China - Lake Dianchi Freshwater Biodiversity Restoration Project

24647 April 2002 MEDIUM-SIZED PROJECT BRIEF PROJECT SUMMARY PROJECT IDENTIFIERS 1. Project name: Lake Dianchi Freshwater 2. GEF Implementing Agency: Biodiversity Restoration Project The World Bank 3. Country or countries in which the 4. Country eligibility: project is being implemented: China ratified the Convention on Biological Diversity Peoples' Republic of China on May I, 1993 5. GEF focal area(s): 6. Operational program: Biodiversity OP2 - Freshwater Ecosystems 7. Project linkage to national priorities, action plans, and programs: Environmental improvements in Lake Dianchi and its watershed are a major national priority as demonstrated by the Government's $300 million Yunnan Environment Project (see below). It is also one of the lakes in the current national multi-sectoral program known as "Three Lakes, Three Rivers" and thus is attracting national, provincial and donor support. Both the Agenda 21 (approved by the State Council in 1994) and the China National Wetland Conservation Action Plan (endorsed by 17 ministries and agencies in 1995), lists Lake Dianchi as a priority site for action. The China Biodiversity Conservation Action Plan (approved by State Council in 1994) does not (in keeping with many similar documents of that time) give much attention to the threats to and conservation of freshwater biodiversity, but some of the endemic fishes of the Lake are listed as Priority Species. China now has a new policy to promote development in western China (including Yunnan), stressing early attention to environmental protection. 8. GEF national operational focal point and date of country endorsement: Focal Point endorsement of PDF A request on October 12, 1999 Focal Point endorsement of Project Brief on March 3, 2002 PROJECT OBJECTIVES AND ACTIVITES 9. Project rationale and objectives: The project is taking advantage of the major Yunnan Environment Project which has been serving to improve water quality conditions in the lake, and applying a biodiversity 'overlay' to its infrastructural, policy and regulatory measures by restoring natural habitats and other activities which will conserve a number of highly range-restricted endemic species. The Lake Dianchi basin lies just'south of Kunming, the capital of Yunnan Province, China. The basin is a 'hotspot' of freshwater biodiversity with 24 indigenous fish species, at least 11 of which are endemic, and dozens of endemic mollusc and crustacean species. These are found in the lake itself and also in adjacent springs, often associated with Buddhist temples. Since the 1950s however, some 31 fish species, and a variety of plant species have been introduced, although not all of these have persisted. Declining water quality (especially high phosphorus and nitrogen), loss of natural habitats, competition from exotic species for food and living space, and possibly introduced diseases and parasites have combined to threaten the indigenous fauna and flora, resulting in the apparent extinction of at least some of the endemic species. Surveys since 1994 indicate that at least seven endemic and five other indigenous fish species are still extant, but it should be noted that surveys of the type and intensity necessary to give an accurate lake-wide picture of the distribution and status of habitats and endemic species have not yet been conducted. The World Bank has been assisting the provincial government in addressing some of the water quality problems through the US$300 million Yunnan Environment Project (YEP); some $200 million of this is estimated to provide water quality benefits to the lake. Specific objectives of the YEP are to: 1) strengthen policies, regulations and institutional arrangements for pollution control, and municipal water, wastewater, solid waste and nightsoil management; 2) support the improvement of the lake environment in Gejiu and Kunming in order to allow the waters to be used for potable supply, industry or agriculture, as appropriate; 3) facilitate complementary sustainable investments in pollution control and municipally-provided urban environmental services; and 4) introduce a comprehensive approach to  planning, prioritization, management, and financing of urban environmental infrastructure investments. The components of YEP are: 1) Lake Dianchi basin water quality recovery; 2) industrial pollution control, 3) provincial urban environmental services; 4) environmental and water quality monitoring; and 5) institutional development, training and construction supervision. With such a major and comprehensive effort in place, it is worthwhile to give attention to the lake's biodiversity. In mid-1996 the World Bank instigated a brief study of the baseline ecological conditions of the lake (funded by UK-ODA). The resulting proposals on means of improving the Lake's biological environment and on how biological processes could support the objectives of the YEP were supported by the Yunnan Provincial Government, and are the basis for this project. The objective of the proposed four-year GEF project is to restore and manage habitats around the lake in order to secure the conservation of the reimaining endemic species of Lake Dianchi and its immediate tributaries. This will be achieved by providing suitable breeding habitat, comprehensively surveying the biological environment of the Lake and its immediate tributaries, establishing a program to monitor lake quality improvements (using the presence/abundance of the endemic species as indicators of improved ecosystem health), and improving public awareness of the Lake region's unique biological environment. 10. Project outcomes: Indicators: Restoration of at least three lengths of shoreline Incidence of native species increases in the to some semblance of their 'natural state' restoration sites Plans for management and restoration Kunming Municipal Planning Bureau allocates interventions integrated with broader local resources for lakeshore restoration in spatial plans government plans and highlights the need for conservation in development documents. On-going environmental degradation of the lake The length of sloping shoreline remains constant or shore and tributary ecosystems slowed down and increases, and regular testing at the restoration sites reversed in at least three areas shows water quality improvements better than those elsewhere in the lake (measured by YEP) Good quality and fundamental ecological Project and broader lake management decisions information provided explicitly based on this new data. Appropriate training will be provided for local Trainees using new skills and knowledge for the Government officials, university staff in adaptive benefit of the native biodiversity of Lake Dianchi wetlands management and biodiversity conservation Public support for, and interest in, the Knowledge, attitudes and behavior relating to the biodiversity of Lake Dianchi generated Dianchi freshwater biodiversity change in positive ways Cooperation developed with the local office of Buddhist temple staff adopt appropriate the Buddhist Association. conservation management plans 2  11. Project activities to achieve outcomes Indicators: (including cost in US$ of each activity): Start up period (Total: $180,315) Project Implementation Unit established I - Component 1 - Wetland Management and At least three lengths of shoreline remodelled, Restoration Total:$635,065; Requested from planted with macrophytes, and re-populated with GEF US$399,000 bivalve molluscs 2 - Component 2 - Surveys, Monitoring and Rigorous monitoring protocols established, regular Species Conservation Total:$276,500; monitoring undertaken, and recovery plans written Requested from GEF US$155,500 for selected species 3 - Component 3 - Capacity Building and Suitable trainees identified and provided with Training Total:$320,000; Requested from GEF appropriate, wetland management-orientated US$265,000 training in-country and overseas 4 - Component 4 - Public Awareness Knowledge, attitudes and behavior surveys Total:$420,550; Requested from GEF undertaken and awareness messages identified and US$155,550 disseminated, and lakeside Visitor Center with displays established 12. Estimated budget (in US$): GEF: 997,550 (includes 22,500 PDF A) Co-financing: Yunnan Minorities Peoples' Village 92,865 Yunnan Scientific Committee 224,560 Alliance for Religions and Conservation/Buddhist Association 5,000 Govt of PR China 537,995 TOTAL 1,857,970 INFORMATION ON INSTITUTION SUBMrITING PROJECT BRIEF 13. Information on project proposer: The Kunming Institute of Zoology (KIZ) is one of two specifically zoological institutions under the Chinese Academy of Sciences and was founded in 1959. It focuses on conservation biology, primatology and evolutionary biology but also has a special interest in the conservation and sustainable utilization of animal resources. It is active in a range of ecological projects in Yunnan and has extensive experience in monitoring biological communities. There are 280 staff members, including 160 scientists and most of the younger scientists have undergone long-term training in Europe or North America. Since the establishment of the Institute, 82 monographs and more than 300 scientific papers have been published. The Department of Systematic Zoology within the KIZ has long focused on the taxonomy, fauna, and evolution of vertebrates and on monitoring of vertebrate populations in some important areas such as the major lakes of Yunnan. It has received grants from WWF, the MacArthur Foundation, and the Asian Development Bank. 14. Information on proposed executing agency (if different from above) 15.. Date of initial submission of project concept PDF A approved by GEF on November 30,1999. 3  INFORMATION TO BE CONIPLETED BY INIPLEMENT[NG AGENCY: -- 16. Project identification number: P068239 17. Implementing Agency contact persons: Tony Whitten, twhittengworldbanl.om, tel:+1-202-458-2253 18. Project linkage to Implementing Agency program: One of the five major themes of the Bank's Country Assistance Strategy for China is environmental protection and is assisting the government in strengthening institutions, developing more effective instruments, and investing in priority and realistic agendas. The Bank's recent Environmental Strategy for China stresses the importance of improved natural resource management, especially biodiversity. The project is a formal part of the China work program and seeks to add an important biodiversity element to a $150 million loan for water quality improvements in Lake Dianchi. 4  Lake Dianchi Freshwater Biodiversity Restoration Project Yunnan, China 1. PROJECT DESCRIPrION 1.1 PROJECT RATIONALE AND OBJECTIVES The Lake Dianchi basin lies just south of Kunming, the capital of Yunnan Province, China. The basin is a 'hotspot' of freshwater biodiversity with 24 indigenous fish species, at least 11 of which are endemic, and dozens of endemic mollusc and crustacean species. These are found in the lake itself and also in adjacent springs, often associated with Buddhist temples. Until the mid 1960s, the main species exploited for commercial purposes were endemic species such as the small carp, white minnows, yellow tail, and golden line fish'. Since the 1 950s however, some 31 fish species, and a variety of plant species have been introduced although not all of these have persisted. Declining water quality (especially high phosphorus and nitrogen), loss of natural habitats, competition for food and living space, and possibly introduced diseases and parasites have combined to threaten the indigenous fauna and flora, resulting in the apparent extinction of at least some of the endemic species. Surveys since 1994 indicate that at least seven endemic2 and five other indigenous fish species are still extant, but it should be noted that surveys of the type and intensity likely to give an accurate picture of the endemics' distribution and status have not yet been conducted. Environmental improvements in Lake Dianchi and its watershed are a major national priority - its water quality data are reported to SEPA on a monthly basis. It is one of the lakes in the national multi-sectoral program known as "Three Lakes, Three Rivers" and thus is attracting national, provincial and donor support. Both the Agenda 21 (approved by the State Council in 1994) and the China National Wetland Conservation Action Plan (endorsed by 17 ministries and agencies in 1995), lists Lake Dianchi as a priority site for action. The China Biodiversity Conservation Action Plan (approved by State Council in 1994) does not (in keeping with many similar documents of that time) give much attention to the threats to and conservation of freshwater biodiversity, but some of the endemic fishes of the Lake are listed as Priority Species. China now has a new policy to promote development in western China (including Yunnan), stressing early attention to environmental protection. The World Bank has been assisting the provincial government in addressing some of the water quality problems through the US$300 million Yunnan Environment Project (YEP) (P003599, $150 million loan, Board date June 1996, closure December 2002). This project is part of a phased development program of Yunnan Province to improve environmental conditions and sustain urban services management. The principal objective of the project is to provide a sustainable environmental framework for the long term economic and social development of the province, while providing a conducive foundation for industrial growth. Specific objectives of the project are to: 1) strengthen policies, regulations and institutional arrangements for pollution control, and municipal water, wastewater, solid waste and nightsoil management; 2) support the improvement of the lake 1 - In order: Cyprinus micrisilius micristius, Anabarilius alburnops, Anabarilius polylepis, Xenocypris yunnanensis, and Sinocyclocheilus grahami grahami. 2 - The surveys conducted under the PDF A grant and other recent short surveys have confirmed that there are seven definitely extant endemic species: Anabarilius alburnops, Pseudobagrus medianalis, Sinocyclocheilus grahami, Schizothorax grahami, Triplophysa grahami, Yunnanilus discoloris, and Yunnanilus sp., a new species discovered during the PDF A surveys. During that same survey the endemic shrimp Caridinia gregoriana, believed extinct, was rediscovered. The Dianchi populations of Discogobioyunnanensis and Yunnanilus pleurotaenia are likely to 'become' endemic when the appropriate taxonomic work is completed. 5  environment in Gejiu and Kunming in order to allow the waters to be used for potable supply, industry-or agriculture, as appropriate; 3) facilitate complementary sustainable investments in pollution control and municipally-provided urban environmental services; and 4) introduce a comprehensive approach to planning, prioritization, management, and financing of urban environmental infrastructure investments. The components of YEP are: 1) Lake Dianchi basin water quality recovery; 2) industrial pollution control; 3) provincial urban environmental services; 4) environmental and water quality monitoring; and 5) institutional development, training and construction supervision. With such a comprehensive effort in place, other environmental activities can build on it. In mid-1996 the World Bank instigated a brief study of the baseline ecological conditions of the lake (funded by UK-ODA). The resulting proposals on means of improving the Lake's biological environment and on how biological processes could support the objectives of the YEP were supported by the Yunnan Provincial Government, and means investigated to implement them. The objective of the proposed four-year GEF project is to restore and manage habitats around the lake in order to secure the conservation of the remaining endemic species of Lake Dianchi and its immediate tributaries. This will be achieved by providing suitable breeding habitat, comprehensively surveying the biological environment of the Lake and its immediate tributaries, establishing a program to monitor lake quality improvements (using the presence/abundance of the endemic species as indicators of improved ecosystem health), and improving public awareness of the Lake region's unique biological environment. By so doing, it is expected to achieve the goals of: * The conservation of a community of internationally significant, threatened and severely range-restricted species; * A demonstration of the utility of restoration for freshwater biodiversity conservation; * The innovative use of biological indicator species for pollution bioremediation and monitoring; * A greater awareness locally, nationally and globally of threats, challenges and opportunities related to Lake Dianchi in particular and freshwater biodiversity in general; and * Increased capacity to survey and identify freshwater biodiversity in Yunnan and elsewhere in China. The project is in accord with the China National Wetland Conservation Action Plan (CNWCAP) and will assist PR China to meet its obligations under international conventions such as the Convention on Biological Diversity and the Convention on Wetlands of International Importance (Ramsar, 1971). On a global scale the project addresses the GEF Biodiversity Operational Program #2: Marine, Coastal and Freshwaters (including wetlands). In order to achieve the goals and aims of the program it is proposed that the Lake Dianchi Freshwater Biodiversity Restoration Project implements four complementary components (Figure 1). 6  Lake Dianchi Freshwater Biodiversity Lake Restoration Project Wetland Surveys, monitoring Capaci Building u c Management and Species and Training Awareness and and Conservation Environmental Restoration Education Figure 1. Proposed Project Components 1.2 Current Situation 1.2.1 Provincial setting Yunnan Province is situated in the south west of the People's Republic of China. To the north, Yunnan is bordered by Sichuan Province and to the east, by the Provinces of Guizhou and Guangxi. To the south and west it is bordered by Vietnam, Lao PDR and Myanmar. The population is about 40 million and the total land area of Yunnan is 394,000 km2 with an average population density of about 100 people km2. The economy is dominated by the capital city of the Province, Kunming, which has a population of over 3 million. The south-eastern Himalaya dominates the north west of the province. Three major river sources are found in this area: 1) the Jinshajiang (which discharges in to the Changjiang); 2) the Lancangjiang (Mekong) and 3) the Nujiang (Salween). The source of the Nanpanjiang is found in the north east of the Province. The south of Yunnan Province is tropical whereas the central and eastern areas comprise a plateau and fertile lake basins at an elevation of 2000 metres. 1.2.2 Dianchi Basin The Dianchi basin is 2920 km2 in extent and is located between the watersheds of the Jinshajiang- Yangtze, Honghe and Pearl rivers at an altitude of 1990 m. In addition to Kunming there are within it 18 towns and 22 villages with 2,103,599 people. The area is largely agricultural and populated almost exclusively by people of Han ethnic origin. The local climate is subtropical with a mean annual temperature of 1 50C. Mean annual rainfall is about 1000 mm. With an area of nearly 300 km2 Lake Dianchi is one of the largest freshwater lakes in Yunnan and the sixth largest in China. It is approximately 40 km long (north to south) and 12.5 km at its widest point. The mean depth is 4.7 metres and the maximum depth is 10 metres. The lake is divided into two parts, the small northern Cao Hai (inner lake - about 3% of the volume) and the much larger Wai Hai (outer lake). These have now been separated by the construction of a causeway. There are 17 rivers draining into the lake. The outflow from the Wai Hai is to the Tanglangchuan River at the southwest of the lake and overflow from the small Cao Hai flows west through the recently constructed Xi Yuan Tunnel and thence to the Tanglangchuan River and the Jinshajiang/Yangtze. To date, the biological surveys of the lake have been somewhat ad hoc in terms of their objectives, format, methodology and intensity. As a consequence, results of the different surveys are usually incompatible and comparisons rather meaningless and providing poor baseline information by which to track or judge the impact of any project intervention. 7  The Yunnan Environment Institute has recently completed a successful pilot for macrophyte restoration in Lake Dianchi. The project site is Hui Wan Bay and has an area of 6.7 ha. The implementation period was from April 1998 until December 2000 and a variety of species were planted3. A recent evaluation of the pilot project found that within the bay, light penetration was twice, and nitrate and phosphate levels were half what they were in neighboring sites, demonstrating the overall improvements in habitat quality possible through this means. The project will build upon this pilot. 1.2.3 Summary of threats to tte freshwater biodiversity of the Lake Dianchi The main threat to the freshwater biodiversity of the Lake Dianchi is habitat degradation, the root causes of which relate to the significant socio-economic development in the Dianchi basin over the last few decades; that is: * The reclamation of lakeside land and floodplain areas for urban and agricultural usage; * The construction of lake perimeter dykes; * The destruction of macrophyte beds during dredging for bivalve molluscs; * Increasing human intervention and disruption of the natural water cycle; * Water pollution from industrial, domestic and agricultural sources; * Increasing turbidity owing to deforestation for local industry in the catchment; * Introduction of exotic fish, shrimp and plant species. These threats are discussed below and summarized in Figure 2 which explains the relevance of the proposed project interventions. 3 Submerged species: Ceratophyllum demersum, Myriophyllum spicatum, floating leaved species: Trapa bicornis, Nymphoides peltata, submerged species: Hydrilla verticillata, Vallisneria gigantea, Potamogeton crispus, P. maackianus, P. malainus, P. pectinatus, and emergent species: Scirpus validus, Phragmites communis, Zizania caduciflera. 8  Figure 2: Lake Dianchi - Root Cause Analysis of Threats CORE PROBLEM h IMMEDIATE THREATS UNDERLYING.OR ROOT CAUESESR TO :i":i". ~ ~~~~~~~~~~~ ~ "_ .:i_ ||t'5 2t i,- .1 ,.. lITRENTIONS * [ F Few otheerop ions - Deforestation for uafilibief&an6ulture. Improve nabi.ta fuel for small ndigenouer