World Bank to Support Urgent Biodiversity Conservation in Madagascar

June 21, 2011

Additional financing of $52 million will protect 30 national parks, three newly protected areas, and encourage long-term community development for 90,000 households

WASHINGTON, June 21, 2011 – The World Bank’s Board of Executive Directors today approved additional financing to continue the Bank’s support to the environment sector in Madagascar, a country that is home to some of the world’s most unique and threatened biodiversity. The financing, amounting to US $52 million, will support conservation efforts in 30 national parks and three newly protected areas, covering some 2.7 million hectares of land.
“Madagascar is one of the world’s poorest countries but is endowed with some of the world’s richest natural assets,” said Haleh Bridi, World Bank Country Director for Madagascar. “The biodiversity in Madagascar is a globally significant resource and an irreplaceable public good. We can’t walk away from protecting it.”
Financed by the International Development Association (IDA), the Bank’s fund for the poorest countries, and including a $10 million grant from the Global Environment Facility (GEF), the additional financing will fund conservation, community development, and ecotourism activities over the next three years across conservation areas managed by the independent Madagascar National Parks (MNP). 
The additional financing has been approved in the context of a two-year, socio-political crisis in Madagascar that has exacted a heavy human, economic, and environmental toll. Since March 2009, the World Bank’s program in Madagascar has been on hold due to its policy for dealing with de facto governments that come into power through means not provided for in the country’s constitution.
The project in need of additional financing was scheduled to close on December 30, 2011. The additional financing approved today by the World Bank will cover the costs of avoiding further environmental deterioration as a result of the political situation.
“Conservation costs money and our support will help protect the island’s unique flora and fauna, both now and in the future,” said Jamal Saghir, World Bank Director for Sustainable Development in Africa. “It is important to note that this additional financing was approved as an exception on environmental and humanitarian grounds given the global significance of Madagascar’s biodiversity and the needs of the communities living near the parks. This does not signal the World Bank’s reengagement with Madagascar, but signals our recognition that the environmental and social costs of inaction are just too high.”
The financing will focus on surveillance and control activities in the protected areas, but a large part will be devoted to tackling poverty in remote rural communities around the protected areas where 200,000 households live in absolute poverty. Approximately $15 million will be dedicated to activities to help these households improve their wellbeing and become more actively engaged in the management of protected areas. In addition, the funding will support the creation and operation of sustainable financing mechanisms through the development of ecotourism, ecosystem services payments, and a $10 million contribution to the capital of an endowment fund whose interests will finance core costs of national parks management 
“By improving the livelihoods of people living near the parks, we also improve the sustainability of the parks and help ensure the protection of the plant and animal species living in them,” said Jean-Christophe Carret, Senior Environmental Economist, Madagascar Country Office.
“The financing will also be used to set up mechanisms to ensure that, in the future, Madagascar’s national parks become more independent in managing costs and less reliant on external aid. Increased support to the Foundation for Protected Areas and Biodiversity, as well as for tourism development and carbon finance, are key to financial independence,”  Carret added.
Taking into account the local political context, a detailed evaluation of financial management risks has been undertaken and measures to ensure the control and  monitoring of funds have been built-in.  Financing will not be provided directly to the Government of Madagascar, but will be channeled through independent entities. Additional safeguards are in place to ensure that the Government of Madagascar plays its part in protecting the national parks and enforcing the national legal framework that prohibits the exploitation or exportation of illegally logged timber.
The Bank retains the right to suspend disbursement should the Government renege on its commitment. This clause will help ensure that the project facilitates improved environmental governance in Madagascar.
“The project combines environmental conservation objectives with social safeguards and community engagement,” said Bridi. “Working closely with civil society partners and the independent Madagascar National Parks Authority, we are committed to helping current and future generations preserve nature’s unique bounty found only in Madagascar.”

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