Malawi - Lake Malawi / Nyasa Biodiversity Conservation Project

GLOBAL ENVIRONMENT FACILITY 1 3COL)44 MAT Republic of-Malawi Lake Malawi/Nyasa Biodiversity Conservation .. ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~~> . Project Document December 1994 THE WORLD BANK  GEF Documentation The Global Environment Facility (GEF) assists developing countries to protect the global environment in four areas: global warming, pollution of international waters, destruction of biodiversity, and depletion of the ozone layer. The GEF is jointly implemented bythe United Nations Development Programme. the Uniited Nations Environment Programme, and the World Bank. GEF. Project Documents - identified by a green band - provide extended project- specific information. The implementing agency responsible for each project is identified by its logo on the cover of the document. Global Environment Coordination Division Environment Department World Bank 1818 H Street, NW Washington. DC 20433 Telephone: (202) 473-1816 .Fax: (202) 522-3256  Report No. 13044 MAI Republic of Malawi Lake Malawi/Nyasa Biodiversity Conservation Project Document December 1994  CURRENCY EQUIVALENTS Currency Unit = Malawi Kwacha (MK) MK 7.14 = US$1 WEIGHTS AND MEASURES The metric system is used throughout this report GOVERNMENT FISCAL YEAR April 1 - March 31 ACRONYMS AND ABBREVIATIONS BMPL Biodiversity Map and Management Plan for Lake Malawi/Nyasa CIDA Canadian International Development Agency DNPW Department of National Parks and Wildlife FD Fisheries Department GEF Global Environment Facility GET Global Environment Trust IDA International Development Association JICA Japan International Cooperation Agency LMNP Lake Malawi National Park MFNR Ministry of Forestry and Natural Resources MK Malawi Kwacha MPPS Ministry of Physical Planning and Surveys NGO Non-governmental Organization SADC Southern Africa Development Community UN United Nations UNDP United Nations Development Programme  REPUBLIC OF MALAWI LAKE MALAWI/NYASA BIODIVERSITY CONSERVATION PROJECT GR4NT AND PROJECT SUMMARY Redpient: Government of Malawi Grantee: Global Environment Trust Beneficiary: Ministry of Forestry and Natural Resources Amount: SDR 3.5 million (US$5 million equivalent) Temn: Grant Finandng Plan: Source Local Foreign Total (USSMillion) GEF Grant 5.0 5.0 CIDA Inc. 0.24 0.24 Governinent 0.2 0.2 TOTAL 0.2 5.24 5.44 Economic Rate of Return: Not calculated, though substantial environmental, social and economic benefits are expected. Poverty Category: Not applicable Map: IBRD No. 25786   REPUBLIC OF MALAWI SADC LAKE MALAWI/NYASA BIODIVERSITY CONSERVATION PROJECT Background 1. Biological Significance. Lake Malawi/Nyasa (the Lake) is the southern-most lake in the African rift valley and ranks among the largest fresh water lakes in the world. The Lake is surrounded by Malawi to the west and south, and Mozambique and Tanzania to the east and north. Thirteen major river systems drain the Lake's total catchment area of 75,000 km2. The majority of the Lake's surface area is within Malawi, along with 80% of the total Lake shore population. 2. The riparian human population density and growth rate is high, and the Lake's resources provide substantial economic and nutritional benefits to the local communities in all three countries. In Malawi, fish accounts for about 70% of the protein consumed by the country's population. About 90% of the Lake's fish catch is caught by small-scale fishermen using artisanal methods. Fishing employs about 40,000 people directly, and another 250,000 people in related employment activities, such as fish processing and marketing. 3. The diversity of the Lake's native fish species is unparalleled in the world, with 500 to 1000 fish species from ten families recorded to date. Particularly noteworthy are the cichlids, of which all but five of the more than 400 species are endemic to the Lake. Many cichlids have localized distributions within the Lake. Consequently, they are vulnerable to extinction from overfishing, localized effects of pollution, and other environmental problems. The 94 km2 Lake Malawi National Park (LMNP), which adjoins and extends into the southern portion of the Lake, is the only protected area for the cichlid fishes in the tripartite Lake. The LMNP was established in 1980 by the Government of Malawi as the first freshwater, underwater national park in Africa, and is now a UNESCO World Heritage Site. 4. Natural Resource Management Policy. While no comprehensive management plan currently exists for the Lake, Malawi, Mozambique and Tanzania are at various stages of developing National Environmental Action Plans (NEAPs) and related environmental policies which will provide the frameworks for general environmental management at the national level. They all recognize the importance of preserving the Lake ecosystem, and that this will depend on tri-national participation in lake management as well as building capacity in the monitoring, legislative and enforcement capabilities of the riparian governments. 5. Related Conservation and Natural Resource Management Projects. The IDA Malawi Fisheries Development Project became effective in 1991 and is being implemented by the Malawi Fisheries Department (FD). In 1993, the project was restructured from a focus on fisheries production to an emphasis on sustainable resource management of the Lake's fisheries stocks. A pilot Aquaculture and Hatchery Program to be financed by the Japan International Cooperation Agency (JICA) is being prepared with the aim of establishing a research center for the mpasa and ntchila indigenous fish species and to promote small-scale market oriented aquaculture using these species. JICA's pilot project will complement the GEF project by increasing the populations of these two specific species. As a pilot program it will also identify the potential for aquaculture production of indigenous species as a means of reducing pressure on the Lake's resources and creating employment 1  opportunities. A third project, the United Kingdom/Southern Africa Development Community (UKISADC) Pelagic Fish Project, concluded in May 1994. It was a tripartite research venture focusing on the productivity of pelagic fish. The project findings have led to the recommendation that a regional consultative group be established for the management of the Lake by the three coL'ntries. This goal has been adopted by the GEF project and it will maintain the Steering Committee management structure established under the UK/SADC project. 6. The research activities of the GEF project would complement the above projects by providing needed information on the occurrence, distribution and ecology of the rare endemic species which will have relevance for zoning the coastline and establishment of reserves to protect the whole range of the Lake's biodiversity. Moreover, the project's training program will strengthen capacity among the riparian countries which is critical tor implementing action programs to sustainably manage the lake over the long-term. Project Objectives 7. The main objective of the project is to assist the riparian states in creating the scientific, educational, and policy basis necessary for conserving the biological diversity of the Lake and its unique ecosystem. It will be achieved through the following specific activities: * building scientific capacity within the riparian countries to survey, study and monitor the Lake's biodiversity, identify threats, and provide recommendations for the Lake's management; * surveying and inventorying species, identifying critical habitats and biodiversity hotspots and recommending preliminary measures to demarcate and protect such areas; * identifying pollution sources and measuring water quality at sites where human activities threaten biodiversity; * preparing a Strategic Plan for the Nankumba Peninsula and Lake Malawi National Park for eco-tourism development, consistent with the protection and conservation of the Lake's biodiversity; * preparing a comprehensive Biodiversity Map and Management Plan for Lake Malawi/Nyasa based on the information provided by the species, habitat, and water quality analyses; * increasing conservation awareness among the lakeshore population and regional and national policy makers, whose decisions regarding regional development have an impact on the Lake's ecosystem; and * reviewing the adequacy of existing national environmental legislation in Malawi, Mozambique and Tanzania and making appropriate legislative recommendations for revising and/or strengthening enforcement for the conservation of the Lake's biodiversity. Project Description 8. The project's main output will be the Biodiversity Map and Management Plan for Lake Malawi/Nyasa (BMPL). The BMPL will recommend conservation actions and investments to protect the Lake's biodiversity. These will include zoning of the Lake's coastline for appropriate biodiversity 2  conservation, and identifying a system of potential protected areas that are representative of the Lake's biodiversity hotspots which will be complementary to the Lake Malawi National Park. The development of the BMPL will be achieved through the project's four components. (a) The Research Component consists of: (i) biodiversity surveys to inventory fish species and their distribution, identify critical habitats and biodiversity areas in the Lake, produce a map of critical habitats, and identify threats to the Lake's biodiversity; (ii) studies on the taxonomy, ecology and distribution of the cichlid species; (iii) a limnology and water quality monitoring program to identify pollution threats to hotspots and fish replenishment areas; and (iv) modest rehabilitation of the Cape MaClear Research Station in Malawi, the Kyela Centre Fisheries Research Station in Tanzania, and the Metangula Fisheries Research Station in Mozambique. (b) The National Capacity Building component consists of "on-the-job" training of officer level and technical staff from the riparian countries in ecology, taxonomy, limnology, and environmental education. The training will focus on building local capacity for the research and conservation planning activities in future lake project/programs. Activities under this component will also increase conservation awareness among all sectors of society from decision-makers to resource users of the Lake through informal and formal educational initiatives implemented by the Wildlife Society of Malawi and development of a Conservation Awareness Program, including media productions. Financing will also be provided for rehabilitation of the Environmental Education Facility at Lake Malawi National Park which has established an important educational link with the local schools and residents of the Park's enclave villages. (c) The Environmental Legislation component will review and evaluate the compatibility of the existing legislation in Malawi, Mozambique and Tanzania for the management of the Lake's biodiversity. The results of the review will be presented at an environmental legislation conference of the three countries, and will culminate in a report to the riparian governments, providing recommendations for revising and strengthening legislation and enforcement ability, while creating a harmonized and effective legal framework for the conservation of Lake Malawi/Nyasa's biodiversity. (d) The Protected Areas Management component involves the preparation of a Strategic Plan for Nankumba Peninsula and Lake Malawi National Park. The Strategic Plan will be prepared in two phases. The first phase, dealing with data survey and collection of information, will be financed by Canadian International Development Agency, Industrial Cooperation Division (CIDA INC). The Project will finance the second phase which will emphasize community participation in the planning process, identify community roles in Park and Lake conservation, and conclude with proposals for preferred development options and their environmental implications. Assistance will also be provided to the Government of Malawi to design a funding mechanism to address recurrent funding for the sustainable development, management and maintenance of Lake Malawi National Park and the continued monitoring of biodiversity conservation indicators. 3  Project Implementation 9. At the regional level, Malawi's Ministry of Forestry and Natural Resources (MFNR) is the SADC Sector Coordinator for Inland Fisheries, Forestry and Wildlife. The Principal Secretary for MFNR will be responsible for the implementation of this GEF project on behalf of the riparian countries. A Steering Committee comprising members from the Fisheries Departments and the National Parks Departments or equivalents from the riparian countries, and NGO/community representatives will serve as an advisory body under the leadership of the Principal Secretary of MFNR. A Project Manager (PM) and Financial Controller based in Senga Bay, Malawi, will manage the project's activities consistent with the Global Environment Trust Fund and the Project Implementation Plan under the guidance of the Principal Secretary of MFNR. Under the PM's supervision, 3 scientific experts will be recruited to lead the research and training components; an international law expert will be recruited to support the implementation of the environmental legislation component; and the Wildlife Society of Malawi, an NGO, will be contracted for the conservation awareness sub-component. The Ministry of Physical Planning and Surveys (MPPS) will supervise the preparation of the Strategic Plan for Nankumba Peninsula and Lake Malawi National Park. The rehabilitation of National Research Stations in Mozambique and Tanzania will be the responsibility of the respective governments, according to programs designed and implemented through UNDP for each country. UNDP will be responsible for all procurement and disbursement under this sub-component. Modest rehabilitation of the National Research Station in Malawi will be implemented under the project's research component. 10. A draft Project Implementation Plan has been prepared which includes inter alia a procurement plan, training programs, and M&E procedures. The main instruments for monitoring project progress will be quarterly reports covering the various project activities, submitted to the PM by the leaders of each project component, including UNDP reports on project activities in Mozambique and Tanzania. A consolidated quarterly progress report prepared by the PM, and copied to the Bank, will be regularly reviewed by the Steering Committee, who will recommend corrective actions, if any. Project Sustainability 11. Through scientific research, the project will identify priority areas for biodiversity conservation and establish the basis for sustainable utilization and management of the Lake's globally important biodiversity. A key element in the project's sustainability will be the training of local scientists and technicians in the fields of fish ecology, taxonomy, and limnology and water quality monitoring who will continue this work beyond the life of the project. The identification of pollution sources and measurement of water quality at sites where human activities threaten biodiversity will facilitate routine, cost-effective monitoring of identified biodiversity indicators on an ongoing basis by all three countries. The establishment of a systematic reporting of scientific findings to administrative, policy, and donor institutions, and the general public will provide authorities with the needed knowledge base for sustainable resource utilization and alert them of the need for tripartite corrective action if there is an indication of ecosystem degradation or threat to the biodiversity of the Lake. The Biodiversity Map and Management Plan for the Lake, as well as the Strategic Plan for Nankumba Peninsula and LMNP, will provide a long term plan for the sustainable management of the Lake's aquatic and coastal resources, and the legislative review will recommend the environmental policy changes needed for sustainable management. 4  Past Experience and Lessons Learned 12. Experience with similar projects has shown that international coordination is an issue of concern. For example, the proposed GEF project for Lake Tanganyika has had difficulties in orchestrating a forum in which the riparian countries can agree on project components. The Lake Malawi/Nyasa GEF project will benefit from existing coordination arrangements under the SADC umbrella. 13. While all efforts have been made to limit the amount of technical assistance in this project, the implementation experience of other projects which have large scientific or technical components indicates the need for staff with substantial scientific expertise in order to achieve desired results. Where this expertise is not available within the project countries, suitably qualified local individuals will be selected to be trained on-the-job by the external experts to assure the continuation of scientific components after project completion. Rationale for Bank Involvement and GEF Funding 14. The global importance of Lake Malawi/Nyasa for biodiversity conservation is derived frol tlhe exceptional diversity of its unique fishes, estimated to number between 500 and 1000 endemic species, of which less than half have been formally described taxonomically. The Lake Malawi/Nyasa ichthyofauna represents the world's most diverse evolutionary radiation of fishes within a single lake. The project represents an important contribution to the GEF portfolio as it will address the problems of: (a) maintaining the stability and diversity of a biota which includes a number of exploited species; (b) enabling local communities to better understand the issues involved and engage in the ecologically sustainable use of the Lake's resources; and (c) creating the framework for internationali cooperation in the management of the Lake. The project will serve as a model for other large freshwater ecosystems where similar problems of overfishing, pollution and other perturbations, and international interdependency arise. The GEF is the only significant source of funding for biodiver-sity conservation of this nature. Agreed Actions 15. Prior to Negotiations, the Government of Malawi agreed to and granted a continuation of the declaration of Trust for SADC's use and maintenance of the Senga Bay research facility for the duration of the GEF project. 16. During negotiations the Government of Malawi agreed: (a) to enter into agreement between the Recipient and UNDP for the rehabilitation of National Research Stations in Mozambique and Tanzania and submit a duly-signed withdrawal application, in an amount of US$400,000 payable to UNDP; (b) to have the first project annual work plan included in the Project Implementation Plan and subsequent consolidated work plans prepared for project components before the end of the year preceding the year addressed by the plan and provide them to the Steering Committee for review with copies sent to the Bank; (c) to prepare a Strategic Plan for Nankumba Peninsula and Lake Malawi National Park and submit it to the Bank for comments within one year after project effectiveness; (d) to undertake development activities in Nankumba Peninsula and Lake Malawi National Park consistent with the Strategic Plan; (e) to prepare a preliminary draft of the Biodiversity Map and Management Plan for Lake Malawi/Nyasa to be reviewed with the Riparian States and the Bank within twenty-four months after Grant effectiveness; (f) to submit a final draft Biodiversity Map and Management Plan for Lake Malawi/Nyasa to the Bank for comments no later than 36 months after Grant effectiveness; 5  and (g) to submit to SADC within 42 months after Grant effectiveness, a time-bound proposal for the implementation of the Biodiversity Map and Management Plan for Lake Malawi/Nyasa by the riparian countries. 17. As conditions of Grant effectiveness the Government will: (a) establish a Project Steering Committee with membership acceptable to the Bank, chaired by the Principal Secretary for the Ministry of Forestry and Natural Resources; (b) appoint a Project Manager and Financial Controller; and (c) finalize the Project Implementation Plan. Environment Aspects 18. The project was assigned environmental assessment category B due to infrastructure development in Lake Malawi National Park which required an environmental mitigation plan. However, infrastructure development has been halted pending the development of a Strategic Plan for Nankumba Peninsula and Lake Malawi National Park which will identify activities that require appropriate environmental impact assessments. There is, therefore, no need to prepare an environmental mitigation plan for the project at this time. Benefits 19. The project is designed to establish the scientific, educational and policy basis for the conservation of the Lake's globally important biodiversity. A major goal of the project is to strengthen capacity among the riparian countries in the fresh water management, research, and environmental education disciplines. The project will provide baseline biological and water quality information as a basis for future scientific monitoring and lake resources management. These outputs, together with the initiatives to harmonize policy and legislation, will strengthen tri-national participation in lake management and provide the capacity and information necessary for maintaining the Lake's unique biodiversity resources. 20. The Biodiversity Map and Management Plan for the Lake will recommend specific follow-up conservation actions and investments, and identify a system of protected areas that will be representative of the biological hotspots of the Lake, and complementary to Lake Malawi National Park, to protect samples of all habitats and fish communities. This plan will provide the framework for follow-up national and potential international action programs to manage the Lake on an environmentally sound and sustainable basis. Risks 21. Limited government implementation capacity may be a major constraint to the realization of the full project benefits. The design of this project minimizes such risks. First, it will utilize the tri- national Steering Committee Management structure which has proved to be successful in the UK/SADC project. Second, technical assistance will be used selectively to augment government capability during the investment period. Third, the extensive training under the project will enable nationals of the riparian states to manage follow-up conservation actions and investments identified in the Biodiversity Map and Management Plan for Lake Malawi/Nyasa, and minimize the need for further foreign technical assistance. The risk that this capacity may be compromised by additional development obligations in the future cannot be entirely dismissed. However, it is anticipated that Government commitment to the management of the Lake will be sufficiently strengthened under the project to mitigate this risk. There is also a risk that the future scarcity of investment sources will 6  prevent the full implementation of the Biodiversity Management Plan for the Lake. The strengthening of scientific work on the Lake, and increased involvement of the international community in its monitoring and management should help to mobilize the resources needed for its sustainable development. 7  Schedule A Table 3.1: Summary of Project Costs by Component COST Project Component _ _ % MK '000 US$ Foreign Total Local Foreign Total Local Foreign Total Costs 1. ResearchA 9,185.0 8,379.6 17,564.5 1,287,528 1,173,611 2,461,139 48 51 2. Strengthening National Capacity 1,876.3 674.2 2,550.5 262,786.2 94,431.1 357,217.3 26 7 3. Legislation 308.1 601.1 909.2 43,154.8 84,188.3 127,343.1 66 3 4. Protected Areas 655.8 7,119.3 7,775.1 91,843.1 998,527 1,090,370 92 22 5. Project Administration 2,923.6 2,989.7 5,913.4 409,473.4 418,728.6 828,202.1 51 17 Total Baseline Costs 14,948.8 19,764.0 34,712.7 2,094,786 2,769,486 4,864,272 57 100 Physical Contingencies 913.0 1,229.2 2,142.2 127,869.4 172,163.7 300,033.1 57 6 Price Contingencies 1,934.4 2,630.8 4,565.2 116,157.2 159,539.4 275,696.6 58 6 Total Project Costs 17,796.1 23,624.0 41,420.1 2,338,813 3,101,189 5,440,001 57 1 A Includes US$400,000 for the rehabilitation of the Kyela Research Station in Tanzania and the Metangula Research Station in Mozambique which will be implemented by UNDP. Schedule B PROCUREMENT ARRANGEMENTS (US$Thousands) Procurement Method Expenditure Category International Local N. B. F. Total Competitive Competitive Other Consulting Bidding Bidding Services A. Civil Works - 571 571 B. Equipment and Goods 68 - 68 C. Vehicles 98 - - 98 D. Consultant Services - - 2,583 254 2,837 E. Service Contracts 535 - 200 735 F. Incremental Operating Costs - - 1,131 - - 1,131 TOTAL 166 571 1,666 2,583 454 5,440 8  Schedule C DISBURSEMENT Category of Items US$Equlvalent % of Expenditure to be Financed A. Civil WorksA 571,000 100 B. Equipment and Goods 68,000 100 C. Vehicles 98,000 100 D. Technical Assistance 3,410,000 100 E. Training 162,000 100 F. Incremental Operating Costs 1,131,000 100 TOTAL 5,440,000 100 A US$400,000 covers National Research Stations in Mozanbique and Tanzania (US$200,000 each) Schedule D TIMETABLE OF PROJECT PROCESSING A. Time Taken to Prepare: 35 months B. Prepared by: Government of Malawi with Bank assistance C. First Bank Mission: September 1991 D. Appraisal Mission Departure: February 1993 E. Negotiations: September 1994 F. Planned Date of Effectiveness: January 1995 G. List of Relevant PCRs and PPARs: None Based on the finding of an appraisal mission, this report was prepared by the following: E. Asibey (Senior Ecologist and Task Manager, AF1AE), J. Larson (Operations Analyst, AFIAE), and S. Riddle (Consultant, AF1AE). The cost tables were prepared by R. Kirubaidoss (Senior Staff Assistant, AF4PH). E. Loayza (AGRTN) was the Lead Advisor, and R. Zweig (ASTEN) and G. Van Santen (EMTAG) were the peer reviewers. The Division Chief is C. Helman and the Departrnent Director is K. Marshall. 9   CURRENCY EQUIVALENTS Currency Unit = Malawi Kwacha (MK) MK 7.14 = US$1 WEIGHTS AND MEASURES The metric system is used throughout this report GOVERNMENT FISCAL YEAR April 1 - March 31 ACRONYMS AND ABBREVIATIONS BMPL Biodiversity Map and Management Plan for Lake Malawi/Nyasa CEO Community Education Officer CIDA Canadian International Development Agency DNPW Department of National Parks and Wildlife DREA Department of Research and Environmental Affairs EEO Environmental Education Officer FAO Food and Agricultural Organization FD Fisheries Department GEF Global Environment Facility GET Global Environment Trust ICB International Competitive Bidding ICS International Competitive Selection IDA International Development Association JICA Japan International Cooperation Agency LCB Local Competitive Bidding LMNP Lake Malawi National Park LOI Letter of Invitation MFNR Ministry of Forestry and Natural Resources MK Malawi Kwacha MPPS Ministry of Physical Planning and Surveys MREA Ministry of Research and Environmental Affairs NEAP National Environmental Action Plan NEMP National Environmental Management Program NGO Non-governmental Organization ODA Overseas Development Administration RAG Research Advisory Group SADC Southern Africa Development Community TFAP Traditional Fisheries Assessment Project UN United Nations UNDP United Nations Development Program WSM Wildlife Society of Malawi   GOVERNMENT OF MALAWI SADC LAKE MALAWI/NYASA BIODIVERSITY CONSERVATION PROJECT TABLE OF CONTENTS Pau~ 1. BACKGROUND .................................... I A. General ................................................. 1 B. Threats to the Sustainability of Lake Malawi/Nyasa's Biodiversity ............. I C. Current Natural Resource Management Policy and Legislation ............... 2 D. Regional and Malawi Institutions Relevant to the Project .................. 3 E. The Project's NGO Involvement .................................. 4 F. Related Conservation and Natural Resource Management Projects ............. 5 2. THE PROJECT .................................... 8 A. Project Concept and Objectives ............................ . 8 B. Detailed Project Description .............................. . 9 C. Project Management and Implementation Arrangements .............. ... . l 5 D. Monitoring, Evaluation, and Reporting ......................... . 16 E. Project Costs and Financing .............................. .I iS (1) Cost Estimates .................................... 18 (2) Procurement ..................................... 19 (3) Disbursements .................................... 2 1 (4) Financial Accounting and Audit Requirements ................. 22 3. ENVIRONMENTAL IMPACT, BENEFITS AND RISKS ...................... 23 A. Environmental Impact ...................................... 23 B. Project Benefits ............................................ 23 C. Project Risks ............................................. 23 4. ASSURANCES, CONDITIONS OF EFFECTIVENESS, AND RECOMMENDATION ... 25 ANNEXES 1. Project Components, Activities and Outputs . .............................. 28 2. Project Implementation Chart .................................... 29 3. Steering Committee Terms of Reference ................................. 30 4. Project Administration Terms of Reference ................................ 31 5. Research Component Terms of Reference ................................. 34 6. Strategic Plan for Nankumba Peninsula, Lake Malawi National Park and Enclave Villages . . 38 7. Legislation Component Terms of Reference . .............................. 41 8. Tanzania National Research Station ................................... 43 9. Mozambique National Research Station .................................. 44 10. Implementation Schedule . ................................... 45 11. Consultancies and Training Schedule ................................... 48 12. Supervision Schedule ................................... 50 13. Estimated Project Costs ................................... 53 MAP: IBRD No. 25786   GOVERNMENT OF MALAWI SADC LAKE MALAWI/NYASA BIODIVERSITY CONSERVATION PROJECT 1. BACKGROUND A. General 1.1 Lake Malawi/Nyasa (the Lake) is the southern-most lake in the African rift valley and ranks amongst the largest freshwater lakes in the world. The Lake is surrounded by Malawi to the west and south, and Mozambique and Tanzania to the east and north. Thirteen major river systems drain the Lake from its total catchment area of 75,000 km2. 1.2 The riparian human population density and growth rate are high, and the Lake's resources provide substantial economic and nutritional benefits to the local communities in all three countries. Malawi is a major beneficiary, as the majority of the Lake's surface area is within Malawi, along with about 80% of the total Lake shore population. About 90% of the Lake's fish catch is caught by small-scale or artisanal methods within 2 km of the shoreline. Fish accounts for about 70% of the animal protein consumed by the population of Malawi, and fishing employs about 40,000 people directly, and another 250,000 people in related employment activities such as fish processing and marketing. 1.3 The diversity of the Lake's native fish species is unparalleled in the world with over 500-1000 fish species from ten families recorded to date. Particularly noteworthy are the 400 documented species of cichlids, of which all but five are endemic to the Lake. Cichlids, due to their sedentary nature, have localized distributions within the Lake. Consequently, they are vulnerable to extinction from overfishing, localized effects of pollution, and other environmental problems. The only area which protects the cichlid fishes is the 94 km2 Lake Malawi National Park (LMNP), which adjoins and extends into the southern portion of the Lake. The LMNP was established in 1980 by the Government of Malawi as the first freshwater, underwater national park in Africa (and now a UNESCO World Heritage Site). B. Threats to the Sustainability of Lake Malawi/Nyasa's Biodiversity 1.4 Fisheries. The Lake ecosystem is not, at this point known to be, critically endangered; however there are disturbing signs and the riparian governments and communities are concerned that unsustainable fishing practices, the lack of knowledge of the Lake's resources, and the lack of a coordinated management plan will threaten the environmental integrity and productive capacity of the Lake in the future. The example provided by the nearby Lake Malombe, located south of Lake Malawi/Nyasa, illustrates the potential crisis that could arise if measures are not taken to use the Lake's resources in a sustainable manner. The chambo fish catch in Lake Malombe was recorded at 10,000 tons in 1986. This has now dropped to between 200 and 300 tons per year. 1.5 Recently fishermen on Lake Malawi have reported declining returns per unit of fishing effort in the southern part of the Lake. In the same area, the commercial trawl fisheries have also experienced declining harvests in recent years, despite being more closely regulated than the inshore artisanal fisheries. Species such as the cichlid "utaka," harvested by local fishing communities as a significant protein source, are declining. Others, such as "mpasa", an endemic cyprinid, have already shown precipitous declines in recent years. It is likely that significant management interventions will be required to make their recovery possible. 1  1.6 Malawi's aquarium fish trade, while probably greater now than at any time in the past (50,000 fish per annum, roughly contributing US$350,000 to the local economy), has probably had little impact on the fish resources. While more than 140 species are taken for the aquarium trade, the number taken of any given species is usually small. Although this industry merits careful monitoring, current indications are that the net benefits to the local economy through direct revenues outweigh the environmental risks of the trade. 1.7 Population Growth and Land Use Practices. The Lake ecosystem is also increasingly under pressure from the rapid population growth and intensified land use practices in the catchment areas. Land policy and an increased demand for arable land have accelerated the expansion of agriculture into marginal lands; in addition, increased soil erosion is occurring, resulting in increased sedimentation of streams and rivers which feed into the Lake. For example, changing land use practices have caused alterations in stream flow patterns associated with the water runoff regime into the Lake. Both the quantity and distribution of sediments in this runoff -- containing human wastes, fertilizer and agro-chemical inputs -- may be threatening the sustainability of both anadromous and sedentary fishes which utilize the rocky littoral zone. More research is needed to confirm the effects of this runoff. The conflict between the human demands on the riparian resources and environmental sustainability has become a particularly pressing issue in the Nankumba Peninsula and the Lake Malawi National Park in the southern end of the Lake within Malawi. C. Current Natural Resource Management Policy and Legislation 1.8 Government Capacity and International Coordination. The current knowledge of the Lake's ecology is fragmentary, making it difficult to assess the status of the Lake's ecosystem and the extent of its degradation. Most of the major scientific work on the Lake has been done in Malawi territorial waters and thus the statistical information used in this document relates largely to Malawi. The riparian governments as a group have limited management, monitoring, regulatory and enforcement capabilities. They all recognize the importance of preserving the Lake ecosystem and that this will depend on tri-national participation in lake management as well as building capacity in research, development, and conservation. 1.9 While no comprehensive management plans for the Lake exist in any one of the three countries, Malawi, Mozambique and Tanzania are all at various stages of developing National Environmental Action/Management Plans and related environmental policies which will provide a framework for general environmental management at the national level. 1.10 In Malawi, the Department of Research and Environmental Affairs (DREA) was established in 1991, as part of the Office of the President and the Cabinet. DREA was responsible for the preparation of Malawi's National Environmental Action Plan (NEAP), which was completed in June 1994. DREA, in September 1994, became the Ministry of Research and Environmental Affairs (MREA). MREA's mandate is the coordination of national policies that will help protect the environment and sustain development. The depletion of fish stocks has been identified as an important environmental issue in Malawi's NEAP. The government's strategy to address this issue is to develop a watershed program to reduce the sediment load in both the rivers and lake waters and improve information on fish species, fish stock and regeneration capacities to formulate guidelines for sustainable management of the country's rivers and lakes. Malawi has also established an Environment 2  Conmmittee and is currently reviewing laws relating to the protection of the environment. It has covered, to date, the fishery, wildlife and national parks sectors. 1.11 In Mozambique, the Government has established the National Commission for the Environment (Commissao Nacional do Meio Ambiente - CNA) by Presidential Decree (No. 2/92) on June 3, 1992. CNA is coordinating the preparation of the National Environmental Management Program (NEMP, the NEAP equivalent), which will be prepared in three phases. The NEMP is envisaged to provide for environmental sustainability in sector plans and the national reconstruction plans currently under preparation, and to aid in refining and developing investment projects by the Government of Mozambique and the donor community. A draft NEMP has identified the lack of scientific data and information available on fisheries resources in Mozambique's territorial waters of Lake Malawi/Nyasa as an issue of concern. With regard to Mozambique's national legislation, a working group has been established under the Provisional Environmental Secretariat, and it is expected that in the near future Mozambique will promulgate an Environmental Protection Act. 1.12 In Tanzania, the National Environment Management Council (NEMC) is spearheading the NEAP process. The deterioration of marine and fresh water systems has been identified in the NEAP as one of the six major problems needing urgent national attention. Among the required actions identified in the NEAP to address this environmental problem are: (i) to develop legal requirements and legally based management plans on the basis of population, habitat conservation, multiple uses and sustained yield of the resource; (ii) to establish regional coordinating committees for rivers and lakes, giving priority to systems where conflicts are already occurring or where there is pollution or threats to biodiversity; and (iii) to monitor aquatic ecosystems - both freshwater and marine - to ensure that fish stocks are not being depleted. The Government has also made efforts through the National Environment Management Council and the Ministry of Tourism, Natural Resources and Environment to develop an Environmental Protection Act. This bill, which is in the final stages of presentation to Parliament, will cover all areas of environmental management in one consolidated act. 1.13 In addition to the above national environmental plans, Malawi, Mozambique, and Tanzania are all contracting parties to the following international agreements: * The 1972 UNESCO Convention concerning the protection of the World Cultural and Natural Heritage; and * The United Nations Convention on the Law of the Sea (Malawi is a signatory). As of November 1994, these riparian countries were not Parties to the 1971 Ramsar Convention on Wetlands of International Irnportance. D. Regional and Malawi Institutions Relevant to the Project 1.14 Southern African Development Community (SADC). At the regional level the most important institution within the current context is the Southern African Development Community (SADC), of which Malawi, Mozambique and Tanzania are all members. Within SADC, the responsibility for the coordination of different developmental functions are apportioned among the member states, with environmental issues coordinated by Lesotho; inland fisheries, forestry, national parks and wildlife issues coordinated by Malawi; and 3  marine fisheries coordinated by Namibia. This project has been formally endorsed by SADC. The Governments of Malawi, Mozambique and Tanzania have endorsed the project with the understanding that it will cover the whole lake for the benefit of the riparian countries. 1.15 The Ministry of Forestry and Natural Resources of Malawi (MFNR). The MFNR's scope encompasses both the use and conservation of natural resources. There are three departments within the MFNR: Forestry, National Parks and Wildlife, and Fisheries. The latter two departments are of particular relevance to the GEF project. 1.16 The Fisheries Department of Malawi (FD). The FD, within the Ministry of Forestry and Natural Resources (MFNR), is responsible for all aspects of fishery and aquaculture, research, management, development and training, through the enforcement of the Fisheries Act. The Department is supported by a number of internationally recruited and financed technical assistants in its Headquarters in Lilongwe, including a research coordinator, a planner and an economist. It has a small but experienced professional staff, however financial constraints severely weaken their enforcement capacity. 1.17 The Department of National Parks and Wildlife of Malawi (DNPW). DNPW, within the MFNR, is responsible for the establishment, development, and management of National Parks. It is also responsible for all aspects of the control and management of hunting, and wildlife management and conservation throughout the country. 1.18 The Ministry of Physical Planning and Surveys (MPPS). The Physical Planning Department (PPD) within the MPPS is responsible for all aspects of physical planning in the country. The PPD is a member of the Lake Shore Development Committee which authorizes development along the Lake Shore in the Mangochi area which covers Nankumba Peninsula. E. The Project's NGO Involvement 1.19 The following Non-Governmental Organizations (NGOs) are actively involved in conservation in the project areas: (i) The Wildlife Society of Malawi (WSM), founded in 1937, is a local NGO supported by donations and subscriptions. The society has played an important role in recent years in community education in wildlife and environmental issues. It is committed to working towards building popular appreciation of natural assets through public awareness campaigns and environmental education programs. WSM in cooperation with Malawi's DNPW will be responsible for implementing the project's conservation awareness program. (ii) The Presbyterian Church of Malawi. Within the Chembe village and adjacent to the boundaries of Lake Malawi National Park is the historic site of the first Livingstone mission settlement and burial grounds. The Presbyterian Church of Malawi has plans to restore the site. The Church will be involved in the review and implementation of the Strategic Plan for Nankumba Peninsula and Lake Malawi National Park, which would include these historical sites. (iii) World Wildlife Fund (USA) (WWF-US) has assisted with planning, training and delivery of park interpretation and environmental education at Cape MaClear. It has established an environmental education center upon which 4  this project will build. WWF will participate in the discussions and reviews associated with the strategic plan for the Nankumba Peninsula and the Lake Malawi National Park. WWF participated in the project's appraisal mission and is now in the process of developing an integrated conservation and development program for the Lake Malawi National Park, complementing this project's activities in Malawi. F. Related Conservation and Natural Resource Management Projects 1.20 Pelagic Fish Resource Assessment Project (UK/SADC). The UK/SADC project funded by the Overseas Development Administration (ODA) concluded in May 1994. was a joint Malawi/Mozambique/Tanzania/UK research venture. The project fielded a large international research team equipped with a multi-purpose 15m research vessel (R/V Usipa), and established a shore base at Senga Bay, Salima in Malawi. 1.21 The principal objectives of the UK/SADC project were: (a) to assess the abundance and distribution of the off-shore (pelagic) fi'sh populations in Lake Malawi/Nyasa and describe their structure anld biology; (b) to investigate the productive base supporting the pelagic fishi resources and ihe factors affecting their abundance and distribution; (c) to quantify the potential sustainable yield from fisheries based oii the pelagic fish populations, should any of sufficient size be found; and (d) to indicate appropriate economically viable options for the saistainable utilization and management of the pelagic fishery. Based on information received from ODA, the project's final biomass figtures for offIshlore unexploited pelagic stocks are discouraging. 1.22 One of the successful aspects of the project has been the Steering Committee Management structure. The project findings have led to the recommendatioll what a regional consultative group be established for the management of the Lake by the three countries. T'his goal has been adopted by the GEF project and it will maintain the Steering Committee Management structure established under the UK/SADC project. 1.23 Malawi Fisheries Development Project (IDA). The IDA Malawi Fisheries Development Project became effective in September 1991, and is being implemented by the Malawi Fisheries Department. The co-lenders are the Nordic Development Fund and the Icelandic International Development Agency. It is a seven year project with a total estimated cost of US$15.5 million. The project initially comprised four components: (i) institution building to strengthen the Fisheries Department in regulatory functions, policy formulation, staff training and technical assistance; (ii) research to strengthen the Fisheries Department's research capacity focusing on demersal stock assessment, lake resource conservation, and developing fish farming models that would help integrate aquaculture into crop farming systems in different ecological zones; (iii) production to rehabilitate and develop the existing capture fisheries by supporting artisanal fishermen, semi-commercial and commercial fishing activities, and establishing a pilot program to increase tht involvement of women in fisheries 5  particularly in fish processing and marketing; and (iv) infrastructure to rehabilitate, upgrade and build access roads, as well as jetties for fish landing, and shore based facilities. 1.24 Since the IDA Project was appraised in June 1991, the fisheries subsector's performance in Malawi has steadily declined. Increasing population pressures around the Lake and overfishing in the near shore areas (Lake Malombe and the two southern arms of the Lake) account for this decline. FAO's Chambo Fisheries Research Project drew attention to the collapse of the chambo fishery in Lake Malombe and the likely collapse of the remaining kambuzi fishery in the absence of management intervention. Fisheries management problems have also been highlighted in a series of working papers under the Traditional Fisheries Assessment Project (TFAP) which outlined as major trends in Lakes Malawi and Malombe artisanal fisheries a large and widespread increase in the fishing effort, declining catch rates and the increasing use of small-meshed nets. TFAP concluded that most of the artisanal fisheries were at, or already beyond, the biological maximum sustainable yield. 1.25 In 1993 - based on the available stock assessment research - the IDA Fisheries Development Project was restructured from its focus on production to an emphasis on sustainable resource management of the Lake's fisheries stocks. The project's incremental production targets (an increase in annual landings of about 7,500 tons) have essentially been removed. Actions to deal with the problems of overfishing such as net mesh control, closed areas and seasons are being addressed under the Project. Two initially identified project activities - aquaculture and rural access roads - have now been omitted. 1.26 Research Project to Promote Small Scale Commercial Fanning of Lake Malawi Indigenous Species (ntchila and mpasa) - Japan International Cooperation Agency (JICA). JICA is preparing a five-year pilot project to undertake research on the biological studies of the indigenous mpasa and ntchila species, as well as to undertake a feasibility study for broodstock management, hatchery operations, feed development and cage culture for the fish. The broad objective of the proposed project is to establish a research center for the mpasa and ntchila and to promote small-scale market oriented aquaculture using these species. The project will be implemented by Malawi Fisheries Department's Aquaculture Section. One of the reasons for the low output from aquaculture in Malawi is the lack of a suitable (fast growing, late maturing, easy to culture, high commercial value) fish species. The cyprinid populations of Lake Malawi are almost an endangered species. It is the intent of the JICA project to restock the Lake with artificially hatched juveniles for these species. Concurrent with the hatchery work, studies will be undertaken to investigate habitat conservation and management for the breeding areas of the fish. The project will also have a training component and will coordinate with Bunda College to have students work in the hatchery and laboratories to carry out research according to their educational requirements; and on-the-job training of counterparts in the areas of hatchery, feed development, biology and ecology of migratory fishes. This project is designed to complement the GEF and IDA projects by working with two specific species (mpasa and ntchila) to increase their populations. As a pilot program, it will also identify the potential for aquaculture production of indigenous species as a means of reducing pressure on the Lake's resources, and creating employment opportunities. 1.27 The cichlid fishes of the Lake can be categorized into two groups: the wide-ranging pelagic species and the more resident populations. The widely-fished pelagic species has been the focus of the research activities undertaken in the UK/SADC and IDA projects. The research activities of the GEF project would complement these projects by providing needed 6  information on the occurrence, distribution and ecology of the more localized endemic species, which will be relevant for the !akeshore zoning and establishment of reserves to protect the whole range of the Lake's biodiversity. Staff from the Fisheries Departments and the National Parks Departments from the riparian states will also be trained through the GEF project, which is critical for implementing action programs to sustainably manage the lake over the long-term. 7  2. THE PROJECT A. Project Concept and Objectives 2.1 Project Concept. The global importance of Lake Malawi/Nyasa for biodiversity conservation derives from the exceptional diversity of its unique fishes. The Lake Malawi ichthyofauna is the world's most diverse evolutionary radiation of fishes within a single lake. The ecological requirements and distributional limits are known for only a minor fraction of these fish species. The project will carry out essential research initiatives to determine what species are in the lake and to identify and document biodiversity "hotspots," or areas of exceptional species diversity and circumscribed centers of endemism within the rocky inshore zone. The project will also create the needed framework for conservation and development among Malawi, Mozambique, and Tanzania by supporting the development of a Biodiversity Map and Management Plan for the Lake, and a plan for ecologically compatible development within the Nankumba Peninsula and Lake Malawi National Park. Project initiatives will also be undertaken to review the scope for harmonization and strengthening of environment-related policy and legislation among the riparian nations and increase conservation awareness among all sectors of society on issues affecting the lake's biodiversity. 2.2 Project Objectives. The main objective of the project is to assist the riparian states in creating the scientific, educational, and policy basis necessary for conserving the biological diversity of the Lake and its unique ecosystem. It will be achieved through the following specific activities: (a) building scientific capacity within the riparian countries to survey, study and monitor the Lake's biodiversity, identify threats, and provide recommendations for the Lake's management; (b) surveying and inventorying species, identifying critical habitats and biodiversity hotspots and recommending preliminary measures to demarcate and protect such areas; (c) identifying pollution sources and measuring water quality at sites where human activities threaten biodiversity; (d) preparing a Strategic Plan for the Nankumba Peninsula and Lake Malawi National Park for eco-tourism development, consistent with the protection and conservation of the Lake's biodiversity; (e) preparing a comprehensive Biodiversity Map and Management Plan for Lake Malawi/Nyasa based on the information provided by the species, habitat, and water quality analyses; (f) increasing conservation awareness among the lakeshore population and regional and national policy makers, whose decisions regarding regional development have an impact on the Lake's ecosystem; and (g) reviewing the adequacy of existing national environmental legislation in Malawi, Mozambique and Tanzania and making appropriate legislative 8  recommendations for revising and/or strengthening enforcement for the conservation of the Lake's biodiversity. 2.3 Project Site. The GEF project will be based at Senga Bay in Malawi, although educational and scientific activities will be conducted on the Lake shores and at various stations around the Lake. The use of the existing UK/SADC Senga Bay facilities in the project will be very cost-effective, saving the project some US$2.0 million in equipping or constructing sinilar facilities. Prior to project negotiations, the Government of Malawi agreed to the use of the Senga Bay facilities and the continuation of the declaration of trust to SADC for the duration of the GEF project. The use of this site and Senga Bay facilities will be the Government's contribution to the project. B. Detailed Project Description 2.4 Biodiversity Map and Managemnent Plan for Lake Malawi/Nyasa. The project manager will coordinate the preparation of a Biodiversity Map and Management Plan for the Lake (BMPL). The BMPL will be based on the project's major activities/outputs as detailed below and in Annex 1 and will include inter alia: (i) the Biodiversity Report and habitat map, that draw together the biodiversity survey work and identify biodiversity hotspots; (ii) the Report on Water Quality/Pollution and Threats to Biodiversity; (iii) the taxonomic and ecological research; (iv) the Strategic Plan for Nankumba Peninsula and Lake Malawi National Park; and (v) the report with recommendations to the riparian countries for revising and/or strengthening legislation for the effective conservation of the Lake. Other relevant sources of information such as related conservation projects and the riparian countries' National Environmental Action Plans will be taken into consideration in the preparation of the plan. The PM will ensure that a preliminary draft of the BMPL is prepared and reviewed with the Bank and the riparian countries within 24 months of Grant effectiveness [para. 4.1 (a)]. The draft BMPL will be discussed at the project's mid-term review (para. 2.48). 2.5 The BMPL will make recommendations for the required follow-up conservation actions and investments, based on the information obtained from this project's research phase. For example, the management plan would recommend actions for the zoning of the Lake's coastline appropriate for biodiversity conservation, such as identifying areas as fisheries replenishment zones or ecologically fragile zones not appropriate for intrusive development. The plan would also identify a system of potential protected areas that together will be representative of its biodiversity and complementary to the Lake Malawi National Park. 2.6 The BMPL will be discussed by the project's Steering Committee as it is being prepared and a final draft will be circulated to the Bank for comments no later than 36 months after Grant effectiveness [para. 4.1 (a)]. The Government of Malawi will present to SADC within 42 months after Grant effectiveness a time-bound proposal for the implementation of the BMPL by the riparian countries [para. 4.1 (b)]. (1) Research 2.7 To conserve and manage biodiversity in Lake Malawi/Nyasa, it is necessary to determine the species diversity that exists in the Lake. Current estimates of the number of fish species range between 500 and 1000 in ten families. Two of the main reasons for the uncertainty in the estimate of the number of species are: (i) the lack of taxonomic work on 9  many of the species groups; and (ii) large portions of the Lake have not been surveyed for fishes. These two issues will be addressed under parts (a) and (b) of the research program. (a) Biodiversity Surveys 2.8 Most of the current research available on the Lake has been done in Malawi waters. Further biodiversity survey work is needed, particularly in the relatively understudied waters of Mozambique and Tanzania. This lack of scientific data and information available on fish resources in the Mozambican territorial waters of the Lake has been identified as an important environmental issue in Mozambique's draft NEMP (para 1.11). 2.9 The research team will consist of an ecologist, taxonomist, research officeis and technical staff who will carry out a program to inventory species and their distribution and identify critical habitats and biodiversity hotspots in the Lake. The taxonomist will supervise and provide on the job training to the local research officers and technicians in the identification of species. The ecologist will supervise and provide on the job training to the local research officers and technicians in mapping the distribution of various species and relating this to habitat types and ecology. The training of research officers and technicians from the riparian countries will assure the continuation of biodiversity surveys and monitoring beyond the life of the project (Annex 11). 2.10 Output: The main output of this sub-component will be a report which identifies biodiversity conservation priorities for Lake Malawi/Nyasa and includes: * survey reports; * maps of species distribution which identify critical habitats and biodiversity hotspots; * species checklists for each of the identified hotspots;