Mozambique - Smallholder Development in the Zambezi Valley Project

Page 1 INTEGRATED SAFEGUARDS DATA SHEET CONCEPT STAGE Report No.: AC1551 Date ISDS Prepared/Updated: 06/29/2005 I. BASIC INFORMATION A. Basic Project Data Country: Mozambique Project ID: P093165 Project Name: Smallholder Development in the Zambezi Valley Task Team Leader: Jeeva A. Perumalpillai-Es Estimated Appraisal Date: October 26, 2005 Estimated Board Date: April 18, 2006 Managing Unit: AFTS1 Lending Instrument: Specific Investment Loan Sector: General agriculture, fishing and forestry sector (20%);Animal production (20%);Irrigation and drainage (20%);Crops (20%);Agricultural extension and research (20%) Theme: Rural markets (P);Rural non-farm income generation (S);Rural services and infrastructure (S);Other rural development (S) IBRD Amount (US$m.): 0.00 IDA Amount (US$m.): 20.00 GEF Amount (US$m.): 0.00 PCF Amount (US$m.): 0.00 Other financing amounts by source: BORROWER/RECIPIENT 2.00 AFRICAN DEVELOPMENT BANK 3.00 5.00 B. Project Objectives [from section 2 of PCN] The main project development objective is to increase the income of smallholder farmers in selected districts by empowering communities, building community organizations, increasing on- and off-farm production and productivity, and facilitating farm access to markets. Project activities would be demand-driven, and closely linked to government's decentralization strategy, agricultural policies, and other donor activities in the project area, as appropriate. C. Project Description [from section 3 of PCN] In order to achieve the development objectives, the proposed project would apply innovative mechanisms for integrating location-specific inputs for the acceleration of agricultural growth through decentralized institutional development, technological change, support to small-scale infrastructure development, and increased private sector participation. However, the project would not finance all the sub-components and activities listed below. The strategy will be to Page 2 look for partnerships with relevant organizations active in the region. The nature of the project means that there would be a heavy emphasis on concurrent monitoring and evaluation of the project impact and outcomes. Component 1: Institutional Development The focus of this component would be to strengthen local institutions and develop capacity and introduce participatory processes to accelerate the decentralization process. This component entails the following sub-components: (i) develop grass-roots or self-help farmer associations, (ii) promote savings mechanisms amongst groups supported by the project, i.e. drawing upon successful experiences in Mozambique and explore linkages to the IFAD Rural Finance Support Program, (iii) support to local civil society organizations, (iv) enhance the district level planning capacity, and (v) address risks related to HIV/AIDS. Component 2: Infrastructure Provision To ensure viability and sustainability of farming operations, smallholders need access to a range of infrastructure facilities. This factor is generally quoted as the key constraint to productivity, and includes the risks associated with variation in rainfall and access to rural roads linking production areas to markets. The objective of this component would be to provide critical infrastructure to smallholders to reduce their risks and increase their productivity. Sub- components are: (i) small dams for irrigation, (ii) access roads, (iii) wholesale and retail market facilities, (iv) market information and communication network, and (v) private sector linkages. Component 3: Agricultural Technology The main thrust of this component would be to increase availability of cost-effective technologies to enable farmers to intensify and, where appropriate, diversify production systems in a sustainable manner. Specific activities to be supported would include the following sub- components: (i) demand-led technology adaptation, (ii) community-based seed production systems, (iii) value addition through improved post-harvest management systems, (iv) small- scale mechanization and (v) on-farm water management. Component 4: Community Investment Fund The project would encourage communities to submit proposals for financing from a Community Investment Fund. The focus of this component would be to finance demand-driven agricultural activities in the project area, including the following sub-components: (i) institutional support to producer organizations, (ii) agriculture related goods and services, and (iii) training opportunities for on-farm and non-farm income generating activities (for example, agricultural extension, processing and marketing activities, development of small enterprises). It is expected that this approach would encourage competition between districts and provinces for additional funds. Communities would be actively encouraged and assisted in preparing proposals based on their needs. Funds would be allocated in response to demand generated and the expected effectiveness of utilization by the participating groups. D. Project location (if known) The proposed project would be located in the central region of the Zambezi Valley, possibly encompassing four districts in three provinces: Mutarara (Tete Province), Morrumbala and Mopeia (Zambezia Province), and Caia (Sofala Province). It would complement investments of Page 3 the Bank and other donors in the area, namely, the "Sena Railways Line" and the "Moatize Coal Mining" operations, thus contributing to the rapid economic development of the area. A final decision will be made during preparation, taking into account the project area's growth potential, socio-economic and institutional factors, and synergies with other donor activities. E. Borrower