Achievements to Date

Muleso Kharika

Background

• DEA ratified the UNCCD in 1997• The objective of the Convention is to combat

desertification and mitigate the effects of drought in countries experiencing serious drought and/or desertification, particularly in Africa

• Article 20 UNCCD: National Action Plan • Funding mechanism to mobilise private sector

resources

Objectives

• To improve the living conditions of the rural poor living in degrading landscapes

• To improve the condition of affected ecosystems • To generate global benefits through effective

partnerships - develop financial mechanisms capable of mobilizing resources/partnerships to support implementation of Convention

• Sustainability of initiatives • Shared learning networks – scalability / replicability

Core Activities

• Establish and operationalise the Drylands Fund as a vehicle for mobilising resources for financing pro-poor sustainable land management practices (improving ecosystem services, productivity of landscapes, and improving livelihoods)

• Focus on community land in resource rich areas (e.g. with high biodiversity and water value – especially people and parks /watersheds)

• Impact measured -

– increasing hectares of land under sustainable land use management – improving livelihoods (e.g. entrepreneurship and job opportunities)

Governance Instruments

• MOA was signed by DEA and DBSA • Steering Committee comprising about 13

people from government, business and private sector. Chaired by DEA

• Fund is managed by a PIU that is mandated through a business plan and Strategy and by SC resolutions– Service providers subject to funding coming on

stream

Budget

BudgetR7.3m guaranteed over 3 years plus additional funds to be raised by the partners.

• R3.250 DEA• R3.250 DBSA

R1m per year projectsR1m per year operational costsPlus raised R800 000 in first year for projects

Expenditure 1.5 yearsR3.1m committed /in process

• R2.8m projects ( 7 projects)• R400 000 operational costs (bank fees, charges, s and t and other

direct costs – excluding DBSA time and other activities and sponsorships planned)

Achievements from June – August 2012

Projects

• Ongoing work on the three projects in implementation ( Thicket, Thababkgolo, Deaf Economy)

• 3 projects approved from CEO Funds R800 000 –prepared for disbursement

• Project in pipeline ready for approval Amashangane Community

Monitoring and Reviews

• Internal • external audit – SizweNtsalubaGobodo • Fund review – Genesis Analytics • DBSA Internal monitoring report • MOA revised awaiting finalisation• Revised strategy and Action Plan

Events /meetings

• National Coordination Body • IAIA – 400 practitioners• ARC SADC Land Management • Seed awards• 3 PES presentations and workshops• Meetings with BUSA, NBI and ABSA

and other business partners• international agencies AFD and

USAID• Drylands Fund SC meeting• Meeting PIU DEA team

Achievements continuedResources Mobilized

• DBSA CEO Fund money materialized R800 000

Examples of Resources in process of being mobilised

• Buffelshoek/Londolozi Trust (R1m to double our efforts in Bushbuck Ridge) • Rotary application – R8m – R20m• Rotary local R500 000• NBI (provide time and skills)• ARC (research funds R200 000) • Department of Agriculture – in kind on monitoring and baselining• DIFD R45m• GEF application - R50m together with 5 other stakeholders• ABSA provide grants for entrepreneur projects leverage on project basis• Gauteng GDARD application R28m – not much promise• AFD (go through DBSA DPD)• GEF small Grants leverage on project basis• DEA R5m per year for 3 years• Green Fund applications for R45m

Strategy Document

Strategy Document completed serves as a guideline R60m budget subject to:

– Green Fund R45m – DEA for operational costs for 3 years R5m/year– DBSA considerations***************************************– Contract a management team (Fund

manager/administrator, resource mobiliser to develop project proposals to a point of buy in)

Green Fund-Drylands Fund Relationship

International best practice:– The National Green Fund is an umbrella wholesale

body whilst the Drylands Fund is a retail specialist rural delivery vehicle (in support of one another)

– The Drylands Fund niche is to mobilise private sector resources to rural communities through developing Incentive and Market Based Financial Instruments such as PES/RES or Easements etc

– Build on and support what exists rather than undermine and or duplicate

The Green Fund• There are niche areas within the ‘green economy’ and ’sustainable environment’

sectors which are associated with specific goals and have unique contextual and operating characteristics. These are typically associated with a multiplicity of small, targeted interventions with relatively quick turnaround times. Directing and managing funding towards these niche areas requires a focused, informed and sustained commitment by a proactive facilitating/coordinating authority. It also requires a well developed network and an ability to rapidly pursue interesting opportunities and new ideas, flexibly and on an informed basis, without the need for a detailed, time-consuming and costly due diligence processes. Given its scale and strategic nature, this is not something the Green Fund (GF) is well equipped to do. Nor does it have the resources to comprehensively review what could amount to an extensive pipeline of small proposals, many of which require specialist assessment and oversight.

• GF can use a portion of its resources to capitalise specialist and focused sub-funds which serve as its ‘retail’ funding vehicles which serve particular niche areas of the green economy.

The Drylands Fund

Although relatively small in scale, the Drylands Fund warrants its specialisation in terms of the support it can provide to the Green Fund:

• understanding the nature of the problems and their potential solutions in its targeted ‘drylands’ areas and communities,

• engaging with the relevant stakeholders and facilitating partnership-based solutions between them,

• pursuing and testing innovative offset-based financing instruments with which to leverage additional investment in fragile ecosystems, and

• effectively translating and communicating the lessons from project interventions within the ‘drylands network’ to a wider community of interested players and policy makers.

Pro-poor and social justice

Pro Environment Partnership

Three – 3 priority geographical areas to start with

Small Grant under 50K

Window 1

Disbursements (against criteria and reporting)

Medium to Large Project Grants 50k +

Window 2

Disbursements ( against criteria and reporting )

Innovative Financial mechanisms

Window 3

Disbursements ( against criteria and reporting)

Action Plan for 2012/3Projects in process• Thabakgolo (Limpopo)• DEAF Rural Economy (KZN)• Thicket (EC)

Project at Grant Agreement stage / implementation (DBSA CEO Fund)• Biogas Digester Energy Sanitation

(Limpopo)• Ndakana Food Security Programme (EC)• Umzimvubu Programme Conservation

Estate Incentives / PES (EC)

Drylands Fund allocated money 2012• Amashangane Bushbuck Ridge

(incentives, private sector resource mobilisation for conservation/ food security/entrepreneurship investments)

Events• Grassland event• Thicket Forum • People and Parks• Earth Link • Adaptation Network• Green Economy Book • Land Care conference

Programme concept support • trees for fees

Action Plan continued

• Implement Strategy - test innovative finance vehicles with private sector companies and such as Rewards or incentives for ecosystem services

• Resource Mobilisation: Green Fund R45m and DFID leverage R45m and Rotary local and International

• Monitor Fund impacts: GEF UNDP and other international best practice land management initiatives

• Augment SC with additional members as deemed appropriate

• Implement finance mechanism in priority landscapes – Umzimvubu/ Maloti Drakensberg (Upper Umzimvub extend it as resources open to

Wild Coast)– Olifants catchment (Kruger to Thabakgolo communities) – Thicket Programme

Criteria• Poverty issues and social inequality addressed promoting a rapid

transition to a green economy • Biodiversity/natural resource/eco system management –

demonstrating the creation of healthy and resilient livelihoods and landscapes

• Partnerships are key promote scaling up, subsidiary, and are proportional to the challenges faced).

• Sustainability factors• Replicability and scalability • Assist to shape Drylands Fund Policy and Strategy and within

focal areas• Risks or likelihood of success• Readiness for impact- capacity to implement• Innovation

Project Priority SelectionProjects Criteria 1

poverty issues and social inequality addressed promoting a rapid transition to a green economy

Criteria 2

Biodiversity/Natural resource/eco system management – demonstrating the creation of healthy and resilient livelihoods and landscapes

Criteria 3

Partnerships are key promote scaling up, subsidiary, and are proportional to the challenges faced).

Criteria 4

Sustainability factors

Criteria 5

Replicability and scalability

Criteria 6

Assist to shape Drylands Fund Policy and Strategy and within focal areas

Criteria 7 Risks or likelihood of success

Criteria 8 Readiness for impact- capacity to implment

Criteria 9

innovation

Total score

Olifants Thabakgolo and Hazey View and communities and parks along KNP

5 5 5 4 5 5 4 5 5 43

Moloti Drakensberg, Upper Umzimvubu/Wild Coast projects

5 4 5 3 4 5 4 5 5 40

Thicket Programme 3 5 5 4 4 5 4 5 5 40

Karoo including support to initiatives such as Skeppies

4 4 4 4 3 4 4 4 4 35

SADC Transfrontier programmes

5 5 5 3 4 4 3 3 3 35

Khosi Bay 4 4 3 3 4 5 4 4 4 35

Buffalo City Turbine 4 5 4 4 4 4 4 2 4 35

Alfred Nzo sanitation programme

5 4 3 4 4 3 3 4 5 35

Agulhas various projects 3 4 4 4 4 4 3 4 3 33

Youth environmental capacity building and SD programme managed through EWT

4 4 4 3 3 4 4 3 3 32

Community project support with Bird Life Africa

4 4 4 3 3 4 4 3 3 32

Climate Change adaptation projects through Green Network

4 4 4 3 3 4 4 3 3 32

Northern Cape composting 3 4 4 3 4 4 2 2 3 29

Camdebou eco-town 3 3 3 4 4 4 3 3 3 29

Small requests instant relief work such as community traditional centres, capacity building initiatives, scientific studies etc

Key to ratings for above chart Rating is out of 5 1= needing a significantly drawn out and huge amount of preliminary work to build it up to a high potential project 2= needing a substantial degree of work to build it up to a high potential project 3= acceptable with a small amount of preliminary work 4= a potential lead example 5 = absolutely solid opportunity

Willing sellers

Priority Landscapes for Ecosystem Services incentives

Umzimvubu/Maluti Drakensberg and Wildcoast

Olifants Catchment (Thabakgolo, Amashangane, Kruger to Canyon and

Kruger Park communities)

Thicket (ABFRP and moving beyond to communal lands)

Mechanism for PES in land restoration across landscapes

Willing buyers

Additional priority emerging landscapes are the Karoo, Northern Cape, Khosi Bay

Olifants Programme

PES/ RFE The Area

Thabakgolo Project

• Driven by the Sekhukhune Traditional Authority and a local village pilot. Exploring innovative financial mechanisms for incentives and rewards for sustainable land use management ( forms of stewardship)

• Works with multiple levels of rural entrepreneurship initiatives -exploring innovative partnership institutional models - Entrepreneurship model - Thwii

• Sharing lessons learnt to the wider Sekhukhune Kingdom and other adjacent Kingdoms

Outcomes • Baseline studies (livelihoods and land/ecosystem values - MDGs, skills, food

security, resources, ecosystem services) • SWOT analysis - Asbestos scoping report• Stakeholder assessment/empowerment/engagement• Common visioning ecosystem and adaptation based planning• Master Plan (conservation, expanded protected areas, productive areas and

local economic/entrepreneurship and job opportunities). Integration with all other emerging regional plans and programmes ( backward forward upstream and downstream)

• Feasibilities of key initiatives• Training programmes• Institutional building • Monitoring and reviewing• Phase 2 implementation of entrepreneurship programe with leveraging of

private sector funding

Amashangane

• Secure community emergency priority capacity/ institutional development needs

• Linkages and support to DEA planning process and other regional initiatives (GEF, USAID, Corridors of Hope, Ivory Trail, Land Affairs, ARC and DAFF etc)

• Mobilise private sector resources for sustainable land management practices and improved ecosystems services and livelihoods through designing and testing incentive and market based financial mechanisms

• Technical support for at least 2-3 potential demonstration projects for enhancing ecosystem services and or finding new and or expanded markets to increase green job opportunities, entrepreneurship opportunities and incomes

The Umzimvubu

Eastern Cape ProgrammeUpper Umzimvubu Project

• Improved land conditions and watershed service at six project sites.• Enhanced capacity of stewardship groups in the region. Removal of invasive species on 35,000 ha with co-financing from the national government.• Interested buyers of ecosystem services identified and at least five new value-add enterprises established in conjunction with development planning/scenario development.• Governance structure of freshwater PES structure piloted and aligned with economic development plans for the region.• Monitoring system established for assessing stocks and flows of fresh water in the Umzimvubu landscape and enabling analysis of changes based on different economic scenarios and valuation of the services.• South African government fresh water pricing strategy reflects lessons learned from the project.

Thicket Restoration Programme

Project Areas

Indicative budget with GF fundingPROJECT AMOUNT COMMUNITY PROJECT DESCRIPTION

Thicket other projects R5m plus Addo communities, Baviaanskloof projects, Presence

3 projects demonstrating resource mobilisation of private sector in Thicket restoration and biodiversity economy

Umzimvubu R8.5m plus CSA and ERS Community Organisations

PES and opening new markets - leveraging /project investments

Olifants Kruger to Thabakgolo

R8.5m plus Community Organisations and Trusts

PES Easement mechanism- leverage in private sector funding for entrepreneurship ecosystem adaptation based inititiatives

Balancing portfolio for project preparation and investment/leveraging windows

R8.5m plus To be determined together with SC members

Determined by SC members and fund criteria in other provinces

TOTAL R37m

Recommendations for the PSCfrom the Drylands Fund

• Support of the PSC for the Drylands Fund submission for a grant of R45m to the Green Fund.

• Secure R10m of this amount to be earmarked for the ABFRP Agency

• Support of the PSC for requesting DEA to resource the Drylands Fund for R5m per year over the next three years to mobilise private sector investment in the Fund and to meet the funds minimal operational and project investment costs

ABFRP Agency ProjectGuy Preston

Background• Signatory Parties for the Addo Elephant Park, Baviaanskloof Nature Reserve,

and the Park Great Fish River Nature Reserve Restoration Programme (ABFRP.) Account included DBSA, SanParks, DEA and ECPTA

• The ABFRP has generated a Project Document which has been validated by

internationally accredited validators against standards stipulated by the Verified Carbon Standard and the Climate, Community, and Biodiversity Alliance. This Project Document specifies how the implementation of the ABFRP needs to be undertaken and importantly how the ecosystem carbon stocks need to be monitored through time in order to generate verified carbon credits for sale

• The Parties have agreed that the money generated and spent in the implementation of the ABFRP objectives will be transparently and responsibly managed with a minimum of transaction costs. In order to achieve this transparent and responsible management of the money, the DBSA has been charged by the Parties to establish a Project Implementation Unit (PIU)

Objective

• The objective of the ABFRP is to restore degraded thicket in three parks with a view to expanding beyond

• Restoration will be achieved by planting cuttings of the indigenous tree P. afra in specific planting sites within the project areas

Progress

• Approved by DBSA Board• MOA signed by 4 parties• Agency created • VCR credits internationally validated• In process of registration potential to bring in R100m - R120m• R50 000 deposited into Agency by DEA• R30 000 committed to registration costs and audit• Presented concept to International and national forums,

conferences and key potential buyers• Found potential buyers and developed a strategy for sales for

discussion by SC members

Interrelationship with the Drylands Fund

• Drylands Fund is currently working to raise funding from Green Fund and others to work with communities to restore Thicket biome – including supporting organisations to establish knowledge and institutional frameworks for managing the thicket biome and for mobilising further private sector resources

• The planting and maintenance of the project sites under the ABFRP Agency will be financed through funds generated by the sale of carbon/biodiversity credits generated by the ABFRP. As it is currently not optimal to sell credits immediately, additional bridging financial arrangements need to be made to mobilise the programme. DEA have provided R50 000 for registration costs and SC meetings. Further bridging finance will come from the Drylands Fund (drawing from the Green Fund or other donations to the Drylands Fund) until time is optimal to sell credits

Way Forward

• Sign a Communication Agreement between Parties in order to finalize registration

• SC site inspection of areas under planting to date• SC resolution on details of roles and

responsibilities, methodology and funding flows• SC to decide on strategy and timing of sales• Agency to implement, monitor and report to SC• Acquire gap funding from Drylands Fund (through

Green Fund donation)

Recommendations for the PSCfrom the Drylands Fund and the ABFRP Agency

• Support of the PSC for the Drylands Fund submission for a grant of R45m to the Green Fund. Secure R10m of this amount to be earmarked for the ABFRP Agency

• Support of the PIU for requesting DEA to resource the Drylands Fund for R5m per year over the next three years to mobilise private sector investment in the Fund and to meet the funds minimal operational and project investment costs