China - Guangxi Integrated Forestry Development and Conservation Project

Page 1 PROJECT INFORMATION DOCUMENT (PID) APPRAISAL STAGE Report No.: AB2116 Project Name Guangxi Integrated Forestry Development and Conservation Project Region EAST ASIA AND PACIFIC Sector Forestry (100%) Project ID P088964 GEF Focal Area B-Biodiversity Global Supplemental ID P087318 Borrower(s) GOVERNMENT OF CHINA Implementing Agency Guangxi Regional Forestry Department Guangxi Autonomous Region China 530022 Tel: 86-771-2809558 Fax: 86-771-2809558 Uffo@Public.Nn.Gx.Cn Government of China Ministry of Finance, Sanlihe China 100820 Tel: 86-10-68551124 Fax: 86-10-68551125 JL.Yang@Mof.gov.cn Environment Category [ ] A [X] B [ ] C [ ] FI [ ] TBD (to be determined) Date PID Prepared April 17, 2006 Date of Appraisal Authorization April 25, 2006 Date of Board Approval November 14, 2006 1. Country and Sector Background China, the most populated and largest developing country, has long been a forest-poor country. The Government has done a remarkable job in increasing forest cover, mainly through an extensive plantations program, from 13 percent in 1980s to 18.2 percent today. However, the hectare per capita of 0.13 is significantly below the world average of 0.6. The increasing gap between timber supply and demand is a key constraint to sustainable forestry development. Currently, annual timber consumption outpaces supply by approximately 80 million cubic meters. Furthermore, most natural forest habitats have been reduced to small and isolated fragments. This in turn has led to a significant threat to biodiversity, many of which are of global importance. While the launch by the Government of China (GoC) of the Natural Forest Protection Program (NFPP) in 1998 was environmentally beneficial to China, it further widened the gap between timber supply and demand. This and other factors have also led to a significant increase in the import of timber and wood products from neighboring countries contributing to unsustainable exploitation of those natural forests. Page 2 To bring the forestry sector under more sustainable management and development, the GoC formulated a