PROJECT COMPLETION REPORT OF THE PHILIPPINE FORESTRY DEVELOPMENT PROJECT IN ILOCOS NORTE (PFDPIN) ADB LOAN NO. 677-PHI FER-ATABLE OF CONTENTS Page Executive Summary i 1. Project Description 1.1 Background 1 1.2 Statement of Official Agreement 2 1.3 Project Area 3 1.4 Project Objectives 4 2, Project Components 6 2.1 Reforestation 6 2.2 Social Forestry 9 2.3 Roads 9 2.4 Consultancy "1 2.$ Training and Information " 2.6 Research "1 2.7 Project Support 14 3. Implementation Methods 14 3.1 Reforestation 16 3.4.1 Selection of Species 16 3.41.2 Forest Nursery Operation ‘7 3.1.3 Plantation Development and Maintenance 19 a. Reforestation by Administration 19 b. Community Based Contract Reforestation a ¢. Protection and Maintenance 2 3.2 Social Forestry 23 3.2.1 Controlled Open Grazing (COG) 23 3.2.2 Communal Tree Farm (CTF) 23 3.2.3 Two-Tier Farm (TTF) rs 3.2.4 Communal Nursery (CnN) 2 3.2.5 Agroforestry (AF) 2 3.3 Road Construction 25 3.4 Training 28 a, Staff Training 28 b. Beneficiary and skilled labor training 29 c. Sereening of the steff for training 2page 3.5 Consultancy 30 3.6 Research 30 3.7 Project Support 31 2A Buildings 31 4.7.2 Vehicles and Equipment 3 4. Deseription and Justification of Changes in the Project Components and Implementation Method 32 41 Revisod Project Scope and Cost Estimate 32 4.2 Nursery Operations 33 4.3 Plantation Establishment 33 4.4 Road Construction 34 4.5 Social Forestry 35 4.5.1 Institutional Linkages 35 4.5.2 Cooperative Development 36 5. Project Inplementation 5.1 Comparison Between Original Implamentation Schedule and Actual Performance 36 5.1.1. Reforestation oe 5.1.2, Bocial Forestry a 5.1.3, Road construction 42 Comparison of Cost (stimate and Actual) 45 5.2 Problems/Difficulties Encountered in the Recruitment of Consultants Relative to the Bank's Procedure 48 5,3 Problems/Difficuities Encountered in the Procurement of Goods and Services Relative to the Bank's Procedure 48 5.4 Borrower's Compliance with Loan Covenants 48 5.5 Reason for any Delay in Loan Utilization 49e 6. Initial Operations Pas 6.1 Description of Initial Operations of the Project Transitional problems 49 6.2 Measures Taken To Insure Continued and Smooth Operation 50 6.3 Analysis of Prospect of Project st 7. Evaluation of Bank's Performance 7.1 Assessment of Bank's Performance 53 7.2 Comments on the Bank's Guidelines, Procedures and Requirement 33LIST OF APPENDICES Appendix A, Training program attended by the Project staff during the Project operation. Appendix B. Abstract of Research Studies. Appendix C, Status of Compliance with Loan Covenants.3 LIST OF FIGURES Map of the project area, showing the location of the project's three sectors Page S Locations of Social forestry activities undertaken by the Phitippine Forestry Development project in Tlocos Norte, 1985 - 1993 Page 10 Road network constructed by the Philippine Forestry Developmant project in Tlocos Norte, 1987 - 1993 ‘Rage 12EXECUTIVE SUMMARY -/77% The Philippine Forestry Development Project in Hocos Norte was generally very successful in its attempt to restore the protective forest cover of the upper watersheds of Banban and Vintar rivers through the establishment of tree plantations. These plantations are now producing fuelwood and timber on open public lands which were formerly used for open grazing and subsistence agriculture. The project also enhanced the Jiving standard of the people in the communities surrounding the project area. Likewise, the project contributed towards increased community awareness on reforestation and prevention of forest fires. Reforestation activities exceeded the target goal by 42. A total of 13,734 ha was planted with fast growing species, premium wood species and rattan. The fast growing species Acacia auricauliformis, A. mangium Gmelina arborea, Casuarina equisetifolia, and Eucalyptus camaldulensis were selected de lige acl Pantin, Vhs select aacophyile end Pemcocarpas indicus vere used for enrichment planting. About 80% of the forest Plantation was established through the Community Based Contract Reforestation Scheme (CBCRS). About 5,000 residents vithin the project site were provided with employment, As a result, their average income increased by as much 2s 500% in which 60% comes from PFDPIN employment and 20 from farm and off-farm sources. The soctal forestry program assisted sbout ‘£00 farmer participant. in the Controlled Open Grazing (COG) program, Two-Tier Farm, Communal Tree Farm, Agroforestry and Communal Nursery Program. In addition, extension ‘services vere provided through institutional linkages and organization of cooperatives. Training programs on livelihood and income generating projects were provided to increase the farmers’ income from the social forestry projects. The project constructed 172 km of all-weather and fair-weather roads connecting the plantation areas and the surrounding communities. The road network improved the transport system of the project as well as the transport of farm products from the surrounding communities. As a result the potential of farm-to-market products increased, thereby contributing to additional income of farmers, Graveling of the roads provided a year-round access to all the barangays around the project. In support to the plantation and social forestry programs, 23 research studies were completed, 10 of which were on nursery practices. The rest were on plantation operations. The species trials provided the bases for the selection of species the large scale planting in the project. There were 16 local trainings and 4 overseas trainings provided to the project staff. Likewise, 16 trainings on different livelihood projects were provided to farner participants. On information dissemination, interpersonal meetings and dialogues, movie films and posters were used to educate and increase the awareness of the local people on reforestation and forest protection.One component of the project was the construction of 26 building units, including a project office, three central aurseries and one seed storage house. The project also purchased 90 vehicles, including motorcycles. Collectively, PFDPIN could well serve as a model for DENR projects of this kind. The sustainability of this project, however, depends upon the support of the local comaunities surrounding the Project and the Government to continue what have been started.PROJECT COMPLETION REPORT OF THE PHILIPPINE FORESTRY DEVELOPMENT PROJECT IN ILOCOS NORTE (PFDPIN) ADE LOAN NO. 677-PHT 1. PROJECT DESCRIPTION 1.1 Background The Philippines is 2 small country with a total land area of 30 million ha scattered into more than 7,000 islands. Northwestern Philippines io among the regions with vast grasslands and unproductive forest lands. It is composed of four provinces, ie, La Union, Pangasinan, Ilocos Sur and Ilocos Norte. Fifty years ago, Northwestern Philippines had 810,578 ha of forested area with about 500,000 ha of virgin forests. However, tight economic situation, aggravated by high population growth rate and political pressures, led swidden agriculturists to clear much of the forests. What's worse was the fact that the remaining forested areas was logged to supply the requirenents of vood-based industries. These indiscriminate activities converted many of the forest lands into marginal lands. Thus, about 335,500 ha of unproductive lands are now evident throughout the region. To alleviate the situation, the Philippine government had given top priority to convert these marginal grasslands into sustainable forest production units. In response to the call for immediate action, both the Government and the private sector started to engage in large scale reforestation work. Joining the common endeavor were several foreign assisted projects which incorporated forestry components in their development2 programs, including a number that have been funded by the Asian Development Bank (ADB). One of these is the Philippine Forestry Development Project in Mocos Norte or PFDPIN. This report presents the major accomplishments of PFDPIN in its nine years of implementation from 1984 to 1993. It includes the experiences derived from the project as well as its socio-economic and environmental impacts. Collectively, PFDPIN could well serve as a model for DENR on projects of this kind. The sustainability of this project, however, depends upon the support of the Government of the Philippines to continue what have been started. 1,2 Statement of Official Agreement The ADB granted an amount of $245,000 for a technical assistance (T.A. No. 453-PHI) in March 1982 to the then Bureau of Forest Development (BFD), now the Forest Management Bureau (FMB), to conduct a feasibility study on forestry development. Cost estimates for the proposed project, covering an area of 25,000 ha, was $60 M. To validate the project site, ADB sent an Appraisal Mission to Tlocos Norte in January to February 1983 to evaluate the area, Final arrangement was made in December 1983 for the then Ministry of Natural Resources, now the Department of Environment and Natural Resources (DENR), to start implementing the project entitled “Philippine Forestry Development Project in locos Norte" (PFDPIN). In the official agreement, the project area was scaled down from 25,000 ha to 13,000 ha at a cost of $43.09 million, The reduced project area was due to3 budgetary constraints which arose as borrowings from external sources became prohibitive. The loan agreement, numbered L.A. 677 - PHI, was signed on December 23, 1983 by Cesar Virata, then Minister of Finance representing the Philippine Government, and Masao Fujioka, ADB President representing the Asian Development Bank. The loan became effective on July 23, 1984. 1.3 Project Area ‘The project was located about 500 km north of Manila in the province of Ilocos Norte. The province has an area of 340,000 ha of which 187,000 ha are classified as forest land. Agricultural lands cover 67,000 ha, 25 parcent of which is irrigated. ‘The project area was about 21,900 ha of which 20,000 ha are in ‘the public domain and 1,300 ha are alienable and disposable (A&D) land within the upper Banban and Vintar watersheds. The area was selected from a potential project area of 200,000 ha. It covers the entire Banban, Vintar and Laoag watersheds. The project site was selected based on the following criteria: ~ availability of land not yet earmarked for tree plantation projects; natural boundaries; suitability of land for reforestation and fuelwood production; and ~ limitation to public forest land.4 The project area was divided into three sectors as shown in Figure 1. Sector I had a total area of 4,237 ha; Sector IL, 4,005 ha; and Sector IM, 4,958 ha. In general, the vegetative cover of the project area was a grassland conmunity. The most common grass covers were Imperata cylindrica and Themede triandria which are indicators of low pH and poor soils. Few patches of fire resistant trees were scattered but the gullies were covered with second growth forest. The project site belonged to a tropical dry forest, a transition from semi-arid to sub-humid condition with long dry months (October to June), an average annual rainfall of 2,000 mn, and low organic matter and available phosphorus contents. The original forest cover was lost through repeated burning, iMlegal logging and kaingin making. The loss of the stable forest cover ed soil erosion, thereby reducing its grazing value. In addition, agricultural production in the lowland was adversely affected due to siltation and frequent flooding. 1.4 Project Objectives The major objectives of the project were the following: a, Restore the protective cover of the watershed of Vintar and Banban rivers te minimize erosion and siltation and increase water yield; b, Produce timber and fuelwood to meet the increasing needs of the people in locos Norte and surrounding provinces;6 ©. Raise the income and improve the Lving conditions of the people in the project area and adjacent communities by introducing more effective techniques of forestry and agricultural produetion; 4G, Construct a network of all-weather and farm - to ~ market roads to serve the project and the people in the project area; and e Serve as 2 model and training ground for the DENR in the implementation of large-scale integrated forestry developnent projects to be replicated nationwide. 2. PROJECT COMPONENTS The project activities were divided into seven major components: reforestation, social forestry, roads, consultancy, traning and information, research, and project support. 2.1 Reforestation The main component of the Project was the establishment of about 10,700 ha of tree plantations, consisting of fast-growing and premium species for the production of fuelwood, pulpwood, timber, poles ad rattan. It also included the protection of about 1,200 ha of steep and eroded land through reforestation of a 300 ha pilot area and the construction of fire-control system and other protection measures for 4,000 ha. (See Table 1 for the revised project scope)“able 1. avis Project Sone of the Philippine Forestry Sovelawmnt Frojeot Jn Tlese Norte (PFEPIN) Revised Prog Povo Projet ‘Soe sope (ovision 1 vision 12 ‘ame en OS ome Bark’ ‘Project Cmparant Origttal Pexject Saxpe Proponal) ‘Sugpstion) Feforestation Sector T2960 ra 2,960 he 3,700 he Secme TE 5,160 ra 5,180 ha 0 ba ‘actor TE 2/560 ra 2,580 fe 2,280 he Yoel 10,700 re ‘Sextal Forestry Contrevied 630 ha a he 2400 he on racing emt om om 20 be Tree farm Ponts fein fod 110 19 100 Sour fons i mie oie Total 19 190 ke 1 im anatege 6 ante at anit 25 unite Wiricleynatoroycten 356 ros 4 moe 9mm Grmitingexvion (a) toa) Foreign tat oT local Foreign etal toss) Forwtgn Total boo umm Reforestation activities were done by project administration and contractors from the locality and surrounding towns. (Please see Table 2for the revised plantation development schedule and accomplishments.)Tile 2. avised socks) forestry develo schaila ard ascot isinents of the Philippi Forstry Deslogment Project tn Toco vor (OPN. UNIT OF ~ ” caeoenr oar we toe wie 100m tame 08) A. pen RORET es . ~ Cxtnite omGrairg cn) om mma ze comsl ie nm ewww 20 er a * = 8 » @ = » # ~ came ser (9 t > 2 3 2 . Aeroforestry (AF) Tamiotoxct m cx mt . © memes certorad Gan Gracy (te 42 23 em aa ms » mae comrst Wee fam €TF) ST wm mT 25 OR . 02 Toe Frm (TF m 41 62 oo S57 mm 2m LD 1 m0 cme rey ca) ™ 109 om oe nat . peroorsty Tent aout rs na em mw me mo (se Tos ro u 6 1B2.2 Social Forestry This component covered about 1,000 ha that were developed as follows: a Bight model Controlled Open Grazing (COG) sites, about 10 ha each; >. Bight Two-Tier Farm (TT) sites, about 10 ha each; c. Eight Communal Tree Farm (CTF), about 5 ha each; 4, Bight Semi-Conmunal Nursery (CnN), about 1.0 ha each; @. Establishment of agroforestry farm lots for the residents- beneficiaries. (Please see Table 2 for the revised social forestry development schedule and accomplishments.) Social forestry activities were undertaken by the project beneficiaries. The locations are shown in Figure 2 The project beneficiaries were encouraged to develop and manage communal Tree Farms, Two-Tier Farms, and Agroforestry areas to help them provide for their daily needs. All the products derived from the farms went to the farmers. PEDPIN provided all the necessary technical assistance including agricultural inputs. 2.3 Roads Road infrastructure has always been a very important component of any forest development program/project. The construction of 110 km of all-weather-roads and 80 km of spur roads, including all necessary bridges, culverts and drainage facilities, was very necessary in order to facilitate the establishment of tree plantations.Ww These were also intended to improve the means of transportation and communication for the residents within the project area. The road network is shown in Figure 3. 2.4 Consultancy The project was provided with local and foreign consultancy services for the conduct of social, land use and market surveys, road engineering and construction supervision, and forest management and fire control techniques. Table 3 shows the Consultancy services contracted by the Project. 2.5 Training and Information The training and information component was designed to strengthen the manpower capability of PFDPIN. A total of 100 Project staff underwent Jocal training in about 200 man-months, while 12 Project staff had overseas training in about 78 man-moaths, The Information and Education Campaign (IEC) program was designed to effectively disseminate the Project's goals and concept to the communities within the project area and to win their acceptance and support. Among the strategies used were the print and broadcast media, interpersonal dialogues, meetings, and field visitation. 2.6 Research In support of the reforestation and social forestry components, the research unit conducted applied plantation research simultaneously with plantation operations.Table 3. services contracted for the Philippine Forestry Sovelopamnd Project in Tlocos Morte (PEER) CONSULTANCY SERVICE ‘Man-months OT Consultancy Group Road Engineering (eer) 66 Market Survey (SEA) 6 Social survey (waDEOOR) a4 Research covered four areas, namely, species trials, nursery Studies, plantation establistment and management, and insect pests and diseases of reforestation species as well as frit trees and pasture species. Researches were undertaken in coordination with the Mariano Marcos State University which alloyed selected members of its faculty to assist the research staff of PFDPIN. 2.7 Project Support This component included the construction of four project offices, five senior manager's houses, four duplex houses, one seed storage and Jaboratory building, three greenhouses, three potting sheds and three look-out towers as well as the procurement and maintenance of vehicles and equipment.(Table 4 shows the project support facilities constructed and purchased for the Project.) 3. IMPLEMENTATION METHODS Massive tree planting was used to restore the protective forest cover of two major watersheds in Mocos Norte. At the same time, it was intended to alleviate the socio-economic conditions of the upland communities surrounding the project area. PEDPIN adopted a holistic approach of project managenent by integrating reforestation activities with social forestry, infrastructure development, consultancy, trainings and other support activities,