China: Protecting the Environment and Improving Livelihoods of Farmers

Challenge

Land degradation was one of the main environmental problems facing China in early 2000s. Land degradation and erosion were caused by unsustainable land management practices and, at the same time, were threatening the livelihood of millions of mainly poor people in rural China. The problems were most severe in the upper watersheds of the Changjiang and Pearl Rivers.

The Changjiang River Basin alone covered a total eroded area of 562,000 square kilometers, about 36 percent of the national total, and the induced soil loss amounted to about 2.4 billion tons annually.

The impacts of degradation ranged from a loss of vegetation, biomass and biodiversity, and a reduction in soil water storage capacity to an irreversible destruction of farmland, damaging floods downstream, and climate change at a regional scale.

In addition, these areas suffered from the greatest social costs of the degradation. The exploitation of forest resources and growth in agricultural production driven by the need to generate income had diminished natural resources basis and accelerated the erosion of farmland, limiting agricultural and livelihood development options.

Solution

The project sought to introduce an integrated approach to watershed rehabilitation and management by building on the Bank’s and the European Commission’s (EC) experience in sustainable watershed management. It also sought to improve the rural business environment and help the country accelerate its transition to a market economy by encouraging active participation of the private sector.

The project financed public goods investments for soil and water conservation, including stone-faced terraces, sediment retention structures, afforestation and restoration of vegetative cover, and village infrastructure such as drinking water supply systems and access roads.

In addition, the project supported investments to improve the farmer’s income, including terracing of slope land to increase crop production, high value fruit and nut tree orchards, grasslands to improve fodder production and reduce soil erosion, livestock development, irrigation facilities, small-scale tanks and cisterns, and energy-saving stoves and small-scale bio-gas digesters to reduce forest destruction and household spending for fuel.

The project was implemented in three provinces of Guizhou, Hubei, and Yunnan and Chongqing Municipality and promoted participatory approach in the project design, management and implementation process.

Results

Implemented from 2006 to 2012, the project achieved the following key results:

• 50 percent long-term erosion reduction was achieved at 1,769 square kilometers area. The most immediate impact in form of erosion reduction was observed on terraces, grassland and in economic tree plantations.
• Total amount of incremental carbon sequestered at the end of the project in 2012 was estimated at 391,000 tons.  Total carbon sequestered is expected to reach between 5.8-8.3 million tons after 10 years and between 11.4-16.2 million tons after 20 years.
• Annual per capita net income increases from project activities ranged between RMB557 and RMB4,368. Households that also engaged in fruit trees could increase income by RMB2,198 per capita per year as fruit trees would need five to eight years to reach full production.
• Farmland productivity increased from RMB11,165 in 2006 to RMB16,679 per hectare in 2012, and labor productivity increased from RMB31 to RMB55 per labor day in the same period.
• About 345,000 rural households with a total population of 1.3 million benefited from environmental and livelihood improvements. Direct beneficiaries included 71percent of all households and 72 percent of ethnic minority households living in the project areas. Nearly 79,000 participating households were female headed.
• Several design features of the project have already been replicated in national programs.

Bank Group Contribution

The World Bank provided an IBRD loan of $100 million and built on its experience in watershed rehabilitation and management gained in China through the Red Soil and Loess Plateau Watershed Rehabilitation Projects and in other countries.

Partners

The project built on a long-term partnership and successful cooperation experience between the Bank and the Ministry of Water Resources. The government provided committed and qualified staff and resources for the coordination and management offices at the national, provincial, municipality and county/city levels.

The project was co-financed by the European Commission (EC) with a grant of EURO 10 million.

The EC grant support allowed for the participation of all households independent of their individual financial capacity and thus greatly contributed to achieving the project’s aim of comprehensive coverage, outreach and integrated watershed rehabilitation.

In addition, the European Union-China River Basin Management Programme (EU-China RBMP) provided valuable cross-support to the project in two ways, namely: (a) through the provision of experts that supported local project management staff; and (b) through funding of technical assistance in monitoring and evaluation, participatory design, orchard management, and impact evaluation studies.

Moving Forward

All livelihood activities have been transferred to the recipient farming households and most of them are generating benefits. Many of fruit orchards established under the project are still young and not yet fully productive. Local project management offices continue to work with responsible technical bureaus and agricultural extension offices to provide technical training and services to the orchard owners to ensure sustainability and long-term income generation from this important project investment. Infrastructure investments have also been turned over to beneficiaries and are operated and maintained by them. Several project provinces expressed a strong interest in a follow-on project.

Beneficiaries

“Before the soil erosion here was really serious. And we were also faced with water shortage. It was difficult to get around then since there was barely any road. Now things are much better – soil erosion has been controlled; water supply has been secured; with the construction of the rural roads, transportation has become more convenient.” – Gong Daihua, orange farmer at the Minquan Village, Chongqing Municipality.