derive their livelihood
from forests, woodlands, and surrounding areas. Downstream from the project area, continued land degradation will
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 67 OF 96

also affect areas and households through increased flood risk and sediment build-up in irrigation and hydroelectric
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dams.

Incremental benefits are estimated for investments in green infrastructure and resilient livelihoods (Component 1). It
is assumed that these benefits will only accrue if the outcomes in the remaining three components are also achieved:
2. Strengthening institutions, information and monitoring for resilience; 3. Land administration and use; and 4. Project
management and reporting. Investment costs include USD 165.24 million from GCF, USD 100 million from IDA, USD
19 million from MDTF, and USD 12 million from expected MDTF Contribution from the Government of Canada for a
total of USD 296.24 million.

Following World Bank guidelines, the economic analysis considers anticipated costs and benefits with and without the
project, including social costs and benefits. This necessitates the consideration of funding sources and labor costs
outside the GCF project. In this project, the following are included as additional costs for capacity building and project
management totaling USD 23 million (USD 13 million from GIZ and USD 10 million from the GoE). In addition, the
analysis includes an estimated USD 99.1 million in in-kind contributions from project beneficiaries minus USD 3.8
million in price contingencies. With all costs included, the total budget included in the analysis is USD 319.2 million.
As part of the exit strategy, recurrent costs in the years after the project has ended are estimated to be 2.5% of initial
costs, including beneficiary in-kind contributions of USD 10.4 million per year.

The Project will increase climate resilience in 210 major watersheds covering an area of 2.1 million ha. Based on
2007 census numbers, the Project has an estimated 4.2 million beneficiaries (or 834,000 households) in the selected
watersheds. Since population growth since 2007 census is estimated to be 15% or more, for the present day this is a
conservative estimate.

Project interventions are assumed to lead to direct net benefits to crop and livestock producers as well as forests and
other non-croplands through watershed management plans. These activities will reduce soil erosion and yield losses
that are expected to result from climate change in the absence of Project intervention. Activities will also improve
productivity and increase resilience against the negative impacts of climate change. To further increase resilience
against future climate change, the Project will encourage climate resilient livelihood diversification through community
groups including CSRPs. Project activities will also constitute a net carbon sink when analyzing impact on GHG
emissions. While not included quantitatively in this EFA, benefits will also accrue from strengthening institutions and
improving information and monitoring systems. Improved administration and secure tenure rights will create
incentives for beneficiaries to adopt sustainable management practices. The Project is also expected to have positive
impact on indirect beneficiaries in neighboring areas through informal dissemination of new management practices as
well as downstream improvements from reduced floor risk and sediment build-up.

In the current 25-year net benefit analysis using a 5 percent discount rate, the project yields an Economic NPV of
USD 3,312 million (ETB 92.7 billion) and has a benefit cost ratio of 3.8. The Economic IRR is 47%. The payback
period is 5.3 years. In economic investment analyses, the Project therefore meets the requirement by yielding a rate
of return higher than the economic discount rate of 5%. Note that, a 25-year model is used to account for the long-
term gradual build-up of benefits from SLM interventions combined with a 5-year implementation phase followed by
20-year capitalization phase for forest plantations and green corridors.

World Bank guidelines recommend using a 5% economic discount rate. 20 Increasing the discount rate from 5% to
10% reduces project returns by 51% to USD 1,617 million. Project returns are still considerable at a 10% discount
rate with a BCR of 3.2.

If the Project only reaches half of the targeted area for example due to unexpected cost increases, estimated project
returns fall by 53% to USD 1,560 million and the rate of return drops from 47% to 26%.

If base case assumptions are too conservative or climate change leads to accelerated soil erosion in the future, the
estimated net benefit of Project interventions would be higher. When assuming a 50% increase in annual soil loss by
year 25 the estimated economic return is USD 3,462 million with a 47% rate of return. Under this accelerated soil
erosion scenario, the estimated Project net benefit of avoiding this larger soil erosion is therefore USD 150 million
across the 25-year period. In the base case, estimated value of soil erosion varies between USD 0.11 and 0.26/tonne
soil per year depending on the gross margin value of different land uses. In the scenario with accelerated soil loss,
this estimated value ranges between USD 0.17 and 0.38/tonne soil per year.

20 World Bank (2015). Technical Note on Discounting Costs and Benefits in Economic Analysis of World Bank Projects. Washington, DC.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 68 OF 96

When excluding the social value of reduced GHG emissions, the net economic project return is USD 2,238 million
D
(ETB 62.7 billion) with a benefit cost ratio of 2.9, an EIRR of 29% and a payback period of 7.3 years. This is 3.1% of
Ethiopia’s GDP in 2016 terms.

When excluding the GHG emissions, 49% of incremental net benefits are generated through activities on non-
cropland areas, particularly due to the transformation of 41,000 ha from bush and grassland to forest plantation but
also due to avoided soil erosion. This constitutes an ENPV of USD 108 per year per treated hectare and an EIRR of
43%. A substantial part of Project returns is also generated by cropland and livestock production at USD 49/ha/year
and USD 39/ha/year, respectively. Much of the incremental benefit estimated from cropland comes from transforming
30,000 ha of unproductive land to green corridor plantations and some is from avoided soil erosion. With exacerbated
problems from climate change, forest plantations and green corridors will enhance watershed restoration and
ecological connectivity as well as extend the lifespan and resilience of drainage, irrigation, and road infrastructure.

In financial terms the NPV is USD 696 million (ETB 19.5 billion) with a Financial IRR of 28%, a benefit cost ratio of 2
and a payback period of 7.5 years. This estimated net return constitutes 1% of Ethiopia’s GDP in 2016. In the
financial analysis a 12% discount rate is used to reflect the opportunity cost of capital in Ethiopia.

By supporting the establishment of financially viable enterprises in the area, the Project helps build resilience and
future self-sufficiency. Without Project support for initial investments and working capital, CSRPs may be financially
viable to also cover future capital maintenance costs, but only if available commercial loan interest rate is below their
FIRR of 18-21% and a payback period of over 5 years. Initial information indicates that commercial loans for
investments may be available at this rate but not the size of loans required. It can be expected that demonstrated
implementation of CSRPs can reduce commercial banks’ future risk perception. CSRPs can improve their financial
viability to an FIRR over 24% for example by using more of their available storage capacity, obtaining a matching
investment grant and reducing their initial working capital requirements. To be financially viable, the CSRPs will
require project support to cover their initial investment costs in the absence of commercial loans at favorable rates.
As part of an exit strategy, this increased level of return would also enable them to cover assumed future capital
maintenance costs.

The National Poverty Line for Ethiopia is a measure of absolute poverty. The poverty line indicates the money
required for food to provide the minimum required caloric intake (Food Poverty Line) and additional non-food items. In
the financial analysis, estimated farm-level gross margins can increase by over USD 101/year/person (including the
value of production used for home consumption), which is 1.2 times the Food Poverty Line (USD 85/person/year in
2018 terms), or 63% of the National Poverty Line (USD 162/person/year). This is a direct measure of increased
resilience in the Project area.

The planned investment Project is expected to yield high returns even when considering key risk factors such as:
yield and price changes; adoption rates; and project delays. As part of a risk management plan, it is particularly
important to ensure that farmers can negotiate and obtain fair output prices and achieve target yields going forward.
Part of the risk management plan could also be to ensure that planned CSRPs are used to their full capacity and that
they receive sufficient financial support toward initial investment and working capital costs to ensure their financial
viability. Close monitoring and support for target farmers and communities to implement water management plans
could help increase the adoption rate. While not always avoidable, project delays can be minimized with close
monitoring and by ensuring implementation does not lose momentum.

The full economic and financial analysis is provided in Annex E.1.

Economic and financial justification for the concessionality that GCF provides
Despite Ethiopia's Debt Sustainability Assessment having rated the risk of debt distress as high, the Ethiopian
Government has agreed to take on significant debt for this project, with $100 million in loans to be provided by IDA
and a request of an additional $107 million in loans from GCF. In addition to the $100 million in loans, $31 million in
grants is provided as co-financing, bringing the percentage of grant funding in the co-finance to 24%. $58 million in
grant finance is also requested from GCF, bringing the percentage of grant funding in the GCF financing to 35%.
GCF funding will be used for the introduction at scale of climate smart agriculture. While some of the individual
activities included in the package of measures for CSA may be business as usual in other parts of the world, they are
new to the target population of smallholder farmers in Ethiopia. In particular, the implementation of such measures in
a coordinated way as part of a larger package faces multiple barriers. RLLP has been designed to mitigate these
barriers to a degree sufficient that upon project end it is expected that the measures will continue to be implemented
without concessional finance. However, for their introduction at scale highly concessional funding is essential. The
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 69 OF 96

D
initial validation of the package of measures is being conducted as part of SLMP2. GCF financing is required to scale
up implementation in all watersheds covered by RLLP subsequent to the pilot phase, in which the package is being
validated in 30 watersheds as part of SLMP2.

While beneficiaries will derive some private benefits as a result of the implementation of this package of measures,
these beneficiaries are vulnerable rural smallholder farmers facing food, land tenure and water insecurity. Any
benefits derived will be used to increase food and water security and cover other basic needs. Due to the high risk
aversion of such a population and the fact that it is overwhelmingly unbanked, it would not be feasible to pass on the
cost of any loans to the beneficiaries.

Activities for the expansion of SLM, the development of income opportunities and resilient livelihoods as well as those
improving the enabling environment will also be funded by GCF finance.
The Economic Net Present Value (ENPV) is USD 3,312 million discounted at 5% over a 25-year period (ETB 92.7
billion). This generates a benefit cost ratio (EBCR) of 3.8 and an Economic Internal Rate of Return (EIRR) of 47%
with a payback period of 5.3 years. In economic investment analyses, the project therefore meets the World Bank
requirement by yielding a rate of return higher than the economic discount rate of 5%.

Financial viability for this investment in the long run is ensured, because once the barriers to implementation of
sustainable land management and climate smart agriculture practices promoted by the project have been removed
and the project has established mechanisms to encourage their implementation, individual farmers will see their
incomes rise. Those practices that are implemented at the farm level will have short payback times that will motivate
farmers to continue with these practices in the long run beyond the project’s intervention. Furthermore, institutions will
be established to ensure that communities continue to maintain collective infrastructure that has been established.
The resilient livelihood interventions that are also part of the project will strengthen the project’s impact and further
ensure long-term maintenance. Private sector development will mean households will see a sustainable increase in
income, which will in turn provide an incentive for them to continue maintaining the green infrastructure and climate
resilient agricultural practices introduced by the project.

By supporting the establishment of financially viable enterprises in the area, the Project helps build resilience and
future self-sufficiency. Without the support of the project for initial investment and working capital, CSRPs might be
able to cover future capital maintenance costs, but only if the commercial interest rate is below their FIRR of 18-21%
and if the payback period is greater than five years. Initial information indicates that commercial loans for smaller
investments may be available at this rate, but not the size of loans required. CSRPs can, however, improve their
ability to afford an FIRR over 24% by using more of their available storage capacity, obtaining a matching investment
grant, or reducing their initial working capital requirements. To be financially viable, the CSRPs will require project
support to cover the initial investment costs in the absence of commercial loans at favorable rates. As part of an exit
strategy, this increased level of return would also enable them to cover estimated future capital maintenance costs.

Ongoing sustainable land management activities in Ethiopia have resulted in the development of a number of
guidelines for the types of interventions included in RLLP. Additional guidelines covering issues not yet dealt with in
the existing guidelines are under development.

The following guidelines will be used to ensure that best available technologies and practices are applied in the
project:

Guidelines already developed and updated:

1. Climate Smart Agriculture (CSA) field manual
2. Income Generating Activities (IGA) guideline
3. HM&E Guideline
4. Gender Mainstreaming Guideline
5. Watersheds Performance Assessment and exit strategy guideline (PA&ES)
6. SLM Best Practice identification guideline
7. Below Woreda Level Data Collection Guideline
8. ESMF guideline (translated into three local languages - Amharic, Oromiffa and Tigrigna)
9. Value Chain Development in SLMP Context
10. Bamboo Development Training Manual
11. Training Manual for FTC Support (HIV)
12. LAU Implementation Strategy
13. Communication Strategy
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 70 OF 96

14. Stakeholders Participation Strategy

D
Guidelines under development:
1. CBPWDG - Community Based Participatory Watershed Development Guidelines ESIF
2. Capacity Development Guideline
3. Rehabilitated communal Land, use and management
4. Small Scale Irrigation
5. Bamboo Development Strategy
6. Payment for ecosystem services (PES)

Quality assurance and sustainable delivery of training is ensured by the SLM Best Practices Task Force. The SLM
Best Practices Task Force was established in August 2011 with a view to expediting the process of screening,
documenting, dissemination and expanding SLM best practices across the country. The Task Force comprises
members from government organizations and development partners whose expertise relates to sustainable land
management. By 2015, it had already achieved impressive results, identifying 105 SLM technologies and 9 SLM
approaches with best-practice potential. The screening criteria to help categorize and prioritize SLM practices are
described in Annex A.2.

The SLM Best Practices Task Force has the following responsibilities:
• To provide initial training to national and regional experts who then train woreda experts and development agents;
• To pre-screen the list of existing SLM practices against the established criteria;
• To validate the list of pre-screened existing practices with SLM experts (in a validation workshop);
• To submit screened and approved SLM practices to the SLM TC for approval;
• To oversee the documentation of each screened SLM best practice as per the description form provided.

After the SLM Best Practices Task Force is eventually dissolved, the national-level structure (such as the case team
or coordination unit of the Natural Resource Management Directorate) must take over the responsibility of both
continuing an effective system of best-practice documentation and building capacity of staff and other stakeholders.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 71 OF 96

E
E. LOGICAL FRAMEWORK
This section refers to the project/programme’s logical framework in accordance with the GCF’s Performance
Measurement Frameworks under the Results Management Framework to which the project/programme contributes
as a whole, including in respect of any co-financing.
E.1. Paradigm shift objectives
Please select the appropriated expected result. For cross-cutting proposals, tick both.
☐ Shift to low-emission sustainable development pathways
☒ Increased climate resilient sustainable development

E.2. Core indicator targets

Provide specific numerical values for the GCF core indicators to be achieved by the project/programme.
Methodologies for the calculations should be provided. This should be consistent with the information provided in
section A.
E.2.1. Expected tonnes of carbon
Annual 1,752,000 CO2 eq
dioxide equivalent (t CO2 eq) to
be reduced or avoided (mitigation
Lifetime 43,800,000 t CO2 eq
and cross-cutting only)
(a) Total project financing 296,237,602 USD

E.2.2. Estimated cost per t CO2 (b) Requested GCF amount 165,237,592 USD
eq, defined as total investment (c) Expected lifetime emission reductions 43.9 mn t CO2eq
cost / expected lifetime emission (d) Estimated cost per t CO2eq (d = a / c) 6.75 Choose an item. / t
reductions (mitigation and cross- CO2eq
cutting only)
(e) Estimated GCF cost per t CO2eq removed 3.76 Choose an item. / t
(e = b / c) CO2eq
(f) Total finance leveraged 131 mn USD
E.2.3. Expected volume of
finance to be leveraged by the (g) Public source co-financed 131 mn USD
proposed project/programme as a (h) Private source finance leveraged _____ Choose an item.
result of the Fund’s financing,
disaggregated by public and (i) Total Leverage ratio (i = f / b) 0.79
private sources (mitigation and (j) Public source co-financing ratio (j = g / b) 0.79
cross-cutting only)
(k) Private source leverage ratio (k = h / b) _____
4,168,000
Direct
Of which 50% are female
E.2.4. Expected total number of
direct and indirect beneficiaries, 26,244,000
Indirect
Of which 50% are female
(disaggregated by sex)
For a multi-country proposal, indicate the aggregate amount here and provide the data
per country in annex 17.

E.2.5. Number of beneficiaries Direct 4.0% (Expressed as %) of country(ies)

relative to total population
(disaggregated by sex) Indirect 25.0% (Expressed as %) of country(ies)
For a multi-country proposal, leave blank and provide the data per country in annex 17.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 72 OF 96

E
E.3. Fund-level impacts 21
Select the appropriate impact(s) to be reported for the project/programme. Select key result areas and corresponding
indicators from GCF RMF and PMFs as appropriate. Note that more than one indicator may be selected per expected
impact result. The result areas indicated in this section should match those selected in section A.4 above. Add rows
as needed.
Means of
Expected Results Indicator Verification Baseline Target Assumptions
(MoV)
Mid-
Final
term

Based on 0 Net change in

inputs from CO2 emissions
M&E 2,948,1 5,621,6 is calculated
M4.0 Reduced
reporting. 53 t 15 t using the ExAct
emissions from land use,
M4.1 Tonnes of carbon Periodic CO2 CO2 eq carbon balance
reforestation, reduced
dioxide equivalent (t surveying eq estimation tool
deforestation, and
CO2 eq) reduced or by for a lifetime of
through sustainable
avoided (including independen 25 years is
forest management and
increased removals) - t 3rd party 43,800,000 t
conservation and
forest and land use to sample CO2 eq. Mid-
enhancement of forest
treatment term target is for
carbon stocks
areas to 2.5 years while
verify22. final target if for
5 years.

Covered as 0 Total: Total: Measured as the

part of the 238,56 596,400 number of land
A1.2 Number of males beneficiary 0 users adopting
A1.0 Increased and females benefiting survey SLM practices.
resilience and enhanced from the adoption of conducted Target is based
livelihoods of the most diversified, climate by Of on 40% of adults
vulnerable people, resilient livelihood independen Of which in project area
communities and options (including t 3rd party. which female: adopting.
regions fisheries, agriculture, female: Women are
tourism, etc.) 326,900 targeted at a
130,76 higher rate of
0 45%.

Choose appropriate Choose appropriate

expected results indicators

E.4. Fund-level outcomes

Select the appropriate outcome(s) to be reported for the project/programme. Select key expected outcomes and
corresponding indicators from GCF RMF and PMFs as appropriate. Note that more than one indicator may be
selected per expected outcome. Add rows as needed.
Expected Outcomes Indicator Baseline Target Assumptions

21 Excludes impacts of 18 watersheds supported by Expected MDTF Government of Canada, which will be determined in later stages of
funding appraisal
22 Specific company/firm has not been selected for 3rd party verification. A competitive request for proposals would be issued to select a
suitable firm. If using EX-ACT as proposed here, the firm would be responsible for verifying the figures used (conduct a representative
sample and collect the necessary data).
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 73 OF 96

Means of
E
Verification Mid-term) Final
(MoV)
Based on
inputs from
M&E
reporting. The entire area
Periodic of the (micro)
M9.1 Hectares of land surveying watershed is
M9.0 Improved or forests under by 1,899, considered
management of land or improved and effective 406,000 1,003,2
independe 000 treated when the
forest areas contributing management that ha 00 ha
nt 3rd party ha multi-year
to emissions reductions contributes to CO2 to sample development
emission reductions treatment plan is
areas to complete.
verify.

Measures the
number of
individuals
participating in
income
generating
activities
supported by the
project. Target
reflects adoption
Numb by 30% of
er of adults. Women
Covered as Number individ are targeted at a
A7.1 Use by vulnerable part of the of uals: higher rate of
households, beneficiary individu 450,6 35%. This
communities, survey als: 00 Of indicator will
A7.0 Strengthened businesses and public- conducted 180,240 which draw on a
adaptive capacity and sector services of Fund- by 0 Of wome number of
reduced exposure to supported tools independe which n: questions
climate risks instruments, strategies nt 3rd party women: 250,3 included as part
and activities to respond and project 100,120 00 of the
to climate change and reporting. beneficiary
variability survey. A score
card approach
will be
developed
focusing on the
adoption of tools
and strategies
including
participation in
income
generating
activities.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 74 OF 96

E
Awareness
raising activities
reach 80% of
the land users in
the area
targeted
(women
targeted at a
higher rate).
Numb
This indicator
Number er of
will draw on a
of individ
Covered as number of
individu uals:
part of the questions
A8.1 Number of males als: 1,200,
A8.0 Strengthened beneficiary included as part
and females made 480,100 400
awareness of climate survey n/a of the
aware of climate threats Of
threats and risk- conducted Of beneficiary
and related appropriate which
reduction processes by which survey. A score
responses women:
independe wome card approach
264,000
nt 3rd n: will be
party. 660,2 developed to
00 assess
awareness to
climate threats
and related
issues.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 75 OF 96

E
E.5. Project/programme performance indicators 23
The performance indicators for progress reporting during implementation should seek to measure pre-existing
conditions, progress and results at the most relevant level for ease of GCF monitoring and AE reporting. Add rows as
needed.
Means of Target
Expected Results Indicator Verification Baseline Assumptions
(MoV) Mid-term Final
Based on
inputs from
M&E
The entire area
reporting.
of the (micro)
Periodic
watershed is
surveying 406,000
Land area under 1,899, considered
Land Restoration and by ha 1,003,20
sustainable landscape 000 treated when the
Watershed Management independen 0 ha
management practices ha multi-year
t 3rd party
development
to sample
plan is
treatment
complete.
areas to
verify.

113,000 141,400 184,0 It is calculated

ha ha 00 ha as a subset of
the total land
area with
sustainable land
management
practices
(indicator 1) that
is treated with
Based on measures to
inputs from return the land
M&E to its natural,
reporting. semi-natural, or
Periodic forested state. It
surveying includes habitat
Land Restoration and Land area restored or by restoration and
Watershed Management reforested/afforested independen other
t 3rd party conservation
to sample measures to
treatment restore
areas to biodiversity,
verify. establishment of
forest on land
with and without
recent tree
cover, gully area
stabilization,
degraded area
closures,
degraded area
woodlot
establishment,

23 Excludes impacts of 18 watersheds supported by Expected MDTF Government of Canada, which will be determined in later stages of
funding appraisal
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 76 OF 96

E
area covered by
bamboo
plantation on
degraded area.
This indicator
does not include
areas, which
have been
cleared during
or in anticipation
of the project.
Area
re/afforested
refers to
“establishment
of forest through
planting, and/or
deliberate
seeding on land
that, until then,
was not
classified as
forest” or “re-
establishment of
forest through
planting and/or
deliberate
seeding on land
classified as
forest”
expressed in
hectare (ha).
This can include
also assisted
natural
regeneration,
coppicing or
other locally
appropriate
methods.

Based on 6,000 ha 76,240 181,6

inputs from ha 00 ha
Covers land on
M&E
which Climate
reporting.
Smart
Land area with Periodic
Land Restoration and Agriculture
productivity enhancing surveying
Watershed Management (CSA) practices
practices applied by
have been
independen
adopted under
t 3rd party
the project.
to sample
treatment
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 77 OF 96

areas to
E
verify.

The Normalized
Difference
Vegetation Index
(NDVI) uses the
visible and near-
infrared bands of
Project area showing
the
an increase in
electromagnetic
Land Restoration and Normalized Difference 3rd party
0 20% 50% spectrum to
Watershed Management Vegetation Index analysis
analyze remote
(NDVI) correcting for
sensing
climate effects
measurements
to determine the
extent to which a
target contains
live green
vegetation
The Land
Surface Water
Index (LSWI)
uses the
shortwave
infrared and
Project area showing near-infrared
an increase in the Land bands of the
Land Restoration and 3rd party
Surface Water Index 0 20% 50% electromagnetic
Watershed Management analysis
(LSWI) correcting for spectrum to
climate effects analyze remote
sensing
measurements
to determine the
amount of water
in vegetation
and soil.
0 238,560 596,4
Of 00 Of
which which
Based on women: wome
information 130,760 n:
Land users adopting collected as Includin 326,9
sustainable land part of g female 00
Adoption of climate headed
management practices stakeholder Includi
resilient diversification househo
as a result of the / ng
activities lds:
project, disaggregated beneficiary female
by gender survey and 22,280
heade
project d
reporting. house
holds:
55,70
0
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 78 OF 96

0 99,600 249,0
E
The target value
Based on Of which 00 reflects a
information female household
Households adopting Of
collected as headed: adoption rate of
diversified livelihood which
part of 17,400 30 percent.
Adoption of climate activities supported by female
stakeholder Female-headed
resilient diversification the project, heade
/ households
activities disaggregated by d:
beneficiary (approx. 15% of
gender of head of 43,50
survey and all households)
household 0
project are targeted at a
reporting. higher rate of 35
percent.
Based on 0 180,240 450,6
information Of which 00 Of
People participating in collected as women: which
income-generating part of 100,120 wome
Adoption of climate stakeholder n:
activities supported by
resilient diversification / 250,3
the project
activities beneficiary 00
disaggregated by
gender survey and
project
reporting.

Functional Common- Based on 0 1,259 3,148

Interest Groups information
established or collected as
supported part of
Adoption of climate
stakeholder
resilient diversification
/
activities
beneficiary
survey and
project
reporting.
0 75 188 Watershed
Management
and Use Plan
that has been
approved locally
by the
community user
group, and
either the
Woreda or
Watershed User
Strengthening resilience regional SLMP
Associations Project
through Institutions and coordination
established and reporting.
Information platform. Micro
strengthened
watershed land
management
and use plans,
established by
farmers user
associations,
detail
management
and use for
treated areas,
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 79 OF 96

E
outline
agreements with
the Kebele
Watershed
Team to
conserve and
utilize the
resources, and
outlines bylaws
for managing
and
implementing
conservation
activities and the
distribution/shari
ng of benefits.
The
development of
these plans are
a critical for
ensuring land
resources are
used and
managed in a
way that
enhances
absorptive and
adaptive
capacity to
climate change,
promoting
resilience
broadly at the
landscape level.

Watershed User 0 59 148

Strengthening resilience Associations with
Project
through Institutions and Watershed
reporting.
Information Management and Use
Plan
Woreda information The functionality
centers being Functionalit and
effectively used by y and effectiveness of
project stakeholders effectivene these
ss tracked information
Strengthening resilience as part of centers is
through Institutions and the 0 66 166 expected to be
Information stakeholder tracked as part
/beneficiary of the
survey and stakeholder/ben
project eficiary survey
reporting. using a
scorecard
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 80 OF 96

E
approach to
assess the
quality of
services.
This includes
the number of
individual and
communal land
parcels
surveyed (using
one or a
combination of
GPS, total
stations, ortho-
photo, or
satellite
imagery),
mapped and
registered with
the woreda land
administration
office as part of
Processed second-level
centrally land certification
using activities.
information Interventions
Improved tenure security Parcels of land that increase
extracted 2,034,00 3,296,40 5,190,
to Incentivize long-term surveyed and mapped tenure security
from 0 0 000
investments in SLM for certification and define the
NRLAIS
database. associated
rights provides
holders with an
incentive to take
a long-term term
perspective
when managing
the land
resources and
undertaking
investments,
increasing
productivity and
enhancing
resilience trough
adaptive and
transformative
means.

Processed 484,000 743,200 1,132, Second-level

Households who have
Improved tenure security centrally Of which 000 Of certification
received second level
to Incentivize long-term using women Of which which differs from the
land holding
investments in SLM information individuall women wome earlier first-level
certificates,
extracted y or individua n certification
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 81 OF 96

disaggregated by from jointly lly or individ

E
program by
gender NRLAIS with a jointly ually providing
database. man: with a or additional spatial
328,000 man: jointly (i.e. location and
521,800 with a boundary) data
man: in the form of a
812,5 parcel map.
00 Interventions
Processed that increase
centrally tenure security
using and define the
Improved tenure security Second level land information associated rights
extracted 1,060,80 2,652, provides holders
to Incentivize long-term certificates issued as a 0
from 0 000 with an incentive
investments in SLM result of the project
NRLAIS to take a long-
database. term term
perspective
when managing
34,65 the land
0 Of resources and
which undertaking
wome investments,
14,000 n: increasing
Landless youth that 10,57
Project 22,260 productivity and
Improved tenure security received certificates in 0
reporting. Of which enhancing
to Incentivize long-term exchange for the work,
Of which women: resilience trough
investments in SLM disaggregated by
women: 6,748 adaptive and
gender
4,200 transformative
means.

E.6. Activities
All project activities should be listed here with a description and sub-activities. Significant deliverables should be
reflected in the implementation timetable. Add rows as needed.

Activity Description Sub-activities Deliverables 24

Establish functional
platform

Establish Micro watershed

Team
- Soil and water
Promotes the restoration of conservation measures Plan preparation by CWT
degraded landscapes in -Gully rehabilitation and KWT, approval by
1.1.1: Sustainable Land
selected watersheds and -Area closure management General assembly
Management help build resilient and use
livelihoods. -Enrichment of degraded Formulation and
pasture and rangeland compilation of a Multi-Year
Plan by Woreda Technical
Committee

24 Deliverables are indicative

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Construction of Soil and
Water Conservation works

Site preparation for A/R or

biological measures

Approval of consolidated
plan by Woreda Steering
Committee & procurement
of necessary inputs such
as tree seed, tools and
1.1.2 Aforestaion- -Establishment of green equipment
Reforestation+Green Promotes the restoration of corridors
degraded landscapes in
Corrdior management at -Establishment of plantation
selected watersheds
Zonal Level blocks Afforestation/reforestation
& procurement of
necessary inputs such as
tree seed, tools and
equipment

Nursery
establishment/seedling
production

Organizing Common
Interest Groups (20-30
farmers)

Develop robust CSA plan

and prepare to implement
CSA practices

Coach and provide support

-Farm water and soil for the CIGs during
moisture management implementation of CSA
-Integrated soil fertility and practices & procure
soil health management necessary inputs, tools and
1.2.1: On-farm CSA -Crop development and equipment
Promotes resilient
1.2.2 Training and management
agriculture Nursery
awareness raising on CSA -Environmentally-friendly
establishment/seedling
livestock production
production
through forage
development and Land preparation for CSA
management implementation coach and
provide support for the
CIGs during
implementation of CSA
practices & procure
necessary inputs such as
seed

Evaluation
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Identify and Establish CIGs
support for development of
business plans for different
commodities

Avail equipment and other

inputs including
-Processing Equipment and construction and
Training establishment of CSRP
1.3.1 IGAs and Connection Support resilient
-Community Storage
to Value Chain livelihoods.
Receipts Programs
Implement business plan;
provide CRSP service to
members

Marketing including
provision of CSRP service

- Rural RE/EE Contract signing with

Enterprise cooperatives or/and
1.3.2 Energy Efficiency Establishment cooperative unions and
Cookstoves members
Strengthen supply chain for
- Establish Fuel
RE/EE products
1.3.3 Investment Planning Saving Cookstove Partner with other value
for Economic Development producer chain actors
enterprises

Recruitment of training for

woreda and kebele level
platforms
Build capacity for the
promotion and Provide awareness
management of SLWM creation to farmers
2.1.1 Kebele and Woreda
Capacity Building practices, and improve
Support different CIGs to
2.1.2 Information information for better
develop and adopt bylaws;
Modernization and Data decision-making in
conduct training needs
Base Management/Policy supporting resilient
assessment, & Provide
Development landscapes and diversified
tailor-made TOTs to at
2.1.3 Technical training on rural livelihoods in the Technical Assistance, Federal, Regional, woreda
cadaster and land project area. Support operating of capacity and community level
registration information modernization building activities and
2.1.4 TA (Cluster Approach to coordinate data Monitoring on local level Provide additional TOTs
at Zonal level) collection and information technical advisors for
2.1.5 Policy Development sharing at all levels and specific outputs linked to
2.1.6 Capacity building at under all components of CIGs in sub-component
Regional level the project so that this 1.1, 1.2 & 1.3
2.1.7 TA at information is well
organized, properly Provide technical support
National level
documented and to on-the-ground
accessible operations/implementation

Exposure visit of technical

advisors for specific
outputs linked to CIGs in
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sub-component 1.1, 1.2 &
1.3

Provide refresher TOT

technical advisors for
specific outputs linked to
CIGs in sub-component
1.1, 1.2 & 1.3

Initiate impact evaluation

research/study

Identify materials for

woreda information center
establishment

Construction of woreda
information center

Develop communication
2.2.1 Impact Evaluation (IE) material

Consultation on
2.2.2 Knowledge
Monitoring and Evaluation communication material
Management and
completed
Communication
Impact evaluations;
dissemination of
knowledge products

Knowledge
sharing/networking events

Support associations to
develop Watershed
Management and Use
plans

orthophoto base map

preparation
Strengthens the rural land consultations on land rights
administration system that using orthophoto
secures tenure rights,
optimizes land use, and base maps
empowers land-users to
scanning and geo-
sustainably invest in
3.1.1-Second Level Participatory Local Land referencing of adjudication
productive landscapes.
Landholding Certification Use Planning and maps, vectorization of
Improves security of tenure
(SLLC) Development Control parcel boundaries and
to smallholder farmers in
RLLP watersheds through keying-in of attribute
SLLC as an incentive to information
increase the adoption of
SLM technologies and public display for validating
practices. parcels (shape and size)
and landholders’
Information
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 85 OF 96

parcel map and

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Landholding Certificate
preparation, production,
authentication and issuance

support development,
testing, and roll-out of
National Rural Land
Administration Information
System

E.7. Monitoring, reporting and evaluation arrangements (max. 500 words, approximately 1 page)
Besides the arrangements (e.g. annual performance reports) laid out in AMA, please give a summary of the
project/programme specific arrangements for monitoring and evaluation. Please provide the types of interim and final
evaluations. Describe Accredited Entity (AE) project reporting relationships, including to the NDA/Focal Point and
between AE and Executing Entity (EE) as relevant, identifying reporting obligations from the EE to the AE. This
should relate to the frequency of reporting on project indicators, implementation challenges and financial status.

The institutional arrangements for M&E will encompass four levels that are well aligned with the RLLP institutional
and implementation arrangement.

Federal Level. The federal level sets the expectations for what is to be accomplished in M&E and oversees that
capacity, ensuring skills and tools are available for staff in the regions and at field level. Federal level M&E staff
ensure that data collected meet quality standards, review aggregated field data to analyze and pull out program level
results and trends and identify best practices important for scale up. The federal level M&E staff prepare reports to
the government and donors and provide feedback to stakeholders. The Federal M&E team will include: a Senior
M&E/Evaluator, a Senior Data Analyst/ MIS Specialist, a Senior Communication/Knowledge Management Specialist,
and a Documentation/Planning and Reporting Specialist. The team will also provide: technical assistance to develop
a new Results-Based M&E (RBME) plan, manual and indicator protocols; TA support in M&E Training (various topics
including advanced excel, data analysis and reporting, and evaluation practice); a functional web-based data
management system (in English and local languages), which will help to aggregate mobile application data and
collect geo spatial data.

Regional Level. The regional level leads the rollout of the M&E system to the field; builds skills and capacity in
regional and field level stakeholders; ensures that data collected meet quality standards; aggregates field data to
analyze and pull out regional levels results and trends and identify best practices important for scale up; prepares
reports to the government and donors and provides feedback to stakeholders. The regional team will include a M&E
Specialist and a Communication/Knowledge Manager/Spatial Analyst. The team will also support: special studies in
the region, involve regional officers in Joint Monitoring Missions (JMM), improved data management system in
English and local languages, and incentives for good regional performance, TA for training using TOT approach.

Zonal level. RLLP will strengthen the functionality of the zonal government structures/offices, mainly the Agriculture
and Natural Resources Office. The project will provide a budget allocation at the zonal level to provide staff to support
regional technical capacity and mentoring, conduct data quality assessments, provide clear guidance on which data
to collect and how, and provide ongoing M&E training and capacity building in M&E.

Woreda Level. This level identifies watershed needs and completes annual workplans and budgets, making sure that
activities get rolled out on time. The woreda team includes the NRM process owner and technical expert, who receive
data from the DAs and aggregate results to determine whether activity implementation is occurring at the right scale.
They prepare reports based on results achieved. Woreda officers are supported by regional and federal M&E staff
(particularly in completing reports).
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Kebele Level. Development Agents (DAs) play a significant role at kebele level. Clear guidance is needed for DAs on
what and how to collect data (strengthen data collection methods), to strengthen ongoing M&E training and capacity
building, and to provide educational opportunities/exchange visits to DAs assigned to follow-up project activities to
help motivate them and reduce frequent turnover.

Community Level. There are several levels of community members who are involved in M&E, but the Community
Facilitator (CF) is the main project interlocuter. Foremen/Forewomen, nursery operators and self-help group leaders
collect data and pass it to the CF, who also collects additional household level data. The CF aggregates data and
passes it to the Community Watershed Team (CWT). The CF is a member of the CWT and serves as a secretary.
The CWT reviews and approve the data and informs the CF to send it to the concerned DA in the respective kebele.
The DA presents the data to the Kebele Watershed Team (KWT) for review and approval, and finally sends the
approved data to the woreda office.

The methodology for monitoring key outcomes of the project is as follows:

Land area under sustainable landscape management practices: this indicator counts as treated the total area of a
micro watershed once all the prescribed soil and water conservation measures identified in the relevant Multi-Year
Development Plan (MYDP) have been fully implemented.

Net GHG greenhouse emissions: estimated using the ExAct carbon balance estimation tool, which calculates carbon
accumulation and emissions based on project biophysical output data. The economic lifetime of the project is
assumed to be 25 years (5 implementation and 20 post-project years, the same time horizon used in the Economic
and Financial Analysis).

Households adopting diversified livelihood activities supported by the project: this is measured as the percent of
households engaging in approved, non-traditional activities, relative to the total number of households in the project
area. The definition of what constitutes the set of potential non-traditional activities will be set during implementation
and applied to activities that are expected to reduce households' vulnerability to future shocks associated with
extreme weather events and climate change by diversifying livelihood activities and increasing the resilience of
natural (i.e. land) resources.

A beneficiary survey conducted by an independent 3rd party will be conducted in the first year, at mid-term and at
completion of the project. Administered to households as well as at the woreda and kebele administrative levels, the
beneficiary survey – a tool normally used to help improve the quality of development operations - will be enhanced
and expanded to support monitoring and verification of key indicators including adoption of diversified livelihood
activities and SLM practices as well as awareness of climate threats and appropriate responses.

An M&E operational manual will be developed that defines the function of the program level M&E system and its
nested RLLP level M&E systems. The manual will embed the tracking of the main GCF indicators related to avoided
emissions and number of beneficiaries of the project.

See Annex D.3 RLLP Gender Approach and Annex D.4 RLLP Gender Action Plan for further information on
statements in terms of number of women involved in the activities. Baseline data for Gender are not available,
however, the RF provides an alternative way to track progress (e.g., starting from baseline of N/A or “0,”) the indicator
measures incremental changes/values throughout project implementation to demonstrate progress.
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RISK ASSESSMENT AND MANAGEMENT
F.1. Risk factors and mitigations measures (max. 3 pages)
Please describe financial, technical, operational, macroeconomic/political, money laundering/terrorist financing
(ML/TF), sanctions, prohibited practices, and other risks that might prevent the project/programme objectives from
being achieved. Also describe the proposed risk mitigation measures. Insert additional rows if necessary.

For probability: High has significant probability, Medium has moderate probability, Low has negligible probability
For impact: High has significant impact, Medium has moderate impact, Low has negligible impact
Prohibited practices include abuse, conflict of interest, corruption, retaliation against whistleblowers or witnesses, as well as fraudulent, coercive,
collusive, and obstructive practices

Key Financial and Operational Risks

In the identification of key risks and their rating, the size of the project was taken into account. While several risks to
achievement of project objectives have been identified, the experience gained during implementation of SLMP-2, as
well as the significant resources allocated in the past 5 years for coordination and capacity building efforts are
expected to be instrumental in implementing measures to address the key financial and operational risks identified
below:

• Political and governance risk: Although the state of emergency ended in June 2018, sporadic civil unrest in
project areas continues to be a risk to implementation. Implementation of SLM activities continues in all
highland regions, however, there remains a risk that preparation and/or implementation of the proposed
operation could slow or be suspended due to a potential re-emergence of civil disturbances. Institutional
capacity for implementation and sustainability risk: While considerable capacity for SLM interventions exists
in current SLM project areas, limited institutional and human capacity in proposed new project areas
contribute to this risk, which is mitigated through a project design including significant training and
coordination at the national level.

• Fiduciary risk: Issues related to procurement and financial management have been observed in previous
projects. However, implementation of the WB-supported SLMP2 has developed significant capacity for
procurement and financial management, that are currently rated satisfactory and moderately satisfactory,
respectively.

• Stakeholder risk: This includes (i) weak multi-sectoral coordination, and (ii) risk of potential elite capture of
project benefits at the local level and exclusion of some stakeholders, particularly underserved members of
targeted communities. These are addressed through intersectoral coordination mechanisms at the Federal,
Regional and woreda levels, strong communication measures, and a grievance redress mechanism.

An Implementation Support Plan has been developed that describes how the World Bank will support the
implementation of the risk mitigation measures identified in the risk matrix.

Selected Risk Factor 1

Category Probability Impact
Governance High Low
Description
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Please describe the risk to the best of your knowledge at this point in time.
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Political and governance risk. The GoE declared a state of emergency from October 2016 to August 2017, which was re-instated
in February 2018 but ended in June 2018. Although the situation has stabilized since the nomination of a new Prime Minister in
April 2018, there remains a risk that implementation of the proposed operation could be negatively impacted should civil
disturbances recur.

Mitigation Measure(s)
While the extent to which project-specific measures can mitigate this risk is limited, the RLLP will adopt the approach
of other Bank-financed operations, including: (i) careful supervision mission planning that emphasizes security; (ii)
strategic communication and outreach; (iii) sound safeguards monitoring building on SLMP-II experience and
capacity; and (iv) enhanced transparency in project-supported activities. RLLP will also contribute to alleviating some
of the drivers of civil unrest, including natural resource degradation and rural landlessness and joblessness.

Selected Risk Factor 2

Category Probability Impact
Technical and operational Medium Medium
Description
Please describe the risk to the best of your knowledge at this point in time.
Institutional capacity for implementation and sustainability risk due to a number of issues including: (i) the restructuring of the GIZ
program in support of SLM; (ii) the limited human resources available at the field level; (iii) the challenge of implementing a reliable
and cost-effective M&E system; and (v) weak coordination among institutions and programs, including between the NRM
Directorate of MoA and the PCU.

Mitigation Measure(s)
Please describe how the identified risk will be mitigated or managed. Do the mitigation measures lower the probability
of risk occurring? If so, to what level?
This set of risks will be mitigated through: (i) continual training on project management and monitoring at all levels, in
coordination with the GIZ SURED project; (ii) project implementation arrangements acceptable to the World Bank and
agreed by the MoA and regional governments clarifying accountability and targets at all levels; and (iii) coordination
between development partners and Technical Committee on SLM.

Selected Risk Factor 3

Category Probability Impact
Other Medium Low
Description
Please describe the risk to the best of your knowledge at this point in time.
Fiduciary risk due to persistent issues related to procurement and financial management. Although SLMP-II has only had
“unqualified” audits to date, which is excellent, there has been high turnover of project fiduciary staff.

Mitigation Measure(s)
Please describe how the identified risk will be mitigated or managed. Do the mitigation measures lower the probability
of risk occurring? If so, to what level?
Mitigation of this risk centers on MoF’s recent increase and harmonization of salaries for project procurement and
financial management staff.
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G.GCF POLICIES AND STANDARDS
G.1. Environmental and social risk assessment (max. 750 words, approximately 1.5 pages)
Provide the environmental and social risk category assigned to the proposal as a result of screening and the rationale
for assigning such category. Present also the environmental and social assessment and management instruments
developed for the proposal (for example, ESIA, ESMP, ESMF, ESMS, environmental and social audits, etc.). Provide
a summary of the main outcomes of these instruments. Present the key environmental and social risks and impacts
and the measures on how the project/programme will avoid, minimize and mitigate negative impacts at each stage
(e.g. preparation, implementation and operation), in accordance with GCF’s ESS standards. If the proposed project or
programme involves investments through financial intermediations, describe the due diligence and management
plans by the Executing Entities (EEs) and the oversight and supervision arrangements. Describe the capacity of the
EEs to implement the ESMP and ESMF and arrangements for compliance monitoring, supervision and reporting.
Include a description of the project/programme-level grievance redress mechanism, a summary of the extent of multi-
stakeholder consultations undertaken for the project/programme, the plan of the Accredited Entity (AE) and EEs to
continue to engage the stakeholders throughout project implementation, and the manner and timing of disclosure of
the applicable safeguards reports following the requirements of the GCF Information Disclosure Policy and
Environmental and Social Policy.

Describe any potential impacts on indigenous peoples and the measures to address these impacts including the
development of an Indigenous Peoples Plan and the process for meaningful consultation leading to free, prior and
informed consent, pursuant to the GCF Indigenous Peoples Policy.

Attach the appropriate assessment and management instruments or other applicable studies, depending on the
environmental and social risk category as annex 6.
The RLLP has been assigned as an EA category of B, for the potential social and environmental impacts on humans
and sensitive areas (wetlands, forests, natural habitats, etc...) are less adverse, site specific, few if any of them are
irreversible. The ESMF was required to comply with not only the relevant national policy and legal frameworks but
also with the applicable environmental and social safeguard policies of the World Bank. Based on the framework of
SLMP-II, and considering its principal features and aspects, the RLLP social assessment was carried out and
updated with the following major objectives in focus:

• Assess key socio-economic factors that require consideration;

• Identify vulnerable and historically underserved groups that may be excluded from the project and be
adversely affected as a result, and the necessary impact mitigating measures.
• Assess any potential adverse social impacts of RLLP, and determine whether the project is likely to trigger
the World Bank social safeguards policies;
• Recommend in the early stage of project preparation the appropriate measures towards addressing World
Bank requirements on social safeguards triggered by the project (OP/BP 4.10 and OP/BP 4.12).

In line with the Ethiopian Government’s decentralization policy, organizational structure and implementation
arrangement and with due consideration to the implementation of project activities at the grassroots level, RLLP is
designed to operate at federal, regional, zonal, woreda kebele levels as well as the beneficiary community level. The
monitoring and evaluation (M&E) and reporting system of the project is in-built in the implementation arrangement to
be executed at all levels of the organizational structure. The institutional arrangement includes RLLP related
conflict/grievance redress mechanism/GRM, consisting of community watershed teams, indigenous local institutions,
kebele watershed teams, and people from woreda agriculture and natural resources offices.

In RLLP the environmental and social management process starts with the sub-project planning process during the
identification of sub-projects by local communities based on their needs and priorities through a participatory
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watershed planning process guided by the Community Based Participatory Watershed Development Guidelines
(CBPWDG), technical support from Development Agents (DAs) and Woreda experts. The DA will screen/design/plan
subprojects applying a simple checklist as a format for fast track eligibility checking of identified sub-projects. This is
done in consultation with the communities and kebele development committee at the early stages of subproject
selection and prioritization phase. Once the checklist is approved at the kebele level, the project design/plan will then
be sent to the Woreda Agriculture Office and/or the Woreda Technical Committee. The Technical Committee,
depending on the scale, nature and type of subproject, will further screen the sub-projects. The Woreda Focal Person
(WFP), woreda implementing office, and regional project support unit will ensure and document such procedures are
properly followed. And a team led by experts from the Woreda Environmental regulatory body will review the
screened subproject and the mitigation measures planned. If any design modifications are required, the
environmental regulatory body passes recommendations and give clearance and/or certificate of subprojects. The
Woreda council will then approve plans based on the recommendations of the team. After approval, the plan
document is referred to the regional Bureau of Agriculture and Natural Resources (BoANR) with all the accompanying
environmental and social screening documents/files.

Monitoring of environmental and social safeguard performance of the project will be conducted regularly.
Performance monitoring will ensure that safeguards instruments are prepared and approved to the required standard
and the proper implementation of ESMP, SA, RPF and GMGs. While the implementation of ESMP is done by the
community at kebele level with the responsibility of the woreda implementing offices, performance monitoring will be
done by the RLLP-PCU environmental and social safeguard specialists at national and regional level and other
stakeholders. The results of the monitoring involve the monitoring compliance and effectiveness of the safeguards
instruments, and the overall environmental, socio-economic and climate-related assessment of the Program’s
interventions. The monitoring will be done on an annual and quarter basis by the RPCU Specialists with support from
the NPCU Environmental and Social Safeguards Specialists, M&E Specialist and WB’s Environmental Safeguards,
Social Safeguards and Social Development team.

Quarterly and annual reviews workshops will be held at regional and national level with a view to enhance the
positive performances of ESMF, SA, RPF and the Gender Mainstreaming Guideline identifying bottlenecks and gaps
in implementing the ESMF and proposing solutions in addressing the gaps. Environmental and social auditing will be
done by the RLLP concerned specialists (both federal and regional) and field verification by independent consultants
to be recruited. This auditing will be conducted twice in the program life, i.e. during MTR and completion period of the
project.

The RLLP triggered OP 4.10 Indigenous People as it was determined that the physical and sociocultural
characteristics of the proposed intervention areas and the people living in these sites meet the policy requirements.
The decision to trigger the policy is also based on the Ethiopian Constitution, which recognizes the presence of
different socio-cultural groups, including historically disadvantaged or

underserved peoples, as well as their rights to their identity, culture, language, customary livelihoods,

socio-economic equity, etc. The social safeguard issues relating to the policy are assessed through an SA and
extensive consultation with potential project beneficiaries, including those identified as vulnerable

groups and underserved peoples.

G.2. Gender assessment and action plan (max. 500 words, approximately 1 page)
Provide a summary of the gender assessment and project/programme-level gender action plan that is aligned with
the objectives of GCF’s Gender Policy. Confirm a gender assessment and action plan exists describing the process
used to develop both documents. Provide information on the key findings (who is vulnerable and why) and key
recommendations (how to address the vulnerability identified) of the gender assessment. Indicate if stakeholder
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consultations have taken place and describe the key inputs integrated into the action plan, including: how addressing
the vulnerability will ensure equal participation and benefits from funds investment; key gender-related results to be
expected from the project/programme with targets; implementation arrangements that the AE has put in place to
ensure activities are implemented and expected outcomes will be achieved, monitored and evaluated.

Provide the full gender assessment and project-level gender action plan as annex 8.
Gender Considerations

Land degradation has important gender dimensions. For example, UNDP finds that land degradation increases the
pressures on women differentially from men in their effort to meet practical needs of supporting their families under
increasingly difficult environmental, physical, social, and economic conditions. Women are also challenged by the
consequences of land and environmental degradation induced fuel-wood and water shortage, making their work even
more challenging.

Analysis also indicated the constraints to women’s access to equitable roles in decision-making concerning land
resources and their engagement in sustainable environmental and land management such as: (a) insecure land use
rights, (b) the low value assigned to labor and subsistence farming, (c) lack of access to credit and (d) lack of
opportunities to gain and share technical knowledge. Further, the United Nations Convention to Combat
Desertification (UNCCD) illustrated that, often ‘women’s inequitable access to secure property rights forces them onto
marginal, fragile, highly degradable lands.

The Sustainable Development Goals (SDGs) emphasize gender equality and empowering all women and girls as not
only a fundamental human right, but a necessary foundation for a peaceful, prosperous and sustainable world. This
is part of each of the SDGs as well as being reflected in the stand-alone goal (Goal 5), to achieve gender equality.
Providing women and girls with equal access to the natural resource base and equal representation in decision-
making processes will boost the returns of RLLP investment and benefit broader society. The design of RLLP will
therefore create opportunities for women’s equal rights to economic resources, as well as access to ownership and
control over land and other forms of the natural capital, in accordance with GoE laws.

Gender Dimensions of Land Degradation in Ethiopia

Understanding gender aspects of natural resources management is an entry point for reversing environmental and
land degradation in RLLP landscapes. Women manage natural resources daily in their roles as farmers and
household providers; typically, they are responsible for growing homestead crops, collecting fuel wood and water.
Climate change disproportionately affects rural women, as they are most reliant on natural resources for their
livelihoods but have fewer resources (natural, physical and social capital) to adapt to climate change and cope with
climate change impacts such as droughts, landslides, and food shortages. Climate vulnerabilities affect not only
women’s health, productivity, and development, but also contribute to the intensification of existing gender gaps,
including gender-based violence The Ethiopia Demographic and Health Survey (2016) shows that 33% of women
ages 15-49 have experience physical or sexual violence; domestic violence is the most common form of violence
toards women.

Gender gaps are amplified when adaptation measures fail to consider specific needs and preferences of women.
Further, local cultural norms and practices have a major impact on access to natural resources and the level of
engagement of women in the agriculture sector. Inequitable access and unequal playing fields have led women
farmers to produce on average 23% less than their male counterparts in Ethiopia. For instance, women in rural
Ethiopia have lower access to inputs such as training and technology that help increase resilience by improving
agricultural knowledge. However, notwithstanding their reliance on natural resources, women have less access and
control than men, despite their constitutional rights to equal land ownership, administration and use. Landless rural
women often depend on common property resources for fuel wood, fodder and food. Lack of land and property
ownership and control limits women’s voice and agency, because assets are an important factor in bargaining power
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and household decision-making, access to finance, and overall economic independence. Protection of the natural
resource base is the centerpiece of the overall RLLP investment so that rural women and men will be empowered to
participate in decisions that affect their needs and vulnerabilities, and in turn lend a hand in effective interventions for
the conservation and sustainable use of these resources.

RLLP Gender Approach

The operational steps encompass resilience building through soil and water conservation works, enhanced tenure
security, homestead and farmland development, livelihood improvements (access to improved, targeted livelihoods
support in rehabilitated watersheds including creating jobs, organized cooperatives, women or girls only), climate
smart agriculture, and affordable and innovative technology (household energy). For RLLP, facilitating the acquisition
of improved cookstoves, will free up women’s time, which could potentially enable them to engage in climate resilient
livelihood diversification. Activities could include promotion of improved cookstoves, cultivating fruit trees, bamboo
handicrafts, beekeeping, etc.

The RLLP components will take into account the different roles of men and women in advancing resilient livelihoods
at multiple scales, and respond to the unique interests, priorities and needs of women and men in order to close
gender gaps. Women and men at all levels of the RLLP decision-making should be involved as key actors in the
assessment, design, monitoring, and evaluation of interventions starting from the community watershed committee.
Both women and men need to benefit from a gender approach that reinforces their joint participation and equitable
benefit in RLLP through participatory, inclusive approaches, including actions such as designing, implementing, and
strengthening guidelines incorporating gender perspectives in the project. The RLLP program is well aligned with the
WBG’s Gender Strategy 2016-2023 – seeks to close gender gaps in human endowments, more and better jobs, and
ownership and control of assets; and promote women’s voice and agency, which constitute the four pillars of strategy.

An impact evaluation of gender innovations under RLLP is currently being carried out. The gender assessment of
SLMP-II experiences helped to determine constraints and experiences that limited female and male project
beneficiaries and whether women's abilities to realize equitable benefits from the natural and environmental
resources were effectively improved by the project's activities/innovations.

A Gender Approach and Action Plan is included in Annex D.3. and Annex D.4., to address the gender aspects of land
degradation and natural resource use. This will be further informed through an assessment of the SLMP-II gender
mainstreaming strategy, which is currently underway.

G.3. Financial management and procurement (max. 500 words, approximately 1 page)
Describe the project/programme’s financial management including the financial monitoring systems, financial
accounting, auditing, and disbursement structure and methods. Refer to section B.4 on implementation arrangements
as necessary.

Articulate any procurement issues that may require attention, e.g. procurement implementation arrangements and the
role of the AE under the respective proposal, articulation of procurement risk assessment undertaken and how that
will be managed by the AE or the implementing agency. Provide a detailed procurement plan as annex 10.

Financial Management

The financial management (FM) arrangements for the proposed project- RLLP will be based on the existing FM
systems and structures established under SLMP-II. The FM arrangements for RLLP and SLMP II are in line with the
World Bank (AE) policies and procedures. This includes the accounting capacity maintained by the implementing
entity (Ministry of Agriculture and Natural Resources) at the Federal, Regional and Woreda (District) levels. SLMP II
was audited in accordance with the International Standards on Auditing. The audit for the financial year ended July 7,
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2017 expressed unqualified (clean) opinion but highlighted some internal control weaknesses in the management
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letter. This includes delays in funds flow between federal level and regional and woreda levels, weak control of
advances to Woredas, weak accounting capacity in some Woredas and weak control of fixed assets in some
Woredas. The project addressed these weaknesses progressively in line with an FM Action Plan agreed with the
World Bank (AE).For RLLP, the Federal PCU based at the MoA will retain the overall fiduciary responsibility for the
implementation of the project supported by other federal level PCU’s, Regional Support Units in the six regional
Bureaus of Agriculture (BoA’s) and the administrations of all the implementing woredas. Project annual budgets will
be prepared based on consolidated annual work plans initiated at the woreda and regional levels and compiled at the
federal level. Disbursements are based on the approved budget and accounted for using quarterly interim financial
reports submitted to the World Bank (AE) within 45 days after the end of each quarter. An external audit of the project
will be conducted annually by the Supreme Audit Institution or an accredited private audit firm. The audit will be
conducted in accordance with Terms of Reference prepared by the EE and the objective of the audit will be to
ascertain whether project funds have been used for the intended purpose. The AE reviews and provides clearance
for the recruitment of the auditor including clearance of the ToR.In each of the federal level-implementing entities, the
six regions and all woredas will maintain segregated local currency bank accounts where project funds will be
deposited and payments made. Proceeds of the IDA Credit and MDTF will initially flow into the DA before further
disbursement into each of the local currency project accounts based on the approved annual work plan and budget.
In addition to receiving advances through the DA, the project may use other disbursement methods such as
reimbursements, direct payment and special commitment. To enhance the level of disbursements under the new
project, the team will ensure prompt submission of quarterly IFRs immediately after the end of each quarter. Financial
reporting for the proposed project will follow international financial reporting and auditing standards. The FM risk
rating for the implementation of the RLLP is considered Substantial. An FM assessment of the implementing entities
including sampled woredas has been completed and used to update the FM arrangements for the RLLP (see Annex
D.5.). Procurement under the project will be carried out in accordance with the World Bank’s Procurement
Regulations for IPF Borrowers - ‘Procurement in Investment Project Financing, Goods, Works, Non-Consulting, and
Consulting Services’, dated July 2016, revised November 2017 and ‘Guidelines on Preventing and Combating Fraud
and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants’, revised as of July 1, 2016, and the
provisions stipulated in the Legal Agreement. A Project Procurement Strategy Document (PPSD) has been prepared
by the MoA, which forms the basis for a Procurement Plan that details procurement methods, estimated costs,
post/prior review requirements, etc. for each contract to be financed by project proceeds. The Procurement Plan will
be updated at least annually or as required to reflect the actual project implementation needs and improvements in
institutional capacity. Procurement of RLLP will be carried out in a decentralized manner in each of the major
watersheds participating in the project. At the federal level, the PCU is the focal organization for implementation of
RLLP. The BoAs and the Woreda Agricultural Development Offices shall serve as the implementing organizations of
RLLP in the respective regions. The land and watershed management activities will be carried out in the existing and
new watersheds in the beneficiary woredas and may involve local community participation in procurement. The
project procurement plan includes community level procurement activities and targets. The procurement at
community level has a separate operational guideline. Training will be provided for the community level procurement
committee to improve capacity and reduce risks. Based on the threshold and procurement plan target there will be
regular monitoring by district (woreda) level procurement authorities to effect payments. Regional level procurement
specialists regularly monitor the procurement plan and its implementation. Moreover, during regular Joint
Implementation Support Missions from the federal level procurement is one of the fiduciary components monitored.
There are also internal and external audits on a yearly basis and a comprehensive independent procurement audit
will be conducted for the entire project period.

Taxation: Where goods and services are procured by the project, these will be subject to income tax, import duties,
withholding tax and Value Added Tax. GCF proceeds can be used to pay taxes.

Taxation of farmland is low due to the use rights of farmers. Farmer cooperatives received a tax incentive, exempting
them from paying profit tax. A proposal has been submitted to exempt irrigation pumps from import tax.

Authorizations needed for project implementation: The World Bank will sign a financing agreement with the Federal
Democratic Republic of Ethiopia. Once this agreement is signed, authorization for project implementation will need to
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 95 OF 96

G
be obtained from Ethiopia’s House of Parliament. During project implementation, the Steering Committee will have
oversight of the project. Steering committee members include various Ethiopian government bodies, as described in
Section C.7.

G.4. Disclosure of funding proposal

Note: The Information Disclosure Policy (IDP) provides that the GCF will apply a presumption in favour of disclosure
for all information and documents relating to the GCF and its funding activities. Under the IDP, project and
programme funding proposals will be disclosed on the GCF website, simultaneous with the submission to the Board,
subject to the redaction of any information that may not be disclosed pursuant to the IDP. Information provided in
confidence is one of the exceptions, but this exception should not be applied broadly to an entire document if the
document contains specific, segregable portions that can be disclosed without prejudice or harm.

Indicate below whether or not the funding proposal includes confidential information.

☐ No confidential information: The accredited entity confirms that the funding proposal, including its annexes, may be
disclosed in full by the GCF, as no information is being provided in confidence.

☐ With confidential information: The accredited entity declares that the funding proposal, including its annexes, may
not be disclosed in full by the GCF, as certain information is being provided in confidence. Accordingly, the accredited
entity is providing to the Secretariat the following two copies of the funding proposal, including all annexes:

full copy for internal use of the GCF in which the confidential portions are marked accordingly, together with
an explanatory note regarding the said portions and the corresponding reason for confidentiality under the
accredited entity’s disclosure policy, and
redacted copy for disclosure on the GCF website.

The funding proposal can only be processed upon receipt of the two copies above, if containing confidential
information.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 96 OF 96

H
ANNEXES
H.1. Mandatory annexes

☒ Annex 1 NDA no-objection letter(s) (template provided)

☒ Annex 2 Feasibility study - and a market study, if applicable

☒ Annex 3 Economic and/or financial analyses in spreadsheet format

☒ Annex 4 Detailed budget plan (template provided)

☒ Annex 5 Implementation timetable including key project/programme milestones (template provided)

☒ Annex 6 E&S document corresponding to the E&S category (A, B or C; or I1, I2 or I3):
(ESS disclosure form provided)
☐ Environmental and Social Impact Assessment (ESIA) or
☒ Environmental and Social Management Plan (ESMP) or
☐ Environmental and Social Management System (ESMS)
☒ Resettlement Policy Framework, Social Assesment

☒ Annex 7 Summary of consultations and stakeholder engagement plan

☒ Annex 8 Gender assessment and project/programme-level action plan (template provided)

☐ Annex 9 Legal due diligence (regulation, taxation and insurance)

☐ Annex 10 Procurement plan (template provided)

☐ Annex 11 Monitoring and evaluation plan (template provided)

☒ Annex 12 AE fee request (template provided)

☒ Annex 13 Co-financing commitment letter, if applicable (template provided)

☒ Annex 14 Term sheet including a detailed disbursement schedule and, if applicable, repayment schedule
H.2. Other annexes as applicable

☒ Annex 15 Evidence of internal approval (template provided)

☒ Annex 16 Map(s) indicating the location of proposed interventions
☐ Annex 17 Multi-country project/programme information (template provided)
☒ Annex 18 Appraisal, due diligence or evaluation report for proposals based on up-scaling or replicating a pilot
project
☐ Annex 19 Procedures for controlling procurement by third parties or executing entities undertaking projects
financed by the entity
☐ Annex 20 First level AML/CFT (KYC) assessment
☐ Annex 21 Operations manual (Operations and maintenance)
☒ Annex x Other references
* Please note that a funding proposal will be considered complete only upon receipt of all the applicable supporting documents.
Project/Programme title: Resilient Landscapes and Livelihoods Project

Country(ies): Ethiopia

Accredited Entity: World Bank

Date of first submission: 2018/06/22

Date of current submission 2020/03/19

Version number [V.000]

 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 0 OF 96

Contents

Section A PROJECT / PROGRAMME SUMMARY

Section B PROJECT / PROGRAMME INFORMATION

Section C FINANCING INFORMATION

Section D EXPECTED PERFORMANCE AGAINST INVESTMENT CRITERIA

Section E LOGICAL FRAMEWORK

Section F RISK ASSESSMENT AND MANAGEMENT

Section G GCF POLICIES AND STANDARDS

Section H ANNEXES

Note to Accredited Entities on the use of the funding proposal template

• Accredited Entities should provide summary information in the proposal with cross-
reference to annexes such as feasibility studies, gender action plan, term sheet, etc.
• Accredited Entities should ensure that annexes provided are consistent with the details
provided in the funding proposal. Updates to the funding proposal and/or annexes must be
reflected in all relevant documents.
• The total number of pages for the funding proposal (excluding annexes) should not
exceed 60. Proposals exceeding the prescribed length will not be assessed within the usual
service standard time.
• The recommended font is Arial, size 11.
• Under the GCF Information Disclosure Policy, project and programme funding proposals
will be disclosed on the GCF website, simultaneous with the submission to the Board,
subject to the redaction of any information that may not be disclosed pursuant to the IDP.
Accredited Entities are asked to fill out information on disclosure in section G.4.

Please submit the completed proposal to:

fundingproposal@gcfund.org
Please use the following name convention for the file name:
“FP-[Accredited Entity Short Name]-[Country/Region]-[YYYY/MM/DD]”
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 1 OF 96

A
PROJECT/PROGRAMME SUMMARY
A.1. Project or A.2. Public or private Public
Project
programme sector
If the funding proposal is being submitted in response to a specific GCF Request for Proposals,
A.3. Request for indicate which RFP it is targeted for. Please note that there is a separate template for the
Proposals (RFP) Simplified Approval Process and REDD+.
Not applicable
Check the applicable GCF result area(s) that the overall proposed project/programme targets.
For each checked result area(s), indicate the estimated percentage of GCF budget devoted to it.
The total of the percentages when summed should be 100%.
Mitigation: Reduced emissions from: GCF contribution:
☐ Energy access and power generation: Enter number%
☐ Low-emission transport: Enter number%
☐ Buildings, cities, industries and appliances: Enter number%
A.4. Result area(s) ☒ Forestry and land use: 100%

Adaptation: Increased resilience of:

☒ Most vulnerable people, communities and regions: 70%
☒ Health and well-being, and food and water security: 30%
☐ Infrastructure and built environment: Enter number%
☐ Ecosystem and ecosystem services: Enter number%
Direct beneficiaries:
834,000 Households (4.2
million people) facing food,
land tenure and water
insecurity in climate
5,621,615 t CO2 eq over 5 vulnerable rural
years watersheds
A.5. Expected mitigation A.6. Expected adaptation
Indirect beneficiaries: Total
impact impact population of the targeted
43,800,000 t CO2 eq over
25 years area – close to 26,200,000
people.
Direct: 4.0%
Indirect: 25.0%

A.7. Total financing (GCF

296,237,602 USD
+ co-finance)
Large (Over USD 250
165,237,592 USD A.9. Project size
million)
A.8. Total GCF funding Choose an item.
requested For multi-country proposals,
please fill out annex 17.
Mark all that apply and provide total amounts. The sum of all total amounts should be consistent
with A.8.
A.10. Financial
instrument(s) requested ☒ Grant 58,063,337 USD ☐ Equity Enter number
for the GCF funding ☒ Loan 107,174,255 USD ☐ Results-based
☐ Guarantee Enter number payment Enter number

A.11. Implementation Start: 07-Oct-2020; End:

period
A.12. Total lifespan 25 years
07-Oct-2025
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 2 OF 96

A
This is the date that the
Refer to the AE’s safeguard
Accredited Entity obtained/will
policy and GCF ESS
A.13. Expected date of obtain its own approval to
Standards to assess your FP
implement the project/ A.14. ESS category
AE internal approval category.
programme, if available.
6/15/2020 B
A.15. Has this FP been A.16. Has Readiness or
submitted as a CN Yes ☒ No ☐ PPF support been used Yes ☐ No ☒
before? to prepare this FP?
A.17. Is this FP included A.18. Is this FP included
in the entity work Yes ☐ No ☐ in the country Yes ☐ No ☐
programme? programme?
Does the project/programme complement other climate finance funding (e.g. GEF, AF,
A.19. Complementarity CIF, etc.)? If yes, please elaborate in section B.1.
and coherence
Yes ☐ No ☒
If not the Accredited Entity, please indicate the full legal name of the Executing
Entity(ies) and provide its country of registration and ownership type. Note that there
can be more than one Executing Entity. Also indicate if an Executing Entity is the
National Designated Authority. Refer to the definition of Executing Entity in the
A.20. Executing Entity Accreditation Master Agreement.
information
The Federal Democratic Republic of Ethiopia, represented by the Ministry of Finance
and acting through the Ministry of Agriculture.

A.21. Executive summary (max. 750 words, approximately 1.5 pages)

 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 3 OF 96

A
Provide an executive summary of the project/programme including:
1. Climate change problem
2. Proposed interventions
3. Climate impacts/benefits

1. Climate Change Problem

Impact of Climate Change on Land Degradation

In the highlands of Ethiopia, climate change is expected to increase both annual precipitation and seasonal variability
in rainfall, increasing soil erosion by 7-10% per year and, in the more extreme scenarios, possibly by as much as 40-
70% per year by 2050. Conservative estimates suggest that partly as a result of this increased soil erosion, climate
change will reduce agricultural crop productivity in Ethiopia by 5 -10 % by 2030 1. Land degradation in Ethiopia has
proceeded at an alarming rate and will be increasingly aggravated by climate change. From 1981 to 2003, 296,812
km2 (29.7 million ha) of land has been degraded, affecting a population of 20.65 million, approximately one in five
people in Ethiopia.

Vulnerability of the agriculture sector and community livelihoods to climate change impacts

The intersection of land management, rights, and use forms the key development issue for millions of rural Ethiopians
facing water insecurity, food insecurity, land tenure insecurity, and livelihood insecurity – all amplified by climate
variability and change as described above. Climate impacts in Ethiopia are felt primarily through water stress, which is
affected by land use and degradation that undermines watershed function. In Ethiopia, the estimated cost of land
degradation is 2-3% of GDP, before accounting for downstream effects, such as increased flood risk.

Exposure of farmers to land degradation

Since the 1970s, the Government of Ethiopia has recognized the problem of land degradation as a major challenge to
the country’s growth and stability. Studies have shown that land degradation has cost the country 2-3 percentage points
in agricultural GDP each year. Due to its impact on agricultural productivity alone, soil erosion currently costs the
economy of Ethiopia about $305 million per year. Based on Ethiopia’s experience to date, the cost of inaction to address
land degradation is estimated to be 4.4 times greater than the cost of preventative action through (SLM). 2

Impacts of Climate Change and Variability on farmer livelihoods

Climate variability such as the droughts and floods described above already negatively impacts livelihoods in
Ethiopia. This will aggravate the impacts of climate change, which are broad in scope and could be severe. Estimates
suggest climate change may reduce Ethiopia’s GDP up to 10 % by 2045, primarily through impacts on agricultural
productivity. These changes would aggravate existing social and economic challenges.

Recently, the impact of climate change on crop yields in Ethiopia was investigated in a report published by IFPRI. 3
Overall, the simulated net effects of increases in average rainfall and higher average temperatures are relatively
small. However, the authors note that there is growing evidence that weather outcomes, particularly rainfall, are likely
to become more variable in the future, which could lead to substantial effects on crop production and household
welfare (as well as on livestock) due to extreme events – droughts, floods, or extremely high temperatures.

Crucially, the models employed in the simulations do not take into account the impact of climate change on land
degradation, while noting that in many parts of the country land degradation is already reducing yields. Climate
change is likely to accelerate the levels of land degradation and soil erosion. As described in more detail in Annex A.7
and Annex A.8, recent analysis by the Water and Land Resource Centre (WLRC) of Addis Ababa University using
soil loss equations calibrated using historical station data from two monitoring stations within the project area in
conjunction with the IPCC’s RCP4.5 scenario for 2050, show that soil erosion is expected to increase by 7-10% per
year and, in the more extreme scenarios, could increase by as much as 40-70% per year by 2050 due to climate
change in the absence of interventions to improve land management 4. As a result, conservative estimates suggest
that climate change will reduce agricultural crop productivity in Ethiopia by 5 -10 % by 2030.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 4 OF 96

1 Refer to Annex A.7., Annex A.8 and Bai, Z. G., Dent, D. L., Olsson, L., & Schaepman, M. E. (2008), “Global assessment of land degradation and improvement. 1. Identification by
remote sensing”. Wageningen, The Netherlands: International Soil Reference and Information Centre (ISRIC).
2 Gebreselassie et al. (2016).
3 Dorosh, P. and Minten, B. (eds.), 2019, Ethiopia’s agri-food system: Past trends, present challenges, and future scenarios, Ethiopia Strategy Support Program (ESSP), IFPRI
4 Based on recent analysis by the Water and Land Resource Centre (WLRC) of Addis Ababa University
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 5 OF 96

A
The direct impacts on crop productivity could in turn lead to impacts on prices, production, and consumption and on
per capita calorie consumption and child malnutrition. Climate change, therefore, complicates efforts to increase food
production and improve food security 5.

Sensitivity of rural communities to the impacts of climate change

Sensitivity to climate change and variability is high in the proposed project communities. More than 80% of Ethiopians
are engaged in subsistence rain-fed agriculture and farms are already under significant climate stress. These
populations are highly dependent on the performance of productive landscapes for income, energy, food, building
materials, and water. Furthermore, agriculture accounts for most jobs and about 40% of output and exports. Low
adaptive capacity contributes to high vulnerability in the proposed project communities. Most of the targeted
watersheds are situated in regions that have relatively low adaptive capacity. As one study of vulnerability in the
Tigray Region concluded, districts most vulnerable to climate change and variability overlapped with districts with the
most vulnerable populations; climate vulnerability was inextricably linked to social and economic development.[8]
Households that are short of basic economic and social resources clearly lack the means to undertake adaptive

measures or respond to climate shocks.

2. Proposed Interventions/Summary of Project

The objective of the Project is to improve climate resilience, land productivity and carbon storage and increase access
to diversified livelihood activities in selected rural watersheds.

The Project consists of the following parts to be carried out in select Regions of Ethiopia:

Part 1. Investment in Green Infrastructure and Resilient Livelihoods

Provide support for the restoration of degraded landscapes in selected watersheds and help build resilient
livelihoods through the following program of activities:

(a) Land Restoration and Watershed Management: Implementation of sustainable soil and water conservation
practices in line with Multi-Year Development Plans (“MYDPs”) in watersheds, including land rehabilitation measures
and establishment of green infrastructure (including rehabilitation through biological and physical conservation
measures that ensure reduced surface run-off and soil erosion, as well as improved land productivity, resulting in
enhanced crop and livestock production) through, inter alia: soil and water conservation measures, gully rehabilitation,
establishment of green corridors, area closure management and use, establishment of plantation blocks, and
enrichment of degraded pasture and rangeland;
(b) Climate-Smart Agriculture: Enhance the livelihood resilience of beneficiary households in restored micro
watersheds by implementing context-specific Climate-Smart Agriculture (“CSA”) activity packages comprising one or
more of the following: farm water and soil moisture management, integrated soil fertility and soil health management,
crop development and management, and environmentally-friendly livestock production through feed development and
management; and
(c) Livelihood Diversification and Connection to Value Chains: Further increase livelihood resilience by diversifying
livelihoods, and helping ensure livelihood sustainability by better connecting products with value chains in selected
watersheds through a program of activities, including provision of technical assistance and grants to Common Interest
Groups (“CIGs”) and financing activities that facilitate private sector engagement in Project-supported value chains
directly or through primary cooperatives and/or coop unions.

Part 2. Investing in Institutions and Information for Resilience

Enhance institutional capacity and improve information for better decision-making in supporting resilient
landscapes and diversified rural livelihoods in the Project area through the following program of activities:

(a) Capacity Building, Information Modernization and Policy Development: Provision of technical assistance, at the local
government level, to implement the Project and build capacity to sustain land and water management practices in
watersheds, including financing of selected staff positions, financing of technical vocational education and training,
development of data management plan, piloting of new technologies for information modernization (such as the use of
electronic tablets for gathering geospatial information and the use of unmanned aerial vehicles for land certification
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 6 OF 96

mapping), and development and application of a regulatory framework for the establishment of WUAs and community
A
bylaws guiding land-use practices, and strengthening the Land Administration System; and
(b) Impact Evaluation, Knowledge Management and Communication: Carry out impact evaluations of (i) the bio-
physical outcomes of MoA’s SLM Program, and (ii) the productivity gains associated with the climate-smart agriculture
interventions supported by the Project, establish a geospatial knowledge platform accessible to planners and
stakeholders, and develop and implement a strategic communication program to inform and mobilize communities, and
to enhance Project visibility and transparency among all actors.

Part 3. Land Administration and Use

Strengthen land tenure and the land administration system in Project areas and improve incentives for
beneficiary communities to invest in sustainable landscape management through the following: (a) in the micro-
watersheds targeted under Part 1 of the Project, improving the land tenure security of rural households and groups
through land certification and administration (including issuance of Second Level Landholding Certificates (“SLLCs”) to
households, and targeted landless youth will receive communal land certificates, inputs, and extension services in
exchange for land restoration), and (b) enhancing local level land use planning and support innovations in landscape
certification systems (including providing support for participatory local land use planning and the rollout of the National
Rural Land Administration Information System (“NRLAIS”).

Part 4. Project Management and Reporting

Provision of support for Project management and reporting, including financing of Operating Costs and
implementation of Project fiduciary aspects, including financial management, procurement, environmental and social
safeguards, and monitoring and evaluation and reporting.

3. Climate Benefits

The proposed project is designed to create resilient landscapes and livelihoods for vulnerable rural populations in
Ethiopia. The Resilient Landscapes and Livelihoods Project (RLLP) will improve climate resilience, land productivity
and carbon storage, as well as improve access to diversified sources of income in selected vulnerable rural major
watersheds in Amhara, Benishangul Gumuz, Gambella, Oromiya, SNNP and Tigray. The project scales up initiatives
with demonstrated climate value and co-benefits within the Sustainable Land Management Program (SLMP), and it
pilots new innovations. Proposed interventions target rural livelihood productivity and resilience through sustainable
land management, low-emission resilient agriculture practices, enhanced land tenure, gender-sensitive livelihood
initiatives which contributes to removing barriers to women’s ownership of and control over assets and improving
voice and agency, and the strengthening of value chains for long-term program durability.

The RLLP will contribute to climate resilience in 210 major watersheds with 8-12 micro-watersheds per major
watershed. The beneficiaries of RLLP include the entire population of the selected watersheds, estimated at 4.2
million people, or 834,000 households. The project interventions are also expected to lead to a GHG emissions
reduction of 43.9 million tons CO2eq due to carbon sequestration as a result of improvements to grasslands and
agriculture. 152 watersheds will be supported by IDA and MDTF (Contribution by Government of Norway), 18
watersheds by the anticipated contribution to MDTF by the Government of Canada, and 40 watersheds by GCF.

The executing entity is the Federal Democratic Republic of Ethiopia. The GCF Proceeds will be channeled through
the World Bank and will be made available to the Federal Democratic Republic of Ethiopia. The World Bank will enter
into a grant agreement and a loan agreement with the Federal Democratic Republic of Ethiopia, represented by MoF
and acting through MoA for the implementation of the GCF Funded Activity.

5 Mahoo H, Radeny M, Kinyangi J, Cramer L, eds. 2013. Climate change vulnerability and risk assessment of agriculture and food security in Ethiopia: Which way forward?
CCAFS Working Paper no. 59. CGIAR Research Program on Climate Change, Agriculture and Food Security (CCAFS).
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 7 OF 96

B
PROJECT/PROGRAMME INFORMATION
B.1. Climate context (max. 1000 words, approximately 2 pages)
Climate change problem: Describe the climate change problem the proposal is expected to address. Describe the
mitigation needs (GHG emissions profile) and/or adaptation needs (climate hazards and associates risks based on
impacts, exposure, and vulnerabilities) that the proposed interventions are expected to address. Also describe the
most likely scenario (prevailing conditions or other alternative) that would remain or continue in the absence of the
proposed interventions. Include baseline information. The methodologies used to derive such information, including
the mitigation and adaptation needs, should be included in the feasibility study.

Context: In describing the mitigation and/or adaptation needs, briefly describe the target region/area of the proposed
interventions including information on the demographics, economy, topography, etc.

Related projects/interventions: Also describe any recent or ongoing projects/interventions that are related to the
proposal from other domestic or international sources of funding, such as the Global Environment Facility, Adaptation
Fund, Climate Investment Funds, etc., and how they will be complemented by this project/programme (e.g. scaling
up, replication, etc.). Please identify current gaps and barriers regarding recent or ongoing projects and elaborate
further how this project/programme complements or addresses these.

Ethiopia is an LDC that is among the most vulnerable to climate change and variability: it is exposed to severe climate
impacts, its economy is highly climate-sensitive, and its adaptive capacity is low. In the ND-GAIN country index,
Ethiopia ranks 163 out of 181 countries in terms of climate readiness. While the poverty headcount has fallen from 55.5
% to 26.7 % from 2000-2016 6, these gains are very fragile in a changing climate. Resilient agriculture is a high priority,
as agriculture accounts for 41% of GDP, 85% of all employment and nine of the top ten export commodities by value 7.

Climate Change and Variability in Ethiopia

Ethiopia has a long history of having to cope with extreme weather events. Rainfall is highly erratic and typically falls
in the form of intensive convective storms spawned by the country’s varied topography. Over the past three decades,
Ethiopia has experienced countless localized drought events and seven major droughts, five of which have been
associated with famines. Climate varies significantly between and even in each one of the Ethiopian regions. Most of
the recent drought and food crisis events have been geographically concentrated in two broad zones of the country,
with the eastern and northern parts of the country being the most vulnerable. For example, rainfall variability and
associated droughts have been major causes of food shortages and famine in the Tigray region in the north of the
country.

There are numerous observed changes in Ethiopia’s climate 8. The most prominent observed climate change trend has
been a tendency towards lower rainfall during the main growing seasons (March–May and December–February). A
decline in rainfall of 15% on average has been associated with anthropogenic Indian Ocean warming. While floods
have historically never been a major economic hazard in Ethiopia, in recent years there has been significant socio-
economic disruption due to flooding, e.g. in 1997 and 2006.

Most global climate models project an increase in precipitation in both the dry and wet seasons. Climate scenarios
based on the ISP2a emissions scenario run by a suite of Global Climate Models (GCMs) are broadly consistent in
indicating increases in annual rainfall for Ethiopia as a whole. These increases are largely a result of increasing rainfall
during the ‘short’ rainfall season (October-December) in southern Ethiopia. October-December rainfall is projected to
increase between 10 and 70% on the average over Ethiopia. These changes will lead to an increase in heavy rains
and floods. The temperature will very likely continue to increase for the next few decades at a rate similar to that seen
in recent years. The projected increases in the inter-annual variability of precipitation in combination with the warming

6 WB database, for Poverty headcount ratio at $1.90 a day (2011 PPP)

7 CRGE (2014)
8 Climate Risk and Adaptation Country Profile: Vulnerability, Risk Reduction and Adaptation to Climate Change - Ethiopia,

World Bank, 2011. Downloaded from: http://countryadaptationprofiles.gfdrr.org

 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 8 OF 96

B
will likely lead to increases in the occurrence of droughts. Figure 1 depicts changes in precipitation and temperatures
during the previous century and under projections beyond the year 2040.

Figure 1 Observed and predicted changes in precipitation and temperature in Ethiopia 9

In the highlands, climate change is expected to result in an increase in both annual precipitation and seasonal variability
in rainfall.

Incremental costs of climate change

The supporting document “Technical Note to modeling soil loss” (Annex A.8) estimates change in soil erosion due to
climate change in RLLP Project Watersheds. Results indicate that soil erosion is expected to increase by 7-10% per
year and, in the more extreme scenarios, could increase by as much as 40-70% per year by 2050 in the absence of
interventions to improve land management that builds resilience to the impacts of climate change. Under business-
as-usual, the Sustainable Land Management (SLM) program estimates that a total of about 670 watersheds need
approximately $2.7 million each in investment to prevent soil erosion i.e. $1.8 billion of total investment in Ethiopia
(see Annex A.9. “Cost of watershed development interventions”). Conservatively assuming that (a) climate change
could increase annual soil erosion by 50% (b) 1:1 relationship between increase in soil erosion and investment cost
to build climate resilience, we expect that $904 million would be the incremental investment cost to prevent increased
soil erosion due to climate change across all 670 watersheds in Ethiopia ($1.35 million of incremental cost of climate
change per watershed). This cost would further increase in watersheds that are highly vulnerable to climate change
since community contributions are likely to be less than regular SLM programs due exposure of beneficiaries to
severe soil loss.

Both climate smart agriculture and sustainable land management are packages of measures in which several
practices are implemented concurrently at the appropriate time and scale to achieve the triple win of climate change
adaptation, climate change mitigation and increases in yields resulting in increased climate resilient livelihood. Hence
it is not possible to identify the scope of GCF financing on the basis of differentiation between development activities
and climate change activities. GCF is requested to finance RLLP activities in watersheds that are highly vulnerable to
climate change. In order to identify such watersheds, a vulnerability analysis was undertaken in which 192 10 RLLP
major watersheds were ranked by highest to lowest annual soil loss per hectare due to precipitation changes by 2050
under RCP 4.5 scenario (see Annex A.12.) compared to current levels. Top 40 of these watersheds were selected for
GCF financing. IDA will finance RLLP activities in remaining 152 watersheds.

9 Keller, M. (2009) Climate Risks and Development Projects. Assessment Report for a Community-Level Project in Guduru,
Oromiya, Ethiopia
10 Details of Co-financing from Government of Canada were not available during this analysis, hence 18 Watersheds

supported by it were not considered

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Vulnerability of the agriculture sector and community livelihoods to climate change impacts

The intersection of land management, rights, and use forms the key development issue for millions of rural Ethiopians
facing water insecurity, food insecurity, land tenure insecurity, and livelihood insecurity – all amplified by climate
variability and change as described above. Climate impacts in Ethiopia are felt primarily through water stress, which is
affected by land use and degradation that undermines watershed function. In Ethiopia, the estimated cost of land
degradation is 2-3% of GDP, before accounting for downstream effects, such as increased flood risk.

Exposure of farmers to land degradation

Since the 1970s, the Government of Ethiopia has recognized the problem of land degradation as a major challenge to
the country’s growth and stability. Studies have shown that land degradation has cost the country 2-3 percentage points
in agricultural GDP each year. Due to its impact on agricultural productivity alone, soil erosion currently costs the
economy of Ethiopia about $305 million per year. Based on Ethiopia’s experience to date, the cost of inaction to address
land degradation is estimated to be 4.4 times greater than the cost of preventative action through (SLM). 11

From 1981 to 2003, 296,812 km2 (29.7 million ha) of land has been degraded, affecting a population of 20.65 million
(Bai et al. 2008), 12 approximately one in five people in Ethiopia. Approximately 27 million ha or almost 50% of highland
areas (which make up about 45 % of the total land area), is considered to be significantly eroded. Of this area, 14
million ha are seriously eroded, with over 2 million ha beyond reclamation. It is estimated that some 30,000 ha are lost
annually as a result of soil erosion. 13 For the highland areas, erosion rates have been estimated to average 35
tons/ha/yr, while the estimated rate from the croplands is 130 ton/ha/yr. This has led to the conclusion that almost half
of Ethiopia’s annual soil losses come from the land under cultivation, even though this land covers only 20% of the
country. 14

Figure 2 shows the distribution of annual precipitation in Ethiopia. According to this mapping exercise, the majority of
planned watershed restoration was conducted in areas with high levels of precipitation. These areas are highly exposed
to erosion.

11 Gebreselassie et al. (2016).

12 Bai, Z. G., Dent, D. L., Olsson, L., & Schaepman, M. E. (2008), “Global assessment of land degradation and
improvement. 1. Identification by remote sensing”. Wageningen, The Netherlands: International Soil Reference and
Information Centre (ISRIC).
13 Berry Leonard (2003) Land Degradation in Ethiopia: Its Extent and Impact
14 Ibid.
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 10 OF 96

Figure 2. Annual precipitation distribution in Ethiopia

Impacts of Climate Change and Variability on farmer livelihoods

Climate variability such as the droughts and floods described above already negatively impacts livelihoods in
Ethiopia. This will aggravate the impacts of climate change, which are broad in scope and could be severe. Estimates
suggest climate change may reduce Ethiopia’s GDP up to 10 % by 2045, primarily through impacts on agricultural
productivity. These changes would aggravate existing social and economic challenges.

Recently, the impact of climate change on crop yields in Ethiopia was investigated in a report published by IFPRI.
Overall, the simulated net effects of increases in average rainfall and higher average temperatures are relatively
small. However, the authors note that there is growing evidence that weather outcomes, particularly rainfall, are likely
to become more variable in the future, which could lead to substantial effects on crop production and household
welfare (as well as on livestock) due to extreme events – droughts, floods, or extremely high temperatures.

Crucially, the models employed in the simulations do not take into account the impact of climate change on land
degradation, while noting that in many parts of the country land degradation is already reducing yields. Climate
change is likely to accelerate the levels of land degradation and soil erosion. As described in more detail in Annex A.7
and Annex A.8, recent analysis by the Water and Land Resource Centre (WLRC) of Addis Ababa University using
soil loss equations calibrated using historical station data from two monitoring stations within the project area in
conjunction with the IPCC’s RCP4.5 scenario for 2050, show that soil erosion is expected to increase by 7-10% per
year and, in the more extreme scenarios, could increase by as much as 40-70% per year by 2050 due to climate
change in the absence of interventions to improve land management. As a result, conservative estimates suggest that
climate change will reduce agricultural crop productivity in Ethiopia by 5 -10 % by 2030.
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 11 OF 96

The direct impacts on crop productivity could in turn lead to impacts on prices, production, and consumption and on
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per capita calorie consumption and child malnutrition. Climate change, therefore, complicates efforts to increase food
production and improve food security.

Sensitivity of rural communities to the impacts of climate change

Sensitivity of rural communities to the impacts of climate change

Sensitivity to climate change and variability is high in the proposed project communities. More than 80% of Ethiopians
are engaged in subsistence rain-fed agriculture and farms are already under significant climate stress. These
populations are highly dependent on the performance of productive landscapes for income, energy, food, building
materials, and water. Furthermore, agriculture accounts for most jobs and about 40% of output and exports. Low
adaptive capacity contributes to high vulnerability in the proposed project communities. Most of the targeted watersheds
are situated in regions that have relatively low adaptive capacity. As one study of vulnerability in the Tigray Region
concluded, districts most vulnerable to climate change and variability overlapped with districts with the most vulnerable
populations; climate vulnerability was inextricably linked to social and economic development. 15 Households that are
short of basic economic and social resources clearly lack the means to undertake adaptive measures or respond to
climate shocks.

Adaptive capacity and barriers to change

Adaptive capacity in rural communities is low. Root causes are a combination of geo-climatic conditions (inherently
fragile soils, undulating terrain, and highly erosive rainfall) and anthropogenic factors.

Baseline BAU with climate change Alternative

Poor cropland management Current farming practices Soil conservation measures are
practices: The farming system, such as frequent tillage (re)introduced, preventing increased
particularly in the highlands, is and limited soil land degradation as a result of
dominated by subsistence cereal conservation practices will climate change (Activity 1.1.1, 1.1.2)
crops, which provide little ground lead to increasingly severe
cover when the most erosive rains impacts as the climate
occur (June-August). This system changes, reducing
often requires frequent tillage and agricultural yields.
pulverization of the soil, rendering it
more susceptible to erosion.
Furthermore, limited soil
conservation practices and the
breakdown of traditional restoration
measures, such as shifting
cultivation, contribute to land
degradation.

Rapid depletion of vegetation As the climate changes Promotion of efficient cookstoves

cover: Household energy needs and erosion increases, reduces deforestation, enabling
are predominantly supported by land in deforested areas maintenance of vegetation cover
wood and other biomass, causing will be further degraded. even under the harsher conditions
an unprecedented level of resulting from climate change
deforestation. The loss of (activity 1.31., WB funded)
vegetation cover has been further Seeds for climate resilient crop
exacerbated by agricultural varieties, improved farm tools,
expansion and livestock grazing. fertilizer and other inputs are used by
As a result, land has been stripped farmers to increase the productivity
of vegetative biomass, exposing it of agriculture, reducing the need for
to high levels of soil erosion. agricultural expansion into land
Average deforestation rates range made marginal as a result of climate

15 Gebrehiwot, T. and A. van der Veen (2013). Climate Change Vulnerability in Ethiopia: disaggregation of Tigray Region. In

Journal of Eastern African Studies, Vol. 7, Issue 4: 607.

 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 12 OF 96

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from 1% to 1.5% annually, a high change (Activity 1.2.1)
rate for a low forest cover country. Free grazing decreases, enabling
Historically, Ethiopia was about recovery of vegetation even in the
40% forested. By 2005, forest harsher conditions resulting from
cover had been reduced to 2.4%, or climate change
3.3. million ha, of high forests.

Poor livestock management: As climate change leads to Livestock feed is grown and free
Ethiopia has one of the largest increased erosion, current grazing is decreased, ensuring
livestock populations in Africa, with practices of free grazing, grazing of land is in line with the
more than 53 million cattle. Only 25 using crop residues to feed reduced carrying capacity in the face
% of cattle graze in rangelands, livestock and using of climate change (Activity 1.2.1)
while the remaining 75 % graze in manure for fuel lead will Improved management practices in
the highlands, leading to serious worsen the impact of grazing areas are introduced,
overgrazing in areas that are climate change on land decreasing this need to use crop
already under high pressure. degradation. residues to feed livestock and
Because the country has a free enabling the maintenance of soil
grazing system, there is no organic matter and nutrients even
incentive for cattle holders to apply under conditions of climate change.
improved management practices in (Activity 1.1.1)
grazing areas. The scarcity of Promotion of efficient cookstoves
grazing land and livestock feed has reduces the need to use cattle
forced the widespread use of crop manure for fuel, meaning manure is
residues to feed livestock. available to build up soil organic
Removing these crop residues for matter, reducing the impact of
feed and utilizing cattle manure for increasing erosion as a result of
fuel further reduces the soil’s climate change (Activity 1.3.1)
organic matter and nutrients. This
breach in the soil nutrient cycle
seriously depletes soil quality,
increases erosion, and eventually
reduces soil productivity.

Insecure land tenure system: Users of land held under Rural cadastral survey conducted
Ethiopia is Africa’s tenth largest insecure tenure continue with the help of drones (Activity
and second most populous to favor short-term 3.1.1)
country. Its rugged topography exploitation of land Land is registered and certified,
makes it difficult to conduct rural resources, even when providing users with the secure land
cadastral surveys of millions of climate change leads to an tenure needed in order to invest in
rural properties and hundreds of increasing need for long- building climate resilience (Activity
thousands of land parcels within a term conservation 3.2.1)
short period of time. Shortcomings measures in order to
in infrastructure also hinder the prevent deleterious
implementation of rural cadastral impacts
surveys. At the same time, there
exists a pressing need to register
and certify rural lands so that users
can be secured and good
governance and rural development
can be promoted and upheld. In the
past, land tenure insecurity caused
by frequent land redistribution
encouraged farmers in Ethiopia to
favor short-term exploitation of land
resources over long-term
conservation, further contributing to
land degradation and low farm
productivity.
SLMP-I and SLMP-II have The inclusion of climate RLLP will scale up the introduction of
supported some watersheds in resilience in SLM activities climate resilience to smallholder
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 13 OF 96

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transitioning to sustainable land has been piloted, but not farmers within the framework of
management, but activities to yet introduced at scale sustainable land management.
graduate from project-based RLLP will put in place the conditions
support are still needed. Further for sustainable implementation of
attention to the creation of resilient resilience building activities
livelihoods is still needed. subsequent to the cessation of
project based support through
support to the creation of resilient
livelihoods (Sub-component 1.2)
The PSNP supports food-insecure Climate change will RLLP will support climate resilient
communities, aiming to achieve endanger the newly food food security of communities
food security secure status of graduating from the PSNP and
communities graduating prevent a return to food insecurity of
from the SNP these communities as a result of
climate shocks
The AGP 2 promotes value chain In the absence of activities RLLP will work synergistically with
development and private sector to build climate resilience, the AGP-2 to create climate resilient
engagement value chains and the value chains and a resilient private
private sector are sector. AGP-2, as a mainstream
vulnerable to the impacts government program, will continue to
of climate change support communities to maintain the
progress made in RLLP after project
end.
The ATA supports some activities In the absence of activities RLLP will work synergistically with
that can contribute to resilience to build climate resilience, the ATA to create climate resilient
such as the introduction of improvements due to ATA livelihoods
warehouses and Common Interest initiatives are vulnerable to
Groups` the impacts of climate
change
Other donors support activities In the absence of activities RLLP shall work with other donor
aiming at improving food security to build climate resilience, funded projects in those areas where
and livelihoods in rural Ethiopia all progress made as a activities overlap to ensure activities
result of other donor are complementary and result in
funded activities is climate resilient progress
vulnerable to the
damaging impacts of
climate change
The GCF financed project The MoFEC project will RLLP will work closely with this
“Responding to the increasing risk increase the climate project to ensure that targeted
of drought: building gender- resilience of water supplies communities have comprehensively
responsive resilience of the most in the targeted areas. It addressed the two major factors of
vulnerable communities” is being targets a different sector vulnerability to climate change –
implemented by MoFEC from RLLP, which focuses water supply and agricultural
on resilient land use and productivity.
agriculture.

Barriers to change and the interventions to mitigate the barriers:

Barriers to change Intervention
Limited awareness of the increasing impact of poor Improved knowledge management and communication
farming and land management practices on water (Activity 2.2.2) with both planners and communities,
resources and soil fertility as the climate changes supported by data collection and information sharing
(Activity 2.1.2)
The potential of land use planning to enhance resilience The on-going local-level participatory land-use planning
is untapped due to weak or absent land use planning exercise at kebele level is extended within the major
watersheds of RLLP with the help of TA for consultation
workshops (Activity 3.3.2).
Extension workers and policy makers lack awareness Capacity building of extension workers and policy
and technical expertise in climate resilient agriculture makers equips them with the awareness and technical
(CSA) practices. As a result planning and implementation expertise to support farmers in increasing their climate
of measures to increase the resilience of agriculture is resilience
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insufficient Robust impact evaluation, knowledge management and
communication establish the conditions for national
scaling-up of SLM for climate change adaptation and
mitigation (Activity 2.1.1)
Lack of soil cover necessary for climate resilience Mulching and cover crops is part of the package of
measures for soil moisture and soil fertility management
in CSA (Activity 1.2.1)
Insecure land tenure prevents investments in climate Outputs 3.1 and 3.2 of the project will initiate a program
resilience for the provision of second level land certificates to
vulnerable, land insecure groups (WB funded)
Maintaining soil quality under conditions of climate The need for using crop residues as feed is reduced due
change by using crop residues and manure is impossible to improved management of grazing areas and feed
due to competing uses production. Improved cookstoves (WB funded activity)
will reduce the need for fuel. Soil fertility improvement is
part of the CSA package of activities (Activity 1.2.1)
Lack of cash prevents farmers from continuing with the Support for resilient livelihoods and income opportunities
practices introduced as part of the project after project (Activity 1.3.1 and 1.4.1)
end
Smallholder farmers are unfamiliar with practices that are SLM and CSA packages are introduced, including:
part of Sustainable Land Management and climate improved seeds for climate resilient crops, improved farm
resilient agriculture tools, fertilizer and other inputs adapted to changed
climatic conditions (Activity 1.1.1 and 1.1.2, 1.2.1)
Fragmentation, duplication and inefficiency of resilience Improved coordination reduces duplication, increases
building actions due to limited coordination among efficiency and ensures comprehensive support to
institutions, sectors, programs and projects that aim to increase the resilience of smallholder farmers (Activity
support smallholder farmer 2.1.1, 2.1.3)

Adaptation needs

Recent experience in Ethiopia has shown that a combination of better natural resource management and resource
rights, jobs and livelihood enhancements, and gender outreach throughout targeted major watersheds can address the
threats posed by land degradation and climate change. Effects of landscape restoration include a range of resilience-
related results, including increased soil moisture and soil fertility important for higher and less variable crop yields,
improved water availability, and increased carbon sequestration – all of which are high priorities for the government.

Much progress has been made by the government and thousands of local communities in addressing these challenges
through proven investment packages under the Government of Ethiopia’s SLM Program, with financing from the World
Bank and other Development Partners (DPs). To bring these benefits to additional rural communities affected by land
degradation, and to help Ethiopia meet its national targets for resilience and low carbon growth, while achieving middle
income status in less than 10 years as planned under the Government’s Second Growth and Transformation Plan
(GTP-2), this work requires greater scale, further innovation, and improved cross-sectoral coordination.

The cost of the investment required to address current levels of land degradation is estimated at $800 million to over
$2 billion, with approximately 670 watersheds needing approximately US$2.7 million each in investment to prevent soil
erosion (see Annex A.9. “Cost of watershed development interventions”). Thus, the incremental investment in (SLM)
required to build resilience to climate change could easily reach hundreds of millions of dollars. Conservatively
assuming that (a) climate change could increase annual soil erosion by 50% (b) 1:1 relationship between increase in
soil erosion and investment cost to build climate resilience, we expect that $904 million would be the incremental
investment cost to prevent increased soil erosion due to climate change across all 670 watersheds in Ethiopia ($1.35
million of incremental cost of climate change per watershed). The request for less than US$ 180 million in GCF funding
for this project is at the conservative end of cost estimates.

The RLLP Objective against the baseline: outcomes and impact that the project aims to achieve

The proposed project will draw on Ethiopia’s decade of experience in addressing the root causes to scale-up tried and
tested interventions. To help address barriers to the ongoing maintenance of restored landscapes, the project will
introduce transformative support for resilient livelihoods and income opportunities.

Though significant results have been achieved over the years, much remains to be done. SLMP initiatives have allowed
Ethiopia to pilot activities to address the root causes of land degradation in the country. However, no matter how
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 15 OF 96

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efficient, they were also a learning process. The RLLP project is a cross-cutting initiative that would scale up and
improve the SLMP experience, implement lessons learned from previous activities, and significantly improve adaptive
capacity of targeted areas. The project aims to scale up the number of restored watersheds, while also improving the
ones already restored and creating an enabling environment, which will lead to productivity, resilience and overall
development of livelihoods. The RLLP is a multidisciplinary project which will link together all relevant sectors in order
to improve the resilience of livelihoods to the highest possible extent.

CSA measures will preserve restored land and will stop reversion to an erosion-sensitive state. These measures will
also significantly increase the adaptive capacity of livelihoods, as they will introduce agrotechnical measures specifically
designed to adjust to conditions outlined in climate scenarios, thus maintaining food security. The acquisition of
processing equipment and storage facilities, as well as training to farmers and establishment of value chains will add
value to goods produced through CSA. All of these activities will enhance adaptive capacity and reduce the exposure
of participating communities to climate change.

This proposed project aims to:

• Increase the resilience of a total of 210 major watersheds located in the Ethiopian Highlands. Watersheds
supported under SLMP-I will receive technical assistance to graduate from project-based support, while
investments in SLMP-II watersheds will allow completion of their MYDPs. In addition, 57 new watersheds were
selected based on criteria set out in the Ethiopia Strategic Investment Framework for Sustainable Land
Management (ESIF), prioritized based on extent and severity of land degradation.
• Complete the implementation of Sustainable Land and Water Management (SLWM) practices by rural
smallholders and communities under Multi-Year Development Plans (MYDPs) in SLMP-II watersheds and
scale up these proven interventions to 57 additional watersheds (average 10,000 ha each) that are vulnerable
to climate variability and change, recurrent drought and floods, and land degradation. The implementation of
SLWM will increase resilience to sudden onsets and long –term climatic changes now and in the future. This
is crucial in order to increase food security through preservation of the land, which is very exposed and sensitive
to climate change impacts, especially in Ethiopia.
• CSA interventions under RLLP will be implemented in 135 watersheds that have already been supported with
landscape restoration during SLMP I and II. SLMP-II piloted CSA in 70 micro-watersheds. As a result of the
lessons learned from this pilot, MoA is now ready to implement CSA at scale and the RLLP, with the GCF
support, will increase the number of micro-watersheds implementing CSA to 370. The implementation of CSA-
specific measures is crucial in order to achieve sustainable agricultural production in the climate change
impacted areas. They will enhance productivity and adaptation capacity of the livelihoods, as well as food
security.
• Beyond physical and biological measures, the Sustainable Land Management Projects (SLMP-I and SLMP-II)
have promoted livelihood diversification and income-generating activities. About 1,446 Self-Help Groups
(SHGs) supported by SLMP-II are engaged in apiculture, poultry, sheep and goat fattening, and vegetable and
fruit farming, and have contributed to the reduction of pressure on the watersheds’ natural resources through
the promotion of improved cook stoves. Improved cookstoves, while using the same type of fuel as baseline
cooking technologies (which is mostly wood), reduce the amount of fuel needed. In areas in which some or all
of the fuelwood used is nonrenewable due to overexploitation of local forests, the introduction of improved
cookstoves reduces GHG emissions. In Ethiopia, the fraction of non-renewable biomass used is 88% (as
determined for CDM projects). Hence, the introduction of improved cookstoves will reduce GHG emissions.
Based on a review of the SLMP-II experience, RLLP will expand and strengthen these interventions through
stronger engagement with the private sector (PS). This will result in a reduced exposure and sensitivity to
climate change impacts onto Ethiopian agriculture. A detailed framework for private sector engagement under
RLLP is presented in Annex B.1.
• Contribute to Ethiopia’s long-term goal of achieving a carbon neutral economy by increasing carbon stocks in
biomass and organic soil, as well as through the promotion of low carbon household energy technologies. Case
studies across regions in Ethiopia indicate that Soil and Water Conservation (SWC) measures can significantly
increase organic carbon content in soil. Soil carbon depletion rates from erosion alone range from 0.02 to 0.97
tons/ha/yr in Ethiopia. Effective land restoration can play a major role in the sequestration of organic carbon
that is lost due to poor land management practices. Soil carbon sequestration with the adoption of restoration
measures is projected to potentially account for 0.41 tonnes CO2-eq. per hectare per year associated with rain-
fed cropland and 0.63 tonnes per hectare per year on Ethiopian rangeland. Reforestation through assisted
natural regeneration will further contribute to the mitigation of carbon emissions, at an estimated rate of 0.92
tonnes of CO2-eq. per hectare annually.
• The project will enhance production and management of and access to relevant environmental, crop, livestock,
forest, weather and geospatial information for land use decision making and disaster risk reduction at the levels
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 16 OF 96

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of major watersheds, community watersheds, and farms. Furthermore, it will provide support for developing
relevant policies, regulations, and by-laws, including for the establishment of watershed associations.
• The project will improve the legal land tenure security of rural households and groups through land certification
and administration, and it will expand and enhance local level land use planning and innovations in landscape
certification models.

A mechanism and supporting elements to allow watersheds to “graduate” from project-based assistance and then
continue sustainable management of restored landscapes through normal government mechanisms is built in to RLLP.
Under SLMP-II, beneficiaries established community watershed teams to discuss natural resource problems and
opportunities and to plan and implement interventions on the ground in an empowered, participatory manner. Under
RLLP, support will be provided to create Watershed User Associations (WUAs), which would be legal entities capable
of sustaining participatory watershed management when project-based support ends. In addition to establishing WUAs,
RLLP will also prepare watersheds for graduation through (i) building local government capacity to design and manage
SLWM interventions, (ii) strengthening incentives for investment in sustainable land management through land
certification, and (iii) improving returns to sustainable productive activities by forging connections to value chains.

It is expected that without the proposed project, land use will continue on its current path while being subjected to
negative and progressively more severe climate change impacts. Negative climate change impacts will further influence
livelihoods due to insufficient adaptive capacity in project areas. Production yields will decrease while farmers will face
increased input costs. Non-agricultural land in the watershed will also continue to deteriorate without the project due to
soil erosion as well as overuse of common land through grazing livestock and firewood collection. This will put a further
strain on local populations, who derive their livelihood from forests, woodlands, and surrounding areas. Downstream
from the project area, continued land degradation will also affect areas and households through increased flood risk
and sedimentation of irrigation dams.

Baseline projects

In addition to the GCF funded MoF project mentioned above, there are several other projects that are been
implemented in the RLLP areas from which RLLP could benefit. RLLP will seek to establish synergies and avoid
duplication of activities with these other projects.

GoE/WB Second Agricultural Growth Program (AGP-2)

AGP-2 currently operates in some woredas where there are SLMP-2 rehabilitated watersheds. They have
implemented interventions to enable irrigation in some woredas. AGP-2 is engaged in support to key livestock and
crop value chains (VCs), and is supporting productivity improvement, processing, storage/warehousing, market
development in these VCs. AGP-2 and RLLP are implemented by same major donor (WB) and GoE ministry (MoA),
and they are expected to have additional geographic overlap in the four main regions. In terms of value chain
development and private sector engagement, RLLP will seek to harmonize as many methodologies and activities
with AGP-2 as possible.

USDA Feed Enhancement for Ethiopian Development (FEED) II/III Project

FEED II is improving incomes and food security through improved availability, access and utilization of livestock and
poultry feed. FEED III has been approved, will begin soon and will be in operation until at least 2020. Some woredas
in which FEED II operates include SLMP I/II rehabilitated watersheds, and there promises to be even more
geographic overlap in RLLP and FEED III. FEED II/III is seeking to exponentially expand their forage development
and has the funds and technical personnel to do so. RLLP will seek to actively collaborate and pilot linking and
contributing to activities in some of the overlapping woredas.

USAID Feed the Future Ethiopia (FtFE) Value Chain Activity (VCA)

The overall project objective of this initiative is to improve agricultural productivity and the commercialization of
smallholder agriculture in the Tigray, Amhara, SNNP and Oromia regions. They support development of 6 major VCs
– chickpeas, coffee, maize, dairy, meat and live animals and poultry. VCA is finalizing their selection of woredas to
target, but they are expected to have significant geographical overlap with SLMP/RLLP.

Agricultural Transformation Agency (ATA)

ATA has completed construction of 44 warehouses in Tigray, Amhara, Oromia and SNNP regions, and it is eager to
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 17 OF 96

facilitate and ensure the best possible use of these warehouses. The locations of these warehouses coincide with
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woredas in which SLMP-2 currently has rehabilitated watersheds and with woredas with new RLLP watersheds.
Enterprising Common Interest Groups (CIGs) from SLMP-2 watersheds with RLLP support could assume management
of selected warehouses.

B.2. Theory of change (max. 1000 words, approximately 2 pages plus diagram)
Describe the theory of change and provide information on how it serves to shift the development pathway towards a
low-emission and/or climate resilient direction. Provide the diagram of the theory of change (approximately 1 page).

The theory of change should include any barriers (social, gender, fiscal, regulatory, technological, financial,
ecological, institutional, etc., as relevant) that need to be addressed. Use a results chain of inputs, activities, outputs,
outcomes, and impact statements, and identify the how and why of causal relations to deliver the project’s expected
results.

This integrated package of activities is the result of the extensive experience gained in previous projects and is
essential to achieving paradigm shift. In order to achieve catalytic impact, it is essential to address all the root causes
of land degradation, which include (i) poor cropland management practices, (ii) rapid depletion of vegetation cover,
(iii) poor livestock management, and (iv) an insecure land tenure system. This approach grows out of the project’s
theory of change: by delivering more productive, secure and resilient livelihoods to local communities and by
establishing the institutional framework needed to support maintenance of restored landscapes over the long term
through watershed associations and local governments, the RLLP will lead to a durable shift towards SLM in the
degraded watersheds of the Ethiopian highlands. A piecemeal approach in which only some of the drivers of
degradation are addressed might lead to temporary, local improvement but would not lead to a sustained, widespread
shift towards resilience for poor Ethiopian farmers. Figure 3 shows an illustration of this Theory of Change.

Figure 3. Illustration of Theory of Change

RLLP presents important opportunities for scaling-up and replication. While government and development partner
interest in SLM in Ethiopia remains high, a crucial barrier to achieving the level of investment required to restore all
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 18 OF 96

degraded watersheds nationally is the need to demonstrate a strategy for the long-term maintenance of these
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restored, newly productive, resilient, low emission landscapes. By building policy, institutional and market incentives
for long-term SLM and by investing in robust impact evaluation, knowledge management and communication, RLLP
will establish the conditions for national scaling-up of SLM for climate change adaptation and mitigation. In the shorter
term, replication of the successes of RLLP interventions can also be expected in neighboring watersheds, a process
that has already been demonstrated to dramatic effect in the ongoing SLM program as a result of informal
dissemination of improved land and water management practices. Such informal dissemination can go far towards
enabling scaling up and replication, since once they are introduced many of the project’s activities depend on
community participation for their success rather than on the private sector or formal financing.

B.3. Project/programme description (max. 2000 words, approximately 4 pages)

Define the project/programme. Describe the proposed set of components, outputs and activities that lead to the
expected Fund-level impact and outcome results. Components should reflect the project/programme level outcomes.

This should be consistent with the financing by component in section C.2, the results and performance indicators
provided in section E.5, and the implementation timetable in annex 5.

Referring to the feasibility study, describe why this set of interventions was selected instead of alternative solutions
and how the project/programme can help unlock the needed support in a sustainable manner. Also identify trade-offs
of the selected interventions, if applicable.

For Enhanced Direct Access (EDA) proposals and projects/programmes with financial intermediation (loans or on-
granting), describe the selection criteria of the sub-project and types.

The proposed project will significantly enhance the resilience of the target populations’ livelihoods to climate change
impacts. The proposed interventions will enhance the resilience of interventions in the government’s ongoing SLM
program through an integrated package of activities and scale up the program while targeting the watersheds and
communities that are most vulnerable to climate change. Figure 4 below indicates areas of the country that need
SLM interventions, those that have already received support and areas that will receive support for the first time in
RLLP.
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 19 OF 96

Figure 4 Watersheds mapped by areas needing SLM treatment

Project interventions include soil and water conservation (SWC) structures, reforestation and assisted natural
regeneration, as well as low-emission and climate-resilient agriculture practices. The scaling-up of SLM for climate
change adaptation and mitigation will be complemented with (i) transformational investments in income
opportunities, resilient livelihoods, and the productive value chains associated with SLM, designed to strengthen
incentives for communities to maintain restored landscapes; (ii) Cofinance for the promotion of low carbon
household energy solutions; and (iii) land tenure.

The RLLP will be implemented through four integrated components: 1. Green infrastructure and resilient livelihoods;
2. Investing in institutions and information for resilience; 3. Rural land administration and use; and 4. Project
management and reporting. Taken together, the activities in these components will achieve the project’s objective
of creating resilient landscapes and livelihoods for vulnerable rural populations in Ethiopia. Component 1 forms the
core of the project in that it includes the activities directly implementing sustainable land management and
agricultural practices. Component 1 also includes cofinanced activities addressing household energy services.
These activities are essential to change the development pathway of rural Ethiopia to one in which land use is
climate resilient. Non-sustainable use of biomass for cooking is one of the main drivers of deforestation and
degradation in Ethiopia. The key interventions proposed in national policy include improved land use, diversified
bioenergy options for cooking, and improving the efficiency of fuel production and use. The Environment Policy also
makes the link between sustainable land management and controlled harvest of forest resources, with specific
actions proposed including the promotion of technologies to reduce the use of fuelwood. In short, if cooking
practices are unchanged then unsustainable harvesting of wood for fuel will continue, undermining progress in
resilient land use made through the introduction of sustainable land management and agriculture.

Component 2 will create institutions and build capacity that will enable the interventions introduced in Component 1
to be sustainably implemented even after watersheds graduate from project-based support. Component 3 deals
specifically with the barrier of weak tenure rights. The provision of security of tenure to smallholder farmers is
essential to motivating to implement the new practices that will be promoted by RLLP. Without clear tenure and
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 20 OF 96

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strong land use planning it is likely that interventions introduced by the proposed project will be abandoned once
project support ends. Finally, project management activities are covered by Component 4.

This integrated package of activities is the result of the extensive experience gained in previous projects and is
essential to achieving paradigm shift. In order to achieve catalytic impact, it is essential to address all the root
causes of land degradation, which include (i) poor cropland management practices, (ii) rapid depletion of vegetation
cover, (iii) poor livestock management, and (iv) an insecure land tenure system. This approach grows out of the
project’s theory of change: by delivering more productive, secure and resilient livelihoods to local communities and
by establishing the institutional framework needed to support maintenance of restored landscapes over the long
term through watershed associations and local governments, the RLLP will lead to a durable shift towards SLM in
the degraded watersheds of the Ethiopian highlands. A piecemeal approach in which only some of the drivers of
degradation are addressed might lead to temporary, local improvement but would not lead to a sustained,
widespread shift towards resilience for poor Ethiopian farmers.

Scale of the project, identification of targeted project area and beneficiaries

In terms of the scale of the project, the World Bank is confident that the benefits of implementing the interventions
included in the project at the relatively large scale proposed outweigh the risks. A number of factors mitigate these
risks, key among them being that the project builds on experience gained by the World Bank and the Federal
Democratic Republic of Ethiopia during previous and ongoing projects. The proposed project benefits from the
lessons learned over many years of projects aimed at sustainable land management, poverty alleviation and
increasing the sustainability of agriculture in Ethiopia, and in particular the SLMP projects. These lessons led to the
creation of the institutions that RLLP will build upon such as bottom-up watershed planning and self-help groups as
well as the approach to CSA described in Annex A.3 in which a number of packages of activities are combined to
achieve the triple goals of adaptation, mitigation and livelihood development.

For the Executing Entity, RLLP activities will come on top of activities with a budget of $316 million that are already
disbursed or committed for SLMP, which are managed or coordinated by MoA. For both the sums already spent or
committed and for the co-financing the World Bank provides to RLLP, the World Bank has conducted risk analysis
and identified mitigation actions that resulted in the decision by the World Bank to commit its own funds to the
project. The valuable experience gained during implementation of SLMP-II, as well as the significant Recipient-
executed and Bank-executed resources allocated in the past five years for coordination and capacity building efforts
are expected to be instrumental to improve or identify viable measures to address all the risks.

Total needs were a major consideration in deciding on the scale of the proposed project. Soil degradation is an
ongoing problem that is becoming more severe with every passing year. There are significant costs related to
inaction – the longer we wait to address the problem, the worse it will get, and the more expensive it will be. To
achieve sufficient momentum for scaling up and replication, countrywide implementation is essential. The targeted
watersheds for this project were selected with inter-regional equity in mind. A total of 210 major watersheds are
included in RLLP, averaging approximately 10,000 hectares each. Out of these, 135 watersheds are those already
targeted by SLMP-I and II. In these watersheds RLLP will implement only innovative climate resilient activities that
were not included in SLMP. 57 watersheds included in RLLP are new to the implementation of (SLM) measures.
The process for the selection of these new watersheds to be targeted by the project is summarized in Section E.4.1
and described in full in Annex A.1.

In order to achieve the aims of the project – achieving restored, productive and low emission landscapes, the
project will work with the communities that are using these landscapes. Hence, beneficiaries are selected at the
community level and the direct beneficiaries are individuals who are living within a project watershed. The members
of these communities are vulnerable smallholder farmers, who are very sensitive and highly exposed to climate
change impacts. The total population within the project area is 4.2 million people or 834,000 households (with an
average of 5 persons per household). Evidence based data driven implementation and planning will ensure that
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interventions benefit smallholder farmers. Detailed bio-physical information for new watersheds, including individual
landholdings, will be collected during the Multi-Year Plan (MYP) preparation of each watershed. Local level
participatory land use planning teams at woreda and kebele levels would ensure that interventions benefit the
smallholder farmers. The baseline study report for 90 watersheds of SLMP II found that the average land holding
was only 1.338 ha. Agro-ecologically, watersheds above the altitude of 2300 meters and lowland areas between
500 and 1500 metres, have an average land holding of only 0.83 ha and 2.082 ha respectively. Furthermore, about
4.2% of the households have no land at all (3.5% of male and 6.5% of female headed households), 10.6% have
less than a quarter of a hectare and 21.9% less than a hectare.

The experience of previous phases of the project has shown that there is a high willingness to participate by
populations of the proposed intervention areas. The World Bank has tracked community contributions during the
second phase of SLMP implementation. Translated into monetary terms, the cumulative community contribution in
the four budget years from 2014/15 until 2018/19 was 23.5% of the total financial utilization of the project, equal to
about USD 27 million. The most important contributions by the population were in the implementation of soil and
water conservation measures on both communal land and farmland and community forest management.

The project components and activities are described below. Implementation will be guided by the recommendations
and supporting studies that comprise the feasibility study. These documents provide guidance on which technology
alternatives should be selected depending on local circumstances. Quantitative information on numbers of
beneficiaries and areas benefiting from each activity, as well as a breakdown of funding between GCF and co-
finance is provided in the detailed budget in Annex K.1.

Component 1. Green Infrastructure and Resilient Livelihoods

This component will greatly increase the adaptive capacity to climate change of the target population by scaling up
proven sustainable land and water management practices. These practices will be introduced to rural smallholders
and communities in watersheds vulnerable to climate variability and change, recurrent drought and floods and land
degradation. Three complementary approaches form the core of this Component: (i) land restoration through
sustainable land management, predominantly targeting communal lands, in which physical and biological
interventions are made to prevent erosion and restore degraded land; (ii) a standardized approach to low-carbon
resilient agriculture, which targets private lands; and (iii) support for income opportunities and resilient livelihoods,
which is designed to provide incentives for maintaining restored landscapes. The project will work through
government development agents in the Bureaus of Agriculture at the local level, which will mobilize and support
communities, providing them with continuous training.

This component will complete the adoption of Sustainable Land and Water Management (SLWM) practices by rural
smallholders and communities under MYDPs in SLMP-II watersheds, and it will scale up these proven interventions
to 57 additional watersheds (average 10,000 ha each) that are vulnerable to climate variability and change,
recurrent drought and floods, and land degradation. Activities will include financing SLWM interventions on
communal and individual lands (with differentiated levels of community contribution), as well as supporting
infrastructure such as green corridors linking fragmented forests, and community roads designed to optimize water
harvesting. Proven SLWM practices that will be implemented include: soil and water conservation infrastructure
such as terraces, water harvesting trenches, check dams, small reservoirs, and other civil works; soil fertility and
moisture management; assisted natural regeneration, enclosures plus livestock land use rationalization,
intercropping, low tillage, gully reclamation, establishment of grazing corridors, watering points and wells, and sylvo-
pastoral management strategies. Government Development Agents (DAs) in the Bureaus of Agriculture will
mobilize and support communities and receive continuous training to ensure high-quality advice and extension
services.
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The specific technological solutions implemented under Subcomponent 1.1 and 1.2 in each watershed will be
determined using a participatory community-based approach. The approach used is described in the Community
Based Participatory Watershed Management Guideline[1]. The community-based participatory approach will identify
the most appropriate technologies that respond to the unique needs of each individual watershed included in the
RLLP. This approach will result in a number of benefits, including improved community ownership and engagement,
as well as ensuring that expected results are achieved and sustained. More information is provided in Section F.2.

During the participatory planning communities first present the problems they have (problem analysis) and
depending on the availability of labor and finance they prioritize interventions based on the Community Based
Participatory Watershed Development Guidelines (CBPWDG). Once prioritized and agreed the plan is approved by
woreda responsible office (office of Agriculture). The procedures are clearly presented in the Community Based
Participatory Watershed Development Guideline, excerpts of which are provided in Annex A.2

The objectives of this component will be achieved through the implementation of the following sub-components: (i)
Land restoration and watershed management; (ii) Climate-smart agriculture; and (iii) Livelihood diversification and
connections to value chains.

Sub-component 1.1 Land Restoration and Watershed Management

Sustainable Land Management activities will be funded by IDA and MDTF in watersheds identified for IDA funding
(budget of USD 55.9 million) and by GCF in watersheds identified for GCF funding (budget of USD 100 million).

Afforestation-Reforestation-Green Corridor - Activities will be funded by IDA and MDTF only in watersheds identified
for IDA funding (budget of USD 1 million).

This sub-component will focus on the implementation of land rehabilitation measures and establishment of green
infrastructure through biophysical land and water conservation measures. These measures are required primarily
for the rehabilitation of communally-owned degraded forest, pasture and woodlands, but also for privately cultivated
lands, as well as to enable and maintain agricultural production in harsh climate conditions which are exacerbated
by climate change. One key objective of this sub-component will be to create benefit streams to the communities in
the targeted micro watersheds from increased ecological services and land productivity, mainly through productive
use and management of landscapes resources. In addition to the proven practices applied during SLMP-II, this sub-
component will also introduce the establishment of green corridors, which will further reduce erosion, enhancing
watershed restoration, and increase ecological connectivity.

The objective of the sub-component will be achieved through biological and physical conservation measures that
ensure reduced surface run-off and soil erosion, as well as improved land productivity, resulting in enhanced crop
and livestock production. The following activities will be supported:

• Soil and water conservation measures on communal and privately cultivated lands: biological and physical
soil and water conservation measures/practices such as construction of terracing, check dams, water
harvesting (e.g. trenching), reseeding, re-vegetating, etc. will be implemented on degraded communal and
farmlands;
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• Gully rehabilitation: Cost efficient biophysical gully restoration techniques such as sandbag check dams,
sediment storage dams and gabion-check dams will be applied. Productive use and management of the
rehabilitated gullies will be supported, such as for forage, fruit and fuel wood production;
• Establishment of green corridors: Planting suitable, preferably native, tree species along rivers/streams and
all-weather roads connecting forest patches in the watersheds. Post plantation management support
including tending, hoeing and soil moisture conservation will be carried out. Green corridors will also be
established along gully offsets to ensure stability and productive use of the land;
• Area closure management and use: assisted natural regeneration through restrictions on free grazing,
enrichment planting, soil fertility improvement and moisture retention will be implemented in communal
areas and/or privately managed degraded bush and woodlands. Cost efficient management practices of
enclosures will include supporting local communities in the preparation and execution of participatory use
and management plans of enclosed areas, including forage cut-and-carry arrangements;
• Establishment of plantation blocks: Reforestation and afforestation of degraded forest and shrub/bush lands
with a diverse range of tree and shrub species that can be used as a source of food, feed and energy, and
enhance fertility of the soil. Planting of appropriate tree seedlings including economically valuable species,
and post-plantation management practices such as tending and watering in moisture stressed areas,
hoeing and weeding during early stages will be carried out to ensure survival of the planted seedlings; and
• Enrichment of degraded pasture and rangeland: Planting and reseeding of appropriate forage species
including fodder crops in degraded pasture and rangelands to increase productivity and improve the value
of feed for grazing animals. Management of unpalatable invasive species will also be undertaken in pasture
and rangelands to ensure optimum forage production.

Suitable rehabilitation interventions for each micro-watershed are determined based on the particular agro-
ecological conditions and incorporated in a MYDP, developed through a participatory process, utilizing the technical
parameters and procedures established in the Community Based Participatory Watershed Development Guidelines
(CBPWDG, 2005) developed by MoA, and currently being updated. MYDPs already exist for SLMP-II watersheds,
but they will be developed under the RLLP for the watersheds that have not yet been addressed.

Supported by the Zonal, Regional and National Platforms (see details in Annex 2), implementation of MYDPs is
undertaken jointly at the woreda and kebele levels through the Woreda Watershed Development Committee
(WWDC), the Kebele Watershed Development Committee (KWDC), and the beneficiary communities. Together with
the Development Agents (DA) and Community Facilitators, the WWDC and KWDC assist communities in: (i)
developing annual work plans and budgets for submission to the Regions for endorsement and integration into the
Regions’ work plans and budgets; (ii) facilitating community participation in watershed planning and rehabilitation;
(iii) identifying training needs; (iv) monitoring and evaluation; and (v) dissemination of experiences and results. This
sub-component will also provide resources for local expertise to be contracted to provide technical assistance to
WWDCs, KWDCs and beneficiary communities in planning and implementing their SLM interventions. The
operational details for the planning, design, and implementation of MYDPs will be planned during implementation. A
guideline has been developed that will be used for this: “Exit Strategy and Performance Assessment for Watershed
Management (ESPAWM) – A Guideline for Sustainability” (see Annex L.3.).

The alternative technologies and practices selected for Sustainable Land Management are:

• Physical soil and water conservation measure on farmlands

• Physical soil and water conservation measures on communal lands including degraded hillside, shrub land
and pastureland
• Gully control measures including gully wall reshaping, check dam and retaining wall construction
• Pitting and planting of multi-purpose trees on degraded lands
• Model plantation blocks with native tree species
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 24 OF 96

Additional alternative technologies and practices selected under this sub-component include:
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• Afforestation
• Reforestation
• Green corridor creation
• Multiyear development plans
• Watershed management and use plans
• Watershed user associations

Sub-component 1.2 Climate Smart Agriculture

Activities will be funded by IDA and MDTF in watersheds identified for IDA funding (budget of USD 18.5 million) and
by GCF in watersheds identified for GCF funding (budget of USD 15 million).

Interventions under this sub-component will aim at enhancing the livelihood resilience of beneficiary households
through Climate-Smart Agriculture (CSA) interventions in all eligible micro watersheds assisted by the project. The
improved adaptation of restored watersheds to variable rainfall patterns and adverse climatic events, combined with
reduced degradation-related risks (achieved through sub-component 1.1), will provide suitable conditions for
beneficiaries to adopt improved, climate-smart farming practices and diversify and/or intensify their current
production systems. For this, technical and financial assistance will be provided to stabilize soils and increase
fertility; improve water retention, harvesting and infiltration; increase biomass (and carbon) accumulation; and
promote the adoption of climate-smart tillage and production practices in farm plots and home gardens. The
introduction of such practices is needed to ensure agricultural productivity in coming decades given expected
climate change impacts as described in section C.2.

This sub-component will build on the achievements of sub-component 1.1, such as improved water run-off retention
and infiltration, gully and degraded hillside stabilization, and enhanced biomass production. This connection to the
biophysical restoration of the landscape is important, as it will help ensure that unsustainable agricultural practices
do not reverse prior restoration measures. In this way, agricultural activities become fully integrated into the
watershed/landscape restoration approach and contribute towards the goal of climate resilient watersheds. The
ongoing pilot of CSA within SLMP-II and lessons from international experience indicate that CSA cannot be
achieved by a single measure or practice. In order to achieve the triple wins of adaptation, mitigation and increased
production, technical and financial assistance will be provided to implement context-specific packages of CSA
activities. The primary set of technologies for CSA that have been selected for use in the project are described in
the manual for Climate Smart Agriculture (Annex A.3) (see also Section F.2 Technical Evaluation for more
information). The following CSA activity activities are based on the manual for CSA which outlines 4 work/activity
packages, will be supported under this sub-component:

• Farm water and soil moisture management (based on Work/Activity Package 1 of CSA manual): This will
include in situ soil moisture management practices such as improved tillage, mulching/permanent soil cover
and water harvesting including construction of cut-off/on drains and road water harvesting. Provision of
improved farm tools/machineries for moisture conservation tillage will be considered under this activity;
• Integrated soil fertility and soil health management (based on Work/Activity Package 2 of CSA manual):
Various soil fertility management practices such as improved compost making including bio-slurry, vermi-
compost and manure management (including bio-digestors); lime and gypsum application for acidic and
alkaline soils respectively; promotion of tree-food crop-livestock systems (agro-forestry practices); and crop
rotation and legume intercropping will be integrated as a package and promoted based on local conditions
and farmers indigenous knowledge and commitment;
• Crop development and management (based on Work/Activity Package 3 of CSA manual): Access to better
performing crops (drought and disease resistant) will be supported based on local-level adaptive research
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 25 OF 96

and crowd-sourcing by farmers over a wide range of crop varieties (both local and improved cultivars).
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Integrated pest and disease management, including post-harvest management, will be implemented to
minimize crop yield losses. Productive use of increased soil moisture through production and management
of high value crops, such as vegetables and fruits, will also be part of this activity package. Improved farm
tools and machinery such as line planters, tillage and harvesting equipment will also be tested to improve
the efficiency and effectiveness of the cropping system; and
• Environmentally-friendly livestock production through feed development and management (based on
Work/Activity Package 4 of CSA manual): High quality and quantity forage in pasture and along farm
boundaries, gullies and back yards will be a priority to minimize dependence on crop residue as livestock
feed, and to ensure increased use of biomass for soil fertility improvement. Efficient use livestock feed
resources through feed treatment and improvement of feeding troughs will also be implemented to reduce
losses. Appropriate integration of agro-sylvo-animal husbandry practices will be introduced at the
homestead level based on the needs of local farmers and the suitability of local conditions. Practicing an
integration of multi-purpose food and tree cropping with livestock rearing at the homestead can improve the
fertility and organic matter content of soils and increase crop yields and household food security.

CSA interventions under RLLP will be implemented in micro-watersheds that have already been supported with
landscape restoration during SLMP I and II. The following set of criteria was used to select eligible micro-
watersheds: (i) at least 75 % of the watershed restoration plans completed; (ii) community agreement on controlled
grazing enforced; (iii) forage development partly implemented; (iv) farmland covering more than 50 % of the micro-
watershed area; (v) access to functional farmers training centers (FTCs); (vi) adjacent to SLMP-II CSA pilot
watersheds; (vii) local knowledge or traditional practice of multi-cropping system; and (viii) commitment of
community and kebele watershed teams.

Consistent with existing limitations, the operational unit for CSA interventions in eligible micro-watersheds will be
groups of organized farmers and their corresponding contiguous farm plots. The number of groups and farm plots
will be determined during the planning phase based on the budget allocated to the woreda for CSA. CSA groups
will be organized by the DAs assisted by woreda experts. In each group, the number of members should ideally
range between 20 and 30 farmers. These groups will constitute the equivalent of the Common Interest Groups
(CIGs) promoted by AGP, which will prepare results-oriented subproject proposals, integrating packages of goods,
small works, services and/or operating costs) for RLLP financing. The project will provide required input to the CSA
interest groups to improve efficiency of the farming practice. The operational procedures –including procurement
methods--for the implementation of the CSA subcomponent of the project are included in the existing CSA Field
Manual, developed by SLMP-II and to be updated for RLLP.

CSA is knowledge intensive and entails moving toward an agro-ecological approach, but these changes are
necessary to increase resilience to climate change. Project practitioners will therefore need to extend their support
to beneficiaries beyond the planning phase and provide technical assistance throughout the entire adoption cycle.
The workload of the local technical unit will therefore include resources to: (i) conduct periodic visits to the plots of
farmers implementing CSA practices, (ii) establish demonstration or testing plots, and (iii) organize and conduct
dissemination activities such as field days and farmer exchange visits. Equally important, the regional structure
should be capable of providing technical backstopping to DAs through periodic joint field visits, on-farm refresher
training, as well as assistance in planning and conducting demonstration activities.

CSA technology testing and demonstration activities, as well as collaboration with research and academic
institutions, will also be a part of CSA implementation. Farmer Training Centers (FTC) or similar structures will be
identified and utilized at the watershed level for these activities, while contributions by research and academic
institutions for the identification of appropriate technologies and practices will be implemented through the
establishment of a CSA Innovation Platform.
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The alternative technologies and practices selected are:

• Soil moisture management including drainage and cutoff drains in micro-watersheds

• Agroforestry
• Disease and drought resistant crops
• Improved farm machines/tools (handheld harvester, ripper, line planter, mechanical weed slasher)
• Compost making
• Organic/biofertilizer
• Improved livestock feeding troughs including feed treatment materials

The RLLP promotes Climate Smart Agriculture, including the use of mulch, cover crops and minimum tillage, which
also seeks to minimize the application of agrochemicals. The combination of CSA activities and the implementation
of the integrated pest management plan included in the ESMF will reduce vulnerability to pest and disease impacts.
The resulting improved crop production together with the provision of high-yielding and disease tolerant seeds will
support efforts to minimize the use of pesticides and agro-chemicals in the project area.

RLLP resources will not be used to purchase pesticides, herbicides, biocides, or GMO and Patented Hybrid Seeds.

Sub-component 1.3 Livelihood Diversification and Connections to Value Chains

Activities will be funded by IDA and MDTF in watersheds identified for IDA funding (budget of USD 6.1 million) and
by GCF in watersheds identified for GCF funding (budget of USD 28 million). Activities for the promotion of high
performing cookstoves will be funded only by IDA and MDTF in watersheds identified for IDA funding (budget of
USD 0.5 million). No GCF funds will be requested for activities related to the promotion of high performing
cookstoves.

This sub-component includes innovative activities that will enhance the sustainability of the resilient, improved
livelihoods created as a result of the activities in sub-components 1.1 and 1.2. The generation of sustainable
improved incomes for the vulnerable smallholder farmers targeted by the project will enable them to maintain the
rehabilitated watersheds. Without the activities in this sub-component there is a risk that poverty will lead the
beneficiaries to return to previous, unsustainable practices after the project ends, reversing the gains made through
the introduction of sustainable land management and climate smart agriculture.

The activities include advisory services and investment to improve access to and implementation of climate resilient
livelihood diversification. These activities will help address the issue of landless/jobless youth/women and the
resulting increased stress on the natural resource base and its potential to reduce climate risks. A number of
potential interventions have been identified. Examples include support to women-managed local enterprise
development, vocational training, processing equipment and CSRPs, facilitation of access to markets, technology
and trade and a suite of other initiatives to incentivize private-sector engagement. It will also finance activities that
facilitate private sector engagement in RLLP-supported value chains directly or through primary cooperatives and/or
coop unions, as well as direct investment in landscape restoration through PES, CSR or volunteer/good citizenship.
In addition, this sub-component will provide small, seed-fund grants to SHGs, CIGs and/or WUAs to launch or
expand productive, processing and storage activities, based on an analysis of what the markets will purchase, and
therefore what will increase incomes of households and sustainability of the rehabilitated watersheds. Finally, the
WB will support co-financed activities aimed at creating a market for improved cookstoves (funding from GCF is not
being requested for this activity). Non-sustainable use of biomass for cooking is one of the main drivers of
deforestation and degradation in Ethiopia. If cooking practices are unchanged then unsustainable harvesting of
wood for fuel will continue, undermining progress in resilient land use made through the introduction of sustainable
land management and agriculture. Reducing demand for fuelwood is critical to maintaining restored landscapes in
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project communities. In addition, as heating and cooking efficiency improves, use of manure and crop residues for
cooking and heating decreases, allowing these materials to be used on fields to enhance soil fertility.

MoA has drafted eligibility criteria for choosing watersheds and commodities eligible for value chain. For example,
the followings are criteria for watershed selection: Sense of ownership of communities’ watersheds managing
team. i.e., Capacity, experience and commitment of (CWT, KWT, WTC &WSC,). - Watersheds aligned with GIZ-
SURED support. - Existence of other private sector support programs. -Rehabilitation status of watersheds:
coverage area of rehabilitated land in watersheds; soil fertility that is suitable for high value commodities; availability
of alternative water sources. - Accessibility to all weathered roads and other infrastructure development. -
Accessibility for Market linkages and reliability of commodity supply. - Accessibility to inputs providers, extension
services deliveries and financial institutions. - Widely existence of proactive community and lead farmers (MHH and
FHH) to accept for new innovations, technology, etc. – Whether RLLP is providing support for CSA. -Unemployment
status of the community/ies within the watersheds.

RLLP is only (a) providing in-kind support such as warehouses and equipments and (b) organizing awareness,
training and workshops for various groups. No sub-loans or sub-grants will be made to any groups or individual
beneficiaries.

Innovation for climate resilient livelihood diversification and private sector development

These activities will focus on private sector development (PSD) in RLLP rehabilitated community watersheds.
Product processing and bulking capacity will be developed that will enable sustainable, environmentally friendly
livelihoods, thus increasing incomes, which in turn will lead to the maintenance of rehabilitated watersheds and
improved food security in the face of climate change. Without appropriate infrastructure and facilitated linkage of the
private sector, newly developed livelihood interventions will diminish and eventually fail, causing households to
revert to previous harmful practices and removing the incentive for maintenance of rehabilitated climate-smart
watersheds, leaving them exposed to risks driven by climate change. If watershed communities produce high-
quality, semi-processed products for bulk purchase by the private sector, they will encourage the private sector to
go the “last mile” to these watershed communities even though lower-quality, unprocessed and unbulked
commodities might be closer at hand.

Processing Equipment and Training: Activities will support the shared purchase of and training on key agricultural
processing equipment, which will increase the value of crops produced through climate smart agriculture (CSA) and
livestock products produced through intensive, environmentally friendly methods by watershed
communities/households. Such equipment may include the following: Forage processing mills, grain threshers,
weighing scales, grain mills, processing sheds, dairy processing equipment, poultry and egg processing equipment,
bamboo processing equipment and tools, and vegetable storage/transport containers.

Heavy equipment is not included in the list of eligible equipment. The use and maintenance of eligible equipment is
delineated in the bylaws and governance structures of CIGs, cooperatives, self-help groups, female groups to which
equipment may be made available.

Community Storage Receipts Programs: The project will foster the development of community storage receipts
programs (CSRPs) in RLLP rehabilitated watersheds by building warehouses or other types of storage facilities and
training community organizations to develop and maintain CSRPs. One of the major barriers to the implementation
of resilience building measures by farmers is lack of cash. Once the project is completed and concessional finance
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is no longer available, farmers will need cash in order to be able to continue practices introduced by the project
such as the use of improved seeds, improved farm tools, fertilizer and other inputs. The CSRP will provide
immediate cash to poor farmers, improving their food security and ability to pay for other necessities as well as
allowing them to improve productivity by investing in agricultural inputs such as seeds, fertilizer and other inputs
through their available income. The CSRP approach will be managed by organized CIGs/Watersheds Associations
or cooperatives which have legal personality to sign contracts, access loans from MFIs or FIs and management
capacity as compared to fragmented farmers with weak management capacity and difficulty of accessing loans from
MIFIs or FIs due to lack of confidence , weak financial management and difficulty of collection/repayment, could not
present collateral. Such initiative has never been tested under SLMP-1 and SLMP-2. But WB financed initiative
such as the AGP initiated such approach using CIGs.

These CSRPs will store commodities in demand by the private sector that will be weighed and valued according to
expected market price at the proposed time of sale and labeled accordingly. The producer will then receive a
receipt for the commodity and 50% of the expected purchase price from the CSRP manager, and the commodities
will be stored carefully and properly until the time of sale. After the commodities are sold, the producer will receive
the other portion of the proceeds based on the actual sales price and a small deduction for the cost of the service.

Crop and other value chain commodities will vary according to watershed conditions with primary commodities
integrated in the Ethiopian Commodity Exchange Trading System such as coffee, sesame, red-kidney beans, white
pea bean, green mung bean, chickpeas, soybeans, wheat, maize. The watersheds identified for interventions have
agro-ecologies that are suitable for most of the commodities mentioned above. Additionally, domestic demand for
teff, barely, fava beans, honey, and spices will inform the selection of value chains to be supported.

CLIMATE INDUCED RISK: The CSRP will support the establishment of stores sufficient to mitigate
temperature/moisture, frost due to climate change and related pests/insects, which might adversely impact the
quality and value of the crops. CSRP: These stakeholder groups will be overseen by the respective cooperative,
union, or watershed user association which have legal standing in Ethiopia to sign contracts and access financing.
CSRP Management: Based on their legal standing and capacity, cooperatives, unions, or watershed user
associations will manage the CSRPs. CIGs and SHGs will subscribe as members to participate in CSRP schemes.

SLMP-I and SLMP-II EXPERIENCE: The CSRP-related initiative was not tested during the SLMP-1 and SLMP-2.
However, the Ethiopia Agricultural Growth Program (AGP) provides lessons and experience regarding CSRP that
have been integrated in the RLLP. Other programs such as the Ethiopian Commodity Exchange
(http://www.ecx.com.et) have also generated relevant experience and capacity in SLMP-I and SLMP-II-supported
watersheds

The cooperatives/watershed user associations and the CIGs will be responsible for developing the management
and business structure of the CSRP. Primary management responsibilities will be held by cooperatives or
watershed user associations. The coops/watershed associations would set price that accommodates such price
risks when designing their bylaws and marketing strategy. The CSRP supports farmers to overcome their
immediate problems, among others. The CSRPs is chiefly applicable to agricultural products which are subject to
fluctuating price within the harvest and lean seasons. The System is an important and effective tool for creating
liquidity and easing access to credit. It also offers additional benefits such as smoothing the supply and prices in the
market, improving smallholder farmers’ incomes, and reducing food losses. The system can play dominant role in
the development of the overall agricultural sector, by permitting smallholder farmers to hold food back to the lean
season, allowing them to access markets on more equitable terms, and enhancing the efficiency of the entire
commodity chain. The CSRP has legal personality and can enter into agreement with the farmers.
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There will be a strong emphasis on the formation, strengthening of and support to activities of the CIGs under this
sub-component because these semi-formal groups, which may transition to either primary cooperatives or
enterprises, are currently the main community-level organizational unit used for AGP-2 activities, and they are
governed by MoA-approved guidelines, including requirements for organization, planning and financing. This sub-
component will provide resources for local expertise to be contracted to provide technical assistance to support
beneficiary communities in forming CIGS, and in planning and implementing income-generating activities and
investments to strengthen connections to local value chains.

In the co-financed support of livelihood diversification, emphasis will be given to the establishment of CIGs/SHGs
for the production and marketing of improved cook stoves. These groups not only provide an alternative source of
income, but they also deliver multiple co-benefits, including time savings for women and girls in fuelwood collection,
health improvements through reduced household air pollution, and reduced pressure on local biomass resources
through improved household energy efficiency. As heating and cooking efficiency improves, use of manure and
crop residues for cooking and heating decreases, allowing these materials to be used on fields to enhance soil
fertility.

Initial support for livelihood diversification and connections to value chains will target beneficiaries in watersheds
that have already begun or completed implementation of their MYDPs, where support for CSA is being provided
and support from AGP and/or other PS-oriented development activities will complement RLLP efforts. This will
facilitate success at this pilot level and allow for any needed adjustments before scaling up these activities in later
years of the project. In addition to SHGs and CIGs at the watershed and/or woreda level, stakeholders involved in
this sub-component include primary cooperatives and their unions, Cooperative Agencies at various administrative
levels, the Rural Saving and Credit Associations (RuSACos), private sector enterprises and their sectoral
associations, and Woreda Offices of Agriculture, Water, Mineral and Energy. For the production of improved
cookstoves, the Woreda office of Cooperative Promotion will: (i) support organization of CIGs/SHGs to produce
energy efficient cook stoves and promote improved cook stoves (ICS) host demonstrations at local markets and
other local level gatherings; (ii) through the Bureau of Energy, Water and Mineral, provide technical experts to
conduct training for the producer groups; and (iii) provide beneficiaries/consumers support in establishing local
channels of finance (such as traditional savings groups - ekub).

Potential maladaptation risks with initial commodity processing are mitigated through the design of the project. The
project promotes sustainable land management on all land belonging to the target watersheds. Hence, even if
agricultural production expands as a result of the development of markets for commodities, the expanded
production will also use the climate smart agriculture measures that have been introduced. In addition, agricultural
production on lands already in use will increase substantially, leading to a decrease in the need for new agricultural
land. Land mapping (the cadaster will have information on agricultural land) as well as issuing land certificates will
prevent uncontrolled expansion of agricultural land, as only those with land certificates will be eligible to participate
in the market. Sustainable land management will ensure that there is no further deforestation in the targeted areas
(which are already highly deforested and degraded). Furthermore, the establishment of green corridors and
elimination of free grazing will contribute to the preservation of the non-agricultural land, while at the same time
enhancing forest cover and preventing deforestation. RLLP will support SLM practices to limit free grazing in project
areas including activity packages that address sustainable livestock production, through feed development and
integrated agro-silvo-pastoral practices. The creation of information platforms and provision of technical assistance
will also reduce the risk of maladaptation, as information and outreach will result in increased awareness and
improvements in local livelihoods.

High-performing cookstove technologies

The activities supported were identified and selected based on the results of the study “Assessment of Household
Energy Options in RLLP Intervention Areas” that is included as Annex A.4 to this proposal. The WB will support a
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set of activities aimed at reducing the use of fuelwood, which is one of the major drivers of deforestation and
degradation. Reducing demand for fuelwood is critical to maintaining restored landscapes in project communities.
Activities include the establishment of improved cookstove production enterprises, provision of technical and
business training to the enterprises, introduction of alternative fuels production including efficient charcoal
production, and the creation of consumer awareness of the advantages of using improved cookstoves and new
fuels. Details on the technologies that will be promoted and on awareness raising activities planned are provided in
the assessment report of household renewable and energy efficient technologies options. The project will lead to
the creation of viable businesses producing efficient cookstoves and consumer awareness of the benefits of using
them, as well as encouraging rural saving groups to support improved cookstove purchases. The activities will be
supported by the Regional Energy Bureaus, who will subsequently introduce similar activities to areas under their
remit that are not covered by RLLP.

The alternative practices selected under sub-component 1.3 include support to:

• Common Interest Groups (CIGs)

• Climate resilient livelihood diversification including promotion of improved cookstoves, cultivating fruit trees,
bamboo handicrafts, beekeeping, etc
• Self-Help Groups (SHGs)
• Cooperatives
• Unions
• Watershed User Associations (WUA)
• community storage receipts programs (CSRPs)
• Enterprises to manufacture, promote and sale fuel saving cookstove and alternative cooking fuels
• Formal and traditional saving groups for the purchase of RE/EE products

Component 2. Investing in Institutions and Information for Resilience

The objective of this component is to enhance institutional capacity and improve information for better decision-
making in supporting resilient landscapes and diversified rural livelihoods in the project area, both for the duration of
the project and after project completion.

This component will build capacity at the local government level (woreda and kebele) for (i) planning and managing
SLWM interventions, and (ii) managing the land certification process. This will include piloting of new technologies
for information modernization at the local level, including the use of electronic tablets for gathering geospatial
information, and the use of Unmanned Aerial Vehicles (UAVs – or drones) for land certification mapping. Tablets
and UAVs will be the property of the project (i.e. MoA) and would be provided to development agents and the
woreda focal persons in the project watersheds for mapping and monitoring. The device setup, training, and support
provided will be tailored to meet the conditions and realities faced in field environment (i.e. off-line data collection,
accessories (protective case, solar charger, etc.), guidance materials, technical and trouble-shooting support).

RLLP intends to monitor all watersheds using UAV. The current capacity within the PCU is classified as low to
moderate and is improving. For example, under RLLP the addition of a database manager as key personnel to
support data management. The use of UAV’s is currently limited in Ethiopia due to GoE security concerns and the
lack of a policy governing their use in general. The PCU with assistance from WB is currently supporting efforts to
develop guidelines on the use of UAVs that would ultimately support monitoring efforts more broadly and with fewer
restrictions. Despite the restrictions, to data the PCU has been a leader in the use of UAVs to support project
activities as demonstrated by receiving permission to use UAVs to collect imagery for parcel demarcation under the
land administration component. The PCU will need to further improve the quality and efficiency with which M&E
data are collected and analyzed with additional expertise to manage the UAV monitoring component.
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Support for policy development under this component will focus on the regulatory framework for Watershed User
Associations (WUAs), community bylaws guiding land-use practices, and strengthening the Land Administration
System. This regulatory framework, once established, will continue to support resilient land use after project
completion. To strengthen the evidence base for sustainable land management decision-making, this component
will include a bio-physical impact evaluation of SLWM interventions, to be conducted through a partnership
arrangement between the MoA, the Water and Land Resource Centre of Addis Ababa University, and the Ethiopia
Development Research Institute’s Environment and Climate Research Center. This will complement a livelihoods
impact evaluation of SLWM interventions to be conducted in parallel led by the Gender Innovation Lab of the World
Bank’s Africa Region. When completed, these evaluations will be available to interested parties in Ethiopia and the
region wishing to institute or improve SLWM. This component will also provide resources to manage the knowledge
generated through these and other assessments of SLWM, and to communicate the lessons learnt to a broad
audience, including local governments and communities, relevant research institutions and Government agencies,
as well as Development Partners.

This component’s objectives will be achieved through the implementation of the following sub-components: (i)
capacity building, information modernization and policy development, and (ii) impact evaluation, knowledge
management and communication.

Sub-component 2.1. Capacity Building, Information Modernization and Policy Development

Activities will be funded by IDA and MDTF in watersheds identified for IDA funding (budget of USD 7.9 million) and
by GCF in watersheds identified for GCF funding (budget of USD 16.15 million).

This sub-component will build capacity at local government level to implement RLLP, and to sustain SLWM
interventions after watershed graduation from project-based support. To achieve this, the sub-component will
finance accountants to support the head of the Woreda office of Agriculture (WoA) and a focal person in each
participating woreda, and part-time community facilitators at the kebele level (5 community facilitators for in each
major watershed). To help build the capacity necessary for an effective land administration system, this sub-
component will also provide technical assistance for training in this field.

This sub-component will support information modernization to coordinate data collection and information sharing at
all levels and under all components of the project so that this information is well organized, properly documented
and accessible. As part of this effort, a data management plan will be developed that specifies how all data used or
created during the course of RLLP will be documented, stored and otherwise managed. The use of electronic
tablets to collect information on project activities and results, combined with appropriate survey and mapping
software, will improve the quality and timeliness of data collection and reduce the effort needed to compile, review,
and generate the necessary reports. This framework will facilitate access to information and support timely
feedback to the local level.

This sub-component further supports the use of aerial vehicles (UAVs)/drones to generate high-quality and timely
aerial imagery data to support planning, monitoring, and land certification. Under this initiative, the drones will be
operated by several teams of trained operators who will travel to the project sites. During the course of RLLP each
micro-watershed will be re-visited twice each year at appropriate intervals to generate visual and multi-spectral
images of the program areas. At each stage the processed imagery will be shared with the woreda and local field
staff for the purpose of assisting in planning, monitoring progress and updating implementation plans. The data and
materials produced will also be used to support M&E and will serve as a source of information and data for
subsequent analysis. Detailed technological specifications and budget have been elaborated including the technical
requirements for the drones, all associated equipment and spare parts, operating costs for the duration of the
project. The use of the drones is intended for the collection of information and data that will be available for long-
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term use and for project planning and monitoring. The project will work with the Information Network Security
Agency (INSA) and the Ethiopian Aviation Authority to ensure all necessary permits are obtained.

Policy development under this sub-component will focus on the regulatory framework required for the establishment
of Watershed User Associations (WUAs), crucial for sustainability of SLWM interventions, frameworks for reward
and incentive schemes such as Payments for Environmental Services (PES), as well as community byelaws guiding
land-use practices, and strengthening of the Land Administration System.

In developing the framework for WUAs, the Project will work closely with regional governments for its application in
establishing WUAs. This work will commence with reviewing of the environmental legislation that relates to the use
and management of Ethiopia’s natural resources (soils, forestry, grassland, water, wildlife, etc.). The manual for
CSA will be used to proceed and enhance this activity. RLLP will give high attention to the opportunities of
engagement of private sector (PS) in all development activities of the project. The first objective of PS engagement
in RLLP is, to attract the PS to invest in RLLP interventions. The second objective is to create and increase income
streams & diversified livelihoods for the communities in a sustainable manner through the promotion of inclusive
business and value chain/partnership relationship based on profitability principles.

Sub-component 2.2 Impact Evaluation, Knowledge Management and Communication

Activities will be funded by IDA and MDTF in watersheds identified for IDA funding (budget of USD 5.1 million). No
GCF funding is requested for this sub-component.

Impact evaluations (IEs) will use rigorous research methods to look at specific interventions under RLLP, assess
the contribution of these to development goals and provide robust evidence of SLM impact. Project funding will
focus on the evaluation of bio-physical impacts, which will be conducted in coordination with a livelihoods impact
evaluation to be led by the Gender Innovation Lab of the World Bank’s Africa Region, financed separately. The bio-
physical impact evaluation will examine the response of the environment to SLWM interventions, considering
parameters such as peak and base surface water flows, groundwater levels and recharge rates, sediment loads,
and remotely sensed information on vegetation cover and soil moisture. For the purposes of this evaluation, the
project will extend the existing partnership between MoA, the Water and Land Resource Center of Addis Ababa
University, and the Environment and Climate Research Centre of EDRI, and will aim to build new partnerships with
relevant international research organizations. IEs are expected to be completed within the Implementation
Period (five-years) and the MOA will procure service providers for such purposes. The IE’s disclosure will be
subject to WB’s access to information policies.

In addition to the bio-physical IE and the livelihoods IE an evaluation of climate-smart agriculture will also be
conducted. Due to the complexity of the evaluations the details of their implementation are still under development
and will be further elaborated in the terms of reference, acceptable to the World Bank. Basic design of the IEs is
expected to be as follows: the livelihoods IE is expected to involve random assignment. The biophysical IE will
involve a 2-stage sampling where in the first stage a stratified selection of watersheds to be treated will be
performed and in the second stage watersheds will be paired with a suitable comparison watershed (outside project
watersheds). This is being done to increase the explanatory power of the evaluation given the large cost associated
with each watershed monitored. The CSA evaluation is expected to follow a treatment-control comparison
methodology and the potential for randomized assignment within the CSA micro-watersheds is being explored. In
any case, the sampling of treatment and control will be randomized.

To build a solid and effective knowledge management system both for the project and the SLM program in Ethiopia,
this sub-component will establish a geospatial knowledge platform that combines information from a variety of
project and other sources and packages it in a format that is accessible to planners and stakeholders at the
national, regional, and local levels. This activity will build upon the work being done by WLRC under SLMP II to
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develop a web-based knowledge management system. By enabling farmers to improve their planning the platform
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will decrease their exposure to climate change related risks.

A strategic communication program will be developed and implemented under this sub-component to inform and
mobilize communities, enhance project visibility and transparency among all actors, support efforts to scale-up SLM
and CSA practices, and build support for the land certification program. Strategic guidelines for the implementation
of the Knowledge Management and Communication (KMC) program have been developed following a rapid KMC
needs assessment. The guidelines include viable options of knowledge management, knowledge sharing and
communication with effective channels, techniques, tools and key messages that address the communication and
knowledge management needs of beneficiaries, stakeholders, partners and actors at various level. While following
those guidelines, implementers will have room to elaborate, modify and adapt additional communication and
knowledge management interventions to meet the overarching goals and specific objectives outlined in this sub-
component. The identified overarching goals are: 1) to build and coordinate a strong knowledge base contributing to
the effective promotion, reporting and scaling up of SLM within Ethiopia; and 2) to inform and mobilize local
communities, strengthen consultation/ participatory development models, and enhance transparency in program-
supported activities. The specific objectives of the KMC program are to: a) Support scaling up efforts and adoption
of SLM and CSA practices; b) Help evidence based planning and reporting through enhanced information flow
among institutions and coordination of monitoring and evaluation; c) Enhance the program visibility among all actors
thereby attract new development partners and insure the buy-in of the government; d) Sustain the outcomes of SLM
practices through awareness raising campaigns. This includes relevant activities in components 1 and 3 such as
land certification. The guidelines include means of verification to evaluate the effectiveness of the activities
implemented within the KMC program.

Possible activities include:

i. knowledge identification, capturing, validation and packaging annually to support scaling up efforts, build
capacity of user groups, youth groups, DAs and FTCs (experiential knowledge, best practice and synthesis
of explicit knowledge products from various sources such as the geo-spatial knowledge platform, the CSA
Innovation Platform, model watershed, etc.);
ii. strengthening and enhancing functionality of existing FTCs and SLM information centers at woreda level
and establishing info centers in new woredas;
iii. outreach activities (i.e. production of printed, audio and video materials to be used as supporting tools
during workshops and events, and media tours for journalists and PR officers of relevant regional bureaus
to show project results);
iv. knowledge sharing/networking events (i.e. annual SLMP Knowledge fair); and
v. advocacy activities to support private sector engagement, policy development and other key initiatives for
RLLP effective implementation (i.e. organization of Stakeholders Workshops).
vi. grassroots level behavioral change campaign targeted to major/critical watersheds, based on preliminary
research to define appropriate media (drama, storytelling, etc.) and effective messengers (i.e.
community/religious leaders) and gauged throughout the duration of the program through a mix of
qualitative/quantitative research methods (FGDs, community level meetings, survey);
vii. public information awareness activities on land registration and cadastral surveys, land laws and
procedures and conflict resolution mechanism, and to explain the benefits of (formalized) rentals and unlock
the blockage set by cultural norms, emphasizing that temporary land renting does not imply abandonment
and formalized rental contracts do not result in land being expropriated.

Component 3. Rural Land Administration and Use

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Activities will be funded by IDA and MDTF in watersheds identified for IDA funding (budget of USD 26.0 million). No
GCF funding is requested for this component.

As indicated under the root causes section above, land tenure insecurity caused by frequent land redistribution in
the past has encouraged farmers in Ethiopia to favor short-term exploitation of land resources over long-term
conservation, contributing to land degradation and declining productivity. The objective of this component will be to
strengthen the land administration system that secures tenure rights, optimizes land use, and empowers land-users
to invest sustainably in productive landscapes. This component will be funded entirely by co-finance. No funding
from GCF is being requested for this component. Refer to detailed budget (Annex K.1.).

Component 3 will provide security of tenure to smallholder farmers through Second Level Landholding Certification
(SLLC) as an incentive to increase the adoption of SLWM technologies and practices. The on-going SLLC exercise
at kebele level will be extended to all kebeles within the watersheds targeted by RLLP, with resources provided for
orthophoto production and para-surveyors for field level data acquisition, and data encoders for office level data
management. It will support the use of low-cost, fit-for-purpose surveying and mapping technologies including drone
aerial mapping and mobile mapping using tablets as appropriate. Activities to be supported will include (i)
orthophoto base map preparation, (ii) adjudication of land rights and demarcation of parcel boundaries on the field
map, (iii) scanning, geo-referencing and digitization of parcel boundaries and attributing information, (iv) public
display for validating parcel (shape and size) and landholders’ information, (v) parcel map and Landholding
Certificate preparation, production, authentication and issuance, and (vi) procurement of equipment, materials and
consumables for cadaster and land registration activities. Matching funds to complete woreda level coverage of
SLLC will be sought from State governments and development partners.

This component will also extend the on-going local-level participatory land-use planning exercise at the kebele level
within the major watersheds in the RLLP. Technical assistance will be provided to support consultation workshops
for land-use plan development at the kebele level and to connect these consultations to the larger land-use
planning exercises underway at the regional and national levels.

This component will also support the rollout of the NRLAIS in RLLP woredas that do not overlap with other land
administration support projects. In Gambella, the project will support the installation and roll out of the NRLAIS both
at the regional and woreda levels, as none of the development partners have interventions in Gambella. NRLAIS
will provide security, transparency, maintenance of the land information with enhanced data management
functionality and usability at woreda level in an efficient, effective, spatially integrated and sustainable manner. It will
also equip the regional and federal authorities with an adequate tool to produce and avail statistical data on rural
land tenure and land use that facilitate evidence based monitoring and ensure a coordinated and consistent
approach to the development of policies, legislations, standards, models and research to enhance sound land
governance across the country.

At the woreda and kebele levels, implementation of this component will be undertaken jointly by the Woreda Office
of Land Administration and Use (WoLAU) through the Kebele Administration Offices, the Kebele Land
Administration and Use Committee (KLAUC), the Land Administration and Use DAs, and the communities. Field
teams will be contracted, trained and deployed, each comprising a team leader, a para surveyor, a data recorder, a
digitizer, and a Woreda GIS expert and a supervisor, to facilitate and undertake the field and office level land
certification activities. Woreda and kebele land use teams will anchor the preparation of Participatory Local Land
Use Plans. At the Regional and Zonal levels, the Bureau of Land Administration and Use (BoLAU) and related
agencies will lead the implementation of this component of the project with support from the Regional RLLP PCU.
At Federal level, the Land Administration and Use Department (LAUD) in the MoA will be the main focal point for
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policy, planning, and implementation guidance to RLLP Regions and Woredas. A NRLAIS rollout support unit
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established at regional and federal levels will provide technical assistance for this activity.

Synergies with interventions on land administration support from other development partners have been identified.
These include the Responsible and Innovative Land Administration in Ethiopia Project (REILA 16) being implemented
by Finland and the Land Investment for Transformation Project (LIFT) 17 being implemented by the UK Department
for International Development (DFID). These two projects together with RLLP will spatially synergize efforts on the
national roll-out of the NRLAIS and distribution of SLLCs. Further discussions with DFID will identify possible
support to the Rural Land Administration and Use Department (RLAUD) to: (i) expend their economic
empowerment interventions to adjacent RLLP woredas to maximize benefits of land certification; and, (ii) complete
SLLC in kebeles outside of watershed boundaries in RLLP woredas. Close coordination with other development
partners (e.g. GIZ, USAID) will build on experience from SLMP-II and will be ensured through the G7 Donor
Working Group on Land. 18

Component 4. Project Management and Reporting

Activities will be funded by IDA and MDTF in watersheds identified for IDA funding (budget of USD 11.5 million) and
by GCF in watersheds identified for GCF funding (budget of USD 6.09 million).

The objective of this component is to effectively consolidate plans and budget, implement and report on project
activities with due diligence and integrity.

This component will finance the operational costs of Regional Project Coordination Units (RPCUs) in MoA and
Regional State Bureaus of Agriculture. In total, there will be 7 RPCUs – one in MoA and one in each of the regions
in which the project will be implemented (Amhara, Oromia, Tigray, SNNP, Beneshangul/Gumuz, and Gambella).
These RPCUs will carry out all fiduciary aspects of project implementation including financial management,
procurement, environmental and social safeguards, Monitoring & Evaluation (M&E), sector coordination of
investment targeting and policy harmonization, and donor coordination structures. The project will support a
modernized M&E system for collecting, managing and analyzing activity data and achievements. A tablet-based
system of data collection that incorporates tools for capturing spatially explicit activities and area treated will be
integrated into the project-wide strategy for the modernization of information management outlined under sub-
component 2.1. The enhancements and functionality incorporated into the M&E system will improve the quality and
accuracy of data while at the same time serving as a platform for providing feedback to the local level on progress,
which will support improved decision-making.

16 REILA II is a 4.5-year project with a total budget of € 7.81 million. The project aims to: 1) Improved regional LA and increased and
certified land tenure security for land users (in 6 woredas in Benishangul Gumuz and 11 Woredas in Amhara region) and NRLAIS rollout; 2)
Improved capacity for federal and regional LA for planning, management and coordination, and for accurate and efficient land surveying;
and 3) Improved supply of skilled manpower to the LA sector.
17 LIFT operates in four regions (Oromia, Amhara, SNNR, and Tigray) with a total funding of £ 63 million. LIFT aims to support the
Government of Ethiopia in the provision of map based land certificates to farmers and assist them to fully benefit from increased investment
and productivity through the development of the rural land market and its supporting operations.
18 In 2013, the Governments of Ethiopia, the United Kingdom, the United States of America, and the Federal Republic of Germany announced
an agreement to enter a land country partnership to work together to improve rural land governance for economic growth and to protect
the land rights of Ethiopians. The partnership was envisioned to build on existing programs and serve as a vehicle for increased coordination
and collaboration among the Government of Ethiopia and its development partners. Since then the WBG has been an active member of the
G7 Land Partnership through its active operations managed under ENR portfolio such as SLMP, OFLP, and CRGE TA.
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Reporting at the federal, regional, woreda and community levels will aim to ensure sound tracking of progress
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information (activity/output level results), to evaluate information from a variety of sources relevant to outcome-level
results, and to promote learning and adaptive management. The outputs under this activity include: (i)
implementation of a new Results Based M&E Plan based on clear guidance on what to collect and how to collect it
(indicator protocols); (ii) a well-functioning MIS system; (iii) improved capacity of stakeholders in M&E; and (iv)
improved quality of information collected.

Scale of the project, identification of targeted project area and beneficiaries

In terms of the scale of the project, the World Bank is confident that the benefits of implementing the interventions
included in the project at the relatively large scale proposed outweigh the risks. A number of factors mitigate these
risks, key among them being the fact that the project builds on experience gained by the World Bank and the
Federal Democratic Republic of Ethiopia, acting through MoA, during previous and ongoing projects. The proposed
project benefits from the lessons learned over many years of projects aimed at sustainable land management,
poverty alleviation and increasing the sustainability of agriculture in Ethiopia, and in particular the SLMP projects.
These lessons led to the creation of the institutions that RLLP will build upon such as bottom-up watershed planning
and self-help groups as well as the approach to CSA described in Annex A.3 in which a number of packages of
activities are combined to achieve the triple goals of adaptation, mitigation and livelihood development.

For the Executing Entity, RLLP activities will come on top of activities with a budget of $316 million that are already
spent or committed for SLMP, which are managed or coordinated by MoA. For both the sums already spent or
committed and for the co-financing the World Bank provides to RLLP, the World Bank has conducted risk analysis
and identified mitigation actions that resulted in the decision by the World Bank to commit its own funds to the
project. The valuable experience gained during implementation of SLMP-II, as well as the significant Recipient-
executed and Bank-executed resources allocated in the past five years for coordination and capacity building efforts
are expected to be instrumental to improve or identify viable measures to address all the risks.

Total needs were a major consideration in deciding on the scale of the proposed project. Soil degradation is an
ongoing problem that is becoming more severe with every passing year. There are significant costs related to
inaction – the longer we wait to address the problem, the worse it will get, and the more expensive it will be. To
achieve sufficient momentum for scaling up and replication, countrywide implementation is essential. The targeted
watersheds for this project were selected with inter-regional equity in mind. A total of 210 major watersheds are
included in RLLP, averaging approximately 10,000 hectares each. Out of these, 135 watersheds are those already
targeted by SLMP-I and II. In these watersheds RLLP will implement only innovative climate resilient activities that
were not included in SLMP. 57 watersheds included in RLLP are new to the implementation of (SLM) measures.
For GCF financing, 40 watersheds out of 192 were identified based on their vulnerability to climate change 19. The
process for the selection of these new watersheds is described in full in Annex A.1.

In order to achieve the aims of the project – achieving restored, productive and low emission landscapes, the
project will work with the communities that are using these landscapes. Hence, beneficiaries are selected at the
community level and the direct beneficiaries are individuals who are living within a project watershed. The members
of these communities are vulnerable smallholder farmers, who are very sensitive and highly exposed to climate
change impacts. The total population within the project area is 4.2 million people or 834,000 households (with an
average of 5 persons per household). Evidence based data driven implementation and planning will ensure that

19 Details of Co-financing from Government of Canada were not available during this analysis, hence 18 Watersheds

supported by it were not considered

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interventions benefit smallholder farmers. Detailed bio-physical information for the 57 new watersheds, including
individual landholdings, will be collected during the Multi-Year Plan (MYP) preparation of each watershed Local
level participatory land use planning teams at woreda and kebele levels would ensure that interventions benefit the
smallholder farmers. The baseline study report for 90 watersheds of SLMP II found that the average land holding
was only 1.338 ha. Agro-ecologically, watersheds above the altitude of 2300 meters and lowland areas between
500 and 1500 meters, have an average land holding of only 0.83 ha and 2.082 ha respectively. Furthermore, about
4.2% of the households have no land at all (3.5% of male and 6.5% of female headed households), 10.6% have
less than a quarter of a hectare and 21.9% less than a hectare.

Beneficiaries are categorized as direct and indirect. The direct beneficiaries are individuals who are living within a
project watershed. The members of these communities are vulnerable smallholder farmers, who are very sensitive
and highly exposed to climate change impacts. The primary beneficiaries of the project will be the rural households
on degraded land, facing land tenure and water insecurity in selected watersheds. Indirect beneficiaries include: (i)
communities adjacent to Project intervention areas adopting SLM and CSA practices through demonstration effects,
as observed under SLMP-II; (ii) private sector participants and end-consumers in value chains targeted by the
Project; (iii) households outside Project areas benefiting from the creation of land certification capacity at woreda
and regional level; (iv) recipients of capacity building at all levels of government, as well as in national partner
organizations; and (v) communities outside Project areas benefiting from groundwater recharge, reduced flooding,
and lower sediment loads, as a result of SLM interventions. Women will be specifically targeted to ensure that they
fully participate in Project benefits through a variety of mechanisms, including: (i) required participation of women in
Community Watershed Teams (CWTs), Kebele Watershed Teams (KWTs), Kebele Land Administration and Use
Committees (KLAUCs), and Watershed User Associations (WUAs); (ii) provision of joint land certificates to married
couples, and individual land titles for women in Female-Headed Households; (iii) promotion of women’s
participation in Common-Interest Groups (CIGs) for income-generating activities; and (iv) targeted support for the
production and marketing of improved cook-stoves, bringing health gains and time-savings that benefit women in
particular. Make note that beneficiaries for Income generating activities are selected by the community watershed
teams. The team has criteria for selecting such as the beneficiary should be the poorest of the poor, able to
contribute to the project, refrain from doing negative harm to environment for example degradation of forest through
charcoal making.

The experience of previous phases of the project has shown that there is a high willingness to participate by
populations of the proposed intervention areas. The World Bank has tracked community contributions during the
second phase of SLMP implementation. Translated into monetary terms, the cumulative community contribution in
the four budget years from 2014/15 until 2018/19 was 23.5% of the total financial utilization of the project, equal to
about USD 27 million. The most important contributions by the population were in the implementation of soil and
water conservation measures on both communal land and farmland and community forest management.

The project components and activities are described below. Implementation will be guided by the recommendations
and supporting studies that comprise the feasibility study. These documents provide guidance on which technology
alternatives should be selected depending on local circumstances. Quantitative information on numbers of
beneficiaries and areas benefiting from each activity, as well as a breakdown of funding between GCF and co-
finance is provided in the detailed budget in Annex K.1.

B.4. Implementation arrangements (max. 1500 words, approximately 3 pages plus diagrams)
Provide a description of the project/programme implementation structure, outlining legal, contractual, institutional and
financial arrangements from and between the GCF, the Accredited Entity (AE) and/or the Executing Entity(ies) (EE)
or any third parties (if applicable) and beneficiaries.
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 38 OF 96

- Provide information on governance arrangements (supervisory boards, consultative groups among others)
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set to oversee and guide project implementation. Provide a composition of the decision-making body and
oversight function, particularly for Enhanced Direct Access (EDA) proposals.
- Provide information on the financial flows and implementation arrangements (legal and contractual) between
the AE and the EE, between the EE or any third party and beneficiaries. For EEs that will administer GCF
funds, indicate if a Capacity Assessment has been carried out. Where applicable, summarize the results of
the assessment.
- Describe the experience and track record of the AE and EEs with respect to the activities (sector and
country/region) that they are expected to undertake in the proposed project/programme.

Provide a diagram(s) or organogram(s) that maps such arrangements including the governance structure, legal
arrangements, and the flow and reflow of funds between entities.

Detailed Project Institutional and Implementation Arrangements

The organizational structure and arrangements acceptable to the World Bank for the implementation of the recently
completed SLMP-II will be maintained and strengthened for the execution of RLLP. Implementation will be carried
out at four levels: Federal, Regional (including Zonal), Woreda (district) and Kebele (sub-district). and decisions in
the meetings are subject to MoA concurrence.

The National SLM Steering Committee, chaired by the State Minister responsible for Natural Resources
Management in MoA, comprises high level representation from MoF, MoWIE, MEFCC and DPs. The Steering
Committee is responsible for the following tasks in the SLM project: (a) providing policy guidance, oversight and
overall supervision for project implementation; (b) reviewing and approving the consolidated annual work plan,
budget and procurement plan; (c) reviewing and approving the annual implementation performance report, and
overseeing the execution of any corrective actions that may be designed.

The National SLM Technical Committee is also chaired by the State Minister responsible for Natural Resource
Management in MoA. It is made up of senior technical staff from institutions such as MoA, MoWIE, MoF, MEFCC,
MoWCA (Ministry of Women and Children Affairs, the Ethiopian Institute for Agricultural Research (EIAR),
Cooperative Promotion Agency, development partners supporting SLM projects or initiatives, and civil society
organizations (non-governmental organizations) actively engaged in SLM activities. Generally, this body is
responsible for providing technical advice to MoA on SLM. Specific to RLLP, this Committee will provide technical
advice on the quality of implementation performance reports and special studies such as policy and legislative
drafts, financial and audit reports, documentation of best practices, and M&E reports.

The SLMP Project Coordination Unit (PCU) at MoA, which is staffed by 33 technical and fiduciary staff, will continue
to play the role of managing and facilitating the day-to-day implementation of the project. Specific tasks will include:
(a) consolidating regional annual work plans, budgets and procurement plans; (b) facilitating and supervising
implementation of work plans and corrective actions, safeguards instruments including management/mitigation
plans; (c) processing and procuring works, goods and services; (d) monitoring overall implementation progress,
safeguards instruments (and management/mitigation plans) and evaluating project impacts; and (e) preparing
progress reports. The Unit will maintain a team of experts including a National Project Coordinator, procurement
and financial management specialists, M&E expert and technical experts in diverse disciplines (including watershed
management, agronomy, forestry/agroforestry, land administration/land use planning, knowledge management &
communication, livelihoods, private sector development).
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 39 OF 96

Regional and Zonal level

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Implementation of activities on the ground is supported by, among others, Regional steering and technical
committees. The Regional Steering Committees will be accountable and responsible for the execution of the annual
work plans developed by the local level implementers in the regions. At the Regional level, the Bureau of
Agriculture (BoA) and the Bureau of Land and Environmental Protection (BoLEP) will lead implementation of the
project in close collaboration with relevant public institutions. Serving as the link between the Federal, Zonal and
Woreda implementation entities, the BoA will review and consolidate annual work plans, budgets, procurement
plans submitted by the woredas. It will also review and approve implementation progress reports (including M&E,
financial, audits, safeguards, etc.) originating from the woredas. The project will finance a project coordinator, M&E
expert, accountant and procurement officer per region to assist the BoA and Woreda Office of Agriculture (WoA) to
implement the project on a day-to-day basis. Together, these will form a regional Project Coordination Unit for each
of the six Regions in which the project will be implemented (including Amhara, Oromia, Tigray, SNNP,
Beneshangul/Gumuz, and Gambella). At the Zonal level, the Zonal Agriculture Office (ZAO) will provide technical
support, extension services and M&E to a group of Woredas under its jurisdiction. The ZAOs will coordinate with
the WoAs to discharge their responsibilities. Moreover, RLLP shall provide opportunities to zonal implementing
entities to participate in the implementation of activities, draw lessons from the project and support scaling up of
SLM practices to wider landscapes. In addition to the existing government staff, RLLP will contract technical
advisors for specific outputs (such as preparation of MYDPs and WMUPs, establishment of WUAs, and preparation
of business plans for IGAs and value chain linkages) in 29 zones where RLLP will be implemented.

Woreda and Kebele levels

On-the-ground planning and execution of activities under the project will be undertaken jointly by WOA, the Kebele
Watershed Development Committee (KWDC), Development Agents (DAs) and communities. Accountants will be
recruited at woreda level to improve financial management capacities and reduce implementation risk. Thus, WoAs,
KWDCs and DAs will be assisting communities in: (a) developing annual work plans and budgets as well as
procurement plans for submissions to the BoAs for review and endorsement and integration into a Region’s annual
work/development plans and budgets; (b) facilitating and mobilizing community participation in watershed planning
and rehabilitation; (c) undertaking awareness campaigns and training; (d) participatory monitoring and evaluation;
(e) extension service delivery and dissemination of best-fit technologies and innovations, etc. Implementation of
Component 3, Rural Land Administration and Use, will be undertaken jointly by the WoLAU through the Kebele
Administration Offices, the Kebele Land Administration and Use Committee (KLAUC), the land administration and
use DAs and the communities.
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 40 OF 96

Figure 5 Implementation arrangements

 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 41 OF 96

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The Project Implementation Manual (PIM) will set forth fiduciary requirements as well as project implementation
arrangements. Importantly, the PIM will clarify the implementation support and supervision roles and
responsibilities of the Regional Bureau of Agriculture (RBA), Woreda Office of Agriculture (WOA) and MoA. To
enhance the accountability and quality of deliverables and the functionality of the program coordination platform at
regional and woreda levels, project implementation arrangements acceptable to the WB and agreed by the MoA
and regional governments will be established to clarify accountability and targets at all levels of project
implementation. . This text is now added in FP in this section after Figure 5.

Roles and responsibilities of the World Bank

The World Bank as the Accredited Entity of the project will play an important role in programme supervision and
implementation. The WB will ensure that the RLLP is executed in line with the WB policies and procedures. The
WB’s roles and responsibilities regarding financial management and procurement are described below. More
detail, including a disbursement plan, is provided in section F.4. Financial Management and Procurement.

Financial management

Payments will be based upon an approved annual work plan and budget. To ensure transparency as well as to
enhance the level of disbursement under the RLLP, quarterly Interim Financial Reports (IFRs) follow international
reporting standards and are submitted promptly at the end of each quarter.

An external audit of the project will be conducted annually by the Supreme Audit Institution or an accredited private
audit firm. The audit will be conducted in accordance with Terms of Reference prepared by the EE and the objective
of the audit will be to ascertain whether project funds have been used for the intended purpose. The WB, as the AE,
is responsible for reviewing and providing a no objection for the recruitment of the auditor including no objection of
the ToR. The WB will verify that the audit is conducted in accordance with the International Standards on Auditing
and that appropriate actions based on the findings ensue. If necessary, the WB will issue corrective actions
throughout the execution of the RLLP.

The GCF Proceeds will be channeled through the World Bank and will be made available to the Federal Democratic
Republic of Ethiopia. The World Bank will enter into a grant agreement and a loan agreement with Ethiopia,
represented by MoF and acting through MoA for the implementation of the GCF Funded Activity. MoA is
responsible for overall Project implementation and accountable for the Funded Activity’s outcome indicators.

MoA will be working closely with MoF, the Ministry of Environment, Forest and Climate Change (MEFCC), the
Ministry of Water, Irrigation and Energy (MoWIE) and other relevant public sector agencies. Project implementation
is according to signed financing agreement(s) (Subsidiary Agreement(s)), procurement procedures, environmental
& social management framework and other applicable WB procedures. The WB’s project supervision covers
monitoring, evaluative review, reporting, and technical assistance activities.

Procurement

As the AE, the World Bank is responsible for ensuring that MoA has the necessary procurement capacity required
for the RLLP. To this end, The WB has conducted a procurement capacity and risk assessment of MoA (see Annex
L.1). The WB will be responsible for ensuring that procurement under the project will be carried out in accordance
with the WB’s Procurement Procedures.

Communities and individuals receive cash payments as an incentive to contribute labor in support of rehabilitation
works under sub-component 1.1 and 1.2. 41 ETB per Person Day (PD) is provided as labor incentive for
participation in rehabilitation work. RLLP will pay 20% of this labor incentive for rehabilitation work on private land
and 50% for rehabilitation work on communal land. The distribution of rehabilitation work needed across both types
of land cannot be determined Ex-Ante. However, if we consider an equal distribution for estimation purposes, it
means that RLLP will pay for 35% of the labor incentive. Based on this, we estimate that RLLP will pay in total
USD 40.4 million as labor incentive. The total number of beneficiaries in watersheds where rehabilitation work will
be undertaken is 3.27 million. Based on previous SLMP experience, typically 3 members out of 5 from each
household participate in rehabilitation work. This translates to 1.96 million beneficiaries receiving labor incentive
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 42 OF 96

under RLLP. Thus, the estimated amount of labor incentive paid per beneficiary by RLLP will be USD 20.61.
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Please note that these are indicative estimates and may vary during implementation due to inflation and
operational factors such as participation of beneficiaries and change in intensity of rehabilitation work due
to extent of land degradation. We confirm that the activities under which labor incentive is provided are sub-
components 1.1 and 1.2.

B.5. Justification for GCF funding request (max. 1000 words, approximately 2 pages)
Explain why the project/programme requires GCF funding, i.e. Why is the project/programme not currently being
financed by public and/or private sector? Which market failure is being addressed with GCF funding? Are there any
other domestic or international sources of financing?

Explain why the proposed financial instruments were selected in light of the proposed activities and the overall financing
package. i.e. What is the coherence between activities financed by grants and those financed by reimbursable funds?
How were co-financing amounts and prices determined? How does the concessionality of the GCF financing compare
to that of the co-financing? If applicable, provide a short market read on the prevailing of the pricing and/or financial
markets for similar projects/programmes.

Justify why the level of concessionality of the GCF financial instrument(s) is the minimum required to make the
investment viable. Additionally, how does the financial structure and the proposed pricing fit with the concept of
minimum concessionality? Who benefits from concessionality?

In your answer, please consider the risk sharing structure between the public and private sectors, the barriers to
investment and the indebtedness of the recipient. Please reference relevant annexes, such as the feasibility study,
economic analysis or financial analysis when appropriate.

In terms of the requirement for GCF funding, there are two types of interventions in this project.

The first type of intervention involves scaling up demonstrated measures for SLM. In past activities, WB and the
GoE have laid the foundations for sustainable agricultural production and improvement of livelihoods. SLMP-I and
SLMP-II program activities have proved to be successful in restoring degraded lands and significant lessons have
been learned for further improvement of activities in the future.

With over 95% of agriculture output generated by smallholder farmers with average farm sizes between 0.5 and 2
hectares, the agricultural sector does not yet have the means to fund the introduction of SLM in all degraded
watersheds without concessional funding. The Ethiopian government is investing heavily in climate change
adaptation. Between 2007 and 2013, the government’s total investment in agriculture was around $1.1 billion, of
which around 40% ($0.4 billion) was from within the federal budget of the Ministry of Agriculture. 60% of the federal
budget ($0.3 bn) was spent on resilience activities related to addressing key climate risks. Around 80% of current
resilience spending ($0.2 bn) is on protecting the most vulnerable people in society through a program of safety
nets that provide income support and social assistance. However, due to the significant impacts of climate change
expected in Ethiopia and the vulnerability of most of the population, this investment will not be sufficient and GCF
funding is required to fully finance the incremental costs of climate change adaptation.

The government of Ethiopia has been investing successfully in the development of SLM. SLM practices address
both the short-term (erosion control, flood control) and the long-term goals of the government, which are part of
efforts to rehabilitate degraded areas through soil and water conservation measures. However, national resources
are insufficient to fund the remaining SLM investments required and additional funding is needed to finance the
required interventions in degraded watersheds. To date, the World Bank has supported these interventions through
concessional IDA credit. The loans requested from GCF for these investments are of a similar level of
concessionality as the IDA Credit. Highly concessional funding is appropriate due to Ethiopia’s status as a Least
Developed Country with a GDP per capita of $707 in 2017. In addition to SLM investments, GCF funding will also
be used to mitigate the risk and overcome the barrier of limited capacity to scale up the current coverage of SLM
activities. This risk includes the limited human resources to support beneficiaries in the planning and
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 43 OF 96

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implementation of complex interventions, the challenge of implementing a cost-effective M&E system, and the need
to strengthen coordination among institutions, sectors, programs and projects.

The GCF highly concessional funding, along with additional financing from IDA, MDTF and GoE, would build upon
previous SLM practices, taking into account lessons learned and introducing new activities in order to achieve
landscape restoration and establish green corridors. Activities would include land use rationalization, intercropping,
low tillage, gully reclamation, establishing grazing corridors, watering points and wells, and sylvo-pastoral
strategies. Large-scale landscape restoration is only achievable through GCF co-financing due to the nature and
scale of the needed investments. Land restoration lays the foundations for increased resilience to climate change
and mitigation capacity while it enables agricultural production.

The second type of intervention for which GCF funding is requested is that of measures intended to encourage the
adoption of Climate Smart Agriculture (CSA) practices and the development of strong value chains associated with
livelihoods based on SLM and CSA. By strengthening value chains linking livelihoods based on SLM and CSA
practices with the private sector, activities funded by GCF will contribute to the development of sustainable
livelihoods, providing incentives for maintaining SLM and CSA practices.

If correctly implemented, CSA helps increase yields while building farmer resilience and contributing to the
achievement of the NDC and several SDGs. Thus, CSA jointly addresses food security and climate change
adaptation and mitigation. The determining factors for effective CSA outcomes are the combination of practices
such as minimum tillage, crop residue management and crop rotation and intercropping. Challenges remain in the
implementation of this combination of practices, such as the need for a change of mindset of farmers, extension
workers and policy makers, competition for crop residue, lack of cover crops and lack of suitable technologies.
Concessional funding is needed in order to remove these barriers and create a culture and knowledge base within
which CSA can continue to be promoted by the extension services and implemented by farmers in future.

Without GCF involvement, Ethiopia cannot finance the proposed interventions. The national Climate Resilient
Green Economy strategy has called for annual spending of $7.5 billion to respond to climate change. With national
budgetary resources for climate-change relevant actions estimated to be in the order of $440 million per year and
international sources contributing tens of millions of dollars per year, there is a major financing gap. Poor access to
credit, high lending rates and an insufficient budget are not conducive to the investments required for handling local
climate change impacts. In addition, Ethiopia's Debt Sustainability Assessment recently changed the risk of debt
distress to high. Thus, GCF concessional financing, including a high degree of concessionality, is needed to ensure
improved resilience to climate change impacts and food security in Ethiopia.

Public goods include: management of communal land; externalities from soil erosion; and water-insecurity (risk of
droughts and floods). Market failures are found in the incomplete markets associated with: land-insecurity (lack of
defined land ownership); water-insecurity; and soil loss.

Improving management of non-cropland areas under communal use requires a public good approach. Livestock
grazing and firewood collection leads to deforestation and soil erosion on these communal lands (e.g. non-crop
land). Using private investments to improve resource management on communal lands is not possible unless all
costs and benefits can be internalized to a well-defined and functioning group of beneficiaries. Watershed
management is one approach to this, but it requires long-term public investments and capacity building beyond
what the private sector can do in the short term.

Soil erosion may lead to impacts outside the watershed management area (externalities). This means that costs
and benefits from the investment will be accrued by people outside the project area. There is no functioning market
for internalizing downstream negative effects and solving them with private sector investments or loans. Public
sector investment is required.
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 44 OF 96

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Water-insecurity (risk of droughts and floods) are exacerbated by poor water/land management as well as climate
change. There are no functioning markets for pricing water and impacts of disasters especially if the future holds
greater risks. This is a market failure that requires public investments due also to the long-term solutions required to
improve resource management.

The impact of poor soil management is felt by farmers and downstream beneficiaries, but there is no market value
put on soil or the loss of soil. The solutions to reducing soil erosion require investments as well as short-term loss of
income and food production while benefits accrue in the long term. Some benefits will also accrue externally to the
project area. This is a market failure. In addition, the lack of land security prevents private sector investments from
being realized due to increased risk from unclear property rights. Providing land security is a public responsibility.

Without land-, water- and soil-security no amount of private investment can ensure sustainable resource
management in the future. This fits neatly with GCF’s stated innovation is to use public investment to stimulate
private finance. The incremental net benefits in the 40 watersheds at most risk from climate change target already
poor and vulnerable populations. The grant proportion is justified compared to a loan because the net benefits are
not expected to improve the fiscal position of the GoE including no additional tax revenue from these populations.

Without the Project intervention, beneficiaries both in the area and downstream will continue to struggle to
establish or maintain their livelihoods and it is expected that without the Project, land use will continue on its
current path. Continued soil erosion, water insecurity, and land insecurity leads to land degradation with direct
losses to those that rely on crop and livestock production and related industries for their livelihood. Production
yields will go down or farmers will have to increase their input costs, on e.g. fertilizer, to maintain current yields. In
the absence of storage facilities, farmers will continue to experience post-harvest losses. They will also be unable to
capture higher crop prices that are only obtainable a few months after harvest and in larger markets. Non-
agricultural land in the watershed will also continue to deteriorate without the Project due to soil erosion and
overuse of common land through grazing livestock and firewood collection. This will put a further strain on the
population who derive their livelihood from forests, woodlands, and surrounding areas. Downstream from the
project area, continued land degradation will also affect areas and households through increased flood risk and
sedimentation of irrigation dams.

Figure 6 illustrates how this analysis assumes a declining production without Project interventions due to soil
erosion. With Project interventions the yield loss is avoided and, for some production systems (crops, livestock, and
grassland), with-project yields increase over time. This yield increase is attributed to adoption of improved cultivars,
improved seeds, better animal breeds, land restoration, water management, and implementing climate smart
agricultural techniques. The sum of the two shaded areas in the Figure constitute the incremental benefit
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 45 OF 96

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Figure 6 Illustration of incremental benefits

B.6. Exit strategy and sustainability (max. 500 words, approximately 1 page)
Explain how the project/programme sustainability (financial, institutional, social, gender equality, environmental) will
be ensured in the long run after project closure, including how the project’s results and benefits will be sustained.

Include information pertaining to the longer-term ownership, project/programme exit strategy, operations and
maintenance of investments (e.g. key infrastructure, assets, contractual arrangements). In case of private sector,
please describe the GCF’s financial exit strategy through IPOs, trade sales, etc.

Provide information on additional actions to be undertaken by public and private sector or civil society as a
consequence of the project/programme implementation for scaling up and continuing best practices.

The project will seek to ensure the long-term maintenance of restored landscapes through (i) an emphasis on
strengthening the value chains associated with sustainable agricultural practices in restored watersheds, designed
to build incentives for local communities to continue SLM practices, (ii) a focus on the provision of land-holding
certificates, to encourage investment in long-term landscape productivity, and (iii) policy an implementation support
for the establishment of watershed associations, combined with capacity building of local governments, to provide a
durable institutional framework SLM. For value chain connections including CSRPs – these investments will be
made through CIGs and cooperatives based on business plans that will include the identification O&M costs and
the revenues necessary to cover them, that will be generated through the connections to value chains

GCF funding will be used to enhance the climate resilience of and add innovative elements to the government’s
ongoing SLM program. Strong government ownership ensures long-term commitment to the promotion of SLM and
CSA practices, as part of the broader national goals of enhancing agricultural productivity, building resilience to
climate change, and achieving a carbon neutral economy. Specifically, MoF and MoA are committed to scaling up
and enhancing the success of the Government’s proven flagship SLM Program. Beyond this national commitment,
a particular focus of the RLLP is providing support for watersheds to graduate from development partner assistance
for SLM, such that maintenance of restored landscapes and CSA will become mainstreamed into local community
practices and local government functions. Component 2 of the proposed project will create institutions and build
capacity that will enable the CSA interventions to be sustainably implemented in watersheds that graduate from
project-based support. Spillover effects of successful SLM interventions have already been observed under the
ongoing program. For example, CSA pilot watersheds have been visited by farmers and extension workers from
adjacent areas and replicated through the government extension system. In addition to this spillover effect, the
RLLP will provide four specific forms of support for the graduation of watersheds:

• First, the principal emphasis of policy development under RLLP will be the establishment of a regulatory
framework for the creation of watershed associations, bringing together all stakeholders in restored
watersheds. This initiative will build on a pioneering effort in the Regional State of Amhara and will draw on
international best practice in this regard. In addition to providing the institutional framework required for
maintenance and further investment in SLM, the establishment of watershed associations is also designed
to leverage possible new sources of funding for SLM. This includes funding through Payment for
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 46 OF 96

Ecosystem Services (PES), such as payments for sustainable watershed management to deliver
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downstream benefits, for example by reducing flooding and sediment loads affecting hydrological
infrastructure (such as reservoirs for hydro-electric power generation), as well as payments for groundwater
recharge from private sector entities dependent on reliable water supply;
• Second, support for capacity building and information modernization under RLLP will emphasize building
permanent capacity in local governments to plan, implement and manage investments in SLM and CSA;
• Third, the focus of RLLP on strengthening value chains associated with livelihoods based on SLM and CSA
practices is designed to strengthen incentives for communities and local governments to maintain and
expand these initiatives;
• Fourth, in Component 3 support for land-holding certification will help secure land tenure for smallholders,
enhancing income opportunities and promoting resilient livelihoods in the long term. Land tenure provides
incentives to maintain restored landscapes, to abandon destructive practices such as free grazing, and to
persevere with CSA practices.

Measures that will be taken to enhance institutional capacity for implementation and sustainability are: (i) continual
training on project management and monitoring at all levels, in coordination with the GIZ SURED project; (ii) project
implementation arrangements acceptable to the World Bank and agreed by the MoA and regional governments
clarifying accountability and targets at all levels; and (iii) coordination between development partners Technical
Committee on SLM.

Sustainability will be ensured through the creation of exit strategies for each participating watershed, based on the
guideline Exit Strategy and Performance Assessment for Watershed Management (ESPAWM) (see Annex L.3.),
which also covers operation and maintenance (O&M). Annex 1 of the ESPAWM provides a sample framework for a
watershed-specific exit strategy, including activities and milestones specifically for highland water and land
management projects in Ethiopia. This framework includes the development of an O&M plan for all infrastructure
financed by the project. Annex 1 of the ESPAWM includes pointers on ensuring the O&M of community service
facilities, which have not been considered as a part of watershed development plans in the past, and consequently
not covered in O&M plans. Annex 1 also indicates the importance of establishing utilization arrangements for
springs/shallow wells, guarding, user fees, community-level trainings for O&M and O&M of introduced improved
farm machinery.

By the end of the project period, all watersheds included in the project are expected to have completed a Multi-Year
Development Plan (MYDP) and those already supported under SLMP will receive assistance to graduate from
project-based support for SLM. To help ensure the sustainability of the SLM interventions, the Project will provide
support for the creation of Watershed User Associations (WUAs) in each graduating watershed to replace the
project-based Community Watershed Teams (CWTs) and Kebele Watershed Development Committees (KWDCs)
with a legally recognized institution for the ongoing planning and management of the watershed.

Watershed Management and Use Plans (WMUPs) adopted by WUAs will detail management and use for
graduating watersheds, outlining agreements to conserve and utilize the resources and establishing bylaws for
managing and implementing conservation activities and the distribution of benefits. The development of these
WMUPs is critical to ensure land resources are used and managed in a way that enhances absorptive and adaptive
capacity to climate change, promoting resilience broadly at the landscape level.

Ongoing monitoring of the success of SLM and CSA will be ensured at the local level through the RLLP’s support
for information modernization as part of local government capacity building. At the national level, the involvement of
MoA and national research organizations in the impact evaluation, knowledge management and communication
 GREEN CLIMATE FUND FUNDING PROPOSALV.2.1 | PAGE 47 OF 96

B
sub-component will help ensure long-term commitment to monitoring, evaluating and improving the performance of
these initiatives.

The loan component of the GCF financing will be provided on similar concessional terms as IDA financing, and
repayments will be managed by the Government of Ethiopia through similar mechanisms.
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FINANCING INFORMATION
C.1. Total financing
(a) Requested GCF funding Total amount Currency
(i + ii + iii + iv + v + vi + vii) 165.24 million USD ($)
GCF financial instrument Amount Tenor Grace period Pricing
(i) Senior loans 107,174,255 40 years 10 years 0%
(ii) Subordinated loans Enter amount Enter years Enter years Enter %
Enter % equity
(iii) Equity Enter amount return

(iv) Guarantees Enter amount Enter years

(v) Reimbursable grants Enter amount
(vi) Grants 58,063,337
(vii) Results-based payments Enter amount
Total amount Currency
(b) Co-financing information
131 million USD ($)
Financial Tenor &
Name of institution Amount Currency Pricing Seniority
instrument grace
Senior 0% senior
Loans million 36 years
IDA 100
USD ($) 5 years

Ethiopia Resilient Landscapes Enter% Options

and Livelihoods multi-donor Grant
million Enter years
trust fund (“MDTF”), 31
USD ($) Enter years
administered by the World
Bank as Trustee
Options Enter% Options
Enter years
Click here to enter text. Enter amount Options Enter years

Amount Currency
(c) Total financing
(c) = (a)+(b) 296.24 million USD ($)
Please explain if any of the financing parties including the AE would benefit from
any type of guarantee (e.g. sovereign guarantee, MIGA guarantee).

(d) Other financing Please also explain other contributions such as in-kind contributions including tax
arrangements and exemptions and contributions of assets.
contributions (max. 250
Please also include parallel financing associated with this project or programme.
words, approximately 0.5
page)

C.2. Financing by component

Please provide an estimate of the total cost per component and output as outlined in section B.3. above and
disaggregate by source of financing. More than one co-financing institution can fund a single component or output.
Provide the summarised cost estimates in the table below and the detailed budget plan as annex 4.

Component GCF financing Co-financing Co-financing

 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 49 OF 96

Indicative Amount Financial Amount Financial Name of Amount Financial

C Name of
cost million Instrument million Instrument Institutions million Instrument Institutions
million USD USD ($) USD ($) USD ($)
($)
57.51 Grants
Component 1. Green
222.5
Infrastructure and Resilient 65 15.5
Livelihoods 85.49 Senior
Loans

Component 2. Investing in Senior

29.65 16.15
Institutions and Information for Loans 6 7.0
Resilience Senior
IDA Grants MDTF
Loans
Component 3. Rural Land 26 0
20 6
Administration and Use

Component 4. Project 0.49 Grants

Management and Reporting
18.09 9 2.5
Senior
5.60
Loans

Indicative total cost (USD) 31

296.24 165.24 100

This table should match the one presented in the term sheet and be consistent with information presented in other
annexes including the detailed budget plan and implementation timetable.

In case of a multi-country/region programme, specify indicative requested GCF funding amount for each country in
annex 17, if available.

Component Sub-component GCF funding (USD) IDA (USD) MDTF (USD)

Sub-component 1.1. Land Restoration

and Watershed Management 100,000,000 49,000,000 6,941,189

Component 1. Green Sub-component 1.2. Climate Smart

Infrastructure and Agriculture 15,000,000 10,000,000 8,462,561
Resilient Livelihoods
Sub-component 1.3. Livelihood
Diversification and Connection to 28,000,000 6,000,000 96,250
Value Chain
Sub-component 2.1. Capacity building,
Component 2. information modernization and policy 16,149,572 3,000,000 4,879,380
Investing in development
Institutions and
Sub-component 2.2. Impact
Information for
Evaluation, Knowledge Management 0 3,000,000 2,120,620
Resilience
and Communication

Component 3. Rural
Land Administration 0 20,000,000 6,000,009
and Use
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 50 OF 96

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Component 4. Project
Management and 6,088,020 9,000,000 2,500,001
Reporting

Total (excluding Accredited Entity Fee) 165,237,592 100,000,000 31,000,010

Total project financing includes the following sources of co-financing:

• International Development Association (IDA) loan: $100,000,000 concessional loan from IDA.
• Multi-donor trust fund (MDTF) grant: $19,000,000 from Norway and $12,000,0000 from Canada. Donor
contributions to the MDTF are in the respective currencies of the donor and are expected in tranches over the
life of the RLLP. Donor contributions to the MDTF are translated to United States dollars when the World
Bank receives the funds.

Grant vs Loan

The GCF loan will be applied across all sub-components funded by GCF except for some specific activities in Sub-
component 1.1 and Component 4 where GCF grant will be applied. Based on GCF's feedback emailed on November
18th, GCF stated that the grant portion should be in support of activities directly linked to the climate benefits.
Accordingly, considering the direct carbon sequestration associated with the set of activities and the need to build
gender-responsive resilience, following activities, listed below with their indicative estimates in brackets (actual
request is rounded off to $58 million), were selected for GCF grant funding:

Sub-component 1.1

• Construction of physical soil and water conservation measures on communal lands including degraded
hillside, shrub land and pastureland ($26,080,515)
• Pitting and planting of multi-purpose trees on degraded lands ($12,922,858)
• Establishment of model plantation blocks with native tree species ($2,268,510)
• Post plantation management of planted trees on communal lands ($ 15,856,773)
• Grass seeds for pastureland development ($ 450,313)

Component 4

• Gender mainstreaming ($ 484,368)

GCF loans are treated like IBRD/IDA loans and will be repaid in parallel following a repayment schedule to be
negotiated with GCF at Term Sheet and FAA stage. GCF loan is senior and not sub-ordinated.

C.3 Capacity building and technology development/transfer (max. 250 words, approximately 0.5 page)
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C.3.1 Does GCF funding finance capacity building activities? Yes ☒ No ☐
C.3.2. Does GCF funding finance technology development/transfer? Yes ☒ No ☒
If the project/programme is expected to support capacity building and technology development/transfer, please
provide a brief description of these activities and quantify the total requested GCF funding amount for these activities,
to the extent possible.

Component 2. Investing in Institutions and Information for Resilience

Activities will be funded by IDA and MDTF in watersheds identified for IDA funding (budget of USD 13.0 million) and
by GCF in watersheds identified for GCF funding (budget of USD 16.15 million).

The objective of this component is to enhance institutional capacity and improve information for better decision-
making in supporting resilient landscapes and diversified rural livelihoods in the project area, both for the duration of
the project and after project completion.

This component will build capacity at the local government level (woreda and kebele) for (i) planning and managing
SLWM interventions, and (ii) managing the land certification process. This will include piloting of new technologies for
information modernization at the local level, including the use of electronic tablets for gathering geospatial
information, and the use of Unmanned Aerial Vehicles (UAVs – or drones) for land certification mapping. Tablets and
UAVs will be the property of the project (i.e. MoA) and would be provided to development agents and the woreda
focal persons in the project watersheds for mapping and monitoring. The device setup, training, and support provided
will be tailored to meet the conditions and realities faced in field environment (i.e. off-line data collection, accessories
(protective case, solar charger, etc.), guidance materials, technical and trouble-shooting support).

Support for policy development under this component will focus on the regulatory framework for Watershed User
Associations (WUAs), community bylaws guiding land-use practices, and strengthening the Land Administration
System. This regulatory framework, once established, will continue to support resilient land use after project
completion. To strengthen the evidence base for sustainable land management decision-making, this component will
include a bio-physical impact evaluation of SLWM interventions, to be conducted through a partnership arrangement
between the MoA, the Water and Land Resource Centre of Addis Ababa University, and the Ethiopia Development
Research Institute’s Environment and Climate Research Center. This will complement a livelihoods impact evaluation
of SLWM interventions to be conducted in parallel led by the Gender Innovation Lab of the World Bank’s Africa
Region. When completed, these evaluations will be available to interested parties in Ethiopia and the region wishing
to institute or improve SLWM. This component will also provide resources to manage the knowledge generated
through these and other assessments of SLWM, and to communicate the lessons learnt to a broad audience,
including local governments and communities, relevant research institutions and Government agencies, as well as
Development Partners.

This component’s objectives will be achieved through the implementation of the following sub-components: (i)
capacity building, information modernization and policy development, and (ii) impact evaluation, knowledge
management and communication.

Sub-component 2.1. Capacity Building, Information Modernization and Policy Development

This sub-component will build capacity at local government level to implement RLLP, and to sustain SLWM
interventions after watershed graduation from project-based support. To achieve this, the sub-component will finance
accountants to support the head of the Woreda office of Agriculture (WoA) and a focal person in each participating
woreda, and part-time community facilitators at the kebele level (5 community facilitators for in each major
watershed). To help build the capacity necessary for an effective land administration system, this sub-component will
also provide technical assistance for training in this field.

This sub-component will support information modernization to coordinate data collection and information sharing at all
levels and under all components of the project so that this information is well organized, properly documented and
accessible. As part of this effort, a data management plan will be developed that specifies how all data used or
created during the course of RLLP will be documented, stored and otherwise managed. The use of electronic tablets
to collect information on project activities and results, combined with appropriate survey and mapping software, will
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improve the quality and timeliness of data collection and reduce the effort needed to compile, review, and generate
the necessary reports. This framework will facilitate access to information and support timely feedback to the local
level.

This sub-component further supports the use of aerial vehicles (UAVs)/drones to generate high-quality and timely
aerial imagery data to support planning, monitoring, and land certification. Under this initiative, the drones will be
operated by several teams of trained operators who will travel to the project sites. During the course of RLLP each
micro-watershed will be re-visited twice each year at appropriate intervals to generate visual and multi-spectral
images of the program areas. At each stage the processed imagery will be shared with the woreda and local field
staff for the purpose of assisting in planning, monitoring progress and updating implementation plans. The data and
materials produced will also be used to support M&E and will serve as a source of information and data for
subsequent analysis. Detailed technological specifications and budget have been elaborated including the technical
requirements for the drones, all associated equipment and spare parts, operating costs for the duration of the project.
The use of the drones is intended for the collection of information and data that will be available for long-term use and
for project planning and monitoring. The project will work with the Information Network Security Agency (INSA) and
the Ethiopian Aviation Authority to ensure all necessary permits are obtained.
Policy development under this sub-component will focus on the regulatory framework required for the establishment
of Watershed User Associations (WUAs), crucial for sustainability of SLWM interventions, frameworks for reward and
incentive schemes such as Payments for Environmental Services (PES), as well as community byelaws guiding land-
use practices, and strengthening of the Land Administration System.

In developing the framework for WUAs, the Project will work closely with regional governments for its application in
establishing WUAs. This work will commence with reviewing of the environmental legislation that relates to the use
and management of Ethiopia’s natural resources (soils, forestry, grassland, water, wildlife, etc.). The manual for CSA
will be used to proceed and enhance this activity. RLLP will give high attention to the opportunities of engagement of
private sector (PS) in all development activities of the project. The first objective of PS engagement in RLLP is, to
attract the PS to invest in RLLP interventions. The second objective is to create and increase income streams &
diversified livelihoods for the communities in a sustainable manner through the promotion of inclusive business and
value chain/partnership relationship based on profitability principles.

Sub-component 2.2 Impact Evaluation, Knowledge Management and Communication

Impact evaluations (IEs) will use rigorous research methods to look at specific interventions under RLLP, assess the
contribution of these to development goals and provide robust evidence of SLM impact. Project funding will focus on
the evaluation of bio-physical impacts, which will be conducted in coordination with a livelihoods impact evaluation to
be led by the Gender Innovation Lab of the World Bank’s Africa Region, financed separately. The bio-physical impact
evaluation will examine the response of the environment to SLWM interventions, considering parameters such as
peak and base surface water flows, groundwater levels and recharge rates, sediment loads, and remotely sensed
information on vegetation cover and soil moisture. For the purposes of this evaluation, the project will extend the
existing partnership between MoA, the Water and Land Resource Center of Addis Ababa University, and the
Environment and Climate Research Centre of EDRI, and will aim to build new partnerships with relevant international
research organizations.

In addition to the bio-physical IE and the livelihoods IE an evaluation of climate-smart agriculture will also be
conducted. Due to the complexity of the evaluations the details of their implementation are still under development.
Basic design of the IEs is expected to be as follows: the livelihoods IE is expected to involve random assignment. The
biophysical IE will involve a 2-stage sampling where in the first stage a stratified selection of watersheds to be treated
will be performed and in the second stage watersheds will be paired with a suitable comparison watershed (outside
project watersheds). This is being done to increase the explanatory power of the evaluation given the large cost
associated with each watershed monitored. The CSA evaluation is expected to follow a treatment-control comparison
methodology and the potential for randomized assignment within the CSA micro-watersheds is being explored. In any
case, the sampling of treatment and control will be randomized.

To build a solid and effective knowledge management system both for the project and the SLM program in Ethiopia,
this sub-component will establish a geospatial knowledge platform that combines information from a variety of project
and other sources and packages it in a format that is accessible to planners and stakeholders at the national,
regional, and local levels. This activity will build upon the work being done by WLRC under SLMP II to develop a web-
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 53 OF 96

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based knowledge management system. By enabling farmers to improve their planning the platform will decrease their
exposure to climate change related risks.

A strategic communication program will be developed and implemented under this sub-component to inform and
mobilize communities, enhance project visibility and transparency among all actors, support efforts to scale-up SLM
and CSA practices, and build support for the land certification program. Strategic guidelines for the implementation of
the Knowledge Management and Communication (KMC) program have been developed following a rapid KMC needs
assessment. The guidelines include viable options of knowledge management, knowledge sharing and
communication with effective channels, techniques, tools and key messages that address the communication and
knowledge management needs of beneficiaries, stakeholders, partners and actors at various level. While following
those guidelines, implementers will have room to elaborate, modify and adapt additional communication and
knowledge management interventions to meet the overarching goals and specific objectives outlined in this sub-
component. The identified overarching goals are: 1) to build and coordinate a strong knowledge base contributing to
the effective promotion, reporting and scaling up of SLM within Ethiopia; and 2) to inform and mobilize local
communities, strengthen consultation/ participatory development models, and enhance transparency in program-
supported activities. The specific objectives of the KMC program are to: a) Support scaling up efforts and adoption of
SLM and CSA practices; b) Help evidence based planning and reporting through enhanced information flow among
institutions and coordination of monitoring and evaluation; c) Enhance the program visibility among all actors thereby
attract new development partners and insure the buy-in of the government; d) Sustain the outcomes of SLM practices
through awareness raising campaigns. This includes relevant activities in components 1 and 3 such as land
certification. The guidelines include means of verification to evaluate the effectiveness of the activities implemented
within the KMC program.

Possible activities include:

i. knowledge identification, capturing, validation and packaging annually to support scaling up efforts, build
capacity of user groups, youth groups, DAs and FTCs (experiential knowledge, best practice and synthesis of
explicit knowledge products from various sources such as the geo-spatial knowledge platform, the CSA
Innovation Platform, model watershed, etc.);
ii. strengthening and enhancing functionality of existing FTCs and SLM information centers at woreda level and
establishing info centers in new woredas;
iii. outreach activities (i.e. production of printed, audio and video materials to be used as supporting tools during
workshops and events, and media tours for journalists and PR officers of relevant regional bureaus to show
project results);
iv. knowledge sharing/networking events (i.e. annual SLMP Knowledge fair); and
v. advocacy activities to support private sector engagement, policy development and other key initiatives for
RLLP effective implementation (i.e. organization of Stakeholders Workshops).
vi. grassroots level behavioral change campaign targeted to major/critical watersheds, based on preliminary
research to define appropriate media (drama, storytelling, etc.) and effective messengers (i.e.
community/religious leaders) and gauged throughout the duration of the program through a mix of
qualitative/quantitative research methods (FGDs, community level meetings, survey);
vii. public information awareness activities on land registration and cadastral surveys, land laws and procedures
and conflict resolution mechanism, and to explain the benefits of (formalized) rentals and unlock the blockage
set by cultural norms, emphasizing that temporary land renting does not imply abandonment and formalized
rental contracts do not result in land being expropriated.
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D
D.EXPECTED PERFORMANCE AGAINST INVESTMENT CRITERIA
This section refers to the performance of the project/programme against the investment criteria as set out in the
GCF’s Initial Investment Framework.
D.1. Impact potential (max. 500 words, approximately 1 page)
Describe the potential of the project/programme to contribute to the achievement of the Fund’s objectives and result
areas. As applicable, describe the envisaged project/programme impact for mitigation and/or adaptation. Provide the
impact for mitigation by elaborating on how the project/programme contributes to low-emission sustainable
development pathways. Provide the impact for adaptation by elaborating on how the project/programme contributes
to increased climate-resilient sustainable development. Calculations should be provided as an annex. This should be
consistent with section E.2 reporting GCF’s core indicators.

In terms of the requirement for GCF funding, there are two types of interventions in this project. The first type of
intervention involves scaling up demonstrated measures for SLM. In past activities, WB and the GoE have laid the
foundations for sustainable agricultural production and improvement of livelihoods. SLMP-I and SLMP-II program
activities have proved to be successful in restoring degraded lands and significant lessons have been learned for
further improvement of activities in the future.

With over 95% of agriculture output generated by smallholder farmers with average farm sizes between 0.5 and 2
hectares, the agricultural sector does not yet have the means to fund the introduction of SLM in all degraded
watersheds without concessional funding. The Ethiopian government is investing heavily in climate change
adaptation. Between 2007 and 2013, the government’s total investment in agriculture was around $1.1 billion, of
which around 40% ($0.4 billion) was from within the federal budget of the Ministry of Agriculture. 60% of the federal
budget ($0.3 bn) was spent on resilience activities related to addressing key climate risks. Around 80% of current
resilience spending ($0.2 bn) is on protecting the most vulnerable people in society through a program of safety nets
that provide income support and social assistance. However, due to the significant impacts of climate change
expected in Ethiopia and the vulnerability of most of the population, this investment will not be sufficient and GCF
funding is required to fully finance the incremental costs of climate change adaptation.

The government of Ethiopia has been investing successfully in the development of SLM. SLM practices address both
the short-term (erosion control, flood control) and the long-term goals of the government, which are part of efforts to
rehabilitate degraded areas through soil and water conservation measures. However, national resources are
insufficient to fund the remaining SLM investments required and additional funding is needed to finance the required
interventions in degraded watersheds. To date, the World Bank has supported these interventions through
concessional IDA credit. The loans requested from GCF for these investments are of a similar level of concessionality
as the IDA Credit. Highly concessional funding is appropriate due to Ethiopia’s status as a Least Developed Country
with a GDP per capita of $707 in 2017. In addition to SLM investments, GCF funding will also be used to mitigate the
risk and overcome the barrier of limited capacity to scale up the current coverage of SLM activities. This risk includes
the limited human resources to support beneficiaries in the planning and implementation of complex interventions, the
challenge of implementing a cost-effective M&E system, and the need to strengthen coordination among institutions,
sectors, programs and projects.

The GCF highly concessional funding, along with additional financing from IDA, MDTF and GoE, would build upon
previous SLM practices, taking into account lessons learned and introducing new activities in order to achieve
landscape restoration and establish green corridors. Activities would include land use rationalization, intercropping,
low tillage, gully reclamation, establishing grazing corridors, watering points and wells, and sylvo-pastoral strategies.
Large-scale landscape restoration is only achievable through GCF co-financing due to the nature and scale of the
needed investments. Land restoration lays the foundations for increased resilience to climate change and mitigation
capacity while it enables agricultural production.

The second type of intervention for which GCF funding is requested is that of measures intended to encourage the
adoption of Climate Smart Agriculture (CSA) practices and the development of strong value chains associated with
livelihoods based on SLM and CSA. By strengthening value chains linking livelihoods based on SLM and CSA
practices with the private sector, activities funded by GCF will contribute to the development of sustainable
livelihoods, providing incentives for maintaining SLM and CSA practices.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 55 OF 96

If correctly implemented, CSA helps increase yields while building farmer resilience and contributing to the
D
achievement of the NDC and several SDGs. Thus, CSA jointly addresses food security and climate change
adaptation and mitigation. The determining factors for effective CSA outcomes are the combination of practices such
as minimum tillage, crop residue management and crop rotation and intercropping. Challenges remain in the
implementation of this combination of practices, such as the need for a change of mindset of farmers, extension
workers and policy makers, competition for crop residue, lack of cover crops and lack of suitable technologies.
Concessional funding is needed in order to remove these barriers and create a culture and knowledge base within
which CSA can continue to be promoted by the extension services and implemented by farmers in future.

Without GCF involvement, Ethiopia cannot finance the proposed interventions. The national Climate Resilient Green
Economy strategy has called for annual spending of $7.5 billion to respond to climate change. With national
budgetary resources for climate-change relevant actions estimated to be in the order of $440 million per year and
international sources contributing tens of millions of dollars per year, there is a major financing gap. Poor access to
credit, high lending rates and an insufficient budget are not conducive to the investments required for handling local
climate change impacts. In addition, Ethiopia's Debt Sustainability Assessment recently changed the risk of debt
distress to high. Thus, GCF concessional financing, including a high degree of concessionality, is needed to ensure
improved resilience to climate change impacts and food security in Ethiopia.

Without the Project intervention, beneficiaries both in the area and downstream will continue to struggle to establish
or maintain their livelihoods and it is expected that without the Project, land use will continue on its current path.
Continued soil erosion, water insecurity, and land insecurity leads to land degradation with direct losses to those that
rely on crop and livestock production and related industries for their livelihood. Production yields will go down or
farmers will have to increase their input costs, on e.g. fertilizer, to maintain current yields. In the absence of storage
facilities, farmers will continue to experience post-harvest losses. They will also be unable to capture higher crop
prices that are only obtainable a few months after harvest and in larger markets. Non-agricultural land in the
watershed will also continue to deteriorate without the Project due to soil erosion and overuse of common land
through grazing livestock and firewood collection. This will put a further strain on the population who derive their
livelihood from forests, woodlands, and surrounding areas. Downstream from the project area, continued land
degradation will also affect areas and households through increased flood risk and sedimentation of irrigation dams.

Figure 6 illustrates how this analysis assumes a declining production without Project interventions due to soil erosion.
With Project interventions the yield loss is avoided and, for some production systems (crops, livestock, and
grassland), with-project yields increase over time. This yield increase is attributed to adoption of improved cultivars,
improved seeds, better animal breeds, land restoration, water management, and implementing climate smart
agricultural techniques. The sum of the two shaded areas in the Figure constitute the incremental benefit

Figure 6 Illustration of incremental benefits

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D.2. Paradigm shift potential (max. 500 words, approximately 1 page)
Describe the degree to which the proposed activity can catalyze impact beyond a one-off project or programme
investment. Describe the following, if applicable:
• Potential for scaling up and replication
• Potential for knowledge sharing and learning
• Contribution to the creation of an enabling environment
• Contribution to the regulatory framework and policies
• Overall contribution to climate-resilient development pathways consistent with relevant national climate change
adaptation strategies and plans
The RLLP will scale up, transform and innovate through the government of Ethiopia’s ongoing SLM program.
Following the success of earlier SLM interventions, the RLLP represents a paradigm shift by focusing on building the
institutions and incentives necessary for long-term investment in, and maintenance of, restored landscapes that are
both resilient to climate change and sequester carbon. Transformative elements of the RLLP include (i) an emphasis
on strengthening the value chains associated with sustainable agricultural practices in restored watersheds, designed
to build incentives for local communities to maintain restored landscapes over the long term, (ii) a focus on the
provision of land-holding certificates, to encourage investment in long-term landscape productivity, and (iii) policy
support for the establishment of watershed associations, combined with capacity building of local governments, to
provide an institutional framework for long-term maintenance of restored landscapes.

The theory of change behind this package of interventions (as shown in the illustration below) is that by delivering
more productive, secure and resilient livelihoods to local communities and by establishing the institutional framework
needed to support maintenance of restored landscapes over the long term through watershed associations and local
governments, the RLLP will lead to a durable shift towards SLM in the degraded watersheds of the Ethiopian
highlands.

Such dissemination will be encouraged through awareness generating initiatives and training programs undertaken
under Component 2.1, including farmer to farmer experience exchange visits, field schools, and awareness raising
workshops (refer to Annex K.1. RLLP Detailed Budget). These activities will mobilize traditional self-help institutions
of the communities in the project woredas, which have already contributed immensely to effective Project
implementation and sustainability. For example, in all implementing regions and woredas, there are indigenous
institutions (such as “Idir”, “Yehager Shimaglewoch”, (Elders), religious fathers, “Maheber”, etc.), which have been
established by the community for different purposes and are also working for the successful implementation and
dissemination of SLM practices (refer to Annex D.1. RLLP Social Assessment). In addition, Ethiopian communities
are used to financing investments through rotating savings and credit associations (ROSCA) called ekub rather than
through the underdeveloped formal financial sector.

RLLP will be implemented by MoA, the ministry responsible for agriculture in the entire country. The ministry, working
together with WB and other donors, already has a clear history of scaling up – SLMP-II expanded the area included in
SLMP-I and RLLP will expand the project area further (see Figure 2). The Government of Ethiopia aims to introduce
sustainable land use practices for all agricultural land in the country and if RLLP is as successful as the preceding
SLM programs, there is every intention to continue the process of scaling up in the coming years. MoF and MoA are
committed to scaling-up and ensuring the long-term sustainability of the Government’s proven flagship SLM Program.

RLLP will also seek to identify innovative sources of SLM financing, including Payment for Ecosystem Services
(PES) from either (i) private sources with an interest in restored watersheds, as exemplified by the recent agreement
with Raya Brewery-BGI Ethiopia in the Tigray Region, or (ii) public sources such as municipalities and River Basin
Authorities with an interest in improved catchment management to extend the lifetime and productivity of hydrological
infrastructure, including for hydropower, irrigation and water supply. Further information on the project’s engagement
with the private sector is provided in Section E.5.3 and Annex B.1.

The knowledge generated and experience gained through implementation and evaluation of RLLP will also be
disseminated more broadly to inform the design of SLM interventions internationally.

D.3. Sustainable development (max. 500 words, approximately 1 page)

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Describe the wider benefits and priorities of the project/programme in relation to the Sustainable Development Goals
and provide an estimation of the impact potential in terms of:
• Environmental co-benefits
• Social co-benefits including health impacts
• Economic co-benefits
• Gender-sensitive development impact
The proposed interventions are designed to support climate change adaptation and mitigation, enhancing long-term
resource productivity while generating multiple social, environmental and economic co-benefits.

Environmental Benefits
Benefits from improved water management include increased soil moisture and reduced variability in response to
flood/drought conditions. Soil retention provides benefits both on-site in terms of soil quality and off-site in terms of
reduced erosion; it can be measured in terms of land savings or erosion prevention. Increased soil fertility is a
determining factor for higher and less variable crop yields. Increased vegetation cover also helps to prevent erosion
and improves downstream water quality, while simultaneously supporting biodiversity, which will be further enhanced
through investment in green corridors.

An illustration of the benefits that sustainable land management can provide in Ethiopia is provided by the Productive
Safety Net Program (PSNP). Under RLLP, a number of communities graduating from food-insecure status in newly
identified watersheds will transition from support under PSNP to join the SLM Program. The PSNP implements land
restoration and sustainable land management and mitigates nearly 3.4 million t CO2e per year (+/-20%), achieved by
sequestering carbon in biomass and soils.19 This equates to 1.5% of Ethiopia’s Nationally Determined Contribution
(NDC) to mitigation.20

Social and Economic Benefits

The principal direct set of benefits from the RLLP will be improved incomes and more resilient livelihoods of
vulnerable communities in degraded watersheds targeted by the project as a result of investments in SLM, climate
resilient livelihood diversification (including grain-, meat-, dairy-, and bamboo-processing; tree seedling nurseries;
manufacturing of improved cook stoves, production of improved environmental services; and private sector initiatives
for PES or CSR), value chain strengthening, and land-holding certification. These interventions are also expected to
deliver co-benefits, including: (i) health benefits of reduced exposure to household air pollution and of improved
nutrition due to a more varied food production, (ii) reduced time spent on biomass fuel collection through the use of
improved cookstoves, and (iii) enhanced infrastructure resilience as a result of reducing flooding and sediment loads.
Benefits from improved administration and tenure rights include conservation of protected areas, biodiversity and
tourism.

RLLP will support climate resilient food security of communities graduating from the PSNP and prevent a return to
food insecurity of these communities as a result of climate shocks, resulting in social and economic benefits for
vulnerable communities in the targeted watersheds. Through the PSNP, the immediate food needs of 8 million people
were met by improving land restoration and infrastructure, and smallholder farmers increased maize yields by an
average of 38%.21

Project-funded capacity building and institutional development at all levels have direct value in that they increase the
skill level in public sector institutions and enable them to work more efficiently in providing essential and enhanced
public goods and services. These institutional benefits are not quantified in the Economic and Financial Analysis
(EFA), but they are seen as critical to ensuring that the other benefits can be realized when it comes to building
productive alliances with access to agricultural financing, land, and other business enabling services.

According to a financial and economic analysis (EFA) of the RLLP, the estimated value of avoided soil erosion varies
between US$ 0.1 and US$ 0.3/tonne of soil depending on the gross marginal value land use (US$ 0.11/tonne of soil
represents non-cropland, while US$ 0.26/tonne is the value of avoided erosion for cropland).The Integrated Financial
and Economic Analysis conducted during project preparation estimates a farm-level gross margins increase of more
than USD 101/year/person, including the value of production used for home consumption, which is 1.2 times the
Food Poverty Line. When assuming 5 persons per household farm, the gross margin can increase to at least USD
101 per household member per year. To associate this result with a measure of absolute poverty, we use the
National Poverty Line for Ethiopia. The poverty line indicates the money required to afford the food covering the
minimum required caloric intake (Food Poverty Line) and additional non-food items. The improvement in farm gross
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margin is around 1.2 times the Food Poverty Line in 2018 terms (USD 85/person/year). This improvement is also
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about 63% of the total National Poverty Line (USD 162/person/year). Other representative farms are estimated to
capture higher growth in gross margins of up to USD 135/person/year. This is a direct measure of increased
resilience in the project area.

Gender Sensitive Development Impact

In addition to promoting women’s participation in community watershed committees, the RLLP will extend experience
under the ongoing SLM program to ensure women fully share in project benefits. In particular, women will continue to
be specifically targeted in the issuance of land-holding certificates, and in the design of support for income-generating
activities. Women and children will benefit disproportionately in the health and time-savings benefits of improved
cookstoves. To ensure that gender-specific lessons are learnt during implementation of the RLLP, a socio-economic
impact evaluation will be conducted by the World Bank’s Africa Region Gender Innovation Lab. Specific gender-
sensitive development impacts include:

• Strengthened implementation practices (planning, implementation and monitoring processes) for equitable
and meaningful participation of females and males in sustainable land restoration and water conservation
practices (50 % female representation in all stages)

• Integrated landscape management practices adopted by local communities based on practical and strategic
gender needs and priorities.

The SLMP-II has produced several gender-related benefits. For example, it had a positive influence on gender norms
and perceptions about women. Income generation through the SLMP-II was appreciated by women participants, who
pointed out that they have gained more respect from community members because of their increased self-reliance.
Another substantial impact was an increase in women’s self-confidence. There have been changes in attitudes about
women’s roles and capacity, and women have started to feel more confident and motivated to engage in IGAs and
climate smart agriculture. The land holding certification component also anticipates benefits by enhancing women’s
access to and control over one of the most important productive assets in a rural community: land. Land tenure will
address the strategic needs of women, such as economic empowerment, enhanced decision-making power, and
improved power relations in the household.

D.4. Needs of recipient (max. 500 words, approximately 1 page)

Describe the scale and intensity of vulnerability of the country and beneficiary groups and elaborate how the
project/programme addresses the issue (e.g. the level of exposure to climate risks for beneficiary country and groups,
overall income level, etc.). Describe how the project/programme addresses the following needs:
• Vulnerability of the country and/or specific vulnerable groups, including gender aspects (for adaptation only)
• Economic and social development level of the country and the affected population
• Absence of alternative sources of financing (e.g. fiscal or balance of payments gap that prevents government
from addressing the needs of the country; and lack of depth and history in the local capital market)
• Need for strengthening institutions and implementation capacity
Ethiopia’s Second National Communication identified the primary cause of vulnerability to climate variability and
change as a high dependence on rain-fed agriculture, which is sensitive to climate variability and change. Other
causes cited included under-development of water resources, low health service coverage, a high population growth
rate, low economic development, low adaptive capacity, inadequate road infrastructure in drought prone areas, weak
institutional structures, and lack of awareness.22

According to the vulnerability assessment in the SNC based on existing information and assessments, the most
vulnerable sectors to climate variability and change are agriculture, water and human health. In terms of livelihoods,
smallholder rain-fed farmers and pastoralists are found to be the most vulnerable. Ethiopia’s rural livelihoods are
highly dependent on the performance of the agriculture and forestry sectors, which are highly sensitive to climate
change. Over 80 % of the Ethiopian population lives in rural areas and are consequently highly dependent on the
performance of productive landscapes for income, energy, food, building materials, and water. Furthermore,
agriculture accounts for most jobs and about 40 % of output and exports, exacerbating exposure to the risks of
climate change, which include increased soil erosion and more frequent droughts and floods. The arid, semi-arid and
dry sub-humid parts of the country are affected most by drought.23
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Furthermore, the project regions exhibit low adaptive capacity, which increases vulnerability. Although it is not
possible to have an exhaustive list of indicators that assess adaptive capacity of a region due availability of
processed data for the proposed project regions, the indicators in Table 2 below relates directly to usage and quality
of water, energy and settlement, and indirectly to the level and quality of education and health facilities. For example,
the use of modern construction materials directly indicates the quality of settlements available to resist the physical
impacts of climate variation. The under 5-mortality rate, however, may indirectly indicate that health facilities are of
poorer quality, or that lower levels of supplementation and vaccinations are being provided.

Table 2 Adaptive capacity indicators in project regions24

The adaptive capacity indicators assessed above indicate that most of the targeted watersheds are situated in regions
that have relatively low adaptive capacity. The regions of Afar, Somali, Oromia, and Tigray, which have relatively high
poverty levels, are comparatively more vulnerable to climate change than other regions in the country.25 Institutional
capacity to respond to impacts in those areas is also low. One study assessed the flood risks and health-related
issues in the Gambella region of the country. It identified three critically important weaknesses, including a lack of
flood-specific policy, absence of risk assessment, and weak institutional capacity.26

A recent World Bank book examines the potential impact of climate change and climate policies on poverty reduction27.
It suggests that as a result of differences in exposure and vulnerability, natural disasters increase inequality and may
contribute to a decoupling of economic growth and poverty reduction. For instance, after Ethiopia’s 1984–85 famine, it
took a decade on average for asset-poor households to bring livestock holdings back to prefamine levels. Poor people
can become more resilient to shocks in agriculture thanks to trade and food reserves that can overcome local shortages
in times of need, better access of poor farmers to markets, and improved technologies and climate-smart production
techniques. Access to functioning markets, however, depends on better infrastructure and better institutions. For
instance, in Ethiopia, the incidence of poverty decreased by 6.7 % following farmers’ access to all-weather roads. Case
studies from Ethiopia provided in the book further suggest that the cost of a drought to households can increase from
zero to about $50 per household if support is delayed by four months, and to about $1,300 if support is delayed by six
to nine months. This rapid increase, which is due to irreversible impacts on children and distress sales of assets
(especially livestock), helps explain why most post-disaster responses have multiple stages. Typically, initial support is
delivered quickly—even at the expense of targeting and accuracy—and larger recovery and reconstruction efforts are
provided later with more emphasis on appropriate targeting. The authors conclude that providing resources for climate
risk analysis and project preparation and ensuring that financial instruments and resources are available for
development and poverty reduction investments can provide a window of opportunity before the impacts of climate
change materialize.28

Figure 6 shows the population density in Ethiopia as well as population density against all restored watersheds and
those planned by RLLP. This map shows that most of the restored and planned watersheds are located in densely
populated parts of the country.
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Figure 6 Population density in Ethiopia

By focusing on the most degraded watersheds in the Ethiopian highlands, the RLLP will target the communities most
vulnerable to climate change impacts. Under Component 1, sustainable soil and water conservation practices will
reduce exposure to climate-related impacts such as erosion and drought. Climate-smart agricultural practices will
reduce the sensitivity of the sector to climate change and variability, and livelihood diversification will reduce the
sensitivity of communities to impacts affecting the agricultural sector. Under Component 2, the capacity building and
information modernization activities will increase adaptive capacity at the local government level. Under Component
3, activities to secure land tenure for small-holder farmers will increase household resources and encourage the
adoption of SLMPs, which will reduce sensitivity to climate impacts and increase adaptive capacity through the
dissemination of adaptive measures across highly vulnerable regions. In addition, the roll-out of the NRLAIS under
this component will increase adaptive capacity at the regional and national level by introducing evidence-based
monitoring and ensuring a coordinated and consistent approach to the development of policies, legislation,
regulations, models and research to enhance sustainable land governance.

The project will work with the most vulnerable populations in the target areas. Detailed bio-physical information will be
used to prepare MYDPs for new watersheds. Local-level participatory land use planning teams at the woreda and
kebele level will ensure that interventions benefit smallholder farmers. The project also includes activities specifically
targeting the particularly vulnerable group of landless and jobless youth and women. In these activities, landless youth
will be provided with communal land certificates in exchange for land restoration. The project will also ensure that the
provision of landholding certification will be implemented in such a way that half of the title-holders will be women. This
will enable these groups to participate in agricultural production, as well as on the agricultural market, thus enhancing
their income opportunities.

D.5. Country ownership (max. 500 words, approximately 1 page)

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Please describe how the beneficiary country takes ownership of and implements the funded project/programme.
Describe the following:
• Existing national climate strategy
• Existing GCF country programme
• Alignment with existing policies such as NDCs, NAMAs, and NAPs
• Capacity of Accredited Entities or Executing Entities to deliver
• Role of National Designated Authority
• Engagement with civil society organizations and other relevant stakeholders, including indigenous peoples,
women and other vulnerable groups

The RLLP will build on and scale up the results of the two completed Sustainable Land Management Programs, SLMP-
I and SLMP-II. RLLP is also designed to be complementary to and avoid overlap with related government programs
such as the Productive Safety Net Program (PSNP), The Second Agricultural Growth Program (AGP 2), the Agricultural
Transformation Agency (ATA) and others. The diagram below summarizes the relationship of the RLLP to the most
important baseline projects, which are described further below.

Figure 2 Baseline projects

Baseline projects
The proposed project has been requested by the government of Ethiopia to both scale up the success of the ongoing
SLM program and introduce new, transformative and innovative elements. Ethiopia’s problem of land degradation
caused by erosion, drought, loss of vegetative cover, and unsustainable grazing and cultivation practices has led to the
development of official government programs for better land management. These programs have evolved from an
unsuccessful “top-down” approach to one that recognizes the importance of community participation in decision making,
not simply as a source of labor.

The Government developed, with support from the TerrAfrica partnership, the Ethiopia Strategic Investment Framework
for SLM. This investment plan anchored the establishment of the GoE’s programmatic approach to scaling up SLM.
Called the SLM Program, it provided the platform for convening and coordinating assistance from donors. When it was
developed, the SLM Program targeted 177 "high potential, food secure" watersheds. Before this programmatic
approach was undertaken by the GoE and partners, efforts to address land degradation were piecemeal and scattered
throughout the country.

Sustainable Land Management Program-I (SLMP-I)

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As part of the SLM Program, the World Bank/GEF-financed SLMP-I operation targeted 35 watersheds initially, later
expanding to 45. The initial target group was an estimated 500,000 beneficiaries, representing rural households living
in 35 large watersheds assisted by the project. These large watersheds, with an average size of about 8,500 ha, were
located in six Regional States of Ethiopia (Amhara, Oromia, Tigray, SNNP, Beneshangul/Gumuz, and Gambella). In
addition, through the capacity building activities of the project, technical staff at the central (Federal Ministry of
Agriculture and Livestock Resource, MoA), regional (Woreda) and district (Kebele) levels benefited from training and
improved working conditions. The project was declared effective in March 2009 and closed on schedule 4.5 years later
(September 2013) with no extensions.

Key conclusions of the final evaluation of SLMP-I were that the project's objectives were substantially relevant to the
country context and priorities. As part of the project, 45 participatory Watershed Management Plans and 613
community-based micro-watershed management plans were prepared. The area under sustainable land management
in the targeted watersheds increased from 86,892 ha to 209,926 ha by project closure. The Normalized Difference
Vegetation Index (NDVI), a measure of vegetation cover and a proxy measure for the reduction of land degradation,
increased in the project areas by 0.543 (9%) over baseline of 0.498 and soil carbon increased by 31% during the period
2009-2013. At appraisal, the project team estimated an overall Economic Rate of Return (ERR) of 10-17% and a
Financial Rate of Return (FRR) of 8-11%. The cost benefit analysis conducted at closure calculated an IRR that ranged
from 10.41% to 22.60%.

SLMP-II
SLMP-I was considered successful by the GoE, which committed to a larger follow-on project, SLMP-II, that aimed to
consolidate the SLM platform and expand the number of large watersheds assisted from 45 to 135. In SLMP-II MoA
continued to develop and implement the innovative, integrated and inclusive SLM Program that supports (i) efforts to
address land degradation and climate risks and productivity constraints through a landscape approach, and (ii)
contributes to growth in the agricultural sector in general. SLMP-II aimed at (i) further scaling up and consolidating the
pioneering efforts and achievements of the project, mainly through replicating the project’s assistance to 90 additional
watersheds; (ii) contributing to the consolidation and harmonization of MoA’s multi-donor SLM program; and (iii)
synergizing the project’s achievements in terms of reduced soil degradation and improved water management by
promoting a comprehensive livelihood improvement strategy anchored on “climate-smart” agricultural practices in
beneficiary farmlands, households, and communities.

In SLMP-II, natural and economic wealth was built on over 1.3 million hectares of degraded communal and smallholder
lands through an integrated package of activities in targeted watersheds that included: (i) management of natural
resources (soil and water conservation structures, agroforestry, participatory forest management, enclosures to reduce
free grazing and allow assisted natural regeneration, small-scale irrigation, water point development, climate-smart
technologies on household farmland, and land use planning); (ii) improved land rights through issuance of legal
landholding certificates to one million people, including women and landless youth; and, (iii) livelihoods support,
including for promotion of improved cookstove adoption that reduces fuelwood demand, women’s labour, and
respiratory illnesses.

Results from SLMP-II financing are well documented. During a major drought in 2015-16 there is some evidence that
water and food security in participating districts were strengthened compared to untreated areas. Degraded lands have
been brought back into production for local farmers, dry season base flow of streams and depth to water table are
improving, and protective vegetation cover was either maintained or expanded, as verified by remote sensing. In
addition, approximately 9 million tons of additional CO2eq have been accumulated in restored productive lands in
SLMP-II areas, a proxy for system function as well as a contribution to climate change mitigation. Smallholder farmers
regularly express how their identity and sense of place has also been restored through landscape restoration and
improved legal land rights. Many community members who were ready to migrate remained in their birthplace and were
able to afford to send their children to school. They were able to improve nutrition by producing vegetables and fruits
using small-scale irrigation, by diversifying through poultry, apiculture and woodlot production, and by increasing
livestock productivity through forage management.

Linkages with other government programs and projects

Flagship programs of the MoA include the Second Agricultural Growth Program (AGP) and the Productive Safety Net
Program (PSNP). PSNP is aimed at enabling the rural poor facing chronic food insecurity to resist shocks, create assets
and become food self-sufficient. It provides multi-annual predictable transfers, as food, cash or a combination of both,
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to help chronically food insecure people survive food deficit periods and avoid depleting their productive assets while
attempting to meet their basic food requirements. Under RLLP, a number of communities graduating from food-insecure
status in newly identified watersheds will transition from support under PSNP to join the SLM Program, while at the
other end of the SLM cycle a number of restored watersheds that benefitted from investments under SLMP-I and SLMP-
II will graduate from project-based SLM support to continue investment in sustainable, productive landscape
management through mainstream government programs.

With support from the Pilot Program for Climate Resilience and the BioCarbon Fund, the Bank is further supporting the
government’s Climate Resilient Green Economy (CRGE) Facility and four line ministries led by the Ministry of Finance
and Economic Cooperation (MoF) to implement a Multi-Sector Investment Plan (MSIP) for climate resilience in key
sectors, including agriculture, forestry, water resources, irrigation, and energy, in the context of resilient landscapes.

RLLP plans to work closely with the GCF financed project “Responding to the increasing risk of drought: building
gender-responsive resilience of the most vulnerable communities” that is being implemented by MoF. Progress in the
implementation of Component 1: Improved access to water to build a resilient livelihood and Component 2:
Management of Natural Resources for Sustained Water Availability of the MoF project will enhance the impact of
Component 1 of RLLP: Investment on Green Infrastructure and Resilient Livelihoods.

The link between the SLMP I and II, RLLP and the MoF project is quite close. As Section C.2, Paragraph 36 of the MoF
project proposal explains, “Project results will feed into other on-going national initiatives such as the IWRM projects
being implemented in the various watersheds, SLMP, AGP and REDD+ programs being implemented in the adjacent
Kebeles. This project could be considered as one of the few initiatives in Ethiopia that has put climate change in to
building the resilience of the communities. Whilst there are various ongoing national development programs and
projects, climate change has not been captured at the core of it. This program has been strategically designed to
address current and future water supply issues to the community as well as integrate initiatives and structural
adjustments to efficiently manage this resource.”

The creation of resilient landscapes and livelihoods as a result of RLLP will work synergistically with the improvement
in drought resilience of communities that will emerge from the MoF project to enhance resilience of the rural population
in Ethiopia to a degree that the participating projects could not achieve on their own.

National strategies

Ethiopia’s long-term goal is to ensure that climate change adaptation and mitigation are fully mainstreamed into
development activities. The proposed project is designed to be transformative, contributing to a number of key national
strategies, including Growth and Transformation Plan 2 (GTP-2), the Climate Resilient Green Economy (CRGE)
Strategy, and accompanying 2015 Climate Resilience Strategy for Agriculture and Forest, Ethiopia’s Nationally
Determined Contribution (NDC), the 2017 National Adaptation Plan to Address Climate Change, the Ethiopia SLM
Investment Framework, the emerging National Forest Sector Strategy and National REDD+ Strategy, as well as sector
strategies for energy, water, and agriculture.

The CRGE Strategy aims at developing a green economy and promoting greater resilience to climate change into a
single policy framework in support of its national development objectives. Some of the key objectives of the CRGE,
which this project supports, include improving crop and livestock production practices to improve food security and
increase farmers’ incomes while reducing emissions; and protecting and re-establishing forests for their economic and
ecosystem services, including as carbon stocks. This project will address crucial issues for the resilience of the
agricultural sector identified in the CRGE. It will also contribute to the National Adaptation Plan (NAP-ETH) launched
in September 2017. NAP-ETH aims to bring about transformational change in the country's capacity to address the
adverse consequence of climate change, focusing in particular on agriculture and forestry.

The project will also contribute to the climate, forest, water, energy, and land tenure targets in the Growth and
Transformation Plan 2 (GTP-2) as well as the forthcoming GTP-3. The institutions strengthened as a result of the project
will also contribute to the implementation of Ethiopia’s Strategic Investment Framework for Sustainable Land
Management (ESIF).
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The proposed project is also in line with the intention of Ethiopia to limit its net greenhouse gas (GHG) emissions in
2030 to 145 Mt CO2e or lower. Achieving this goal would mean a 255 MtCO2e (64%) reduction from ‘business-as usual’
(BAU) emission projections by 2030. The agriculture sector and REDD+ are targeted to reduce 88% of the volume of
GHGs.

Finally, the Policy Implementation Principles of the National Policy and Strategy on Disaster Risk Management (July
2013) include ‘decentralized and community-centered’ approach towards disasters and points out the importance to
‘forecast the hazard, analyze, and take early action’. The goal of the Environment Policy is to enhance the health and
quality of life of citizens and to promote sustainable social and economic development through the sound management
and use of natural, human made and cultural resources and the environment.

Alignment with NDC and NAPA

As a result of the development of the Climate Change National Adaptation Program of Action (NAPA) in 2007, Ethiopia
has made significant advances towards integrating climate change into national planning processes. The NAPA was
replaced in 2010 by the Ethiopian Program of Adaptation to Climate Change (EPACC), which calls for mainstreaming
climate change into decision-making at the national level. In September 2017 Ethiopia launched a 15-year National
Adaptation Plan which focuses on a number of vulnerable sectors including agriculture and forestry. This project is in
line with these documents and other government policy.

Ethiopia’s NDC states that adaptation initiatives to reduce vulnerability will be based on the country’s Climate Resilient
Green Economy Strategy (CRGE). The CRGE has informed the design of adaptation activities of the RLLP (see above).
Given that 80% of the population depends on agriculture for their livelihoods, increasing the resilience of agriculture is
a priority for Ethiopia. The SLMP is mentioned in the NDC as one of the adaptation actions that has already been
undertaken and that will contribute to building resilience to climate change. RLLP will contribute towards many of the
adaptation interventions identified in the NDC, which concentrate strongly on increasing the resilience of agriculture.
The adaptation intervention strategy identified in the NDC towards which RLLP contributes most strongly is “Enhancing
ecosystem health through ecological farming, sustainable land management practices and improved livestock
production practices to reverse soil erosion, restore water balance, and increase vegetation cover, including drought
tolerant vegetation.”. The project will also strongly contribute towards the actions “Improve and diversity economic
opportunities from agroforestry and sustainable afforestation of degraded forest areas” and “Enhance the adaptive
capacity of ecosystems, communities and infrastructure through an ecosystem rehabilitation approach in the highlands
of Ethiopia. Rehabilitation of degraded lands/forests will also increase resilience of communities, infrastructures and
ecosystems to droughts and floods.”. Ethiopia seeks to maximize the synergies between adaptation and mitigation,
especially involving agriculture and forests. RLLP will contribute towards two of the pillars for mitigation of GHG
emissions: “Improving crop and livestock production practices for greater food security and higher farmer incomes while
reducing emissions;” and “Protecting and re-establishing forests for their economic and ecosystem services, while
sequestering significant amounts of carbon dioxide and increasing the carbon stocks in landscapes;”.

Capacity of Accredited Entities and Executing Entities

Project financing will flow through MoF, which is mandated to mobilize both domestic and external resources for the
implementation of the Climate Resilient Green Economy (CRGE) Strategy. The Project will be implemented by
Federal Ministry of Agriculture (MoA).

Significant progress in remediation of degraded lands has been achieved in recent years by the Government of
Ethiopia and thousands of local communities largely through investment and technical assistance under MoA’s SLM
Program. MoA has been implementing the SLMP with World Bank support in six regional states by coordinating
investments from major donors and partners (IDA, Norway, Canada, Germany, GEF, LDCF) into a holistic and
coordinated landscape management framework. With financing from IDA through the SLMP-II, over 1.3 million
hectares of degraded communal and smallholder lands in selected watersheds is being converted into a sustainable
source of natural and economic wealth through an integrated package of activities. Working through Regional
Bureaus of Agriculture (BoAs) and woreda (equivalent to district) administrations over the last ten years, the SLM
Program has restored productivity in more than two million hectares of degraded watersheds in six regional states
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of the Ethiopian highlands. Up to now, the SLM Program has supported interventions in a total of 223 major
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watersheds, out of an estimated 700 that would benefit from SLM interventions.

The project is featured in the World Bank’s Country Partnership Framework (CPF) for FY 17-21 as a flagship
operation addressing the CPF’s resilience pillar, with a funding commitment from IDA-18 for US$100 million.

IDA financing has helped restore productive capacity and build resilient livelihoods in 135 highland watersheds
through an integrated package of activities that includes management of natural resources on more than half a
million hectares of degraded communal and smallholder lands. Through soil and water conservation structures,
enclosures to limit free grazing, and afforestation or reforestation of more than 80,000 hectares, these activities
have led to an average 9 % increase in vegetation cover in treated watersheds. Complementing these physical
interventions, IDA financing for the SLM Program has strengthened MoA’s support for land rights through the
issuance of landholding certificates to over 300,000 households, including more than 200,000 women who have
received titles either individually or jointly with their husbands, and more than 7,000 landless youth who have
received titles to communal holdings in exchange for restoring land. To further ensure that local communities derive
livelihood benefits from these investments, more than 130,000 smallholders in the targeted watersheds have
participated in income-generating activities under the SLM Program, including for improved cookstove adoption that
reduces fuelwood demand, women’s labor and respiratory illnesses.

SLMP-II benefitted from parallel financing from GIZ for Cluster Advisors who supported extension, technical
planning, and results reporting at woreda and kebele levels. The new GIZ program launched in 2018, Sustainable
Use of Resources for Economic Development (SURED), will play an important role in providing training for technical
assistance to be contracted under RLLP, as well as quality control of these services.

D.6. Efficiency and effectiveness (max. 500 words, approximately 1 page)

Describe how the financial structure is adequate and reasonable in order to achieve the proposal’s objectives,
including addressing existing bottlenecks and/or barriers, and providing the minimum concessionality to ensure the
project is viable without crowding out private and other public investments. Refer to section B.5 on the justification of
GCF funding requested as necessary.

Please describe the efficiency and effectiveness of the proposed project/programme, taking into account the total
financing and mitigation/ adaptation impact the project/programme aims to achieve, and explain how this compares to
an appropriate benchmark.

Please specify the expected economic rate of return based on a comparison of the scenarios with and without the
project/programme.

Please specify the expected financial rate of return with and without the Fund’s support to illustrate the need for GCF
funding to illustrate overall cost effectiveness.

Please explain how best available technologies and practices have been considered and applied. If applicable,
specify the innovations/modifications/adjustments that are made based on industry best practices.
Project co-financing is USD 131 million, bringing the co-financing ratio (total amount of co-financing divided by the
Fund’s investment in the project) to 0.79. In addition to this co-financing, parallel financing is provided by the
Government of Ethiopia, who will provide USD 10 million in kind, and by GIZ, which is providing USD 13 million in the
form of technical assistance. The project will leverage private sector and beneficiary contributions through activities
aimed at providing household energy solutions and strengthening value chains associated with SLM interventions.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 66 OF 96

D
A detailed framework for private sector engagement under RLLP is presented in Annex B.1. This framework identifies
three major categories of partners. The first are partners with activities currently being supported by other funders.
RLLP will collaborate with existing private sector engagement activities in order to best utilize available funding and
avoid unnecessary duplication. The figure below shows the relationships between players in this category who can
support private sector engagement in the project. RLLP will facilitate these existing activities to extend their activities
to rehabilitated watersheds. The second category is made up of private enterprises who have the potential to buy
RLLP products or sell products that watershed households need. RLLP will engage with enterprises that already have
a base in or plan to focus on the geographical areas of rehabilitated watersheds. A strong example of this type of
opportunity is the MOU signed with Raya Brewery-BGI Ethiopia in Enda-Mohoni Woreda of South Tigray Zone. In the
final category are long-term opportunities for the private sector to begin to implement activities in the targeted
watersheds. RLLP will identify gaps and potential partners and suggest pilot collaborations, for example with
enterprises who may be interested in specific crop varieties that can be grown in the targeted watersheds.

Figure 7 RLLP Linkages from Diversified Livelihoods to Value Chains and Markets

Narrative and rationale for the detailed economic and financial analysis

To assess the ex-ante efficiency of the project investment, a cost benefit model is used. Annual cost and benefit flows
are estimated as the difference between without-project and with-project net benefits for direct beneficiaries (See
Annex E.1: Economic and Financial Analysis for more details). Efficiency indicators include the Economic Net
Present Value (ENPV) and the Economic Internal Rate of Return (EIRR), as well as impact on farm productivity,
household incomes, soil erosion, and GHG emissions. Based on available information compiled during preparation,
gross margins and representative farm models have been developed for selected cropland, non-cropland, and
livestock production in the project area. Additional net benefits are analyzed from establishing Community Storage
Receipts Program (CRSP) facilities.

In the counterfactual scenario without the Project, land use will continue on its current path. Continued soil erosion,
water insecurity, and land insecurity will result in land degradation. It is expected that climate change will exacerbate
soil erosion and water insecurity leading to direct losses to those who rely on crop and livestock production and
related industries for their energy use and livelihood. Production yields will go down or farmers will have to increase
their input costs, such as fertilizer use, to maintain current yields. In the absence of CSRP facilities, farmers will
continue to experience post-harvest losses. They will also be unable to capture higher crop prizes that are obtainable
a few months after harvest and in larger markets. Non-agricultural land in the watershed will also continue to
deteriorate without the Project due to climate change and soil erosion as well as overuse of common land through
livestock grazing and firewood collection. This will put a further strain on the population who derive their livelihood
from forests, woodlands, and surrounding areas. Downstream from the project area, continued land degradation will
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 67 OF 96

also affect areas and households through increased flood risk and sediment build-up in irrigation and hydroelectric
D
dams.

Incremental benefits are estimated for investments in green infrastructure and resilient livelihoods (Component 1). It
is assumed that these benefits will only accrue if the outcomes in the remaining three components are also achieved:
2. Strengthening institutions, information and monitoring for resilience; 3. Land administration and use; and 4. Project
management and reporting. Investment costs include USD 165.24 million from GCF, USD 100 million from IDA, USD
19 million from MDTF, and USD 12 million from expected MDTF Contribution from the Government of Canada for a
total of USD 296.24 million.

Following World Bank guidelines, the economic analysis considers anticipated costs and benefits with and without the
project, including social costs and benefits. This necessitates the consideration of funding sources and labor costs
outside the GCF project. In this project, the following are included as additional costs for capacity building and project
management totaling USD 23 million (USD 13 million from GIZ and USD 10 million from the GoE). In addition, the
analysis includes an estimated USD 99.1 million in in-kind contributions from project beneficiaries minus USD 3.8
million in price contingencies. With all costs included, the total budget included in the analysis is USD 319.2 million.
As part of the exit strategy, recurrent costs in the years after the project has ended are estimated to be 2.5% of initial
costs, including beneficiary in-kind contributions of USD 10.4 million per year.

The Project will increase climate resilience in 210 major watersheds covering an area of 2.1 million ha. Based on
2007 census numbers, the Project has an estimated 4.2 million beneficiaries (or 834,000 households) in the selected
watersheds. Since population growth since 2007 census is estimated to be 15% or more, for the present day this is a
conservative estimate.

Project interventions are assumed to lead to direct net benefits to crop and livestock producers as well as forests and
other non-croplands through watershed management plans. These activities will reduce soil erosion and yield losses
that are expected to result from climate change in the absence of Project intervention. Activities will also improve
productivity and increase resilience against the negative impacts of climate change. To further increase resilience
against future climate change, the Project will encourage climate resilient livelihood diversification through community
groups including CSRPs. Project activities will also constitute a net carbon sink when analyzing impact on GHG
emissions. While not included quantitatively in this EFA, benefits will also accrue from strengthening institutions and
improving information and monitoring systems. Improved administration and secure tenure rights will create
incentives for beneficiaries to adopt sustainable management practices. The Project is also expected to have positive
impact on indirect beneficiaries in neighboring areas through informal dissemination of new management practices as
well as downstream improvements from reduced floor risk and sediment build-up.

In the current 25-year net benefit analysis using a 5 percent discount rate, the project yields an Economic NPV of
USD 3,312 million (ETB 92.7 billion) and has a benefit cost ratio of 3.8. The Economic IRR is 47%. The payback
period is 5.3 years. In economic investment analyses, the Project therefore meets the requirement by yielding a rate
of return higher than the economic discount rate of 5%. Note that, a 25-year model is used to account for the long-
term gradual build-up of benefits from SLM interventions combined with a 5-year implementation phase followed by
20-year capitalization phase for forest plantations and green corridors.

World Bank guidelines recommend using a 5% economic discount rate. 20 Increasing the discount rate from 5% to
10% reduces project returns by 51% to USD 1,617 million. Project returns are still considerable at a 10% discount
rate with a BCR of 3.2.

If the Project only reaches half of the targeted area for example due to unexpected cost increases, estimated project
returns fall by 53% to USD 1,560 million and the rate of return drops from 47% to 26%.

If base case assumptions are too conservative or climate change leads to accelerated soil erosion in the future, the
estimated net benefit of Project interventions would be higher. When assuming a 50% increase in annual soil loss by
year 25 the estimated economic return is USD 3,462 million with a 47% rate of return. Under this accelerated soil
erosion scenario, the estimated Project net benefit of avoiding this larger soil erosion is therefore USD 150 million
across the 25-year period. In the base case, estimated value of soil erosion varies between USD 0.11 and 0.26/tonne
soil per year depending on the gross margin value of different land uses. In the scenario with accelerated soil loss,
this estimated value ranges between USD 0.17 and 0.38/tonne soil per year.

20 World Bank (2015). Technical Note on Discounting Costs and Benefits in Economic Analysis of World Bank Projects. Washington, DC.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 68 OF 96

When excluding the social value of reduced GHG emissions, the net economic project return is USD 2,238 million
D
(ETB 62.7 billion) with a benefit cost ratio of 2.9, an EIRR of 29% and a payback period of 7.3 years. This is 3.1% of
Ethiopia’s GDP in 2016 terms.

When excluding the GHG emissions, 49% of incremental net benefits are generated through activities on non-
cropland areas, particularly due to the transformation of 41,000 ha from bush and grassland to forest plantation but
also due to avoided soil erosion. This constitutes an ENPV of USD 108 per year per treated hectare and an EIRR of
43%. A substantial part of Project returns is also generated by cropland and livestock production at USD 49/ha/year
and USD 39/ha/year, respectively. Much of the incremental benefit estimated from cropland comes from transforming
30,000 ha of unproductive land to green corridor plantations and some is from avoided soil erosion. With exacerbated
problems from climate change, forest plantations and green corridors will enhance watershed restoration and
ecological connectivity as well as extend the lifespan and resilience of drainage, irrigation, and road infrastructure.

In financial terms the NPV is USD 696 million (ETB 19.5 billion) with a Financial IRR of 28%, a benefit cost ratio of 2
and a payback period of 7.5 years. This estimated net return constitutes 1% of Ethiopia’s GDP in 2016. In the
financial analysis a 12% discount rate is used to reflect the opportunity cost of capital in Ethiopia.

By supporting the establishment of financially viable enterprises in the area, the Project helps build resilience and
future self-sufficiency. Without Project support for initial investments and working capital, CSRPs may be financially
viable to also cover future capital maintenance costs, but only if available commercial loan interest rate is below their
FIRR of 18-21% and a payback period of over 5 years. Initial information indicates that commercial loans for
investments may be available at this rate but not the size of loans required. It can be expected that demonstrated
implementation of CSRPs can reduce commercial banks’ future risk perception. CSRPs can improve their financial
viability to an FIRR over 24% for example by using more of their available storage capacity, obtaining a matching
investment grant and reducing their initial working capital requirements. To be financially viable, the CSRPs will
require project support to cover their initial investment costs in the absence of commercial loans at favorable rates.
As part of an exit strategy, this increased level of return would also enable them to cover assumed future capital
maintenance costs.

The National Poverty Line for Ethiopia is a measure of absolute poverty. The poverty line indicates the money
required for food to provide the minimum required caloric intake (Food Poverty Line) and additional non-food items. In
the financial analysis, estimated farm-level gross margins can increase by over USD 101/year/person (including the
value of production used for home consumption), which is 1.2 times the Food Poverty Line (USD 85/person/year in
2018 terms), or 63% of the National Poverty Line (USD 162/person/year). This is a direct measure of increased
resilience in the Project area.

The planned investment Project is expected to yield high returns even when considering key risk factors such as:
yield and price changes; adoption rates; and project delays. As part of a risk management plan, it is particularly
important to ensure that farmers can negotiate and obtain fair output prices and achieve target yields going forward.
Part of the risk management plan could also be to ensure that planned CSRPs are used to their full capacity and that
they receive sufficient financial support toward initial investment and working capital costs to ensure their financial
viability. Close monitoring and support for target farmers and communities to implement water management plans
could help increase the adoption rate. While not always avoidable, project delays can be minimized with close
monitoring and by ensuring implementation does not lose momentum.

The full economic and financial analysis is provided in Annex E.1.

Economic and financial justification for the concessionality that GCF provides
Despite Ethiopia's Debt Sustainability Assessment having rated the risk of debt distress as high, the Ethiopian
Government has agreed to take on significant debt for this project, with $100 million in loans to be provided by IDA
and a request of an additional $107 million in loans from GCF. In addition to the $100 million in loans, $31 million in
grants is provided as co-financing, bringing the percentage of grant funding in the co-finance to 24%. $58 million in
grant finance is also requested from GCF, bringing the percentage of grant funding in the GCF financing to 35%.
GCF funding will be used for the introduction at scale of climate smart agriculture. While some of the individual
activities included in the package of measures for CSA may be business as usual in other parts of the world, they are
new to the target population of smallholder farmers in Ethiopia. In particular, the implementation of such measures in
a coordinated way as part of a larger package faces multiple barriers. RLLP has been designed to mitigate these
barriers to a degree sufficient that upon project end it is expected that the measures will continue to be implemented
without concessional finance. However, for their introduction at scale highly concessional funding is essential. The
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 69 OF 96

D
initial validation of the package of measures is being conducted as part of SLMP2. GCF financing is required to scale
up implementation in all watersheds covered by RLLP subsequent to the pilot phase, in which the package is being
validated in 30 watersheds as part of SLMP2.

While beneficiaries will derive some private benefits as a result of the implementation of this package of measures,
these beneficiaries are vulnerable rural smallholder farmers facing food, land tenure and water insecurity. Any
benefits derived will be used to increase food and water security and cover other basic needs. Due to the high risk
aversion of such a population and the fact that it is overwhelmingly unbanked, it would not be feasible to pass on the
cost of any loans to the beneficiaries.

Activities for the expansion of SLM, the development of income opportunities and resilient livelihoods as well as those
improving the enabling environment will also be funded by GCF finance.
The Economic Net Present Value (ENPV) is USD 3,312 million discounted at 5% over a 25-year period (ETB 92.7
billion). This generates a benefit cost ratio (EBCR) of 3.8 and an Economic Internal Rate of Return (EIRR) of 47%
with a payback period of 5.3 years. In economic investment analyses, the project therefore meets the World Bank
requirement by yielding a rate of return higher than the economic discount rate of 5%.

Financial viability for this investment in the long run is ensured, because once the barriers to implementation of
sustainable land management and climate smart agriculture practices promoted by the project have been removed
and the project has established mechanisms to encourage their implementation, individual farmers will see their
incomes rise. Those practices that are implemented at the farm level will have short payback times that will motivate
farmers to continue with these practices in the long run beyond the project’s intervention. Furthermore, institutions will
be established to ensure that communities continue to maintain collective infrastructure that has been established.
The resilient livelihood interventions that are also part of the project will strengthen the project’s impact and further
ensure long-term maintenance. Private sector development will mean households will see a sustainable increase in
income, which will in turn provide an incentive for them to continue maintaining the green infrastructure and climate
resilient agricultural practices introduced by the project.

By supporting the establishment of financially viable enterprises in the area, the Project helps build resilience and
future self-sufficiency. Without the support of the project for initial investment and working capital, CSRPs might be
able to cover future capital maintenance costs, but only if the commercial interest rate is below their FIRR of 18-21%
and if the payback period is greater than five years. Initial information indicates that commercial loans for smaller
investments may be available at this rate, but not the size of loans required. CSRPs can, however, improve their
ability to afford an FIRR over 24% by using more of their available storage capacity, obtaining a matching investment
grant, or reducing their initial working capital requirements. To be financially viable, the CSRPs will require project
support to cover the initial investment costs in the absence of commercial loans at favorable rates. As part of an exit
strategy, this increased level of return would also enable them to cover estimated future capital maintenance costs.

Ongoing sustainable land management activities in Ethiopia have resulted in the development of a number of
guidelines for the types of interventions included in RLLP. Additional guidelines covering issues not yet dealt with in
the existing guidelines are under development.

The following guidelines will be used to ensure that best available technologies and practices are applied in the
project:

Guidelines already developed and updated:

1. Climate Smart Agriculture (CSA) field manual
2. Income Generating Activities (IGA) guideline
3. HM&E Guideline
4. Gender Mainstreaming Guideline
5. Watersheds Performance Assessment and exit strategy guideline (PA&ES)
6. SLM Best Practice identification guideline
7. Below Woreda Level Data Collection Guideline
8. ESMF guideline (translated into three local languages - Amharic, Oromiffa and Tigrigna)
9. Value Chain Development in SLMP Context
10. Bamboo Development Training Manual
11. Training Manual for FTC Support (HIV)
12. LAU Implementation Strategy
13. Communication Strategy
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 70 OF 96

14. Stakeholders Participation Strategy

D
Guidelines under development:
1. CBPWDG - Community Based Participatory Watershed Development Guidelines ESIF
2. Capacity Development Guideline
3. Rehabilitated communal Land, use and management
4. Small Scale Irrigation
5. Bamboo Development Strategy
6. Payment for ecosystem services (PES)

Quality assurance and sustainable delivery of training is ensured by the SLM Best Practices Task Force. The SLM
Best Practices Task Force was established in August 2011 with a view to expediting the process of screening,
documenting, dissemination and expanding SLM best practices across the country. The Task Force comprises
members from government organizations and development partners whose expertise relates to sustainable land
management. By 2015, it had already achieved impressive results, identifying 105 SLM technologies and 9 SLM
approaches with best-practice potential. The screening criteria to help categorize and prioritize SLM practices are
described in Annex A.2.

The SLM Best Practices Task Force has the following responsibilities:
• To provide initial training to national and regional experts who then train woreda experts and development agents;
• To pre-screen the list of existing SLM practices against the established criteria;
• To validate the list of pre-screened existing practices with SLM experts (in a validation workshop);
• To submit screened and approved SLM practices to the SLM TC for approval;
• To oversee the documentation of each screened SLM best practice as per the description form provided.

After the SLM Best Practices Task Force is eventually dissolved, the national-level structure (such as the case team
or coordination unit of the Natural Resource Management Directorate) must take over the responsibility of both
continuing an effective system of best-practice documentation and building capacity of staff and other stakeholders.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 71 OF 96

E
E. LOGICAL FRAMEWORK
This section refers to the project/programme’s logical framework in accordance with the GCF’s Performance
Measurement Frameworks under the Results Management Framework to which the project/programme contributes
as a whole, including in respect of any co-financing.
E.1. Paradigm shift objectives
Please select the appropriated expected result. For cross-cutting proposals, tick both.
☐ Shift to low-emission sustainable development pathways
☒ Increased climate resilient sustainable development

E.2. Core indicator targets

Provide specific numerical values for the GCF core indicators to be achieved by the project/programme.
Methodologies for the calculations should be provided. This should be consistent with the information provided in
section A.
E.2.1. Expected tonnes of carbon
Annual 1,752,000 CO2 eq
dioxide equivalent (t CO2 eq) to
be reduced or avoided (mitigation
Lifetime 43,800,000 t CO2 eq
and cross-cutting only)
(a) Total project financing 296,237,602 USD

E.2.2. Estimated cost per t CO2 (b) Requested GCF amount 165,237,592 USD
eq, defined as total investment (c) Expected lifetime emission reductions 43.9 mn t CO2eq
cost / expected lifetime emission (d) Estimated cost per t CO2eq (d = a / c) 6.75 Choose an item. / t
reductions (mitigation and cross- CO2eq
cutting only)
(e) Estimated GCF cost per t CO2eq removed 3.76 Choose an item. / t
(e = b / c) CO2eq
(f) Total finance leveraged 131 mn USD
E.2.3. Expected volume of
finance to be leveraged by the (g) Public source co-financed 131 mn USD
proposed project/programme as a (h) Private source finance leveraged _____ Choose an item.
result of the Fund’s financing,
disaggregated by public and (i) Total Leverage ratio (i = f / b) 0.79
private sources (mitigation and (j) Public source co-financing ratio (j = g / b) 0.79
cross-cutting only)
(k) Private source leverage ratio (k = h / b) _____
4,168,000
Direct
Of which 50% are female
E.2.4. Expected total number of
direct and indirect beneficiaries, 26,244,000
Indirect
Of which 50% are female
(disaggregated by sex)
For a multi-country proposal, indicate the aggregate amount here and provide the data
per country in annex 17.

E.2.5. Number of beneficiaries Direct 4.0% (Expressed as %) of country(ies)

relative to total population
(disaggregated by sex) Indirect 25.0% (Expressed as %) of country(ies)
For a multi-country proposal, leave blank and provide the data per country in annex 17.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 72 OF 96

E
E.3. Fund-level impacts 21
Select the appropriate impact(s) to be reported for the project/programme. Select key result areas and corresponding
indicators from GCF RMF and PMFs as appropriate. Note that more than one indicator may be selected per expected
impact result. The result areas indicated in this section should match those selected in section A.4 above. Add rows
as needed.
Means of
Expected Results Indicator Verification Baseline Target Assumptions
(MoV)
Mid-
Final
term

Based on 0 Net change in

inputs from CO2 emissions
M&E 2,948,1 5,621,6 is calculated
M4.0 Reduced
reporting. 53 t 15 t using the ExAct
emissions from land use,
M4.1 Tonnes of carbon Periodic CO2 CO2 eq carbon balance
reforestation, reduced
dioxide equivalent (t surveying eq estimation tool
deforestation, and
CO2 eq) reduced or by for a lifetime of
through sustainable
avoided (including independen 25 years is
forest management and
increased removals) - t 3rd party 43,800,000 t
conservation and
forest and land use to sample CO2 eq. Mid-
enhancement of forest
treatment term target is for
carbon stocks
areas to 2.5 years while
verify22. final target if for
5 years.

Covered as 0 Total: Total: Measured as the

part of the 238,56 596,400 number of land
A1.2 Number of males beneficiary 0 users adopting
A1.0 Increased and females benefiting survey SLM practices.
resilience and enhanced from the adoption of conducted Target is based
livelihoods of the most diversified, climate by Of on 40% of adults
vulnerable people, resilient livelihood independen Of which in project area
communities and options (including t 3rd party. which female: adopting.
regions fisheries, agriculture, female: Women are
tourism, etc.) 326,900 targeted at a
130,76 higher rate of
0 45%.

Choose appropriate Choose appropriate

expected results indicators

E.4. Fund-level outcomes

Select the appropriate outcome(s) to be reported for the project/programme. Select key expected outcomes and
corresponding indicators from GCF RMF and PMFs as appropriate. Note that more than one indicator may be
selected per expected outcome. Add rows as needed.
Expected Outcomes Indicator Baseline Target Assumptions

21 Excludes impacts of 18 watersheds supported by Expected MDTF Government of Canada, which will be determined in later stages of
funding appraisal
22 Specific company/firm has not been selected for 3rd party verification. A competitive request for proposals would be issued to select a
suitable firm. If using EX-ACT as proposed here, the firm would be responsible for verifying the figures used (conduct a representative
sample and collect the necessary data).
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 73 OF 96

Means of
E
Verification Mid-term) Final
(MoV)
Based on
inputs from
M&E
reporting. The entire area
Periodic of the (micro)
M9.1 Hectares of land surveying watershed is
M9.0 Improved or forests under by 1,899, considered
management of land or improved and effective 406,000 1,003,2
independe 000 treated when the
forest areas contributing management that ha 00 ha
nt 3rd party ha multi-year
to emissions reductions contributes to CO2 to sample development
emission reductions treatment plan is
areas to complete.
verify.

Measures the
number of
individuals
participating in
income
generating
activities
supported by the
project. Target
reflects adoption
Numb by 30% of
er of adults. Women
Covered as Number individ are targeted at a
A7.1 Use by vulnerable part of the of uals: higher rate of
households, beneficiary individu 450,6 35%. This
communities, survey als: 00 Of indicator will
A7.0 Strengthened businesses and public- conducted 180,240 which draw on a
adaptive capacity and sector services of Fund- by 0 Of wome number of
reduced exposure to supported tools independe which n: questions
climate risks instruments, strategies nt 3rd party women: 250,3 included as part
and activities to respond and project 100,120 00 of the
to climate change and reporting. beneficiary
variability survey. A score
card approach
will be
developed
focusing on the
adoption of tools
and strategies
including
participation in
income
generating
activities.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 74 OF 96

E
Awareness
raising activities
reach 80% of
the land users in
the area
targeted
(women
targeted at a
higher rate).
Numb
This indicator
Number er of
will draw on a
of individ
Covered as number of
individu uals:
part of the questions
A8.1 Number of males als: 1,200,
A8.0 Strengthened beneficiary included as part
and females made 480,100 400
awareness of climate survey n/a of the
aware of climate threats Of
threats and risk- conducted Of beneficiary
and related appropriate which
reduction processes by which survey. A score
responses women:
independe wome card approach
264,000
nt 3rd n: will be
party. 660,2 developed to
00 assess
awareness to
climate threats
and related
issues.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 75 OF 96

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E.5. Project/programme performance indicators 23
The performance indicators for progress reporting during implementation should seek to measure pre-existing
conditions, progress and results at the most relevant level for ease of GCF monitoring and AE reporting. Add rows as
needed.
Means of Target
Expected Results Indicator Verification Baseline Assumptions
(MoV) Mid-term Final
Based on
inputs from
M&E
The entire area
reporting.
of the (micro)
Periodic
watershed is
surveying 406,000
Land area under 1,899, considered
Land Restoration and by ha 1,003,20
sustainable landscape 000 treated when the
Watershed Management independen 0 ha
management practices ha multi-year
t 3rd party
development
to sample
plan is
treatment
complete.
areas to
verify.

113,000 141,400 184,0 It is calculated

ha ha 00 ha as a subset of
the total land
area with
sustainable land
management
practices
(indicator 1) that
is treated with
Based on measures to
inputs from return the land
M&E to its natural,
reporting. semi-natural, or
Periodic forested state. It
surveying includes habitat
Land Restoration and Land area restored or by restoration and
Watershed Management reforested/afforested independen other
t 3rd party conservation
to sample measures to
treatment restore
areas to biodiversity,
verify. establishment of
forest on land
with and without
recent tree
cover, gully area
stabilization,
degraded area
closures,
degraded area
woodlot
establishment,

23 Excludes impacts of 18 watersheds supported by Expected MDTF Government of Canada, which will be determined in later stages of
funding appraisal
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 76 OF 96

E
area covered by
bamboo
plantation on
degraded area.
This indicator
does not include
areas, which
have been
cleared during
or in anticipation
of the project.
Area
re/afforested
refers to
“establishment
of forest through
planting, and/or
deliberate
seeding on land
that, until then,
was not
classified as
forest” or “re-
establishment of
forest through
planting and/or
deliberate
seeding on land
classified as
forest”
expressed in
hectare (ha).
This can include
also assisted
natural
regeneration,
coppicing or
other locally
appropriate
methods.

Based on 6,000 ha 76,240 181,6

inputs from ha 00 ha
Covers land on
M&E
which Climate
reporting.
Smart
Land area with Periodic
Land Restoration and Agriculture
productivity enhancing surveying
Watershed Management (CSA) practices
practices applied by
have been
independen
adopted under
t 3rd party
the project.
to sample
treatment
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 77 OF 96

areas to
E
verify.

The Normalized
Difference
Vegetation Index
(NDVI) uses the
visible and near-
infrared bands of
Project area showing
the
an increase in
electromagnetic
Land Restoration and Normalized Difference 3rd party
0 20% 50% spectrum to
Watershed Management Vegetation Index analysis
analyze remote
(NDVI) correcting for
sensing
climate effects
measurements
to determine the
extent to which a
target contains
live green
vegetation
The Land
Surface Water
Index (LSWI)
uses the
shortwave
infrared and
Project area showing near-infrared
an increase in the Land bands of the
Land Restoration and 3rd party
Surface Water Index 0 20% 50% electromagnetic
Watershed Management analysis
(LSWI) correcting for spectrum to
climate effects analyze remote
sensing
measurements
to determine the
amount of water
in vegetation
and soil.
0 238,560 596,4
Of 00 Of
which which
Based on women: wome
information 130,760 n:
Land users adopting collected as Includin 326,9
sustainable land part of g female 00
Adoption of climate headed
management practices stakeholder Includi
resilient diversification househo
as a result of the / ng
activities lds:
project, disaggregated beneficiary female
by gender survey and 22,280
heade
project d
reporting. house
holds:
55,70
0
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 78 OF 96

0 99,600 249,0
E
The target value
Based on Of which 00 reflects a
information female household
Households adopting Of
collected as headed: adoption rate of
diversified livelihood which
part of 17,400 30 percent.
Adoption of climate activities supported by female
stakeholder Female-headed
resilient diversification the project, heade
/ households
activities disaggregated by d:
beneficiary (approx. 15% of
gender of head of 43,50
survey and all households)
household 0
project are targeted at a
reporting. higher rate of 35
percent.
Based on 0 180,240 450,6
information Of which 00 Of
People participating in collected as women: which
income-generating part of 100,120 wome
Adoption of climate stakeholder n:
activities supported by
resilient diversification / 250,3
the project
activities beneficiary 00
disaggregated by
gender survey and
project
reporting.

Functional Common- Based on 0 1,259 3,148

Interest Groups information
established or collected as
supported part of
Adoption of climate
stakeholder
resilient diversification
/
activities
beneficiary
survey and
project
reporting.
0 75 188 Watershed
Management
and Use Plan
that has been
approved locally
by the
community user
group, and
either the
Woreda or
Watershed User
Strengthening resilience regional SLMP
Associations Project
through Institutions and coordination
established and reporting.
Information platform. Micro
strengthened
watershed land
management
and use plans,
established by
farmers user
associations,
detail
management
and use for
treated areas,
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 79 OF 96

E
outline
agreements with
the Kebele
Watershed
Team to
conserve and
utilize the
resources, and
outlines bylaws
for managing
and
implementing
conservation
activities and the
distribution/shari
ng of benefits.
The
development of
these plans are
a critical for
ensuring land
resources are
used and
managed in a
way that
enhances
absorptive and
adaptive
capacity to
climate change,
promoting
resilience
broadly at the
landscape level.

Watershed User 0 59 148

Strengthening resilience Associations with
Project
through Institutions and Watershed
reporting.
Information Management and Use
Plan
Woreda information The functionality
centers being Functionalit and
effectively used by y and effectiveness of
project stakeholders effectivene these
ss tracked information
Strengthening resilience as part of centers is
through Institutions and the 0 66 166 expected to be
Information stakeholder tracked as part
/beneficiary of the
survey and stakeholder/ben
project eficiary survey
reporting. using a
scorecard
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 80 OF 96

E
approach to
assess the
quality of
services.
This includes
the number of
individual and
communal land
parcels
surveyed (using
one or a
combination of
GPS, total
stations, ortho-
photo, or
satellite
imagery),
mapped and
registered with
the woreda land
administration
office as part of
Processed second-level
centrally land certification
using activities.
information Interventions
Improved tenure security Parcels of land that increase
extracted 2,034,00 3,296,40 5,190,
to Incentivize long-term surveyed and mapped tenure security
from 0 0 000
investments in SLM for certification and define the
NRLAIS
database. associated
rights provides
holders with an
incentive to take
a long-term term
perspective
when managing
the land
resources and
undertaking
investments,
increasing
productivity and
enhancing
resilience trough
adaptive and
transformative
means.

Processed 484,000 743,200 1,132, Second-level

Households who have
Improved tenure security centrally Of which 000 Of certification
received second level
to Incentivize long-term using women Of which which differs from the
land holding
investments in SLM information individuall women wome earlier first-level
certificates,
extracted y or individua n certification
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 81 OF 96

disaggregated by from jointly lly or individ

E
program by
gender NRLAIS with a jointly ually providing
database. man: with a or additional spatial
328,000 man: jointly (i.e. location and
521,800 with a boundary) data
man: in the form of a
812,5 parcel map.
00 Interventions
Processed that increase
centrally tenure security
using and define the
Improved tenure security Second level land information associated rights
extracted 1,060,80 2,652, provides holders
to Incentivize long-term certificates issued as a 0
from 0 000 with an incentive
investments in SLM result of the project
NRLAIS to take a long-
database. term term
perspective
when managing
34,65 the land
0 Of resources and
which undertaking
wome investments,
14,000 n: increasing
Landless youth that 10,57
Project 22,260 productivity and
Improved tenure security received certificates in 0
reporting. Of which enhancing
to Incentivize long-term exchange for the work,
Of which women: resilience trough
investments in SLM disaggregated by
women: 6,748 adaptive and
gender
4,200 transformative
means.

E.6. Activities
All project activities should be listed here with a description and sub-activities. Significant deliverables should be
reflected in the implementation timetable. Add rows as needed.

Activity Description Sub-activities Deliverables 24

Establish functional
platform

Establish Micro watershed

Team
- Soil and water
Promotes the restoration of conservation measures Plan preparation by CWT
degraded landscapes in -Gully rehabilitation and KWT, approval by
1.1.1: Sustainable Land
selected watersheds and -Area closure management General assembly
Management help build resilient and use
livelihoods. -Enrichment of degraded Formulation and
pasture and rangeland compilation of a Multi-Year
Plan by Woreda Technical
Committee

24 Deliverables are indicative

 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 82 OF 96

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Construction of Soil and
Water Conservation works

Site preparation for A/R or

biological measures

Approval of consolidated
plan by Woreda Steering
Committee & procurement
of necessary inputs such
as tree seed, tools and
1.1.2 Aforestaion- -Establishment of green equipment
Reforestation+Green Promotes the restoration of corridors
degraded landscapes in
Corrdior management at -Establishment of plantation
selected watersheds
Zonal Level blocks Afforestation/reforestation
& procurement of
necessary inputs such as
tree seed, tools and
equipment

Nursery
establishment/seedling
production

Organizing Common
Interest Groups (20-30
farmers)

Develop robust CSA plan

and prepare to implement
CSA practices

Coach and provide support

-Farm water and soil for the CIGs during
moisture management implementation of CSA
-Integrated soil fertility and practices & procure
soil health management necessary inputs, tools and
1.2.1: On-farm CSA -Crop development and equipment
Promotes resilient
1.2.2 Training and management
agriculture Nursery
awareness raising on CSA -Environmentally-friendly
establishment/seedling
livestock production
production
through forage
development and Land preparation for CSA
management implementation coach and
provide support for the
CIGs during
implementation of CSA
practices & procure
necessary inputs such as
seed

Evaluation
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 83 OF 96

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Identify and Establish CIGs
support for development of
business plans for different
commodities

Avail equipment and other

inputs including
-Processing Equipment and construction and
Training establishment of CSRP
1.3.1 IGAs and Connection Support resilient
-Community Storage
to Value Chain livelihoods.
Receipts Programs
Implement business plan;
provide CRSP service to
members

Marketing including
provision of CSRP service

- Rural RE/EE Contract signing with

Enterprise cooperatives or/and
1.3.2 Energy Efficiency Establishment cooperative unions and
Cookstoves members
Strengthen supply chain for
- Establish Fuel
RE/EE products
1.3.3 Investment Planning Saving Cookstove Partner with other value
for Economic Development producer chain actors
enterprises

Recruitment of training for

woreda and kebele level
platforms
Build capacity for the
promotion and Provide awareness
management of SLWM creation to farmers
2.1.1 Kebele and Woreda
Capacity Building practices, and improve
Support different CIGs to
2.1.2 Information information for better
develop and adopt bylaws;
Modernization and Data decision-making in
conduct training needs
Base Management/Policy supporting resilient
assessment, & Provide
Development landscapes and diversified
tailor-made TOTs to at
2.1.3 Technical training on rural livelihoods in the Technical Assistance, Federal, Regional, woreda
cadaster and land project area. Support operating of capacity and community level
registration information modernization building activities and
2.1.4 TA (Cluster Approach to coordinate data Monitoring on local level Provide additional TOTs
at Zonal level) collection and information technical advisors for
2.1.5 Policy Development sharing at all levels and specific outputs linked to
2.1.6 Capacity building at under all components of CIGs in sub-component
Regional level the project so that this 1.1, 1.2 & 1.3
2.1.7 TA at information is well
organized, properly Provide technical support
National level
documented and to on-the-ground
accessible operations/implementation

Exposure visit of technical

advisors for specific
outputs linked to CIGs in
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 84 OF 96

E
sub-component 1.1, 1.2 &
1.3

Provide refresher TOT

technical advisors for
specific outputs linked to
CIGs in sub-component
1.1, 1.2 & 1.3

Initiate impact evaluation

research/study

Identify materials for

woreda information center
establishment

Construction of woreda
information center

Develop communication
2.2.1 Impact Evaluation (IE) material

Consultation on
2.2.2 Knowledge
Monitoring and Evaluation communication material
Management and
completed
Communication
Impact evaluations;
dissemination of
knowledge products

Knowledge
sharing/networking events

Support associations to
develop Watershed
Management and Use
plans

orthophoto base map

preparation
Strengthens the rural land consultations on land rights
administration system that using orthophoto
secures tenure rights,
optimizes land use, and base maps
empowers land-users to
scanning and geo-
sustainably invest in
3.1.1-Second Level Participatory Local Land referencing of adjudication
productive landscapes.
Landholding Certification Use Planning and maps, vectorization of
Improves security of tenure
(SLLC) Development Control parcel boundaries and
to smallholder farmers in
RLLP watersheds through keying-in of attribute
SLLC as an incentive to information
increase the adoption of
SLM technologies and public display for validating
practices. parcels (shape and size)
and landholders’
Information
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 85 OF 96

parcel map and

E
Landholding Certificate
preparation, production,
authentication and issuance

support development,
testing, and roll-out of
National Rural Land
Administration Information
System

E.7. Monitoring, reporting and evaluation arrangements (max. 500 words, approximately 1 page)
Besides the arrangements (e.g. annual performance reports) laid out in AMA, please give a summary of the
project/programme specific arrangements for monitoring and evaluation. Please provide the types of interim and final
evaluations. Describe Accredited Entity (AE) project reporting relationships, including to the NDA/Focal Point and
between AE and Executing Entity (EE) as relevant, identifying reporting obligations from the EE to the AE. This
should relate to the frequency of reporting on project indicators, implementation challenges and financial status.

The institutional arrangements for M&E will encompass four levels that are well aligned with the RLLP institutional
and implementation arrangement.

Federal Level. The federal level sets the expectations for what is to be accomplished in M&E and oversees that
capacity, ensuring skills and tools are available for staff in the regions and at field level. Federal level M&E staff
ensure that data collected meet quality standards, review aggregated field data to analyze and pull out program level
results and trends and identify best practices important for scale up. The federal level M&E staff prepare reports to
the government and donors and provide feedback to stakeholders. The Federal M&E team will include: a Senior
M&E/Evaluator, a Senior Data Analyst/ MIS Specialist, a Senior Communication/Knowledge Management Specialist,
and a Documentation/Planning and Reporting Specialist. The team will also provide: technical assistance to develop
a new Results-Based M&E (RBME) plan, manual and indicator protocols; TA support in M&E Training (various topics
including advanced excel, data analysis and reporting, and evaluation practice); a functional web-based data
management system (in English and local languages), which will help to aggregate mobile application data and
collect geo spatial data.

Regional Level. The regional level leads the rollout of the M&E system to the field; builds skills and capacity in
regional and field level stakeholders; ensures that data collected meet quality standards; aggregates field data to
analyze and pull out regional levels results and trends and identify best practices important for scale up; prepares
reports to the government and donors and provides feedback to stakeholders. The regional team will include a M&E
Specialist and a Communication/Knowledge Manager/Spatial Analyst. The team will also support: special studies in
the region, involve regional officers in Joint Monitoring Missions (JMM), improved data management system in
English and local languages, and incentives for good regional performance, TA for training using TOT approach.

Zonal level. RLLP will strengthen the functionality of the zonal government structures/offices, mainly the Agriculture
and Natural Resources Office. The project will provide a budget allocation at the zonal level to provide staff to support
regional technical capacity and mentoring, conduct data quality assessments, provide clear guidance on which data
to collect and how, and provide ongoing M&E training and capacity building in M&E.

Woreda Level. This level identifies watershed needs and completes annual workplans and budgets, making sure that
activities get rolled out on time. The woreda team includes the NRM process owner and technical expert, who receive
data from the DAs and aggregate results to determine whether activity implementation is occurring at the right scale.
They prepare reports based on results achieved. Woreda officers are supported by regional and federal M&E staff
(particularly in completing reports).
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 86 OF 96

E
Kebele Level. Development Agents (DAs) play a significant role at kebele level. Clear guidance is needed for DAs on
what and how to collect data (strengthen data collection methods), to strengthen ongoing M&E training and capacity
building, and to provide educational opportunities/exchange visits to DAs assigned to follow-up project activities to
help motivate them and reduce frequent turnover.

Community Level. There are several levels of community members who are involved in M&E, but the Community
Facilitator (CF) is the main project interlocuter. Foremen/Forewomen, nursery operators and self-help group leaders
collect data and pass it to the CF, who also collects additional household level data. The CF aggregates data and
passes it to the Community Watershed Team (CWT). The CF is a member of the CWT and serves as a secretary.
The CWT reviews and approve the data and informs the CF to send it to the concerned DA in the respective kebele.
The DA presents the data to the Kebele Watershed Team (KWT) for review and approval, and finally sends the
approved data to the woreda office.

The methodology for monitoring key outcomes of the project is as follows:

Land area under sustainable landscape management practices: this indicator counts as treated the total area of a
micro watershed once all the prescribed soil and water conservation measures identified in the relevant Multi-Year
Development Plan (MYDP) have been fully implemented.

Net GHG greenhouse emissions: estimated using the ExAct carbon balance estimation tool, which calculates carbon
accumulation and emissions based on project biophysical output data. The economic lifetime of the project is
assumed to be 25 years (5 implementation and 20 post-project years, the same time horizon used in the Economic
and Financial Analysis).

Households adopting diversified livelihood activities supported by the project: this is measured as the percent of
households engaging in approved, non-traditional activities, relative to the total number of households in the project
area. The definition of what constitutes the set of potential non-traditional activities will be set during implementation
and applied to activities that are expected to reduce households' vulnerability to future shocks associated with
extreme weather events and climate change by diversifying livelihood activities and increasing the resilience of
natural (i.e. land) resources.

A beneficiary survey conducted by an independent 3rd party will be conducted in the first year, at mid-term and at
completion of the project. Administered to households as well as at the woreda and kebele administrative levels, the
beneficiary survey – a tool normally used to help improve the quality of development operations - will be enhanced
and expanded to support monitoring and verification of key indicators including adoption of diversified livelihood
activities and SLM practices as well as awareness of climate threats and appropriate responses.

An M&E operational manual will be developed that defines the function of the program level M&E system and its
nested RLLP level M&E systems. The manual will embed the tracking of the main GCF indicators related to avoided
emissions and number of beneficiaries of the project.

See Annex D.3 RLLP Gender Approach and Annex D.4 RLLP Gender Action Plan for further information on
statements in terms of number of women involved in the activities. Baseline data for Gender are not available,
however, the RF provides an alternative way to track progress (e.g., starting from baseline of N/A or “0,”) the indicator
measures incremental changes/values throughout project implementation to demonstrate progress.
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 87 OF 96

F
RISK ASSESSMENT AND MANAGEMENT
F.1. Risk factors and mitigations measures (max. 3 pages)
Please describe financial, technical, operational, macroeconomic/political, money laundering/terrorist financing
(ML/TF), sanctions, prohibited practices, and other risks that might prevent the project/programme objectives from
being achieved. Also describe the proposed risk mitigation measures. Insert additional rows if necessary.

For probability: High has significant probability, Medium has moderate probability, Low has negligible probability
For impact: High has significant impact, Medium has moderate impact, Low has negligible impact
Prohibited practices include abuse, conflict of interest, corruption, retaliation against whistleblowers or witnesses, as well as fraudulent, coercive,
collusive, and obstructive practices

Key Financial and Operational Risks

In the identification of key risks and their rating, the size of the project was taken into account. While several risks to
achievement of project objectives have been identified, the experience gained during implementation of SLMP-2, as
well as the significant resources allocated in the past 5 years for coordination and capacity building efforts are
expected to be instrumental in implementing measures to address the key financial and operational risks identified
below:

• Political and governance risk: Although the state of emergency ended in June 2018, sporadic civil unrest in
project areas continues to be a risk to implementation. Implementation of SLM activities continues in all
highland regions, however, there remains a risk that preparation and/or implementation of the proposed
operation could slow or be suspended due to a potential re-emergence of civil disturbances. Institutional
capacity for implementation and sustainability risk: While considerable capacity for SLM interventions exists
in current SLM project areas, limited institutional and human capacity in proposed new project areas
contribute to this risk, which is mitigated through a project design including significant training and
coordination at the national level.

• Fiduciary risk: Issues related to procurement and financial management have been observed in previous
projects. However, implementation of the WB-supported SLMP2 has developed significant capacity for
procurement and financial management, that are currently rated satisfactory and moderately satisfactory,
respectively.

• Stakeholder risk: This includes (i) weak multi-sectoral coordination, and (ii) risk of potential elite capture of
project benefits at the local level and exclusion of some stakeholders, particularly underserved members of
targeted communities. These are addressed through intersectoral coordination mechanisms at the Federal,
Regional and woreda levels, strong communication measures, and a grievance redress mechanism.

An Implementation Support Plan has been developed that describes how the World Bank will support the
implementation of the risk mitigation measures identified in the risk matrix.

Selected Risk Factor 1

Category Probability Impact
Governance High Low
Description
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 88 OF 96

Please describe the risk to the best of your knowledge at this point in time.
F
Political and governance risk. The GoE declared a state of emergency from October 2016 to August 2017, which was re-instated
in February 2018 but ended in June 2018. Although the situation has stabilized since the nomination of a new Prime Minister in
April 2018, there remains a risk that implementation of the proposed operation could be negatively impacted should civil
disturbances recur.

Mitigation Measure(s)
While the extent to which project-specific measures can mitigate this risk is limited, the RLLP will adopt the approach
of other Bank-financed operations, including: (i) careful supervision mission planning that emphasizes security; (ii)
strategic communication and outreach; (iii) sound safeguards monitoring building on SLMP-II experience and
capacity; and (iv) enhanced transparency in project-supported activities. RLLP will also contribute to alleviating some
of the drivers of civil unrest, including natural resource degradation and rural landlessness and joblessness.

Selected Risk Factor 2

Category Probability Impact
Technical and operational Medium Medium
Description
Please describe the risk to the best of your knowledge at this point in time.
Institutional capacity for implementation and sustainability risk due to a number of issues including: (i) the restructuring of the GIZ
program in support of SLM; (ii) the limited human resources available at the field level; (iii) the challenge of implementing a reliable
and cost-effective M&E system; and (v) weak coordination among institutions and programs, including between the NRM
Directorate of MoA and the PCU.

Mitigation Measure(s)
Please describe how the identified risk will be mitigated or managed. Do the mitigation measures lower the probability
of risk occurring? If so, to what level?
This set of risks will be mitigated through: (i) continual training on project management and monitoring at all levels, in
coordination with the GIZ SURED project; (ii) project implementation arrangements acceptable to the World Bank and
agreed by the MoA and regional governments clarifying accountability and targets at all levels; and (iii) coordination
between development partners and Technical Committee on SLM.

Selected Risk Factor 3

Category Probability Impact
Other Medium Low
Description
Please describe the risk to the best of your knowledge at this point in time.
Fiduciary risk due to persistent issues related to procurement and financial management. Although SLMP-II has only had
“unqualified” audits to date, which is excellent, there has been high turnover of project fiduciary staff.

Mitigation Measure(s)
Please describe how the identified risk will be mitigated or managed. Do the mitigation measures lower the probability
of risk occurring? If so, to what level?
Mitigation of this risk centers on MoF’s recent increase and harmonization of salaries for project procurement and
financial management staff.
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F
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G
G.GCF POLICIES AND STANDARDS
G.1. Environmental and social risk assessment (max. 750 words, approximately 1.5 pages)
Provide the environmental and social risk category assigned to the proposal as a result of screening and the rationale
for assigning such category. Present also the environmental and social assessment and management instruments
developed for the proposal (for example, ESIA, ESMP, ESMF, ESMS, environmental and social audits, etc.). Provide
a summary of the main outcomes of these instruments. Present the key environmental and social risks and impacts
and the measures on how the project/programme will avoid, minimize and mitigate negative impacts at each stage
(e.g. preparation, implementation and operation), in accordance with GCF’s ESS standards. If the proposed project or
programme involves investments through financial intermediations, describe the due diligence and management
plans by the Executing Entities (EEs) and the oversight and supervision arrangements. Describe the capacity of the
EEs to implement the ESMP and ESMF and arrangements for compliance monitoring, supervision and reporting.
Include a description of the project/programme-level grievance redress mechanism, a summary of the extent of multi-
stakeholder consultations undertaken for the project/programme, the plan of the Accredited Entity (AE) and EEs to
continue to engage the stakeholders throughout project implementation, and the manner and timing of disclosure of
the applicable safeguards reports following the requirements of the GCF Information Disclosure Policy and
Environmental and Social Policy.

Describe any potential impacts on indigenous peoples and the measures to address these impacts including the
development of an Indigenous Peoples Plan and the process for meaningful consultation leading to free, prior and
informed consent, pursuant to the GCF Indigenous Peoples Policy.

Attach the appropriate assessment and management instruments or other applicable studies, depending on the
environmental and social risk category as annex 6.
The RLLP has been assigned as an EA category of B, for the potential social and environmental impacts on humans
and sensitive areas (wetlands, forests, natural habitats, etc...) are less adverse, site specific, few if any of them are
irreversible. The ESMF was required to comply with not only the relevant national policy and legal frameworks but
also with the applicable environmental and social safeguard policies of the World Bank. Based on the framework of
SLMP-II, and considering its principal features and aspects, the RLLP social assessment was carried out and
updated with the following major objectives in focus:

• Assess key socio-economic factors that require consideration;

• Identify vulnerable and historically underserved groups that may be excluded from the project and be
adversely affected as a result, and the necessary impact mitigating measures.
• Assess any potential adverse social impacts of RLLP, and determine whether the project is likely to trigger
the World Bank social safeguards policies;
• Recommend in the early stage of project preparation the appropriate measures towards addressing World
Bank requirements on social safeguards triggered by the project (OP/BP 4.10 and OP/BP 4.12).

In line with the Ethiopian Government’s decentralization policy, organizational structure and implementation
arrangement and with due consideration to the implementation of project activities at the grassroots level, RLLP is
designed to operate at federal, regional, zonal, woreda kebele levels as well as the beneficiary community level. The
monitoring and evaluation (M&E) and reporting system of the project is in-built in the implementation arrangement to
be executed at all levels of the organizational structure. The institutional arrangement includes RLLP related
conflict/grievance redress mechanism/GRM, consisting of community watershed teams, indigenous local institutions,
kebele watershed teams, and people from woreda agriculture and natural resources offices.

In RLLP the environmental and social management process starts with the sub-project planning process during the
identification of sub-projects by local communities based on their needs and priorities through a participatory
 GREEN CLIMATE FUND FUNDING PROPOSAL V.2.1 | PAGE 91 OF 96

G
watershed planning process guided by the Community Based Participatory Watershed Development Guidelines
(CBPWDG), technical support from Development Agents (DAs) and Woreda experts. The DA will screen/design/plan
subprojects applying a simple checklist as a format for fast track eligibility checking of identified sub-projects. This is
done in consultation with the communities and kebele development committee at the early stages of subproject
selection and prioritization phase. Once the checklist is approved at the kebele level, the project design/plan will then
be sent to the Woreda Agriculture Office and/or the Woreda Technical Committee. The Technical Committee,
depending on the scale, nature and type of subproject, will further screen the sub-projects. The Woreda Focal Person
(WFP), woreda implementing office, and regional project support unit will ensure and document such procedures are
properly followed. And a team led by experts from the Woreda Environmental regulatory body will review the
screened subproject and the mitigation measures planned. If any design modifications are required, the
environmental regulatory body passes recommendations and give clearance and/or certificate of subprojects. The
Woreda council will then approve plans based on the recommendations of the team. After approval, the plan
document is referred to the regional Bureau of Agriculture and Natural Resources (BoANR) with all the accompanying
environmental and social screening documents/files.

Monitoring of environmental and social safeguard performance of the project will be conducted regularly.
Performance monitoring will ensure that safeguards instruments are prepared and approved to the required standard
and the proper implementation of ESMP, SA, RPF and GMGs. While the implementation of ESMP is done by the
community at kebele level with the responsibility of the woreda implementing offices, performance monitoring will be
done by the RLLP-PCU environmental and social safeguard specialists at national and regional level and other
stakeholders. The results of the monitoring involve the monitoring compliance and effectiveness of the safeguards
instruments, and the overall environmental, socio-economic and climate-related assessment of the Program’s
interventions. The monitoring will be done on an annual and quarter basis by the RPCU Specialists with support from
the NPCU Environmental and Social Safeguards Specialists, M&E Specialist and WB’s Environmental Safeguards,
Social Safeguards and Social Development team.

Quarterly and annual reviews workshops will be held at regional and national level with a view to enhance the
positive performances of ESMF, SA, RPF and the Gender Mainstreaming Guideline identifying bottlenecks and gaps
in implementing the ESMF and proposing solutions in addressing the gaps. Environmental and social auditing will be
done by the RLLP concerned specialists (both federal and regional) and field verification by independent consultants
to be recruited. This auditing will be conducted twice in the program life, i.e. during MTR and completion period of the
project.

The RLLP triggered OP 4.10 Indigenous People as it was determined that the physical and sociocultural
characteristics of the proposed intervention areas and the people living in these sites meet the policy requirements.
The decision to trigger the policy is also based on the Ethiopian Constitution, which recognizes the presence of
different socio-cultural groups, including historically disadvantaged or

underserved peoples, as well as their rights to their identity, culture, language, customary livelihoods,

socio-economic equity, etc. The social safeguard issues relating to the policy are assessed through an SA and
extensive consultation with potential project beneficiaries, including those identified as vulnerable

groups and underserved peoples.

G.2. Gender assessment and action plan (max. 500 words, approximately 1 page)
Provide a summary of the gender assessment and project/programme-level gender action plan that is aligned with
the objectives of GCF’s Gender Policy. Confirm a gender assessment and action plan exists describing the process
used to develop both documents. Provide information on the key findings (who is vulnerable and why) and key
recommendations (how to address the vulnerability identified) of the gender assessment. Indicate if stakeholder
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consultations have taken place and describe the key inputs integrated into the action plan, including: how addressing
the vulnerability will ensure equal participation and benefits from funds investment; key gender-related results to be
expected from the project/programme with targets; implementation arrangements that the AE has put in place to
ensure activities are implemented and expected outcomes will be achieved, monitored and evaluated.

Provide the full gender assessment and project-level gender action plan as annex 8.
Gender Considerations

Land degradation has important gender dimensions. For example, UNDP finds that land degradation increases the
pressures on women differentially from men in their effort to meet practical needs of supporting their families under
increasingly difficult environmental, physical, social, and economic conditions. Women are also challenged by the
consequences of land and environmental degradation induced fuel-wood and water shortage, making their work even
more challenging.

Analysis also indicated the constraints to women’s access to equitable roles in decision-making concerning land
resources and their engagement in sustainable environmental and land management such as: (a) insecure land use
rights, (b) the low value assigned to labor and subsistence farming, (c) lack of access to credit and (d) lack of
opportunities to gain and share technical knowledge. Further, the United Nations Convention to Combat
Desertification (UNCCD) illustrated that, often ‘women’s inequitable access to secure property rights forces them onto
marginal, fragile, highly degradable lands.

The Sustainable Development Goals (SDGs) emphasize gender equality and empowering all women and girls as not
only a fundamental human right, but a necessary foundation for a peaceful, prosperous and sustainable world. This
is part of each of the SDGs as well as being reflected in the stand-alone goal (Goal 5), to achieve gender equality.
Providing women and girls with equal access to the natural resource base and equal representation in decision-
making processes will boost the returns of RLLP investment and benefit broader society. The design of RLLP will
therefore create opportunities for women’s equal rights to economic resources, as well as access to ownership and
control over land and other forms of the natural capital, in accordance with GoE laws.

Gender Dimensions of Land Degradation in Ethiopia

Understanding gender aspects of natural resources management is an entry point for reversing environmental and
land degradation in RLLP landscapes. Women manage natural resources daily in their roles as farmers and
household providers; typically, they are responsible for growing homestead crops, collecting fuel wood and water.
Climate change disproportionately affects rural women, as they are most reliant on natural resources for their
livelihoods but have fewer resources (natural, physical and social capital) to adapt to climate change and cope with
climate change impacts such as droughts, landslides, and food shortages. Climate vulnerabilities affect not only
women’s health, productivity, and development, but also contribute to the intensification of existing gender gaps,
including gender-based violence The Ethiopia Demographic and Health Survey (2016) shows that 33% of women
ages 15-49 have experience physical or sexual violence; domestic violence is the most common form of violence
toards women.

Gender gaps are amplified when adaptation measures fail to consider specific needs and preferences of women.
Further, local cultural norms and practices have a major impact on access to natural resources and the level of
engagement of women in the agriculture sector. Inequitable access and unequal playing fields have led women
farmers to produce on average 23% less than their male counterparts in Ethiopia. For instance, women in rural
Ethiopia have lower access to inputs such as training and technology that help increase resilience by improving
agricultural knowledge. However, notwithstanding their reliance on natural resources, women have less access and
control than men, despite their constitutional rights to equal land ownership, administration and use. Landless rural
women often depend on common property resources for fuel wood, fodder and food. Lack of land and property
ownership and control limits women’s voice and agency, because assets are an important factor in bargaining power
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and household decision-making, access to finance, and overall economic independence. Protection of the natural
resource base is the centerpiece of the overall RLLP investment so that rural women and men will be empowered to
participate in decisions that affect their needs and vulnerabilities, and in turn lend a hand in effective interventions for
the conservation and sustainable use of these resources.

RLLP Gender Approach

The operational steps encompass resilience building through soil and water conservation works, enhanced tenure
security, homestead and farmland development, livelihood improvements (access to improved, targeted livelihoods
support in rehabilitated watersheds including creating jobs, organized cooperatives, women or girls only), climate
smart agriculture, and affordable and innovative technology (household energy). For RLLP, facilitating the acquisition
of improved cookstoves, will free up women’s time, which could potentially enable them to engage in climate resilient
livelihood diversification. Activities could include promotion of improved cookstoves, cultivating fruit trees, bamboo
handicrafts, beekeeping, etc.

The RLLP components will take into account the different roles of men and women in advancing resilient livelihoods
at multiple scales, and respond to the unique interests, priorities and needs of women and men in order to close
gender gaps. Women and men at all levels of the RLLP decision-making should be involved as key actors in the
assessment, design, monitoring, and evaluation of interventions starting from the community watershed committee.
Both women and men need to benefit from a gender approach that reinforces their joint participation and equitable
benefit in RLLP through participatory, inclusive approaches, including actions such as designing, implementing, and
strengthening guidelines incorporating gender perspectives in the project. The RLLP program is well aligned with the
WBG’s Gender Strategy 2016-2023 – seeks to close gender gaps in human endowments, more and better jobs, and
ownership and control of assets; and promote women’s voice and agency, which constitute the four pillars of strategy.

An impact evaluation of gender innovations under RLLP is currently being carried out. The gender assessment of
SLMP-II experiences helped to determine constraints and experiences that limited female and male project
beneficiaries and whether women's abilities to realize equitable benefits from the natural and environmental
resources were effectively improved by the project's activities/innovations.

A Gender Approach and Action Plan is included in Annex D.3. and Annex D.4., to address the gender aspects of land
degradation and natural resource use. This will be further informed through an assessment of the SLMP-II gender
mainstreaming strategy, which is currently underway.

G.3. Financial management and procurement (max. 500 words, approximately 1 page)
Describe the project/programme’s financial management including the financial monitoring systems, financial
accounting, auditing, and disbursement structure and methods. Refer to section B.4 on implementation arrangements
as necessary.

Articulate any procurement issues that may require attention, e.g. procurement implementation arrangements and the
role of the AE under the respective proposal, articulation of procurement risk assessment undertaken and how that
will be managed by the AE or the implementing agency. Provide a detailed procurement plan as annex 10.

Financial Management

The financial management (FM) arrangements for the proposed project- RLLP will be based on the existing FM
systems and structures established under SLMP-II. The FM arrangements for RLLP and SLMP II are in line with the
World Bank (AE) policies and procedures. This includes the accounting capacity maintained by the implementing
entity (Ministry of Agriculture and Natural Resources) at the Federal, Regional and Woreda (District) levels. SLMP II
was audited in accordance with the International Standards on Auditing. The audit for the financial year ended July 7,
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2017 expressed unqualified (clean) opinion but highlighted some internal control weaknesses in the management
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letter. This includes delays in funds flow between federal level and regional and woreda levels, weak control of
advances to Woredas, weak accounting capacity in some Woredas and weak control of fixed assets in some
Woredas. The project addressed these weaknesses progressively in line with an FM Action Plan agreed with the
World Bank (AE).For RLLP, the Federal PCU based at the MoA will retain the overall fiduciary responsibility for the
implementation of the project supported by other federal level PCU’s, Regional Support Units in the six regional
Bureaus of Agriculture (BoA’s) and the administrations of all the implementing woredas. Project annual budgets will
be prepared based on consolidated annual work plans initiated at the woreda and regional levels and compiled at the
federal level. Disbursements are based on the approved budget and accounted for using quarterly interim financial
reports submitted to the World Bank (AE) within 45 days after the end of each quarter. An external audit of the project
will be conducted annually by the Supreme Audit Institution or an accredited private audit firm. The audit will be
conducted in accordance with Terms of Reference prepared by the EE and the objective of the audit will be to
ascertain whether project funds have been used for the intended purpose. The AE reviews and provides clearance
for the recruitment of the auditor including clearance of the ToR.In each of the federal level-implementing entities, the
six regions and all woredas will maintain segregated local currency bank accounts where project funds will be
deposited and payments made. Proceeds of the IDA Credit and MDTF will initially flow into the DA before further
disbursement into each of the local currency project accounts based on the approved annual work plan and budget.
In addition to receiving advances through the DA, the project may use other disbursement methods such as
reimbursements, direct payment and special commitment. To enhance the level of disbursements under the new
project, the team will ensure prompt submission of quarterly IFRs immediately after the end of each quarter. Financial
reporting for the proposed project will follow international financial reporting and auditing standards. The FM risk
rating for the implementation of the RLLP is considered Substantial. An FM assessment of the implementing entities
including sampled woredas has been completed and used to update the FM arrangements for the RLLP (see Annex
D.5.). Procurement under the project will be carried out in accordance with the World Bank’s Procurement
Regulations for IPF Borrowers - ‘Procurement in Investment Project Financing, Goods, Works, Non-Consulting, and
Consulting Services’, dated July 2016, revised November 2017 and ‘Guidelines on Preventing and Combating Fraud
and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants’, revised as of July 1, 2016, and the
provisions stipulated in the Legal Agreement. A Project Procurement Strategy Document (PPSD) has been prepared
by the MoA, which forms the basis for a Procurement Plan that details procurement methods, estimated costs,
post/prior review requirements, etc. for each contract to be financed by project proceeds. The Procurement Plan will
be updated at least annually or as required to reflect the actual project implementation needs and improvements in
institutional capacity. Procurement of RLLP will be carried out in a decentralized manner in each of the major
watersheds participating in the project. At the federal level, the PCU is the focal organization for implementation of
RLLP. The BoAs and the Woreda Agricultural Development Offices shall serve as the implementing organizations of
RLLP in the respective regions. The land and watershed management activities will be carried out in the existing and
new watersheds in the beneficiary woredas and may involve local community participation in procurement. The
project procurement plan includes community level procurement activities and targets. The procurement at
community level has a separate operational guideline. Training will be provided for the community level procurement
committee to improve capacity and reduce risks. Based on the threshold and procurement plan target there will be
regular monitoring by district (woreda) level procurement authorities to effect payments. Regional level procurement
specialists regularly monitor the procurement plan and its implementation. Moreover, during regular Joint
Implementation Support Missions from the federal level procurement is one of the fiduciary components monitored.
There are also internal and external audits on a yearly basis and a comprehensive independent procurement audit
will be conducted for the entire project period.

Taxation: Where goods and services are procured by the project, these will be subject to income tax, import duties,
withholding tax and Value Added Tax. GCF proceeds can be used to pay taxes.

Taxation of farmland is low due to the use rights of farmers. Farmer cooperatives received a tax incentive, exempting
them from paying profit tax. A proposal has been submitted to exempt irrigation pumps from import tax.

Authorizations needed for project implementation: The World Bank will sign a financing agreement with the Federal
Democratic Republic of Ethiopia. Once this agreement is signed, authorization for project implementation will need to
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be obtained from Ethiopia’s House of Parliament. During project implementation, the Steering Committee will have
oversight of the project. Steering committee members include various Ethiopian government bodies, as described in
Section C.7.

G.4. Disclosure of funding proposal

Note: The Information Disclosure Policy (IDP) provides that the GCF will apply a presumption in favour of disclosure
for all information and documents relating to the GCF and its funding activities. Under the IDP, project and
programme funding proposals will be disclosed on the GCF website, simultaneous with the submission to the Board,
subject to the redaction of any information that may not be disclosed pursuant to the IDP. Information provided in
confidence is one of the exceptions, but this exception should not be applied broadly to an entire document if the
document contains specific, segregable portions that can be disclosed without prejudice or harm.

Indicate below whether or not the funding proposal includes confidential information.

☐ No confidential information: The accredited entity confirms that the funding proposal, including its annexes, may be
disclosed in full by the GCF, as no information is being provided in confidence.

☐ With confidential information: The accredited entity declares that the funding proposal, including its annexes, may
not be disclosed in full by the GCF, as certain information is being provided in confidence. Accordingly, the accredited
entity is providing to the Secretariat the following two copies of the funding proposal, including all annexes:

full copy for internal use of the GCF in which the confidential portions are marked accordingly, together with
an explanatory note regarding the said portions and the corresponding reason for confidentiality under the
accredited entity’s disclosure policy, and
redacted copy for disclosure on the GCF website.

The funding proposal can only be processed upon receipt of the two copies above, if containing confidential
information.
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H
ANNEXES
H.1. Mandatory annexes

☒ Annex 1 NDA no-objection letter(s) (template provided)

☒ Annex 2 Feasibility study - and a market study, if applicable

☒ Annex 3 Economic and/or financial analyses in spreadsheet format

☒ Annex 4 Detailed budget plan (template provided)

☒ Annex 5 Implementation timetable including key project/programme milestones (template provided)

☒ Annex 6 E&S document corresponding to the E&S category (A, B or C; or I1, I2 or I3):
(ESS disclosure form provided)
☐ Environmental and Social Impact Assessment (ESIA) or
☒ Environmental and Social Management Plan (ESMP) or
☐ Environmental and Social Management System (ESMS)
☒ Resettlement Policy Framework, Social Assesment

☒ Annex 7 Summary of consultations and stakeholder engagement plan

☒ Annex 8 Gender assessment and project/programme-level action plan (template provided)

☐ Annex 9 Legal due diligence (regulation, taxation and insurance)

☐ Annex 10 Procurement plan (template provided)

☐ Annex 11 Monitoring and evaluation plan (template provided)

☒ Annex 12 AE fee request (template provided)

☒ Annex 13 Co-financing commitment letter, if applicable (template provided)

☒ Annex 14 Term sheet including a detailed disbursement schedule and, if applicable, repayment schedule
H.2. Other annexes as applicable

☒ Annex 15 Evidence of internal approval (template provided)

☒ Annex 16 Map(s) indicating the location of proposed interventions
☐ Annex 17 Multi-country project/programme information (template provided)
☒ Annex 18 Appraisal, due diligence or evaluation report for proposals based on up-scaling or replicating a pilot
project
☐ Annex 19 Procedures for controlling procurement by third parties or executing entities undertaking projects
financed by the entity
☐ Annex 20 First level AML/CFT (KYC) assessment
☐ Annex 21 Operations manual (Operations and maintenance)
☒ Annex x Other references
* Please note that a funding proposal will be considered complete only upon receipt of all the applicable supporting documents.