45784 William R.. Suttonn William R Sutto William R. Sutton Peterr Whitfordd Pete Whitfor Emanuelaa Montanarii Stephenss EmanPeter Montanar Stephen uel Whitford Emanuela Montanari Stephens Suzettee Pedrosoo Galinatoo Suzett Pedros Galinat Suzette Pedroso Galinato Bonniee Nevell Bonni Neve Bonnie Nevel Beataa Plonkaa Beat Plonk Beata Plonka Ebru Karamete Ebru Karamete Ebru Karamete THE WORLD BANK Integrating Environment into Agriculture and Forestry Progress and Prospects in Eastern Europe and Central Asia EUROPE AND CENTRAL ASIA REGION SUSTAINABLE DEVELOPMENT DEPARTMENT Integrating Environment into Agriculture and Forestry Progress and Prospects in Eastern Europe and Central Asia William R. Sutton Peter Whitford Emanuela Montanari Stephens Suzette Pedroso Galinato Bonnie Nevel Beata Plonka Ebru Karamete THE WORLD BANK Washington, DC © 2008 The International Bank for Reconstruction and Development/The World Bank 1818 H Street, NW Washington, DC 20433 Telephone: 202-473-1000 Internet: www.worldbank.org E-mail: feedback@worldbank.org All rights reserved. 1 2 3 4 11 10 9 8 This volume is a product of the staff of the International Bank for Reconstruction and Development/ The World Bank. The findings, interpretations, and conclusions expressed in this paper do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guaran- tee the accuracy of the data included in this work. 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All other queries on rights and licenses, including subsidiary rights, should be addressed to the Office of the Publisher, The World Bank, 1818 H Street NW, Washington, DC 20433, USA, fax 202-522-2422, e-mail pubrights@ worldbank.org. This report is also available online at: http://www.worldbank.org/eca/environmentintegration. ISBN: 978-0-8213-7743-7 eISBN: 978-0-8213-7744-4 DOI: 10.1596 / 978-0-8213-7743-7 Library of Congress Cataloging-in-Publication Data Integrating environment into agriculture and forestry : progress and prospects in Eastern Europe and Central Asia / William Sutton ... [et al.]. p. cm. Includes bibliographical references. ISBN 978-0-8213-7743-7 (alk. paper) -- ISBN 978-0-8213-7744-4 1. Environmental policy--Europe, Eastern. 2. Environmental policy--Asia, Central. 3. Agriculture and state--Europe, Eastern. 4. Agriculture and state--Asia, Central. 5. Forest management--Environmental aspects-- Europe, Eastern. 6. Forest management--Environmental aspects--Asia, Central. I. Sutton, William R., 1967- II. World Bank. GE190.E852I58 2008 338.1095--dc22 2008035534 Cover design by Word Express Cover photos: Main photo, Kyrgyzstan meadow, by Joop Stoutjesdijk; irrigation headworks in Kyrgyzstan with destroyed apron, by Joop Stoutjesdijk; Uzbekistan, a family in the field during the grain harvest, by Anvar Ilyasov; farmer with horse cart, Moldova, by William Sutton Table of Contents Preface ....................................................................................................................................................................ix Acknowledgments.................................................................................................................................................xi Executive Summary ........................................................................................................................................... xiii Acronyms............................................................................................................................................................. xix Abbreviations....................................................................................................................................................... xx 1. Integrating Environment Into Agriculture And Forestry...............................................................................1 2. Agriculture and Forestry Have Major Impacts on the Environment ...........................................................5 3. Focusing On The East And On Agriculture...................................................................................................13 4. Improving Awareness Of Sustainability Issues In Agriculture And Forestry ...........................................19 5. Building Capacity For Implementation..........................................................................................................23 6. Increasing Incentives For Implementation ...................................................................................................27 7. Building On Success.........................................................................................................................................31 8. Meeting The Challenges Ahead.......................................................................................................................33 Annex 1: Key Economic, Agricultural, and Forestry Statistics.......................................................................35 Annex 2: Analysis of Questionnaires..................................................................................................................39 Annex 3: Explanation of Indicators....................................................................................................................51 Annex 4: The Issue of Abandoned Land ............................................................................................................57 Annex 5: Sub-Regional Comparisons.................................................................................................................63 References.............................................................................................................................................................65 Annexes continue on the Volume II CD that accompanies this book Study Brochure Main Report--Russian translation Individual Country Reviews--English and Russian translations v Contents Figures Map: Integrating Environment into Agriculture and Forestry.............................................Inside front cover Figure 1: Share of Irrigated Area Affected by Moderate to Severe Soil Salinity, Select Countries ...................................................................................................................................11 Figure 2: Areas of Organic Production by Country .........................................................................................16 Figure 3: Obsolete Pesticide Stocks by Country ..............................................................................................20 Figure 4: Extent of Forest Certification by Country ........................................................................................29 Tables Table 1: Recommendations .............................................................................................................................. xvii Table 2: Summary of Issues...................................................................................................................................7 Table 3: Reported Trends of Selected Mainstreaming Indicators in EECCA and SEE Countries since 2000................................................................................................................................................10 Annex Table 1.1: Agriculture and forest indicators of EECCA and SEE countries, various years............36 Annex Table 2.1: Integration of Environmental Considerations into the Agricultural Sector,...................42 EECCA Countries, 2006 Annex Table 2.2: Integration of Environmental Considerations into the Forestry Sector,.........................44 EECCA Countries, 2006 Annex Table 2.3: Integration of Environmental Considerations into the Agricultural and ........................45 Forestry Sectors, SEE Countries, 2006 Annex Table 2.4: Combined Table of Questions Common to OECD and World Bank ................................48 Questionnaires. EECCA and SEE Countries, 2006 Annex Table 4.1. Abandoned Farmland across the SEE Region, Various Years ..........................................58 Boxes Box 1: Kazakhstan Shows the Way.......................................................................................................................2 Box 2: Carbon Finance in Moldova......................................................................................................................3 Box 3: Integrated Pest Management in Uzbekistan..........................................................................................13 Box 4: Russia Combats Illegal Logging..............................................................................................................14 vi Contents Box 5: Integration and the EU Accession Process...........................................................................................15 Box 6: Good Practice from Hungary and Poland .............................................................................................16 Box 7: Prospects for Organic Farming...............................................................................................................17 Box 8: Modernizing Agricultural Extension......................................................................................................21 Box 9: Abandoned Farmland: Threat or Opportunity?....................................................................................30 Box 10: Money from Manure in Georgia............................................................................................................32 vii Preface T his study reviews how the integration of and emerging environmental priorities reviewed. environmental concerns into agriculture This report also includes an assessment of SEE and forestry is progressing in the countries countries and territories. The analysis provided of Southeastern Europe (SEE) and of Eastern Eu- here is intended primarily to inform discussions rope, Caucasus, and Central Asia (EECCA)1 since during and after the Sixth Environment for Europe 2000 and assesses prospects for the future. Ministerial Conference, to be held in Belgrade in The present report is a contribution to the October 2007.2 Environment for Europe process. At the Fifth The main text of this report provides a syn- Ministerial Conference in Kiev in 2003, participants thesis of major regional issues and trends, with decided to pay greater attention to the needs of the broad recommendations for future directions and EECCA and adopted an Environmental Strategy for priorities. The annexes provide a wealth of data the sub-region. The commitments made under that along with detailed Country Reviews for the 22 strategy are taken as benchmarks against which countries and territories studied (included with progress is assessed, recommendations made, the book as Volume II on CD). 1The EECCA countries are Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyz Republic, Moldova, Rus- sian Federation, Tajikistan, Turkmenistan, Ukraine, and Uzbekistan. The SEE countries and territories reviewed are Albania; Bosnia and Herzegovina; Bulgaria; Croatia; Kosovo (which is a province of Serbia under autono- mous administration of the United Nations consistent with UNSC 1244 and is treated as a separate entity for the purposes of the study); FYR Macedonia; Romania; Serbia; Montenegro; and Turkey. Because of the recent emergence of Montenegro as an independent country, it was not feasible to do a separate Country Review; however, its data are included in regional statistics. In addition, special studies were conducted of EU member countries Hungary and Poland, mostly to identify good practice examples for the rest of the region. 2 Officially, this report was submitted by the World Bank as a Category II Document (ECE/BELGRADE. CONF/2007/INF/32) through the Ad Hoc Working Group of Senior Officials for the Sixth Ministerial Conference on "Environment for Europe". ix Acknowledgments T his report was prepared by a team led version of the report, while Irina Tsoy oversaw the by William Sutton, and comprising Peter Russian translation. Whitford, Emanuela Montanari Stephens, Special thanks are due to our local consultants: Suzette Pedroso Galinato, Bonnie Nevel, Beata Genti Kromidha (Albania), Gagik Gabrielyan (Arme- Plonka, and Ebru Karamete. It was prepared under nia), Tofig Hasanov (Azerbajian), Siarhei Sauchyk the guidance of Sector Managers Marjory-Anne (Belarus), Mirza Agic (Bosnia and Herzegovina), Bromhead and Juergen Voegele. Peer reviewers Dimitar Stoev (Bulgaria), Ratko Matosevic (Croatia), were Peter Dewees, Erick Fernandes, and Jiten- Beka Tagauri (Georgia), Martin Szabo (Hungary), dra Srivastava. Guidance was also provided by Ramil Dissembayev (Kazakhstan), Shkipe Deda (Ko- Grzegorz Peszko. Among the many World Bank sovo), Baktybek Koichumanov (Kyrgyz Republic), staff who assisted with the work were Arcadie Nikola Nikolov (Macedonia), Dorin Dumbraveanu Capcelea, Rita Cestti, Andrey Kushlin, Robert (Moldova), Krzysztof Skapski (Poland), Dan Ma- Kirmse, Jessica Mott, Maurizio Guadagni, Julian noleli (Romania), Vladislav Minin (Russia), Valentin Lampietti, Matthias Grueninger, John Fraser Strakhov (Russia), Vera Matusevich (Russia), Natal- Stewart, Karin Shepardson, Agnes Kiss, Vladimir ija Bogdanov (Serbia), Malika Babadjanova (Tajiki- Tsirkunov, Alexander Nacev, Emilia Battaglini, stan), Ebru Karamete (Turkey), Oleg Gulchgeldiev Mahwash Wasiq, Al Watkins, John Nash, Darejan (Turkmenistan), Andriy Demydenko (Ukraine), and Kapanadze, Bulat Utkelov, Olivera Jordanovic, Asror Nazirov (Uzbekistan). Alexei Slenzak, and Alexander Kaliberda. Admin- Financial support was generously provided istrative support was provided by Maria Gabitan by the Bank-Netherlands Partnership Program and Sharifa Kalala. Alma McNab edited the English (BNPP). xi Executive Summary A s part of its contribution to the Environ- between transition countries and OECD nations ment for Europe meeting in Belgrade remains large. Yet, because agriculture and for- in October 2007, the World Bank has estry are particularly dependent on the resource undertaken a review of the Europe and Central base, closing the productivity gap has important Asia Region3 with the objective of raising implications for the environment. awareness among policy makers of the need to accelerate and enhance implementation To ensure the sustainability of the resource of environmentally sustainable practices in base, agriculture and forest management has the agricultural and forestry sectors in SEE to improve significantly in these countries. Is- and EECCA, and to provide recommendations sues of primary concern include soils management, for doing so. The process of incorporating con- nutrient conservation, water management, pest siderations of environmental sustainability and management, sustainable forestry, forest health, resource conservation into sector policies, strate- and illegal logging. Other issues include rangeland gies, programs, and investments will be referred and watershed management, food safety, organic to as integration or mainstreaming. The text of farming, carbon sequestration, and climate change this report provides a synthesis of major regional adaptation. issues and trends, with broad recommendations for future directions and priorities. It is based on Agriculture and forestry policies, laws, and an original set of 21 in-depth Country Reviews strategies that promote integration have im- prepared by the team with the support of local proved, but more needs to be done on imple- specialists in each country. The detailed Country mentation. The importance of environmental Reviews can be found on the Volume II CD that protection is usually recognized in statements of accompanies this book. environmental, agricultural, and forestry policy, as well as in the resulting strategies, action plans, Agriculture and forestry continue to be very and legislation. Nevertheless, a lack of capacity, important for economic growth and poverty reduction in transition countries. The sectors 3 contribute about 15 percent of GDP and support The region includes nine countries of Southeastern Europe (SEE): Albania; Bosnia and Herzegovina; Bul- the 35 percent of the population that is rural in garia; Croatia; FYR Macedonia; Montenegro; Romania; these countries. This segment of the population Serbia; Turkey; plus Kosovo (which is a province of faces a higher risk of poverty than that in urban ar- Serbia under autonomous administration of the UN eas, and accounts for about 65 percent of the poor. consistent with UNSC 1244) as well as twelve countries of Eastern Europe, Caucasus and Central Asia (EECCA): This situation creates demands on agriculture and Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyr- forestry to generate higher growth and income for gyz Republic, Moldova, Russian Federation, Tajikistan, rural residents. The gap in agricultural productivity Turkmenistan, Ukraine, and Uzbekistan. xiii Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia limited funding access, and insufficient incentives change, and it is critical for EECCA and SEE are impeding progress on implementing these countries to build awareness and capacity for the strategies. proactive integration of climate change adapta- tion into agricultural and forestry sector policies, Failure to integrate environment into agricul- programs and investments. ture and forestry will have major economic and human health implications. For example, Accelerating implementation of environmen- salinity in Uzbekistan is estimated to cost that tal integration will require increased efforts country $1 billion per year, and soil erosion is by EECCA countries. This study confirms the estimated to cost Moldova at least $40 million per conclusion on agriculture and forestry reached year. Furthermore, it is now known that drinking by the 2003 EfE Conference in Kiev, that greater water contaminated by agricultural nutrients and effort was needed to ensure environmental sustain- pesticides has adverse effects on human health, ability in the EECCA sub-region. Major issues such although the extent of the long-term impacts are as water and rangeland management, radioactive just beginning to be understood. The irony is that contamination of forests and farmland, and illegal the solutions to most of these problems are known, logging are much more prevalent in EECCA coun- and the technology to address them is available tries (with important exceptions). Membership from other countries, yet the necessary measures and accession into the EU are major incentives are often not taken. for integrating environment into agriculture and forestry. However, in non-accession countries such Agriculture and forestry can also be impor- as those of EECCA, the drive towards integration tant providers of environmental services. is much weaker, and generous external support Agriculture and forestry have unique potential for and incentives will be required. making positive contributions to the environment. Environmental services provided can include More effort is needed to address the impact sequestering carbon, managing watersheds and of agriculture on the environment. Agricultural rural landscapes, and preserving biodiversity. But impacts on the environment are much more sig- currently, many of these services are undervalued nificant than those of forestry, but they are being and unremunerated. The right incentives should be less adequately addressed in both sub-regions. In put in place to encourage the development of more the forestry sector, regional countries generally sustainable production systems and the provision harvest less than the annual growth increment of environmental services. (though overharvesting does occur at the local level), and certification of forest products is gain- The interactions between the agriculture ing ground. Progress on the widespread problem and forestry sectors and climate change of illegal logging is less certain; although major are highly complex and deserve special at- efforts have begun, it is too early to tell how suc- tention. Together, agricultural production and cessful they will be. In agriculture, soil erosion deforestation account for up to 30 percent of is worsening in nearly all countries. Initiatives greenhouse gas emissions (World Bank 2007d). to improve nutrient management and introduce But the sectors also offer important opportunities integrated pest management have been mostly at for carbon sequestration through afforestation the pilot project level. While irrigation rehabilita- and improved agricultural techniques, and incen- tion projects have had some success in improving tives for these should be increased. Agriculture water use efficiency and reducing salinity, these and forestry are also highly sensitive to climate are not yet major objectives. xiv Executive Summary Increasing awareness among decision mak- capacity for economic analysis to better prioritize ers and the general public is an important investments and more effectively demonstrate first step towards accelerating integration the negative impacts of unsustainable practices. of environment into agriculture and forestry. Developing a Code of Good Agricultural Practices Change is unlikely unless the main stakeholders is a step in the right direction, but farmers need are well informed of the issues and press for training to adopt these practices, and technologies change. To this end, environmental monitoring must first be adapted to local conditions. This re- systems need to be enhanced to provide more quires investing in improved agricultural research, quantitative data over time, and indicators should education, and extension systems. Curtailing be standardized across countries. Implementing negative practices such as illegal logging requires the Aarhus Convention in all countries will im- good governance, which, according to published prove public access to this information. Ministries indices, is still lacking in many countries of the of the environment need to step up their efforts region. Collaboration among agencies responsible to inform other public agencies--including those for agriculture, forestry, and the environment responsible for agriculture, forestry, finance, and needs to improve. the economy--of the long-term consequences of allowing the resource base to be eroded. This will Incentives for implementation need to be require more evidence of the negative impacts not enhanced, and disincentives to good practices only on the environment, but also on the economy removed. Governments should use policy instru- and human health. ments and public expenditures to encourage the spread of good agricultural and forestry practices. One of the most important tools for increas- The first priority should be to eliminate perverse ing awareness is an effective agricultural incentives, such as subsidies for chemical fertil- advisory and extension service. Agricultural izers and pesticides, or policies that hinder or extension systems in the region vary greatly in undermine private ownership of agricultural land. their mode of organization and their effectiveness Governments need to implement the "polluter in informing farmers on sustainability issues. In pays" and "user pays" principles in agriculture and SEE, basic government systems are in place but forestry, so that meaningful fees are assessed on need to be modernized and supplemented by the polluters and on users of scarce resources such private sector. In EECCA, there are few services as irrigation water. available to small, private farmers, and a number of innovations aimed at filling the gap cost-effectively The question of incentives is particularly need to be strengthened. In SEE, services to pri- important for non-accession countries. New vate forest owners need to be improved as well. EU member states and accession countries receive powerful incentives for integration in the form of The region needs to build up the financial, membership and generous grants. However, non- human, and institutional capacities for accession countries, particularly those in EECCA, implementation. Although just as important do not benefit from the same incentives and have as increased investment, institutional change is much more limited resources. Therefore, western often more challenging. Agriculture ministries countries and international financing institutions need to strengthen their capacity by training (IFIs) must do more to encourage integration ef- staff on environmental issues and, if necessary, forts in these countries through grants and loans. establishing environmental units. Environmental These will be more effective if they are integrated and agriculture ministries need to enhance their into the countries' own strategies. xv Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia A tool that has been little explored but has so that representatives of countries within a significant potential is the use of trade incen- sub-region can establish networks that meet and tives, combined with rigorous certification communicate regularly to share experiences and of sustainable production. This would require ideas. Several related issues--from water nutrient western nations to open their markets to more pollution and avian flu to illegal logging--are trans- agricultural imports from EECCA, support the border in nature, providing additional impetus for establishment of certification systems in those regional cooperation. countries, and educate consumers and import- ers in their own countries. However, even new Countries of the region have already shown their EU member states, when given the option, have commitment to integrating environmental con- demonstrated a tendency to employ European cerns into agriculture and forestry through their Union Common Agricultural Policy (CAP) funds policy statements and action plans, including the for income support rather than for environmental EECCA Environment Strategy adopted in Kiev. investments. More should be done to encourage Many, however, are finding it difficult to turn those countries to use CAP Pillar 2 funds for their in- commitments into action on the ground. Significant tended purpose. needs for investment remain, and these should be supported by a combination of the countries' own Countries should accelerate integration by resources, funding from donors and IFIs, and pri- scaling up successful pilot initiatives and dis- vate sector partnerships. seminating good practices. There have been a number of successful pilot initiatives in the east, This report makes a number of suggestions including for nutrient management, integrated for addressing constraints and giving momen- pest management, erosion control, and drylands tum to such implementation. These are sum- management. However, these initiatives have marized into ten overarching recommenda- often been sponsored by external development tions in Table 1 for consideration by all relevant agencies, and more needs to be done to scale them ministries of the governments in the region, as well up and integrate them into national forestry and as NGOs, regional organizations, and the IFI and agricultural development strategies. In addition, donor community. regional knowledge-sharing should be increased xvi Executive Summary Table 1: Recommendations Recommendation Responsibility Duration 1. Having expressed their commitment to sustainable agriculture and forestry through policy Governments, led by ministries of agriculture Short term declarations, strategy documents, and initial programs, regional countries now need to and forestry. advance to full-scale implementation. 2. Further analyses of the economic impact of unsustainable agriculture and forestry manage- Ministries of environment, agriculture, and Short term ment should be used to persuade policy makers in economic and sectoral ministries of the forestry, supported by universities and priority for action. Economic cost-benefit analysis should be increasingly integrated into NGOs. decision making. 3. Given that non-EU accession countries face particular difficulties in reaching the goals of Governments, led by ministries of environ- Medium term the EECCA Environment Strategy, they will need to mobilize all possible domestic and ment, agriculture, and forestry. international support. 4. The EU should enhance its role as the main driver of progress on mainstreaming by EU, EECCA governments. Medium term expanding support to the EECCA countries, especially in foundation issues of governance, awareness, capacity building, and incentives. 5. The World Bank and other IFIs and donors should build on the foundation with well- World Bank, other donors, regional Medium and long term targeted projects in all regional countries, scaling up successful pilots where available. governments. 6. Governments should re-examine their policy instruments, including taxes, subsidies, and Governments, with donor support. Medium term support services (research, extension, food safety, etc.) to ensure that their support to integration is consistent and cost-effective. 7. Certification systems for food and forest products should be encouraged and supported as Governments (including trade ministries), Medium term an important driver of sustainable management, including the powerful incentive of market certification bodies. access. 8. Pilot projects in mainstreaming should be evaluated and their results disseminated; where Ministries of agriculture, forestry, and Medium and long term warranted, their success should be scaled up to achieve national impact. environment, and donors. 9. Regional mechanisms for the exchange of experience among countries should be Regional organizations (EU, UNECE, OECD), Medium and long term strengthened. new EU members, and governments 10. While continuing efforts to mitigate climate change, including examining the potential of International organizations (UN, World Medium and long term abandoned farmland for reforestation and carbon sequestration, governments should begin Bank, EU, OECD), carbon funds, govern- development and implementation of climate change risk management adaptation plans. ments, donors. xvii Acronyms ARET Agriculture Research, Extension and Training Project (Georgia) BNPP Bank-Netherlands Partnership Program CAP European Union Common Agricultural Policy CDM Clean Development Mechanism EEA European Environmental Agency ECA Europe and Central Asia Region EECCA Eastern Europe, Caucasus, and Central Asia EfE Environment for Europe process EFMA European Fertilizer Manufacturers Association EU European Union EurepGAP European Equal Partnership (to support) Good Agricultural Practices FAO Food and Agriculture Organization (UN) FLEG Forest Law Enforcement and Governance GAP Good Agricultural Practice(s) GEF Global Environmental Facility GDP Gross Domestic Product HCH Hexachlorocyclohexane HELCOM Helsinki Commission HNV High Nature Value (farmland) IFAS International Fund for the Aral Sea IFI International Financial Institution IMF International Monetary Fund IPM Integrated Pest Management METAP Mediterranean Environmental Technical Assistance Program NEAP National Environmental Action Plan NEFCO Nordic Environment Finance Corporation NGO Non-Government Organization OECD Organization for Economic Cooperation and Development POP Persistent Organic Pollutant SEE Southeastern Europe UNECE United Nations Economic Commission for Europe USDA United States Department of Agriculture WB World Bank xix Abbreviations ALB Albania ARM Armenia AZE Azerbaijan BEL Belarus BiH Bosnia and Herzegovina BUL Bulgaria CRO Croatia GEO Georgia KAZ Kazakhstan KOS Kosovo KYR Kyrgyz Republic MAC FYR Macedonia MOL Moldova ROM Romania RUS Russian Federation SER Serbia TAJ Tajikistan TRK Turkmenistan TUR Turkey UKR Ukraine UZB Uzbekistan xx Integrating Environment into Agriculture and Forestry 1 A s part of its contribution to the Environ- Reviews were distributed to ministries responsible ment for Europe meeting in Belgrade in Oc- for environment, agriculture, and forestry in each tober 2007, the World Bank has undertaken subject country; comments received have been a review of the Europe and Central Asia Region4 reflected in the text. with the objective of raising awareness among Agriculture and forestry continue to be very policy makers of the need to accelerate and important for economic growth and poverty enhance implementation of environmentally reduction in transition countries. The share of sustainable practices in the agricultural and these sectors in national income is much higher in forestry sectors in SEE and EECCA, and of transition countries than in the West, representing providing recommendations for doing so. The on average 14 percent of GDP (compared to the process of incorporating considerations of envi- OECD average of 2.2 percent), and an even higher ronmental sustainability and resource conserva- 18 percent in EECCA (Csaki 2006). Agriculture tion into sector policies, strategies, programs, and and forestry are also the main sources of income investments will be referred to as integration or in rural areas, where 35 percent of the population mainstreaming. of transition countries still resides. In the least Unless other references are cited, the review developed SEE and EECCA countries, the major- is based on an original set of 21 in-depth Country ity of the population--over 70 percent--still lives Reviews prepared by the study team with the sup- in rural areas and is employed in agriculture and port of local specialists in each country. The text of forestry. Nearly all the transition countries have this report provides a synthesis of major regional experienced healthy, sustained levels of growth issues and trends, with broad recommendations since 2000, which has contributed to poverty re- for future directions and priorities. The Country duction overall; nevertheless, rural residents face Reviews are presented in full on the Volume II CD a significantly higher risk of poverty than urban that accompanies this book. In addition to the local residents and continue to make up the bulk of the specialist inputs, the study benefited from World Bank country, sector, and project documents, other IFI documents, country publications, UN- 4The region includes nine countries of Southeastern Eu- ECE Country Environmental Profiles, and other rope (SEE): Albania; Bosnia and Herzegovina; Bulgaria; Croatia; FYR Macedonia; Montenegro; Romania; Serbia; accessible documents, as well as the advice of Turkey; plus Kosovo (which is a province of Serbia under numerous World Bank staff working in the region. autonomous administration of the UN consistent with Field visits were made to selected countries to UNSC 1244 and is treated as a separate entity for the pur- confirm information and fill knowledge gaps. Draft poses of the study); and the following twelve countries of Eastern Europe, Caucasus and Central Asia (EECCA): Country Reviews were reviewed by World Bank Armenia; Azerbaijan; Belarus; Georgia; Kazakhstan; Kyr- country teams. Advance copies of this volume plus gyz Republic; Moldova; Russian Federation; Tajikistan; executive summaries of the respective Country Turkmenistan; Ukraine; and Uzbekistan. 1 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia poor--70 percent in EECCA and 62 percent in SEE sustainability of production and conservation of (Alam et al. 2005). natural resources. The importance of environmen- Significant improvements in agriculture and tal protection is usually recognized in statements forestry still have to take place in transition of environmental, agricultural, and forestry policy countries. Although production levels in these (and even in some state constitutions), and in the sectors have generally stabilized, the productiv- resulting strategies, action plans, and legislation. ity gap between transition countries and OECD In most cases, National Environmental Action countries remains large. For example, cereal Plans (NEAPs) were adopted early in the transi- yields are less than half of the OECD average tion period, through processes involving a range (Csaki et al. 2006). This productivity gap means of stakeholders. In some countries, NEAPs have there is significant potential for growth in the been updated or followed by detailed sectoral ac- sectors through improvements in efficiency. But tion plans and pilot projects (often with support for agriculture and forestry, the sustainability of from the Global Environmental Facility--GEF). growth over time is particularly dependent on the In others, that remains to be done. Most countries sustainability of the resource base. Therefore, en- have ratified the key international conventions suring that these economic sectors achieve their on global and trans-border environmental issues. potentials for growth and poverty reduction re- These actions indicate there is a high level of quires integrating environmental considerations commitment to environmental sustainability in all into their management. regional countries. Agriculture and forestry policies, laws, and Regional countries with greater capacity, strategies that promote integration have improved, more funding access, and adequate incentives but more needs to be done on implementation. are following through on their policy commit- Regional countries have generally recognized ments with programs and projects that promote that past agricultural and forestry practices have more sustainable production. Kazakhstan (see had adverse impacts on the environment and that Box 1) has undertaken a broad range of initia- action is needed to move towards longer-term tives in both agriculture and forestry. Serbia is Box 1: Kazakhstan Shows the Way Kazakhstan has a broad policy of economic diversification and is emerging as a regional leader based on its efforts to incorporate environmental concerns and sustainable resource management into a diverse array of agricultural and forestry programs. For example, the Syr Darya and Northern Aral Sea Project (World Bank/Government, 2001­2008) aims to increase irrigated agriculture and fish production, restore the Northern Aral Sea, and improve environmental conditions in the Syr Darya delta. The sea is already showing improvement: water flow into the delta has increased, several freshwater fish species have returned, and fish harvests are increasing. A second project is being prepared that will be funded mainly by the government. The Drylands Management Project (World Bank/GEF/Government, 2003­2009) addresses dryland degradation due to unsustainable cultivation practices. The project has replaced cereal production on marginal drylands with traditional livestock grazing, restored grasslands, and improved the capacity of local institutes. The Forest Protection and Reforestation Project (World Bank/GEF/Government, 2006­2012) aims to ensure cost-effective and sustainable environmental rehabilitation and management of drylands and rangelands, with a focus on pine forests, the dry bed of the Aral Sea, and semi-arid rangelands. The Agricultural Competitiveness Project (World Bank/Government, 2005­2010) seeks to promote agricultural productivity by improving the quality and safety of farm products, enhancing access to information, and harmonizing standards. The food safety and quality certification component will have a direct positive impact on the environment. The Zhasyl Yel (Green Country) Program (2005­2007), initiated and financed by the government, aims to fulfill Kazakhstan's obligations under the Convention on Biological Diversity and the Aarhus Convention through forest conservation and reforestation, and by increasing public awareness and participation. The program has improved media coverage of conservation measures; it is also promoting active youth participation in tree planting nationwide. 2 Integrating Environment into Agriculture and Forestry harmonizing its legislation with that of the EU neglecting environmental concerns. Moreover, and beginning to use strategic environmental experience in many countries shows that little will assessment. It is also undertaking research and be done on environmental protection unless the extension programs in nutrient management, public is well informed on the issues and presses pest management, organic farming, and other the government to action. areas. Countries with lower institutional and Environmental integration is better in SEE financial capacity are also making progress, al- countries than in EECCA and more advanced in beit at a slower pace and on a narrower range of forestry than in agriculture. The EU is clearly a issues. Moldova has been a pioneer in the use of powerful driver for change in its new member carbon finance for reforestation (see Box 2), as states, in countries on the path to accession, and well as in nutrient management, organic farming, in some that are not. However, some transition and legislation harmonization. Albania has made countries that became EU members have shown great strides in the improvement of irrigation that increasing production and supporting farm systems, introducing user organizations more incomes are higher priorities for them than envi- extensively than elsewhere in the region. It has ronmental sustainability. When given the choice, adopted a similar approach in forestry. they often prefer to shift funds from environmental Nevertheless, decision makers and the gen- activities under Pillar 2 of the Common Agricul- eral public are not yet fully aware of the impor- tural Policy (CAP) to income supports under Pillar tance of integrating environment into agriculture 1. In the forestry sub-sector, there is a tradition of and forestry. At the government level, ministries resource conservation that is being reinstated fol- of the environment have an essential role to lowing the dislocations of transition. Agriculture, play in analyzing and providing information on however, is faced with a more complex and less environmental issues (including their potential tractable set of issues. impact on human health, economic productivity, There is a lack of capacity in virtually all tran- the natural environment, and the global com- sition countries. While limited funding is the most mons) and in reaching out to sectoral ministries obvious example, all countries face shortages of to ensure sustainability concerns are given proper skilled staff. Moreover, they need to continue the recognition in their programs. But ministries of slow process of institutional change to support economy and finance also need to be made aware new policies on integrating environment into of the longer-term economic consequences of agriculture and forestry. There is also a lack of ca- Box 2: Carbon Finance in Moldova Moldova is successfully taking the lead in mainstreaming environmental considerations into afforestation to contribute to carbon sequestration and reduc- tion of greenhouse gas emissions. The Soil Conservation Project (World Bank Prototype Carbon Fund/Government/Japan, 2004­2007) addresses the link between afforestation efforts and protection of forest ecosystem diversity, as well as agricultural land degradation, while contributing to carbon sequestration. The project has restored nearly 20,000 ha of degraded agricultural lands to productive uses for rural communities and has established community-based management. A follow-up project includes the planting of new forests on 33,000 ha, of which approximately 6,000 ha were granted carbon finance eligibility. Further stages of development are planned. The Agricultural Pollution Control Project (World Bank/GEF/Government, 2004­2009) includes afforestation efforts and the creation of buffer zones along the Dniestr River. Grants are provided to entrepreneurs and businesses for investing in environmentally sustainable agricultural practices, including agro-forestry, planting of buffer strips, wetland restoration, monitoring of soil and water quality, and assessing environmental impacts. 3 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia pacity to evaluate the economic costs and benefits have tremendous potential for creating positive of environmental issues in these sectors. Because incentives, particularly for non-EU countries. of such constraints, even new EU member states Creating the right incentives also requires integrat- find it difficult to spend EU funds for sustainable ing sound economic analysis into agricultural and agriculture in a timely manner, and to demonstrate forestry policy-making. the impact of those expenditures. Successful pilot projects need to be scaled up Positive incentives for environmentally and experience exchanged among countries of the friendly behavior need to be enhanced, while region. By now, there are numerous examples of negative incentives should be curtailed. Tax and good practices--many of which are cited below-- subsidy programs must work together to promote but mechanisms for implementing these pilots on sustainability. Trade opportunities with the West a national level and transferring this knowledge combined with rigorous environmental standards between countries need strengthening. 4 Agriculture and Forestry Have Major Impacts on the Environment 2 A gricultural production and forest man- ued and unremunerated. The challenge, therefore, agement can have major impacts on the is not to constrain the development of agriculture environment. For example, soil erosion and forestry, but to provide the right incentives to affects all regional countries; in Turkey it generates encourage the development of more sustainable 1 billion tons of sediment per year. The agricultural production systems and the provision of environ- and forestry sectors are responsible for almost mental services. 60 percent of waterborne nitrogen input and 50 The interactions between the agriculture and percent of waterborne phosphorus input into the forestry sectors and climate change are perhaps Baltic Sea, which includes a number of transition more complex than with any other sectors, and countries in the catchment area.5 These two pol- deserve special attention. Together, agricultural lutants are the major causes of the eutrophication production and deforestation account for up to problems that afflict the sea (HELCOM and NEFCO 30 percent of greenhouse gas emissions, second 2007). A similar situation exists in the Black Sea. only to the energy sector (World Bank 2007d). But Indiscriminate use of pesticides in the past in Cen- the sectors also offer important opportunities for tral Asia has had major impact on human health. carbon sequestration, such as through afforestation Forest fires can cause enormous economic damage or improved agricultural techniques like minimum and release huge amounts of greenhouse gases. tillage. However, much of this potential has not been At the same time, the future of agriculture and realized due to a lack of incentives. The production forestry depends on the sustainable management of biofuels has also been put forth as an opportunity of the resource base, including land, water and for reducing greenhouse gas emissions (although climate. Table 2 lists the main issues of concern, more work is needed to reduce the environmental their geographical scope, the nature of the threat, footprint of biofuel production and increase its the availability of mitigation measures, and priori- economic viability). At the same time, due to their ties for future action.6 dependence on weather and the resource base, Agriculture and forestry can also be important agriculture and forestry are also highly sensitive to providers of environmental services. While the climate change. The increased frequency of heat potential negative side effects of poor agricultural stress, droughts and flooding events caused by and forestry practices have become increasingly recognized over the past decades, largely unrec- 5 Estonia, Latvia, Lithuania, Poland, and Russia are Baltic ognized is the unique potential these sectors also littoral countries, while Belarus, Czech Republic, and have for making positive contributions to the en- Ukraine are also located within the catchment. 6 vironment. Environmental services provided can The information in Table 2 is intended to provide a broad, generalized picture of the whole region. There include sequestering carbon, managing watersheds are many country exceptions, which are described in and rural landscapes, and preserving biodiversity. the detailed Country Reviews on the Volume II CD that But currently, many of these services are underval- accompanies this book. 5 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia global warming will reduce crop yields and livestock the norm in EECCA. Given the public-good nature productivity, while increased risks of fires and pest of many forest benefits, state ownership of forest outbreaks will have negative consequences for resources is compatible with sustainable manage- forestry (Easterling et al. 2007). While aggressive ment; the bigger challenge is to get the public-pri- mitigation of greenhouse gas emissions should vate balance right. Forest management in Europe continue to be a priority, most experts agree that has a long tradition of resource conservation that climate change is already happening (IPCC 2007), is now being reasserted, for example, in Croatia and that countries should now be making serious and Bulgaria. The forest health situation is more efforts to reduce their vulnerability. The best way mixed, but most countries are taking action to to do this is not to treat climate change in isolation, control fires, pests, and diseases, including a major but to integrate climate change risk management program in Russia that recently experienced seri- into agricultural and forestry policies, programs ous difficulties as a result of a fast-track transition and investments (World Bank 2006a). This is par- to decentralized fire management, as mandated by ticularly important for poor farmers who are the the new Forest Code (2007). most vulnerable. The transition to a market economy presents The transition brought about major changes both a challenge and the opportunity to put in in agricultural production. Since the year 2000, place policies and incentives that would minimize countries of the region7 have largely completed the environmental impact of increased output. The the wrenching transition from a socialist to a free- introduction of market prices for inputs, energy, market economic model and, as a result, most have and farm products has greatly altered production experienced relatively high levels of economic operations and has led to shifts in the crop mix growth. The transition drastically changed produc- and, often, to less input-intensive production-- tion relationships in all sectors, none more so than which has generally benefited the environment. agriculture. The most basic change has been the For the same reasons, together with reduced con- privatization of farmland, a process that is almost sumer demand, livestock numbers and production complete in SEE and some EECCA countries but have declined, putting less pressure on natural continues in others. Evidence from elsewhere in resources. For example, manure production in the world8 suggests that full private land owner- Russia has declined by two-thirds, or almost 400 ship provides a powerful incentive for farmers to million tons. However, there are indications that, conserve their land and apply sustainable farm- as regional economies improve, input use and the ing practices. In most countries, grazing land still demand for meat and dairy products will grow, belongs to the state and/or local communities, eventually approaching levels now observed in which presents a challenge for sustainable man- Western Europe. For example, in the Baltic Sea agement. Disruptions in the forestry sector have been perhaps more temporary in nature. Increased 7 Turkey is the exception, not being a transition poverty and higher energy prices, together with country. a breakdown of law and order, led many rural 8 See for example, World Bank. (2000). While it is gener- people to exploit local forests for fuelwood and ally rather early to observe private ownership leading to encouraged industrial-scale illegal logging in some greater use of sustainable practices in EECCA, a study in Tajikistan did show that private cotton farmers were countries. However, these problems are now being more likely to practice crop rotation (and obtain higher seriously addressed in many countries. Some for- yields) than collective farms (World Bank. 2006b.) est land in SEE has been restored to the previous 9 HELCOM and NEFCO. (2007). Projections from FAO, private owners,9 while state ownership remains OECD and EFMA (2004). 6 Table 2: Summary of Issues Issue Occurrence Nature of impact Availability of mitigation Response Priority measures Human Economic Natural Global health productivity environment commons Agriculture Soils management Soil erosion Throughout the region Technologies well understood Limited action, except in Turkey. Conserva- I but need to be adapted to local tion tillage not widely practiced. conditions. Poor structure and fertility; Throughout the region; fertility Technologies well understood. Limited because of cost of amendments for II acidification esp. in EECCA, acidification esp. in poorer farmers. northern SEE Nutrient Conservation Eutrophication Especially in the Baltic and Black Pilot projects in Russia, Turkey, National program in Poland and beginning in I Seas Bulgaria, Romania, Serbia, Georgia, Romania. Limited elsewhere. Moldova. Agriculture Nitrates in Throughout the region but esp. in Mitigation expensive. Prevention Accession countries implementing Nitrates I drinking water Russia, Bulgaria, Croatia, Serbia, better. Directive. Limited elsewhere. Romania Water Management and Water use All countries with irrigated agriculture Technologies well understood. Projects with modest impact underway in I Forestry inefficiency all irrigation countries except Russia and Ukraine. Waterlogging and salinity Central Asia, Russia, Ukraine, Turkey Basic technologies understood but Projects with modest impact underway in I have more comprehensive approaches all irrigation countries except Russia and needed. Ukraine. Major Pest Management Lack of pesticide regulation Throughout the region Technologies well understood. Well addressed on paper; enforcement II Impacts variable. Non disposal of obsolete Throughout the region Testing of lower cost approaches Inventories underway in most countries. II products needed. Disposal projects underway in several on countries, complete in three. the Lack of IPM Opportunities throughout the region Concept well accepted but much Great success in cotton in Central Asia but I Environment adaptive research needed. limited elsewhere to high value and organic crops. Rangeland Throughout the region but esp. in Techniques well known but need Pilot projects in Kazakhstan and Kyrgyz II 7 deterioration Central Asia adaptation to local conditions. Republic. (continued on next page) Table 2: Summary of Issues (continued) 8 Integrating Issue Occurrence Nature of impact Availability of mitigation Response Priority measures Lack of watershed Upland areas Good pilot projects that balance Progress in Turkey and Tajikistan. II management environmental, economic, and social Environment factors. Threats to food Throughout the region but esp. in Technologies well known but Good progress in most SEE and Caucasus I safety food exporting countries systematic (and expensive) approach countries. needed. into Lack of organic SEE, Ukraine, Georgia, Moldova Technologies well known but Promising starts in most SEE countries plus II farming economic and marketing factors Ukraine, Georgia, and Moldova. Agriculture may determine success. Abandoned farmland SEE and Kazakhstan Afforestation alternative well Opportunities for economic use and/or II understood. carbon sequestration not yet widely taken. Conversion of cropland to rangeland in and Kazakhstan. Forestry: Radioactive Belarus, Ukraine,Russia and Pioneering approaches in Belarus Chernobyl situation under control, with some I contamination Kazakhstan and Ukraine. land being returned to cultivation and strict standards for crops and timber. Scant action in Kazakhstan. Progress Forestry Unsustainable Throughout the region Technologies well understood. Annual cut less than incremental growth in II management all countries. and Threats to forest Throughout the region but episodic Technologies generally understood. Countries able to handle routine outbreaks II health of fire, pests, and diseases. Prospects Illegal logging Large scale in Russia, Ukraine, Technologies being pioneered Countries now making serious efforts; I Albania, and Bulgaria; small scale in through FLEG, certification, etc. problem may be diminishing. rest of region in Climate Change Eastern Lack of mitigation Throughout the region but especially Carbon sequestration technologies Only modest efforts in Moldovan, Romanian, I in larger countries well understood but institutional and and Russian forestry to date. Very large Europe financial mechanisms still a challenge. scope in the region. Lack of adaptation Throughout the region, but especially Along with knowledge on likely Almost nothing has been done to develop I in the south impacts, ideas on adaptation are and implement explicit adaptation action and being developed. Important for both plans. Awareness being raised now. agriculture and forestry. Central Key: box with dark shade = major impact; box with light shade = lesser impact. Notes: Asia 1. The categorization of impacts was adapted from World Bank/OECD (1998). A category, global commons, was added to reflect the growing importance of trans-boundary impacts. 2. The rating of impacts, assessment of responses, and setting of priorities are qualitative and partly subjective, for which the authors take responsibility. Priorities for future action were assessed by balancing the seriousness of the threats (while giving greater weight to the impacts on human health) with the effectiveness of possible responses. Agriculture and Forestry have Major Impacts on the Environment region, current nutrient runoff from the EU15 is to generate an economic rate of return of 19 percent, significantly higher than from the EU8 or Russia. even if other environmental benefits are excluded. However, this situation will change as transition Another impressive example of economic damage economies continue to grow. For example, by 2015, is salinity in Uzbekistan, which is estimated to cost pig meat production is expected to increase by that country $1 billion per year.12 An ongoing World over 70 percent in the EU8, and poultry production Bank project (World Bank 2003) aimed at reducing is expected to increase by over 50 percent in Rus- salinity over an area of 100,000 ha and enhancing sia, leading to significant increases in manure. By wetlands is expected to give an economic rate of 2016, nitrogen fertilizer use is expected to increase return of 24 percent. In neighboring Kazakhstan by 30 percent in Poland (HELCOM and NEFCO (World Bank 2001), restoration of the northern part 2007). As a result of these developments, by 2020, of the Aral Sea is beginning to generate substantial surpluses of nitrogen and phosphorus are expected environmental benefits but also major economic to grow by 63 percent and 84 percent, respectively, benefits in the form of fish production, with an in the EU8, while they will shrink by 12 percent estimated economic rate of return of 20 percent. and 25 percent in the EU15.10 Finally, going back to the example of eutrophication Countries have had to adjust to the changing in the Baltic Sea, the upper bound on the costs of role of the state in agricultural production. Instead eutrophication caused primarily by agriculture and of directing every step of the production process, forestry is estimated at Euro 4.5 billion (HELCOM ministries of agriculture now support and regulate and NEFCO 2007). the emerging private sector. Several countries have Solutions to environmental issues related not yet completed that transition, and numerous to agriculture and forestry are often known, as vestiges of the old system remain.11 Although evidenced by the number of times that "technolo- many of the impacts of agriculture and forestry gies well understood" appears in Table 2. Western on the environment and on the economy in the countries have faced the same issues listed in the region are similar to those observed elsewhere in table, with the possible exception of radioactive the world, some may be traced to the historical contamination; thus an array of policy and techni- legacy of this region. For example, the emphasis cal measures is available--for example, manure on food self-sufficiency in Albania during social- management to minimize nutrient outflows (Box ism led to cultivation of unsuitable land, which 6) or conservation tillage and buffer strips to re- exacerbated soil erosion and diminished forest duce soil erosion. Nevertheless, such technologies areas. The "virgin lands" scheme in Kazakhstan, are often not implemented, perhaps because they which aimed to promote cereal cropping, had a usually need to be adapted to local conditions similar motivation and caused extensive damage through research or pilot projects. Most of the to the resource base. region's countries are still at this stage on most of The economic impacts may be so significant the issues. Table 3 shows trends with respect to due to the long-term nature of many of these prob- lems. To continue with the erosion example, the 10 economic damage it causes each year may be small HELCOM and NEFCO. (2007). Projections from EEA (2005). but the cumulative impact after 10 or 20 years may 11 In a few countries, such as Belarus, Turkmenistan, be extremely significant. In the Anatolia region of and Uzbekistan, major parts of the old system, such Turkey, a watershed rehabilitation project is work- as "state orders" and managed prices, have not been ing to restore the resource base and increase house- dismantled and are a major impediment to private en- hold incomes. The resulting reduction in erosion, trepreneurship. increases in yields, and flood control are expected 12 World Bank staff estimates. 9 10 Integrating Environment Table 3: Reported Trends of Selected Mainstreaming Indicators in EECCA and SEE Countries since 2000 EECCA SEE Indicator ARM AZE BEL GEO KAZ KYR MOL RUS TAJ TRK UKR UZB ALB BiH BUL CRO KOS MAC ROM SER TUR into Agriculture Soil Agriculture Protection Nutrient (a) ... (a) ... ... (a) (a) ... (a) ... (a) ... Conservation Water Use (b) ... (b) (b) (b) + (b) (a) ... ...(b) ...(b) + and Efficiency Forestry: IPM Coverage ... ... (a) ... (a) (a) ... (a) Forestry Protected ... ... Areas Progress Forest Health Certification ... ... ... ... ... ... ... ... and Sustained ... ... ... ... ... ... ... Yield © Prospects Note: Given the difficulties in presenting quantitative data for indictors included in this table, trend indicators (up or down arrows) have been used as proxies. Trends reported here refer to the period 2000­2006. When available, data reported in local specialists' reports, supplemented by parallel qualitative analysis by the Bank team working on this study, were used to derive these trends. See Annex 3 for a detailed list of indicators and an explanation of how they were used to define mainstreaming trends. = positive trend; = very positive trend; = negative trend; = no change; ...= no data or none. in (a) Pilot level work only. Eastern (b) Projects to rehabilitate irrigation and drainage systems will have some impact on water use efficiency, but have generally not yet focused on this objective. (c) An "up" arrow indicates that annual harvesting is less than incremental growth but may mask factors such as over-harvesting of more accessible or higher-value forests. DISCLAMER: The mainstreaming trends reported in this table are pending full review and validation by the respective national governments. Europe and Central Asia Agriculture and Forestry have Major Impacts on the Environment Figure 1: Share of Irrigated Area Affected by Moderate to Severe sive irrigation systems (Russia and Ukraine being Soil Salinity, Select Countries (%) major exceptions) are acting to rehabilitate those 100 systems, with some likely, albeit modest, improve- ments in water use efficiency and salinity control (%) 80 (see Figure 1). It should be noted that differences salinity 60 between the two sub-regions are relatively minor by at this level of aggregation. 40 In each country, questionnaires were used to affected 20 assess progress, especially on institutional issues Area and government services.13 Results show that, in 0 most EECCA countries, the latest agricultural and AZE KAZ RUS TRK UKR UZB forest strategies incorporate environmental targets Source: GEF (2003). Also, local consultant reports for this study. (see Annex 2). There are ongoing reforestation or afforestation programs in all EECCA countries, and most SEE countries have agricultural and for- selected mainstreaming indicators. How the indi- estry research systems that address environmental cators were selected is explained in Annex 2. The and sustainability issues. Common areas of good limitations of the table should be borne in mind: practice in the agricultural sector in the region as the data are of variable quality, and "up" arrows do a whole include: good inter-ministerial cooperation not mean the issue is being fully addressed. in most countries; nutrient management research The outlook is more positive for forestry than programs and pesticide regulations established; for agriculture. As reflected in the trends reported environmental impact assessments of farm opera- in Table 3, harvested timber volumes are less tions and investments; and programs to improve than the incremental growth in all countries for water use efficiency and soil management.14 In which data are available, protected forest areas the forestry sector, mainstreaming efforts are are increasing throughout the region, and certi- more prevalent than in the agricultural sector. The fication of forest products is gaining momentum. main weaknesses reported were in the following For example, certification covers more than 90 areas: environmental capacity in the ministries of percent of Croatia's forests, is growing rapidly agriculture; extension services; programs to man- in Russia (which accounts for 93 percent of the age manure and capture methane; integrated pest region's forests), and is starting in Armenia, de- management; support to organic farming; forest spite its limited financial resources. The status of certification; the use of strategic environmental forest health is more mixed; trends are difficult to discern, but most countries are taking action to manage fires, pests, and diseases, including a 13 major program in Russia. In agriculture, the most This work was initiated by OECD for its study Progress on Environmental Management in Eastern Europe, disturbing finding is that soil erosion is gener- Caucasus and Central Asia, 2007, and expanded under ally not being addressed--with the exception of the present study to include SEE. However, the results several projects in Turkey--and is consequently should be interpreted with caution as the respondents getting worse across the region. Positive results in the OECD study were government officials and, in the case of the World Bank questionnaire in SEE, a differ- are being achieved in nutrient management and ent consultant in each country. Comparability between IPM, although mostly on a small scale. The most countries may therefore be limited. progress on IPM has been made in Central Asia. As 14 However, these innovations are often on a small for water management, most countries with exten- scale. 11 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia assessment of policies; and lack of cooperation (Boxes 5 and 6 and para. 5.3 and 7.1). Salinization between ministries of agriculture and ministries of irrigated land is widespread and increasingly of the environment on strategy development. trans-boundary in nature, especially in Central Many of the impacts noted are trans-boundary Asia; efforts to combat salinity in the future will or global in nature. As already mentioned, ag- require more cooperation at the river basin level riculture and forestry are major generators of (Table 2, paras. 2.6 and 4.5, and Annex 5). Programs greenhouse gases, and most of the emissions to improve food safety (Table 2, Boxes 1 and 5, and from these sources come from developing and paras. 3.1 and 6.6) or combat avian influenza also transition countries. It is beyond the scope of this have important trans-boundary dimensions that report to provide a comprehensive assessment of require international cooperation. the impact of climate change on agriculture and forestry in transition countries.15 However, given the growing concern on this issue and on finding ways to mitigate the release of greenhouse gases, the study did consider the potential in forestry and 15The report "Climate Change 2007: Impacts, Adaptation agriculture for carbon sequestration and methane and Vulnerability" (2007), the Contribution of Working capture (Table 2 and Boxes 2, 9, and 10), as well as Group II to the Fourth Assessment Report of the Inter- the importance of adaptation to climate change. governmental Panel on Climate Change, does consider the impacts of climate change on "food, fibre and forest Nutrient pollution often impacts downstream wa- products" (Ch. 5), as well as the implications for Europe ter bodies, which is why early actions have focused (Ch. 12). A forthcoming World Bank report will look on the Danube-Black Sea and Baltic Sea basins specifically at adaptation in the ECA region. 12 Focusing on the East and on Agriculture 3 A ccelerating implementation of environ- the two sub-regions, and the best performing mental integration will require increased EECCA countries, such as Kazakhstan, are ahead efforts in the EECCA countries and the of SEE laggards, as is Uzbekistan in the area of agricultural sector. At the 2003 Environment for IPM (see Box 3). Europe Conference in Kiev, there was strong sup- The impacts of agriculture on the environ- port for the view that greater attention was needed ment are different from those of forestry. Except to ensure environmental sustainability in the EE- perhaps for Russia, environmental impacts from CCA sub-region. This study confirms the validity agriculture are arguably of greater magnitude than of that assessment with respect to integrating those from forestry and not as well addressed. environment into agriculture and forestry.16Annex Despite the dislocations of transition, forests in 5 compares the two sub-regions with each other the region are managed with a considerable degree and with the relatively new EU member states of sustainability, especially when compared with Poland and Hungary. Major issues such as water those in tropical regions. Throughout the region, and rangeland management, radioactive contami- harvesting is considerably less than the incremen- nation of farmland and forests, and illegal cutting tal growth (even when estimated illegal cutting is of forests are much more prevalent in the EECCA sub-region. Food safety and organic farming are much less developed in the east. As the analysis 16 An internal World Bank assessment in 2005 of environ- in Annex 2 suggests, policy and institutional de- mental performance of regional countries (covering all velopment are less advanced in EECCA, where sectors) showed a clear gradation from new EU member countries, which scored 5.25 (out of 6), SEE countries at more of the mainstreaming indicators in Table 3 3.75 and EECCA at 3.2. The EECCA countries have work and Annex 3 are showing a worsening trend. Nev- to do to reach the level of SEE, but the latter sub-region ertheless, there is considerable overlap between is still well behind its EU neighbors. Box 3: Integrated Pest Management in Uzbekistan In Uzbekistan the growing concern over chemical pesticide application in cotton cultivation in the 1980s gave rise to research on biological pest control methods. At that time, as many as 12 kg/ha of herbicides and pesticides were being applied to the crop. After independence, interest in IPM was revived, initially under the World Bank's Cotton Sector Project (1995­2002), which supported the production and distribution of predator insects and other IPM techniques. Uzbekistan's Ministry of Agriculture and Water Resources subsequently expanded the program, but the main work of producing predator insects is done by nearly 900 laboratories, 40 percent of which belong to the private sector; they produce 12 tons of wasps and other insects per year. Biological controls are now used on 90 percent of cotton fields, where effective pest management has been achieved. Not only has chemical pesticide use been reduced by 75 percent in the last five years, but biological methods have the added advantage that they cost less than 50 percent than do the chemicals. 13 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia included).17 Generally, forest areas are increas- which could be used to support environmental ing, for several reasons: the European forestry integration in agriculture, to Pillar 1 income sup- tradition of resource conservation, which was ports instead. This reveals the need for increased followed by the Soviet Union and other countries; awareness even in these countries. growing external scrutiny; and enhanced incen- In contrast, in non-accession countries, such tives for sustainable management, for example, as those of EECCA, drivers towards integration through certification. A major qualification to this are much weaker, and generous external support optimistic picture is illegal logging, which remains (especially grants) is less likely. These countries, prevalent in all EECCA and a few SEE countries. therefore, need to do more with less, for ex- Most countries are now taking serious steps to ample, by focusing on setting the "foundation" curb illegal cutting, but these efforts may take for integration--i.e., governance, awareness, years to produce full results (see Box 4). Forest capacity building, and incentives--before fires are also a major threat in some countries, launching major investment programs. The including Russia. cost of building these components, described Proximity to the EU is a major driver for main- in more detail in the following sections, can be streaming in both agriculture and forestry, whether relatively low. Donors and IFIs are well disposed proximity is defined in a purely geographical sense to providing assistance to governments in the or in terms of progress towards EU accession. mainstreaming area. Non-accession countries, Even when accession is some time off, its pos- therefore, need to work closely with donors to sibility may focus decision makers on issues of achieve a shared vision and strategic support. concern to the EU, such as sustainability. In the But donor-sponsored and government projects pre-accession process itself, the need to harmonize can only go so far. Ultimately, incentives have legislation and fulfill criteria for pre-accession to be created for the private sector to integrate funding attracts greater attention to integration environmental concerns into their production matters. Finally, EU funding itself may provide processes. A potentially powerful tool for achiev- considerable momentum for turning good inten- ing this is through trade preferences in the West tions into reality. Box 5 provides an overview of how this process has worked in recent and current EU candidate countries. At the same time, there is 17 However, this may not be true in every locality. Often, still room for improvement among new EU mem- forests are overcut close to settlements or roads, and ber states; many prefer to shift CAP Pillar 2 funds, forest quality may be decreasing. Box 4: Russia Combats Illegal Logging Access to information, stakeholder participation, and accountability are key elements of good governance that protect not only the rights of people and communities, but also their natural environment. The Russian Federation is custodian of 22 percent of the world's forests, but faces serious economic losses from illegal logging. Estimates of the volume of illegal logging range from 10 to 60 percent of total harvest, according to region. In response, Russia has recently emerged as one of the major contributors to international efforts to improve forest governance and combat illegal logging and the associated corruption. Since 2004, the Russian Government and the World Bank have worked together to develop and launch the Europe and North Asia Forest Law Enforcement and Governance (FLEG) Ministerial Process. The Russian Government is also poised to implement its own comprehensive National Action Plan to Combat Illegal Logging and Illegal Timber Trade, which, if implemented fully and consistently with good detection practices, would be a step in the right direction. 14 Focusing on the East and on Agriculture for environmentally sound products. This tool is the Country Reviews show that few initiatives have just beginning to be utilized. been undertaken without initial donor support. Selected public investments in environmental There are obvious reasons for this to continue: integration in transition countries are justified, es- donors bring technical expertise, access to global pecially where there are substantial economic, as knowledge, funding, and an ability to link project well as environmental, benefits to be gained. Reha- assistance to policy and institutional reforms. bilitation of irrigation and drainage systems (with a However, donors may need to take a more system- focus on water conservation and salinity reduction) atic and strategic view of environmental integra- and large-scale soil conservation programs are ex- tion priorities and constraints in each country, as amples of worthwhile investments, as is reforesta- well as ensuring that the "foundation" is in place, tion with carbon sequestration benefits. Some good rather than promoting innovations in isolation or practice examples from EU member states Poland copying projects from one country to another. It and Hungary are described in Box 6. is also imperative that they coordinate with one Donors and IFIs have played a critical role another and take the time to build ownership by in successes achieved so far in integrating envi- client governments. Donor support will continue ronment into agriculture and forestry, and must to be crucial for trans-boundary issues, such as continue to do so, with the EU dominant in SEE, climate change, and global public goods, such as and the World Bank and GEF in EECCA. In fact, agricultural biodiversity, because in these areas, Box 5: Integration and the EU Accession Process To emphasize the importance of the environment in rural development and agriculture, farmers' eligibility for agricultural subsidies from the EU is tied to their compliance with EU environmental policies. Similarly, support for nature protection in private landscapes is integrated under the Common Agricul- tural Policy (CAP) Pillar 2, starting in the 2007­2013 programming period, as are support payments to promote more environmentally sustainable rural landscape management. Previous EU funds for SEE countries are being replaced with an Instrument for Pre-Accession Program for Rural Development (IPARD) in 2007­2013. Accession to the EU is a strong driver for mainstreaming; despite this, the implementation of environmental components within national agricultural strategies is still lagging in all SEE countries. For example, in Macedonia, environmental objectives are acknowledged in the national agricultural policy agenda but full financial support for implementation is lacking. In the case of Bulgaria and Romania, EU funds played an important role in mainstreaming in agricultural and forestry sectors during the pre-accession period. Access to CAP financing required harmonization with the EU Acquis (directives, regulations, programs, plans, and projects) of national legislation in the agricultural and forestry sectors. Recent availability of EU structural funds has led, among other things, to strengthening, harmonizing, and imple- menting legislation for soil, water, nutrients, pests, biodiversity, crops and forestry, improved water management, and soil conservation. In Bulgaria, the National Strategy for Sustainable Development of Forests (2006­2015), a draft Action Plan for the Development of the Forest Sector (2007­2011), and a draft of the new Forestry Law (2007) are based on the envisaged use of EU Structural Funds as specific financial instruments to better support the national forest management system and the sustainable use of forest resources. Even for the EU-8, challenges to integration remain. As a result of political and social pressures, many EU-8 countries have opted to shift CAP resources from Pillar 2 environmental programs to Pillar 1 farm income supports when given the choice. This demonstrates the need for more public awareness efforts, particularly to demonstrate that environmental integration also has important economic benefits. Further, the EU Nitrates Directive and Water Framework Directive require members to improve water management and reduce pollution. But new member states continue to have difficulties in meet- ing their obligations under these directives. New EU members are rewarded for adapting well to food safety, veterinary, and phytosanitary systems. At the same time, they are aware that they may be at a competitive disadvantage with older members, as direct CAP payments will be phased in over nine years. Sources: WB Consultants' reports, as well as World Bank (2007b); CAP: new members have felt benefits but more needs to be done. Agriculture, European Parliament, 2007. 15 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia Box 6: Good Practice from Hungary and Poland Since Hungary and Poland joined the EU in 2004, both countries have made substantial progress in mainstreaming environment into agriculture and forestry. For example, in the area of crop protection, Poland was faced with a problem of about 23,000 tons of obsolete pesticides, some as old as 50 years, stored under very precarious conditions at numerous scattered underground sites. Since 1999, about half the products have been excavated and disposed of safely in hazardous waste incinerators, initially outside Poland but now within. The program will be completed by 2010. The key to success was grants to local authorities for the collection process. In Hungary, a program of subsidies to farmers allowed them to switch from pesticides to IPM techniques. As a result, IPM went from being practiced on zero to 12,000 ha in only three years; the area has since expanded to 290,000 ha. Both countries have given active support to organic farming by putting in place appropriate legal and support frameworks and providing subsidies to eligible farmers. In Hungary, 150,000 ha of organic farming was reached in three years. In Poland, the figure has already reached 200,000 ha, and a new program plans to expand this to 600,000 ha (20,000 farms) by 2013. Lessons learned include: the need for careful calculation of subsidy amounts; the importance of promotion among farmers and consumers; and the need for support in marketing. Poland is also a regional leader in nutri- ent management; results from modest GEF, EU, and other grant programs in three counties were evaluated and used to design a national program, with tens of thousands of manure storage sites, to meet Poland's obligations under the EU Nitrates Directive. The result is reduced nutrient levels in aquifers, rivers, and lakes. Poland has also been active in improving the sustainability of forestry through a number of programs that support private forest owners, pest suppression, genetic resource conservation, reforestation, afforestation, and biodiversity protection. Among the results is an increase in Poland's forested area of 222,000 ha, of which about 50 percent is private land. Forest cover in Hungary has also grown in the last decade. countries cannot capture the full benefits of their sociations for irrigation management (pioneered own investments. in Turkey); provision of extension services by pri- Public-private partnerships have consider- vate providers and even processors; community able potential. Examples include: water user as- management of forests (as in Albania, Armenia, and Georgia), and watershed programs (as in Turkey and Tajikistan). Perhaps the most dynamic example is organic Figure 2: Areas of Organic Production by Country (thousand hectares; %) farming (see Box 7 and Fig- 350 3.5 ure 2), which a decade ago 300 3.0 was non-existent and is now a promising contributor to 250 2.5 ha) (%) food exports in most SEE 200 2.0 area (and a few EECCA) countries. (thousand 150 1.5 total of Nevertheless, it is important Area 100 1.0 for countries to have realis- Share tic expectations about the 50 0.5 potential for private sector 0 0 involvement. The private B&H BUL CRO HUN MAC MOL ROM RUS S&M TUR UKR sector will not take care of Area in organic production Share of agricultural area in organics everything, especially where Source: All data from local consultant reports for this study, except Bosnia & Herzegovina (2005), Turkey (2006) and Romania public goods are concerned (2006), which are from USDA Foreign Agricultural Service GAIN Reports: http://www.fas.usda.gov/scriptsw/AttacheRep/default. (see the discussion below on asp. advisory services). 16 Focusing on the East and on Agriculture Box 7: Prospects for Organic Farming Producing food and other agricultural commodities without agrochemicals clearly reduces pressure on the environment and on ecosystems, although in most cases some yield reduction does occur. More and more consumers, especially in richer countries, perceive health benefits from organically grown products and are willing to pay a price premium, provided that a certification system guarantees that the product is what it purports to be. The EU and some regional governments are prepared to stimulate organic production through targeted subsidies. The SEE countries have been quick to seize the opportunity offered by this new market and are setting up legal frameworks, certification systems, and support services. Bulgaria, Romania, Serbia, and Turkey are among the leaders in organic farming, although coverage remains much less than Hungary's 3 percent of farmland. In EECCA, Ukraine has managed to convert nearly 1 percent of its farmland to organic production, despite a lack of government support and no subsidies. Moldova and Georgia are also making progress without subsidies. However, little or nothing is happening in the other nine EECCA countries. Given the scant use of agrochemicals in the past and their low labor costs, the SEE (and some EECCA) countries have a comparative advantage in organic production and need assistance to expand it through further development of legal frameworks, certification systems, marketing support, and training and advisory services. However, markets in Western Europe will remain limited, and newer EU entrants, such as Bosnia, Croatia, and Macedo- nia, may face stiff competition and lower prices. As environmental awareness grows, all countries may find greater marketing opportunities domestically. 17 Improving Awareness of Sustainability Issues in Agriculture and Forestry 4 A n important first step in setting the foun- Until recently, information on obsolete pesti- dation for integrating environment will be cides was sketchy at best. However, ratification to improve awareness of the extent and of the Stockholm Convention on Persistent Or- impact of sustainability issues in agriculture and ganic Pollutants has led to greatly improved data forestry. This is because change is unlikely unless (see Figure 3). While the overall picture remains and until the main stakeholders--including non- quite alarming, with about 225,000 tons of toxic environment government agencies, the private materials inadequately stored in the study region, sector, and the general public--are well informed progress is being made in several countries. In about the issues and press for change. The local Albania, Croatia and Romania, disposal of stocks consultant reports on which this study is based is almost complete, while programs have started showed that, in nearly all countries, public aware- in Armenia, Georgia and Moldova. ness of the environmental impacts of agriculture Ready access to environmental information is and forestry is quite low. a pre-requisite to public awareness. Although 15 Data from environmental monitoring are of the 22 study countries have signed the Aarhus important for raising awareness. Environmental Convention19 and passed national legislation to en- monitoring systems generate data on the extent sure access to information, some major countries of the problem and provide a way of measuring (including Russia, Turkey, Serbia, and Uzbekistan) progress towards its solution. Such systems have have not. Moreover, many practical barriers still advanced considerably over the past decade, hinder information access, especially in the east. especially in terms of establishing basic param- There is bureaucratic reluctance to share informa- eters for air and water quality. Although data are tion, a tradition of not questioning authority, and still lacking in many areas related to agriculture technical barriers such as limited access to the and forestry,18 donor support is improving such internet, especially in rural areas. NGOs can play monitoring in selected areas, such as forestry a catalytic role in overcoming these barriers. and nutrient management in Georgia and dryland Awareness among government decision mak- management in Kazakhstan. There is a need for ers also needs to be improved. An important role quantitative, time-series data on such param- eters as soil erosion; nutrient levels in streams, 18As illustrated by the inability of this study to get com- aquifers, and drinking water; salinity levels in parable country statistics on many areas of concern, such soils and water; food safety inspections; forest as the indicators in Annex 3. health; illegal cutting; and forest certification. 19 The Convention on Access to Information, Public While environmental monitoring is primarily a Participation in Decision-making and Access to Justice in Environmental Matters, 1998. Its Secretariat's Com- government function, NGOs also have a role to pliance Committee has documented a number of cases play in generating and, especially, in disseminat- in EECCA countries where the public has been denied ing such data. reasonable access to environmental information. 19 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia Figure 3: Obsolete Pesticide Stocks by Country (thousand tons) stress, droughts, flooding, wildfires, pests and diseases), 100 90 and warming above 3°C will 80 have negative implications 70 even for higher lattitudes tons 60 50 (Alcamo et al. 2007). The 40 thousand transition countries should 30 therefore begin to proactively 20 10 integrate climate change risk 0 management into their de- ALB ARM AZE BEL BUL CRO GEO KAZ KOS KYR MAC MOL ROM RUS JTA TRK UKR UZB velopment plans for the agri- Source: POPs Newsletter (2007). culture and forestry sectors. Note: Total recorded stocks for these countries = 224,500 tons. Data not available for BiH, SER, or TUR. Adaptations could include actions such as altering variet- ies, improving water manage- ment, investing in irrigation, for ministers of the environment is to provide altering the time or location of activities, rural concise data on the nature and extent of priority income diversification, improving pest manage- problems, as well as their economic, environmen- ment, and increasing the effectiveness of weather tal, and social implications to cabinet colleagues-- forecasting. Thus far, there is little evidence that both in relevant line agencies such as agriculture, this important work has begun. Undertaking it on forestry, and water, and in ministries of finance and a sufficient scale will require increasing aware- economy, where resource allocation decisions are ness among the public and policy makers about made. In many cases, special efforts will be needed the potentially devastating implications of climate to inform those who allocate budgets, because of change for agriculture and forestry. The EU has their lack of familiarity with the sectors, as well recently made promising progress in this direction as regional and local government officials who with the release of the "Green Paper" on climate administer agricultural and forestry programs. adaptation (Commission of the European Com- Awareness of the need to adapt to climate munities 2007). The transition countries should change is becoming increasingly critical. Until use this example to raise awareness of their par- recently, attention has focused primarily on the ticular situations, and most importantly to begin need to reduce greenhouse gas emissions in order taking action. to reduce the effects of global warming. But most While adoption of innovations from the rest experts now agree that despite mitigation efforts to of the world is encouraged, robust agriculture date, the climate is already warming and will likely and forestry research systems are needed to adapt continue to do so, and the agriculture and forestry technologies to local conditions and test them in sectors will be among the most affected (Parry et the field. This is especially true for more intractable al. 2007). The EECCA and SEE countries will not issues such as IPM or salinity. In many regional be immune from these changes: while some of the countries, research systems have not adapted to most northerly areas may initially benefit from a new role in support of the private sector or have slightly increased agricultural and forestry produc- been weakened by transition. Funding is generally tivity as a result of initial warming (1­3°C), even scarce. Nevertheless, responses to questionnaires mild warming will reduce productivity in more in the SEE countries (Annex 2) suggest that most southerly areas due to a variety of causes (heat research systems are addressing environmental 20 Improving Awareness of Sustainability Issues in Agriculture and Forestry and sustainability issues. Although a comparable in their effectiveness and ability to advise farmers question was not asked in the EECCA countries, on sustainability concerns. For example, even Po- the picture there appears less optimistic. However, land's large extension system is providing limited in a number of countries, including Azerbaijan, value to farmers because of low pay, inadequate Georgia, and Serbia, World Bank projects have travel allowances, and a high administrative bur- introduced competitive grants and targeting of den. The situation in Turkey is similar. priority problems, with evident success. Romania Problems in advisory and extension systems has recently increased staffing and funding for are more acute in the EECCA sub-region, where agricultural research. the previous system of top-down directives to col- Arobust,widespread,andcost-effectivesystem lective farms is no longer relevant but has yet to of agricultural advisory and extension services is be replaced, in most cases, with a fully effective needed to disseminate relevant research findings-- alternative. Governments are reluctant to shoulder including Good Agricultural Practices--to farmers the full cost of a "conventional" system and also and to receive feedback from them on problems wish to address the need for advice on business of current concern (see Box 8). Experience in the planning and marketing for farm workers turned region is extremely varied. The SEE countries gen- farmer entrepreneurs. Consequently, a number of erally have a "conventional" government extension innovations are being tried, often with outside sup- service, with regionally based extension agents pro- port. For example, under a World Bank-financed viding advice on agro-technical issues on a no-cost project in Kazakhstan, a private corporation has basis. However, these services vary considerably been contracted by the government to recruit and Box 8: Modernizing Agricultural Extension It is generally recognized that an effective two-way channel of communication among farmers, researchers, and administrators is needed, if agricultural output is to grow in a sustainable fashion. A system usually called agricultural extension provides such a channel. In moving from central planning to a market economy, regional countries have followed a number of paths with varying success. There is a stark contrast between the two sub-regions; in SEE countries extension services are able to reach private farmers (Turkey is a good example), although some are quite new and many lack full effective- ness. Extension agents are often constrained by low pay, lack of mobility, and excessive paperwork. Many EECCA countries, however, provide few services to private farmers and are making do with the vestiges of the old Soviet system, directed mainly at privatized former collective farms. Moldova is a refreshing exception, and Kazakhstan and Ukraine are beginning to build new systems. In both sub-regions, there is a clear trend towards supplementing the conventional system of regionally based government extension agents with various forms of private sector support on a fee-for-service basis. This "second tier" of services is typically directed at larger commercial growers and provides business planning services, in addition to agricultural technology. In some cases, farmer associations provide a third tier of services. While this is a logical way to limit budget outlays in countries that already have a widespread conventional service, there are dangers in relying solely on the private sector in countries (such as Georgia) where the bulk of farmers are poor. There are already examples of new models of extension that collapsed after the donor project was completed. In virtually all regional countries, extension services are doing relatively little to promote sustainable agriculture, indicating a need to redirect priorities and staff training. It seems clear that integrating environment into agriculture will only become widespread when governments and donors take decisions to modernize extension systems and provide a full range of services to farmers at all levels. This implies costs to governments, but studies show that benefits will likely greatly exceed such costs. A comprehensive global meta-analysis of returns on investment in agricultural extension services found a median rate of return of 44 percent (Alston et al., 2000). A review of estimated rates of return for World Bank agricultural extension projects in EECCA countries found similar results, ranging from 16 percent to over 200 percent. 21 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia train extension agents to provide both agro-tech- growers and small subsistence farmers. The old nical and business advice. However, it remains to approach of top-down extension services fully be seen how this system will survive when project funded by governments is no longer seen as being funding is over, and whether the agents can also particularly effective or affordable, and therefore deliver messages on sustainability. In Georgia, the needs to be replaced by demand-driven systems government intends to rely on the private sector to that rely on a combination of public and private provide services on a charge-back basis, but this support. seems unlikely to work for the bulk of poor farm- The SEE countries with substantial areas of ers. In several countries, effective services have private forests are in the process of establishing been set up in certain regions with donor project forestry extension services (for example, Croatia). support, but there is no mechanism to expand them However, these should not be expected to solve towards national coverage. all the challenges faced by the new forest own- The challenge for countries and donors alike ers: small holdings; lower productivity compared is to examine the strengths and weaknesses of to state forests; and lack of knowledge of sound current extension systems in the light of present silvicultural practices. Owners are also faced with needs, including the need to advise farmers on the temptation to sell their timber for a quick profit. good agricultural practices and other sustainable Romania illustrates the need for reasonable but en- technologies, and to review and evaluate success- forceable regulations on private forests. Forestry ful innovations from other regional countries. Im- departments may need to develop other tools, such portant considerations will be cost-effectiveness; as integrated community development programs the feasibility of cost recovery from farmers; the for forest villages (e.g., in Turkey) or programs role of farmer associations; input suppliers; pro- aimed at educating the public about multiple-use cessors/wholesalers; mass media; and achieving concepts or the advantages of certification for equity between the needs of larger commercial domestic consumption, especially in the east. 22 Building Capacity for Implementation 5 T he region needs to build capacity for imple- Agriculture ministries should consider how to mentation, especially in the EECCA coun- strengthen their environmental capacity, includ- tries. Countries of the region should review ing staff training and the establishment of special and, where needed, update their policy and strategy environmental units. A few regional countries, documents on the environment, agriculture, and such as Serbia and Belarus, have already done so. forestry specifically to identify capacity constraints Alternatively, environmental review of policies, and needs. National Environmental Action Plans programs, and projects can be delegated to the (NEAPs) are often a good vehicle for doing this, ministry of the environment through strategic and as they are generally prepared by inter-ministerial project environmental assessment procedures. working groups with participation from NGOs Where the forestry agency is part of the ministry and civil society. At the very least, "capacity" has of environment, as in some EECCA countries financial, human, and institutional dimensions. but not in SEE (except Turkey), coordination is While all three dimensions (further explained less of an issue. In either case, the capacity to below) are challenging, institutional change is enforce environmental regulations currently in often the most difficult and time consuming. As place (such as those on nutrient discharge) needs the questionnaire analysis (para. 2.9 and Annex to be strengthened and focused on the biggest 2) shows, institutional weaknesses are prevalent culprits--industrial-scale agribusinesses, often across the region. with foreign backing. Consideration should be given to making Some ministries of agriculture are still com- permanent any ad hoc inter-agency environmental pleting the transition from being directly respon- working groups or consultative bodies. By their sible for organizing and directing agricultural nature, integration issues need a multi-disciplinary production, under the socialist model, to regulat- approach. For example, the safe use of chemical ing and supporting the private farm sector, for pesticides includes consideration of public health example, the ministries in Belarus, Turkmenistan, issues for a range of stakeholders (applicators, and Uzbekistan. Even where transition is rela- rural residents, consumers of farm products), tively complete, a bias towards directing ministry ecological safety (including persistence and ac- programs to maximize agricultural production cumulation in the food chain), technology for is still evident, as seems to be the case in Russia disposing of hazardous waste from obsolete prod- and Ukraine. This leads to continuation of old ucts, and international conventions. Adaptation programs that subsidize inputs and crop produc- to climate change is another issue that requires tion,20 and pressure to ensure that all agricultural inter-agency cooperation, and due to the new challenges posed by climate change risk, there 20In Uzbekistan, Turkmenistan, Moldova, Georgia, Be- is a lack of capacity in agricultural and forestry larus, Armenia, and parts of Russia. Source: World Bank agencies to manage it. consultant reports. 23 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia land is kept under production, with consequent on the appropriate role of the private sector and neglect of longer-term issues such as soil conser- the potential for cost recovery from farmers. This vation. Accession countries such as Croatia and should alleviate the strain on government budgets Serbia provide good examples of how to re-direct caused by a full-fledged extension service based agriculture ministry programs and budgets from on western models. Countries may find a two-tier direct support to production to resource conserva- approach desirable, with limited government and tion and sustainable management. However, this greater private sector involvement in services to change in focus remains only partial, as indeed it larger commercial growers and a more conven- does in most Western countries. Similar consider- tional approach of geographically based extension ations apply in the forestry sub-sector, though the agents for the large number of small subsistence transition there has been less radical, especially farmers. in EECCA. The SEE countries (and some in EECCA) are The capacity for economic analysis in minis- developing Codes of Good Agricultural Practice, tries of environment and agriculture needs to be both to educate farmers on sustainable agricultural enhanced. Making the case for investing in environ- technologies and to set standards for certain sup- mental integration often means providing rigorous port programs. Although these codes have good economic cost-benefit analyses to ministries of potential to increase the integration of environ- finance and economy, and politicians. The capacity mental concerns in agriculture, they have clear for such analysis is often lacking in ministries of limitations. Despite their name, they are typically environment and agriculture, which weakens their just voluntary guidelines rather than legally bind- position when seeking funding, as well as their ing codes. Also, they cannot anticipate the condi- ability to rank long lists of investment "priorities" tions on every farm or the knowledge and financial by order of importance. Once investments are capacity of every farmer. These considerations made, it is essential to demonstrate their impact in need a more "hands-on" approach, which exten- both environmental and economic terms, in order sion agents can provide. to justify continued support. Even the newer EU A recent study of forest institutions in transi- member states are often unable to demonstrate tion (World Bank 2005) points out the importance the impact of CAP Pillar 1 cross compliance and of a culture of service delivery in forest organiza- Pillar 2 environmental investments. tions. The same could be said for agricultural Farmers need reliable advice on sustainable agencies. Organizations should have performance production techniques. As indicated in Chapter 4, standards for services to their clients, monitoring virtually no regional country has a fully functional information, and accountability. There is no single and effective agricultural advisory and extension model for success, and numerous cultural and his- service through which to communicate knowl- torical factors must be taken into account. Finally, edge on sustainability to farmers, especially the trying to improve organizational performance smaller and poorer ones. In SEE, the challenge merely by providing tools such as strategies, train- is to modernize existing services, improve cost- ing, and equipment will likely be futile, without a effectiveness, and expand the range of advice thorough analysis of the organization and a strong provided. In EECCA, the need is to evaluate the willingness to change. pilot approaches currently being implemented, All of the above proposals imply a need for expand their geographic coverage, and turn them more staff with appropriate specialized train- into communication channels that support the ing. For example, in Turkey, of the 4,500 staff of integration of sustainability issues in production the General Directorate for National Parks and and processing. Such an evaluation should focus Protected Areas, who are mostly qualified forest 24 Building Capacity for Implementation engineers, fewer than 2 percent have any train- this affects performance in the agricultural and ing in ecology. Many other agencies in the region forestry sectors, and especially in the latter. The face similar situations. Building specialized skills persistence of illegal logging is largely due to the takes time and, in many transition countries, the connivance of corrupt officials,21 although coun- process is undermined by moribund agriculture tries are now beginning to address corruption (see and forestry education systems in desperate need Box 4) through processes such as Forest Law En- of restructuring and reform. This has clear budget- forcement and Governance (FLEG). A major role ary implications, although in some cases new pro- of government in a market economy is to ensure grams could be financed by curtailing old programs impartial enforcement of the laws. that are no longer needed, and by improving the cost-effectiveness of services. 21According to allegations by a number of independent Regional countries, especially in EECCA, do observers and recently confirmed by the head of the not score well on published indices of good gover- Russian Federal Forest Agency, Roshchupkin, Valery P., nance. For example, on average, the SEE countries 2007, "Results of Inspection in Chita Oblast, Measures to Prevent Illegal Logging and Trade of Illegal Timber," received a score of 3.19 out of 10 on Transparency presentation by the Head of Russian Federal Forest International's Corruption Perception Index, while Agency to the Illegal Logging and Associated Trade EECCA countries scored only 2.50. Unfortunately, Meeting, Chita, 19 May, 2007. 25 Increasing Incentives for Implementation 6 I ncentives for implementation need to be research shows that subsidies on recurrent inputs increased, especially in non-accession coun- do little or nothing to enhance long-term produc- tries. Governments should use their policy tivity, and can even have a negative impact on instruments and public expenditures to discourage economic growth (Allcott, Lederman, and Lopez unsustainable behavior and provide incentives 2006; Fan and Rao 2003). Instead, regional govern- for the dissemination of good agricultural and ments should use public resources to encourage forestry practices, and to encourage the provi- investments in public goods, including those that sion of environmental services. The international generate positive environmental consequences, community, particularly the West, can also play an such as under the EU's CAP Pillar-II approach important role through the powerful tool of trade (see Box 5). For example, EU support has helped incentives. Croatia to refine subsidy policies, harmonize vet- The first priority should be to eliminate per- erinary standards, improve integration with other verse incentives, such as taxes and subsidies that sectors, enhance monitoring, and implement the encourage unsustainable practices. For example, Nitrates Directive. the "state order" systems in Uzbekistan and Turk- Governments should apply the "polluter pays" menistan tell farmers what crop to grow, subsidize and "user pays" principles in agriculture and for- inputs and credit, and require a fixed portion of estry, to which they have generally given rhetorical production to be sold to the state at below world support.22 Indeed, most regional countries impose market prices. Although these systems have been pollution fees and fines on major pollution sources loosened since independence, they still drain a such as animal feedlots. However, enforcement is huge amount of resources from the rural sector, often variable (and subject to corruption), and fees severely constraining farmers' capacity to invest are set so low that they do not provide any incen- even in irrigation infrastructure maintenance, let tive for the producer to change his behavior, nor alone in efforts to improve water use efficiency. enough revenue for the state to finance remedial Many regional countries (see Footnote 21) still investments. As for user charges, irrigation water maintain subsidies on recurrent chemical inputs use is a good example. Raising charges to a level such as fertilizers and pesticides, causing negative that would provide an incentive for conservation impacts on both the environment and the state by users could contribute greatly to national water budget. It should be noted, however, that fertilizer management goals, provided farmers could afford use, in particular, is still generally quite low, and in to pay such charges. This points to the limitations some cases amounts to soil mining. The present low levels of nutrient application and runoff pro- 22The principles that polluters of the environment vide a valuable window of opportunity to expand should compensate society for the damage they cause the use of good agricultural practices designed to and that users of natural resources should pay for the minimize nutrient runoff. Extensive international use of those resources. 27 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia of an approach that relies solely on economic considerations into the production of export com- instruments in situations where farmers are poor, modities. Import requirements by western coun- lacking in knowledge, and without functioning tries typically include provisions that the traded infrastructure. goods meet food safety standards and, increas- Although incentives there are stronger, EU- ingly, that they be produced in a sustainable man- accession countries still need capacity develop- ner. In addition, public concern about food safety ment to respond properly to them. EU-accession and consumer demands for "green" and organic countries have a clear path to follow and sig- products are growing with awareness in the West, nificant amounts of funding they can access. and producers in transition countries must meet Nevertheless, considerable domestic funding is these requirements if they wish to export to lucra- also required, there are complicated procedures tive western markets. For example, EurepGAP is a to be followed, and the countries' capacities for private sector entity, initiated by EU retailers, with managing and utilizing the funds effectively may a secretariat in Cologne, that sets voluntary stan- be limited at first. One should therefore not expect dards for the certification of agricultural products rapid change. However, more can and should be around the globe. Certification is by independent done to develop the capacity of accession coun- third parties. The reward of growers who manage tries to tap EU resources and use them effectively to satisfy such standards is access to larger, higher- to comply with environmental requirements. The value markets and premium prices. international community can play an important The SEE and EECCA countries should be well role in this, as illustrated by a new World Bank- placed to meet the demands of western importers, financed project designed to assist Romania in given their lower labor costs and scant use of agro- meeting its obligations under the EU Nitrates chemicals in the past. Indeed, most SEE countries Directive.23 are now marketing organic produce in the EU. The challenge in non-accession countries is But many others, particularly in EECCA, need to even greater, as domestic incentives and external improve their agricultural product standards and funding will remain much more limited. There is certification systems, and help producers and a clear role for IFIs and other donors as agents of processors enhance their capacity to meet the change, especially in EECCA. However, donors requirements. should begin any program of assistance to integra- Certification that forest products are sustain- tion in agriculture and forestry with a broad view ably produced is rapidly gaining ground in the that encompasses line agencies and ministries of region (Cashore et al. 2006). By 2005, over 3 million finance and economics as well as ministries of hectares of forest had been certified as sustainably the environment, plus a strategic approach that managed in SEE, and nearly 22 million hectares in is consistent with the countries' own integration EECCA (though this only amounts to 11 percent strategies. For example, in mountainous regions, and 3 percent of the total forest area in each sub- an integrated watershed management approach region). Presently, nearly all of Croatia's timber is might be desirable, both to protect the environ- certified, and the Russian Federation, the region's ment and improve rural livelihoods. The best biggest timber exporter, has made a promising examples of such projects (e.g., in Turkey) give equal emphasis to economic, social, and envi- 23 ronmental goals and work with a large variety of The Integrated Nutrient Pollution Control Project, which aims to reduce nutrient discharges into water bod- stakeholders. ies by promoting behavior change through strengthened International trade opportunities can be a institutional and regulatory capacity, and demonstrated powerful driver for integrating environmental community-based actions. 28 Increasing Incentives for Implementation Figure 4: Extent of Forest Certification by Country (million ha; %) nately, rather than using this potentially powerful tool, 20 100 18 EECCA countries have be- 90 16 80 come increasingly dependent 14 70 on exports to other regional ha) (%) 12 60 area countries, where environ- 10 50 mental standards are much (thousand total 8 40 of lower, and as a result, their Area 6 30 Share share of exports to the EU has 4 20 decreased significantly since 2 10 1993 (Broadman 2005). More 0 0 BEL B&H BUL CRO ROM RUS UKR could also be done to increase the demand for certified forest Area of forests certified Share of forest area certified products by raising awareness Source: FSC (2007). among consumers in the U.S., Note: The remaining EECCA and SEE countries and territories (Albania, Armenia, Azerbaijan, Georgia, Kazakhstan, Kosovo, Kyrgyz Re- public, Macedonia, Moldova, Montenegro, Serbia, Tajikistan, Turkey, Turkmenistan and Uzbekistan) do not have certified forest areas. where sales of certified prod- ucts as a share of the total are much lower than in the EU. Incentives should also be increased to encourage start in three production areas, though none of the provision of environmental services from ag- these are in the east, where it is needed most (see riculture and forestry. For example, sustainable Figure 4). There remains great scope for increasing watershed and forest management can generate forest certification and strengthening standards, environmental services like improved water qual- especially in chain of custody documentation. ity, stable water flows and reduced flooding, car- Poland was one of the first European countries to bon sequestration, and biodiversity conservation. seek certification, which now covers 80 percent But more often than not, these services are not of its forest area. Romania provides a valuable remunerated, which results in sub-optimal levels tax incentive for certified producers. However, of provision from the perspective of society. The a concern is that many major timber importers, market failure can be addressed by setting up sys- especially in Asia, do not require certification. For tems of payment for environmental services. This more information, see Annex 1. is already happening in other regions, such as in Western countries could do much to encour- Latin America, where there are examples of users age sustainable production in the region by open- of clean water (municipalities, food processors) ing their markets to more agricultural imports paying upstream farmers to maintain the vegeta- from transition countries, combined with rigorous tive cover on the land in order to reduce erosion requirements for safe and environmentally sound and maintain water quality. The EU has made production. Much has been made of the tremen- important steps in this direction by introducing dous positive impact that reducing agricultural support to landowners under CAP Pillar II (Axis supports and protection to farmers in the West 2) for promoting the sustainable management of could do for growth and poverty reduction in agricultural and forestry land, and compensating transition and developing countries. Much less them for the production of environmental public has been said of the potential for increased trade goods, such as bird habitat. But efforts in this direc- to encourage environmental integration. Unfortu- tion need to be expanded, and similar measures 29 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia Box 9: Abandoned Farmland: Threat or Opportunity? Land abandonment, which occurs when farmers cease to use land for agricultural purposes, is inevitable in the transition to a market economy. The causes of abandonment are largely economic, as farmland is abandoned when it no longer yields a positive economic return, or when the farming system is no longer viable when faced with new forms of competition. In the SEE region, the decline in viability accelerated with the collapse of state- owned and collective farms in the early 1990s. Additional causes included civil wars (Bosnia and Herzegovina, Serbia, Croatia, and Kosovo), uncertain land ownership, and demographic change. In the nine SEE countries for which data are available (Annex 4), abandoned land, typically the steeper, rocky, infertile soils and the areas farthest from market, represents approximately 8 percent of total farmland. The lack of active management often results in the growth of tall grasses, scrub, and, eventually, forest, which generally has positive environmental consequences. However, extensively farmed land that has been used for grazing tends to be rich in both flora and fauna, so abandonment of these lands may result in a loss of biodiversity. While land abandonment can accelerate the economic and social decline of communities, it may also create new opportunities for tourism, recreation, and forestry. Afforestation of such land also offers opportunities for carbon sequestration (which can result in payments; see Box 2) within the frame- work of the United Nations Framework Convention on Climate Change. However, few regional countries are developing plans and programs along these lines. adopted in non-EU countries. With regard to car- nized that carbon sequestration services provided bon sequestration, a number of EECCA countries by transition countries are a global public good in particular have potential to benefit from carbon that will be furnished in less-than-optimal quanti- payments through the Clean Development Mecha- ties unless rich countries transfer more resources nism (CDM) of the Kyoto Protocol, and some al- to compensate for them. ready have (see Box 2). Nevertheless, the CDM is Abandoned farmland, especially in SEE, pres- very restrictive and covers only afforestation and ents both an environmental challenge and an op- reforestation, while offering no incentives for the portunity to capture national and global benefits. preservation of existing forests. In addition, there As Annex 4 and Box 9 indicate, the amount of land is currently no mechanism for encouraging the that has gone out of production for economic and sequestration of carbon in soils (such as through war-related reasons is a substantial 8 percent of conservation tillage), which is an important con- all farmland in SEE (excluding Turkey). While tribution of agriculture. Efforts should be made farming could be restored on a portion of this to correct these flaws during negotiations for the land, countries should also examine the potential period after 2012. In addition, it should be recog- for afforestation for carbon credits. 30 Building on Success 7 P rogress on integration can be accelerated Minimum tillage is a proven technique that by scaling up successful pilot initiatives and minimizes soil erosion, but requires specialized disseminating good practices. The study farm equipment and adaptive research to meet has found several areas where sustainable prac- local conditions. Pilot results in Kazakhstan look tices have been successfully introduced on a small promising, but less so in Georgia. However, gov- scale through a pilot project (often with GEF sup- ernments should be prepared to continue experi- port) and where the next step is to scale up such mentation in this important area. initiatives. For example, promising results have A major challenge when scaling up is to main- been obtained in manure/nutrient management tain momentum after donor funding ceases. In the in the Baltic and Danube-Black Sea areas (with area of nutrient management, Poland provides a support from GEF, Sweden, and others) specifi- good example of a successful World Bank-financed cally in Russia, Turkey, Romania, Bulgaria, Serbia, operation for manure management that was fol- Moldova, and Georgia. Following the examples of lowed by a national program established with EU Poland and Romania, these countries could turn support. Romania is planning to follow a similar pilot projects into national programs and begin course. Successful scaling up involves several to make serious inroads into the problem of eu- elements: trophication, with its damaging impact on water quality. In Kazakhstan, the virgin lands program of · pilot project results well documented in envi- the 1950s introduced grain cultivation into semi- ronmental, economic, and social terms; arid land, previously used for grazing, with serious · building government ownership of the innova- environmental consequences. A World Bank/GEF tion; project is succeeding in reversing that process, · dissemination of technical information and and the Kazakh government has expressed inter- results; est in scaling up the project to the national level · institution building to support a larger pro- (see Box 1). gram; Integrated pest management is another case in · streamlining of project models to improve point. While IPM is generally regarded as a much cost-effectiveness; and more sustainable alternative to the blanket use of · step-by-step rather than wholesale expan- chemical pesticides, most regional countries have sion. applied it only on specialized crops (such as fruit or greenhouse production) or organic produce. Regional knowledge sharing should be in- It is now time to apply that experience to other creased. As the region presents a wide diversity crops and on broader expanses, perhaps following of conditions and experiences, but also a degree Uzbekistan's success in using IPM on 90 percent of commonality through culture and history, much of its cotton production. can be gained when regional countries learn from 31 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia Box 10: Money from Manure in Georgia Biodigestors installed in western Georgia have proven a recent success, with considerable potential for scaling up. Between 2001 and 2007, under the Agricultural Research, Extension, and Training (ARET) Project, the World Bank financed the installation and maintenance of 272 biodigestors in 56 vil- lages. Other donors funded 80 units, and the Adjaria Region government has also contributed. A biodigestor is a simple device for the collection, storage, and processing of manure that the farmer can easily install and use for producing biogas (methane) for cooking and biomass to improve soil structure and replace mineral fertilizers. Methane is a potent greenhouse gas that would otherwise escape into the atmosphere. The biodigestor can be sized to fit very small livestock operations of 3 to 10 cows. Careful monitoring of the ARET project is revealing significant benefits, including the annual production of 180­200,000 m3 of methane, which replaced about 2,000 m3 of fuelwood, often the result of unregulated cutting and deforestation.24 Though significant, reductions in carbon emissions have not yet been quantified. Finally, between 2002 and 2007, annual savings of about 200 lari (82 Euros) per farmer were recorded on purchases of mineral fertilizers that have now been replaced by organic fertilizer produced on farm from manure and other waste; the cost of firewood and liquid gas consumption was reduced by 600 lari (247 Euros) over the same period of time. each other.25 Regional organizations, such as the · soil erosion; EU, UNECE, and OECD, could take the lead in · nutrient management; strengthening the means to disseminate such · pest management, including IPM and the dis- knowledge. New EU member countries might have posal of outdated pesticide stocks; a special role to play in information sharing. While · salinity control; learning will often be from "west" to "east", there · food safety; are important exceptions. For example, Uzbeki- · organic farming; stan and Turkmenistan make the most widespread · illegal logging; and use of IPM, Kazakhstan is pioneering rangeland · sustainable forest management, including management, and Georgia is showing success with community participation. biodigestors (see Box 10) and food safety. Coun- tries and donors might consider holding regular forums for exchanging experiences, particularly 24 at the sub-regional level. A useful model might be On average, a typical 6 m3 biodigestor can produce 700­800 m3, or 14­20 tons, of biomass per farm annu- the Mediterranean Environmental Technical As- ally; the consumption of fuelwood was halved, from 15 sistance Program (METAP), which has specialized to 7 m3 per year. in knowledge transfer through numerous regional 25 A series of sub-regional workshops is planned for the workshops. Subjects of interest might include: dissemination of this report. 32 Meeting the Challenges Ahead 8 C ountries of the region have shown their on an equal footing for public or private sector commitment to integrating environmen- funds with more conventional investments aimed tal concerns into agriculture and forestry at increasing productivity. through their policy statements and action plans, The EECCA sub-region has further to go in in- including the EECCA Environment Strategy tegrating environment into agriculture and forestry adopted in Kiev. Many, however, are finding it dif- but, at present, has less access to external support, ficult to turn those commitments into action on especially from the EU. This was recognized at the ground. This report has made a number of sug- the Kiev meeting where the EECCA Strategy was gestions for addressing constraints and providing adopted. To implement that strategy, EECCA will momentum to such implementation. These have need to do more with less and focus on clear priori- been summarized into ten overarching recom- ties. However, donors and IFIs should be prepared mendations in Table 1 for consideration by the to expand support to those countries willing to governments of the region, involving all relevant commit to an environment integration agenda. ministries, as well as NGOs, regional organizations, Granting market access for environmentally cer- and the IFI and donor community. tified food and forest products would be another Moving to implementation will require, first, valuable means of support. a review of existing policy documents and action The EU is already the main driver on main- plans, as well as careful setting of priorities in a streaming progress in the SEE sub-region, and multi-stakeholder context. Priority actions can its grant assistance could play a catalytic role in then be delineated in terms of their costs, expected EECCA, especially in foundation issues such as benefits, institutional responsibilities, skilled governance, awareness, capacity building, and staffing needs, and other factors. Early actions incentives. will likely be "win-win," that is, they will produce The World Bank and other IFIs and donors economic and social benefits that outweigh their should build on the foundation with well-targeted costs. projects, in all regional countries, scaling up suc- Economic evaluation needs to play a greater cessful pilots where available. Particular consid- role in integration-related decision making. Most eration should be given to soil conservation; pest of the mainstreaming issues identified in this management; reforestation and carbon sequestra- study involve damage that can be evaluated in tion; rangeland and watershed management; re- economic terms, but such calculations may not search and extension; food safety; and continuing always be easy. Difficulties in obtaining reli- the extensive ongoing work in water and salinity able data may indicate the need to strengthen management. New investments should be based monitoring systems. However, once the results of primarily on evaluation of past activities. cost-benefit analyses of environmental programs Governments should re-examine their policy and investments are available, they will compete instruments, including taxes, subsidies, and sup- 33 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia port services (research, extension, food safety, Regional mechanisms for the exchange of etc.) to ensure that their support to integration experience between countries should be strength- is consistent and cost-effective. The first priority ened. For most of the issues studied, one or more should be to remove perverse incentives, such regional countries has already shown some suc- as subsidies for agro-chemicals. These public cess, but mechanisms for knowledge transfer are resources should be shifted to public support weakly developed. New EU member states have services necessary to facilitate integration. In much to share with countries following in their nearly all regional countries, support services, footsteps. Regional organizations should make this particularly agricultural extension, need to be process a priority. modernized and expanded to better meet the needs More opportunities should be pursued to of private farmers. make use of the full potential of forestry and Certification systems for food and forest prod- agriculture for carbon sequestration by scaling ucts, as important drivers of sustainable manage- up successful pilots, and using the negotiations ment, should be encouraged and supported by for a Kyoto follow-up agreement to push for governments, NGOs, and donors, as should the use the inclusion of forest preservation and carbon of the powerful incentive of market access. For- sequestration in soils as ways for transition estry certification should include chain of custody countries to benefit from carbon finance. More documentation. Certification, along with strong law use should also be made of emerging innovative enforcement, community management, and provi- instruments that provide compensation for verifi- sion of alternative income and energy sources, are able hydrological and biodiversity conservation important tools in the struggle against the illegal benefits from improved resource management. logging that is rife in many regional countries. Meanwhile, it is critical for EECCA and SEE Pilot projects in mainstreaming should be countries to build awareness and capacity for the evaluated and their results disseminated; where proactive integration of climate change adapta- warranted, their success should be scaled up to tion into agricultural and forestry sector policies, achieve national impact. Successful scaling-up programs and investments. involves several elements: well-documented pilot The potential of abandoned farmland for project results, in environmental, economic, and reforestation and carbon sequestration should be social terms; building government ownership of evaluated, and action programs developed. Such the innovation; dissemination of technical informa- abandonment is an inevitable consequence of de- tion and results; institution building to support a velopment but should be viewed not as a problem, larger program; streamlining of project models to but as an opportunity, with potential environmen- improve cost-effectiveness; and step-by-step rather tal, economic, and social benefits. than wholesale expansion. 34 Annex Key Economic, Agricultural, and Forestry Statistics 1 35 36 Annex Table 1.1: Agriculture and forest indicators of EECCA and SEE countries and territories, various years Integrating EECCA countries INDICATORS Unit ARM AZE BEL GEO KAZ KYR MOL RUS TAJ TRK UKR UZB Land area (c),(2) 1,000 ha 2,820 8,266 20,748 6,949 269,970 19,180 3,287 1,638,139 13,996 46,993 57,938 42,540 Environment Population (c),(7) 1,000 3,016 8,388 9,776 4,474 15,146 5,144 4,206 143,114 6,507 4,766 47,075 26,167 GDP per capita (c),(7) current US$ 1,625 1,498 3,024 1,429 3,772 475 694 5,336 355 1,414*** 1,761 533 Agriculture Agriculture share in GDP (c),(7) % of GDP 19 9 8 15 6 31 14 5 21 19*** 10 25 into Agriculture share in % of total emp .. 39 .. 54 .. .. 41 10 .. .. 19 .. total employment (c),(7) Agriculture Agricultural area (c),(2) 1,000 ha 1,390 4,759 8,860 3,006 207,598 10,745 2,518 215,680 4,255 32,966 41,304 27,259 Main land uses (as percentage of agricultural area) (c),(2) Arable land % 35.6 38.73 61.57 26.68 10.77 11.95 73.39 56.46 21.86 6.67 78.57 17.24 and Permanent crops % 4.3 4.65 1.31 8.78 0.07 0.67 11.83 0.83 2.98 0.20 2.18 1.25 Permanent pasture % 60.1 56.61 37.12 64.54 89.16 87.38 14.77 42.70 75.16 93.13 19.25 81.51 Forestry: Foreign trade in agriculture (b),(3) Agricultural exports million US$ 79 189 1,076 184 693 113 592 2,197 204 86 3,415 835 Agricultural imports million US$ 272 419 1,450 403 934 102 283 12,363 111 99 1,691 166 Progress Forestry Forest share in GDP (a),(6) % 0.1 n.s. 2.3 0.2 0.1 0.1 0.6 0.8 n.s. n.s. 1.2 n.s. and Forest share in total % of total 0.2 0.1 2.6 0.2 0.2 0.3 0.2 1.2 0.1 0.4 0.5 0.0 labor force (a),(6) labor force Prospects Total forest area (a),(1) 1,000 ha 305 936 7,849 2,760 3,365 858 326 809,269 410 4,127 9,510 3,212 Share of private % of total 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 forest (a),(1) forest area in Designated functions of forest (as percentage of total forest area)(a),(1) Eastern Production 1,000 ha 0 0 4,012 0 0 0 211 623,120 22 0 4,558 6 Protection of soil and water 1,000 ha 189 864 2,246 2,163 0 680 22 70,386 44 4,023 2,894 2,995 Conservation of biodiversity 1,000 ha 52 72 395 227 33 52 44 16,190 344 104 249 211 Europe Social services 1,000 ha 64 .. 1,196 370 218 14 .. 11,827 0 .. 1,809 .. Multiple purpose 1,000 ha 0 0 0 0 3,114 112 .. 87,746 0 0 0 .. and No (or unknown) function 1,000 ha 0 0 0 0 0 0 49 .. 0 0 0 .. Central Production of selected forest products (c),(4) Industrial Roundwood 1,000 m3 4 7 6,446 162 130 9 27 139,500 0 0 6,461 8 Pulpwood, Round & Split 1,000 m3 0 4 1,612 0 13 0 0 49,700 0 0 953 0 Asia Roundwood 1,000 m3 41 14 7,543 616 301 27 57 186,500 0 3 14,606 27 Sawlogs and Veneer Logs 1,000 m3 4 4 2,304 81 104 5 3 74,200 0 0 4,632 8 (continued on next page) Annex Table 1.1: Agriculture and forest indicators of EECCA and SEE countries and territories, various years (continued) EECCA countries INDICATORS Unit ARM AZE BEL GEO KAZ KYR MOL RUS TAJ TRK UKR UZB Sawnwood 1,000 m3 2 0 2,304 69 265 22 5 22,500 .. .. 2,184 .. Wood Fuel 1,000 m3 37 6 1,097 454 171 18 30 47,000 0 3 8,146 18 Wood-Based Panels 1,000 m3 1 0 856 10 10 .. 10 8,103 .. .. 1,502 .. Paper and Paperboard 1,000 tons 2 148 279 .. 58 2 0 7,024 .. .. 760 11 Wood Pulp 1,000 tons .. 0 61 .. 0 .. 0 7,011 .. .. 27 .. Wood Charcoal 1,000 tons .. 0 1 .. 0 .. 0 60 .. .. 22 .. Foreign trade of forest products (c),(8) ,* Exports million US$ 0.9 1.8 258.4 18.0 5.4 0.8 3.7 7,633.3 0.1 0.5 684.8 2.7 Imports million US$ 18.2 48.4 211.3 5.1 239.1 20.5 29.3 1,404.9 4.0 3.9 731.2 53.9 Total certified forest area(d),(5),** 1,000 ha 0.0 0.0 2,501.5 0.0 0.0 0.0 0.0 17,808.2 0.0 0.0 1,353.1 0.0 SEE countries and territories Indicators Unit ALB BiH BUL CRO KOS MAC ROM SER9 TUR Annex Land area (c),(2) 1,000 ha 2,740.0 5,120.0 10,864.0 5,592.0 2,543.0 22,998.0 10,200.0 76,963.0 Population (c),(7) 1,000 3,129.7 3,907.1 7,740.0 4,443.4 2,034.1 21,634.4 8,064.3 72,065.0 1: GDP per capita (c),(7) current US$ 2,677.7 2,546.3 3,442.9 8,665.9 2,834.8 4,556.0 3,250.8 5,030.2 Key Agriculture Economic, Share of GDP (c),(7) % of GDP 19.6 8.2 8.0 5.8 10.9 8.9 12.9 9.7 Share of total employment (c),(7) % of total emp. 58.4 .. 8.9 17.3 19.5 32.1 .. 29.5 Area (c),(2) 1,000 ha 1,123.0 2,147.0 5,265.0 2,695.0 1,242.0 14,513.0 5,590.0 41,223.0 Agricultural, Principal land uses (as percentage of agricultural area) Arable land % 51.5 46.6 60.3 41.2 45.6 64.0 62.7 57.8 Permanent crops % 10.9 4.5 3.8 4.3 3.7 3.7 5.7 6.7 Permanent pasture % 37.7 48.9 35.9 54.5 50.7 32.3 31.6 35.5 and Foreign trade in agriculture Forestry Exports millions US$ 24.9 113.5 1,065.6 659.0 260.0 765.3 687.6 5,957.9 Imports millions US$ 288.6 992.8 848.5 1,402.6 403.9 2,144.9 867.9 4,659.5 Forestry Statistics Share of GDP (a),(6) % 0.4 2.2 0.7 1.6 0.8 2.0 3.1 0.8 Share of total labor % of total 0.2 0.6 1.2 1.3 .. 0.8 1.3 0.7 1.0 37 (continued on next page) 38 Annex Table 1.1: Agriculture and forest indicators of EECCA and SEE countries and territories, various years (continued) Integrating SEE countries and territories Indicators Unit ALB BiH BUL CRO KOS MAC ROM SER9 TUR force(a),(6) labor force Environment Total forest area(a),(1) 1,000 ha 769.0 2,185.0 3,375.0 2,129.0 906.0 6,366.0 2,649.0 10,052.0 Share of private forest(a),(1) % of total 0.9 21.4 8.4 21.3 22.0 5.7 46.0 0.1 forest area Designated forest functions (as percentage of total forest area) into Production 1,000 ha 619 1,226 2,258 2,025 745 3,043 .. 8,018 Protection of soil and water 1,000 ha 97 .. 433 52 .. 2,652 .. 1,310 Agriculture Conservation of biodiversity 1,000 ha 52 20 46 6 .. 307 .. 708 Social services 1,000 ha .. .. 223 6 .. 364 .. 16 Multiple purpose 1,000 ha .. .. 415 40 .. 0 .. 0 No (or unknown) function 1,000 ha .. 939 0 0 161 0 .. 0 and Production of selected forest products (c),(4) Forestry: Industrial roundwood 1,000 m3 75 2,444 3,184 3,110 158 11,542 1,316 11,202 Pulpwood, round & split 1,000 m3 0 155 1,723 610 0 1,878 168 4,403 Roundwood 1,000 m3 296 3,806 5,862 4,018 822 14,501 3,170 16,185 Sawlogs and veneer logs 1,000 m3 62 2,030 1,367 2,234 144 7,847 1,096 5,107 Progress Sawnwood 1,000 m3 97 1,319 569 624 18 4,321 497 6,445 Fuelwood 1,000 m3 221 1,362 2,678 908 664 2,959 1,854 4,983 and Wood-based panels 1,000 m3 37 28 347 128 0 1,011 70 4,771 Paper and paperboard 1,000 tons 3 81 326 592 20 371 229 1,153 Prospects Wood pulp 1,000 tons 0 20 135 98 0 161 24 225 Wood charcoal 1,000 tons 55 6 24 0 .. 26 3 0 Foreign trade of forest products (c),(8), * in Eastern Exports million US$ 7.4 210.3 267.7 348.0 4.7 857.3 136.7 256.3 Imports million US$ 24.8 126.9 294.0 360.9 55.8 636.9 582.0 1,583.2 Total certified 1,000 ha 0.0 62.2 21.6 1,988.5 0.0 0.0 1,092.8 0.0 0.0 Europe forest area (d),(4),** and Reference years of data: (a) 2000; (b) 2004; (c) 2005; (d) 2007. Sources: Central (1)FAO (2005). (2) FAO (2006a). (3)FAO (2006b). (4)FAO (2006c). (5)FSC (2007). (6,7)World Bank (2006c). (8) WRI (2007). (9) Includes Montenegro * Forest products exports or imports show the value, in thousands of US dollars, of all forest products transferred out of or into a particular country or region to be sold. Forest products include industrial roundwood (including sawlogs and veneer logs, pulp- Asia wood and particles, chips and particles, wood residues, and other industrial roundwood), fuelwood and charcoal, sawnwood, wood-based panels (including veneer sheets, plywood, particle board, and fibreboard), wood pulp (including mechanical, chemical, semi-chemical, dissolving, and recovered paper), and paper and paperboard (including newsprint, printing and writing paper, and other paper and paperboard). Both non-coniferous and coniferous species are included. ** Total certified area refers to: FSC-Certified forest area, which measures the total land area of a particular forest type that is certified as managed in accordance with the ten Forest Stewardship Council (FSC) criteria. Certification is awarded by FSC-accredited groups around the world in order to assure purchasers that forests are managed within each country's legal framework, in an ecologically and socially sustainable manner. *** The "GDP per capita" and "agriculture share in GDP" data of Turkmenistan are for year 2004. Annex Analysis of Questionnaires 2 P erformance indicators are useful tools ficials, academics, or NGOs. The responses, for measuring the extent of the countries' however, also represent the consultant's best efforts to integrate environmental consid- professional judgment of the situation. erations into the agricultural and forestry sectors. These indicators should encompass the multi- It should be noted that data from these dimensional nature of progress/performance, questionnaires should be used with caution, es- including not only the existence of specific envi- pecially where they appear to contradict findings ronmental programs in the two sectors, but also in the main text. The OECD data were obtained their effectiveness and the strength of institutional from official sources that might have had a bias mechanisms that are key for supporting their sus- towards reporting positive developments. Yes/ tainable implementation. no answers do not convey the extent of progress To obtain comparable information from re- or the nuances of each situation. For some data gional countries on key mainstreaming variables, or responses, attempts have been made to obtain data were drawn from three sources: clarification or supporting information. However, it would be difficult to ensure total comparability · OECD EECCA26 Questionnaire. This question- across countries because responses represent the naire was developed by OECD before the pres- subjective views of many informants. ent World Bank study on mainstreaming began. The tables in Annex 2 are meant to present a Its emphasis is mainly on institutional aspects snapshot of mainstreaming efforts across different and implementation of environment-related countries in the region, and to identify strengths programs in different economic sectors. Re- and weaknesses, geographical variation, and areas sponses were received from official contacts for action. In general, the questionnaires covered in each country's ministry of the environment such aspects as institutional mechanisms, re- (or equivalent agency). search, extension, and the measures or programs · For EECCA states, Supplementary Ques- that support environmental management in the tionnaires. These were given to the local agricultural and forestry sectors. The responses consultants of the mainstreaming study to indicate the status of the aforementioned variables provide more detail on some key questions in as of 2006, and pertain to one of the following: Yes the EECCA Questionnaire. · Questionnaire for Southeast European countries (SEE). Local consultants working 26 EECCA = Eastern Europe, Caucasus and Central with the mainstreaming study were asked to Asia, also known as the Commonwealth of Independent States (CIS), whose members are: Armenia, Azerbaijan, complete the questionnaire as fully and ac- Belarus, Georgia, Kazakhstan, Kyrgyz Republic, Moldova, curately as possible, using published sources Russian Federation, Tajikistan, Turkmenistan, Ukraine, and/or interviews with knowledgeable of- and Uzbekistan. 39 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia (dark shade); Partial Yes (light shade); and No (no good inter-ministerial cooperation in most color). A "partial yes" corresponds to those vari- countries; research programs on nutrient man- ables that, although existent, have limited scope agement; pesticide regulation; environmental and no public participation, are weakly enforced, impact assessment of farm operations and and/or were recently implemented. Thus it is too investments; and, in about half the countries, early to assess their effectiveness. programs to improve water use efficiency and Annex Tables 2.1 and 2.2 show whether or not address soil management. environmental mainstreaming has taken place in · In forestry, most countries in the region have the agricultural and forestry sectors, respectively, good inter-ministerial coordination on envi- of EECCA countries. Data were obtained from the ronmental issues, and staff have undergone OECD EECCA Questionnaire. Annex Table 2.3, on relevant training. Effective regulations and the other hand, shows the mainstreaming efforts of enforcement systems to ensure sustainable both sectors in SEE countries. Questions common harvesting are in place in about 60 percent of to both the OECD and SEE questionnaires were countries. Mainstreaming efforts in this sector amalgamated into a table for the whole region, are more prevalent than in the agricultural Annex Table 2.4. sector. Based on the four tables, the following areas of good progress can be identified.27 There also remain weaknesses concerning certification, policies, and nutrient management, · In most EECCA countries, the latest agri- for example: cultural and forest strategies incorporate environmental targets, and the latter have · In EECCA countries, implementation of the been subjected to environmental assessment. following is very limited: (i) strategies to Only half the countries reported having farm promote organic farming or a formal system advisory services on environmental manage- of organic certification; (ii) a system of vol- ment. untary certification of forest stands; and (iii) · All EECCA countries have ongoing reforesta- outsourcing or delegation to the private sector tion or afforestation programs. of pest and fire management in forests. · Most SEE countries have agricultural and forestry research systems that address envi- In the region as a whole, a majority of coun- ronmental and sustainability issues. However, tries lack the following: (i) collaboration between agricultural and forestry extension services the ministry of agriculture and ministry of the were judged effective in only two out of nine environment in preparing strategic reports in the countries. past three years; (ii) environmental assessment of · Just three SEE countries offer extension ad- policies, and price support and subsidy schemes vice on manure management, and only four for agricultural products; (iii) regulations on man- countries offer advice on the timing of fertil- aging and handling organic manure; and (iv) pro- izer application to reduce runoff. None has a grams to capture methane gas emissions. The main program to capture methane. differences between EECCA and SEE countries · Integrated pest management was reported to include the lack of a specialized environmental be widely used in two SEE countries, but this appears to be an overstatement. 27 · To have a realistic view of progress, "Partial Yes" Common areas of good practice in the agri- responses in the tables were not counted as a "Yes" cultural sector in the two sub-regions include: response in this analysis. 40 Annex 2: Analysis of Questionnaires unit in the ministry of agriculture, prevalent in tors of most countries; however, inter-ministerial SEE, and voluntary certification of forest stands, cooperation and collaboration on environmental which is practiced more widely in SEE. Results in issues need to be strengthened and supported, Table 2.4 also demonstrate that, although countries especially in countries where such mechanisms with higher per capita income (such as Russia and are still lacking. Past experience shows that strong Romania) appear to be faring well with respect to institutions are key for the sustainability of devel- mainstreaming, a closer look at the data shows that opment projects/programs. Certification schemes income and mainstreaming progress are negatively for organic and forest products should also be correlated. This may reflect the fact that relatively promoted and supported more widely in view of more donor support is given to lower-income potential access to international markets. Methane countries, where project components may include offset programs likewise need to be encouraged aspects of mainstreaming. and supported. They will facilitate the compliance of Kyoto Protocol signatory countries (of the 13 Priority Areas for Action SEE and EECCA countries that signed the Pro- Institutional mechanisms for integration are in tocol, only three have government programs for place in both the forestry and agricultural sec- agricultural methane capture). 41 42 Integrating Annex Table 2.1: Integration of Environmental Considerations into the Agricultural Sector, EECCA Countries, 2006 Kyrgyz Russian Questions Armenia Azerbaijan Belarus Georgia Kazakhstan Rep. Moldova Fed. Tajikistan Turkmenistan Ukraine Uzbekistan Environment Institutional mechanisms in place to support environmental management in the agricultural sector 1. There are inter-ministerial working groups where .. agricultural and environmental issues are discussed 2. Officials from the ministries of agriculture and environ- .. into ment have regular and easy contacts 3. Ministry of agriculture staff have received training on .. Agriculture environmental issues 4. Environmental responsibilities in the ministry of .. .. agriculture are spread across units and 5. Environmental responsibilities in the ministry of .. agriculture are dealt with by a specialized unit Forestry: 6. The ministry of agriculture has provided significant .. input to strategic reports produced by the ministry of environment in the previous three years Progress 7. The latest Agriculture Strategy has been subjected to .. some sort of environmental assessment 8. The latest Agriculture Strategy incorporates environmental .. and targets Prospects 9. Irrigation schemes have been subjected to some sort of environmental assessment 10. Price support schemes for agricultural products have been .. in subjected to some sort of environmental assessment Eastern 11. Subsidy schemes for agricultural products have been .. subjected to some sort of environmental assessment Europe Measures or programs in place to support environmental management in the agricultural sector 12. General advice to farmers on environmental manage- .. .. ment and 13. Programs to improve the management/storage of .. .. Central organic manure 14. Programs to improve water use efficiency in irrigation .. .. 15. Programs to support better soil management to prevent .. .. Asia soil erosion/compaction (continued on next page) Annex Table 2.1: Integration of Environmental Considerations into the Agricultural Sector, EECCA Countries, 2006 (continued) Kyrgyz Russian Questions Armenia Azerbaijan Belarus Georgia Kazakhstan Rep. Moldova Fed. Tajikistan Turkmenistan Ukraine Uzbekistan 16. Programs to support better management of .. .. agrochemicals 17. Programs to support management of biodiversity or the .. creation/maintenance of landscape elements Acquisition of environmental management skills in the following areas (through either formal education programs or on-the-job training by agricultural extension workers/providers) 18. Management/storage of organic manure .. 19. Water use efficiency in irrigation .. 20. Soil management to prevent soil erosion/compaction .. 21. Management of agrochemicals .. 22. Management of biodiversity or creation/maintenance of .. landscape elements Organic farming in place in the country 23. Is there a strategy to promote organic farming? .. 24. Is there a formal system of organic certification? .. Source: OECD EECCA Questionnaire. Color Legend: Yes Partial Yes No Note: ".." means no answer was provided Annex 2: Analysis of Questionnaires 43 44 Annex Table 2.2: Integration of Environmental Considerations into the Forestry Sector, EECCA Countries, 2006 Integrating Kyrgyz Russian Questions Armenia Azerbaijan Belarus Georgia Kazakhstan Rep. Moldova Fed. Tajikistan Turkmenistan Ukraine Uzbekistan Institutional mechanisms in place to support environmental management in the forestry sector 1. There are inter-ministerial working groups where forestry Environment and environment issues are discussed 2. Officials from the ministries of forestry and environment have regular and easy contacts into 3. Staff from the ministry of forestry have received training .. .. on environmental issues Agriculture 4 Environmental responsibilities in the ministry of forestry .. .. .. are spread across units 5. Environmental responsibilities in the ministry of forestry .. .. are dealt with by a specialized unit and 6. The ministry of forestry has provided significant input to .. Forestry: strategic reports produced by the ministry of environment in the previous three years 7. The latest Forestry Strategy has been subjected to some .. sort of environmental assessment Progress 8. The latest Forestry Strategy incorporates environmental .. .. .. targets and Measures or programs in place to support environmental management in the forestry sector Prospects 9. Decisions on forest use regularly subjected to environmental impact assessment 10. Decisions on forest use regularly subjected to state in environmental expertise assessment Eastern 11. There is a system of voluntary certification of forest stands .. .. 12. There are ongoing programs for forest reconstruction or Europe afforestation 13. There are laws/regulations on technical requirements .. .. for equipment, technologies, and transportation used for and harvesting timber Central 14. Pest and fire management in forests has been delegated or .. outsourced to the private sector Asia ource: OECD EECCA Questionnaire. Color Legend: Yes No Note: ".." means no answer was provided Annex Table 2.3: Integration of Environmental Considerations into the Agricultural and Forestry Sectors, SEE Countries and Territories, 2006 Bosnia & Subject Question Albania Herzegovina Bulgaria Croatia Kosovo Macedonia Poland Romania Serbia Turkey Agriculture Institutional 1. There are inter-ministerial working groups where agriculture and environ- ment issues are discussed 2. Ministry of agriculture staff have received training on environmental issues 3. Environmental responsibilities of the ministry of agriculture are dealt with by a specialized unit Policy/strategy 4. The ministry of agriculture has provided significant input to strategic reports produced by the ministry of environment in the last three years 5. The ministry of environment has provided significant input to strategic reports produced by the ministry of agriculture in the last three years 6. Policies, including price support and subsidy schemes, are subject to strategic environmental assessment (EIA), with public participation 7. Agricultural projects, including water management, are subject to EIA, with public participation 8. Farm operations and investments are subject to EIA procedures Research 9. Agricultural research is addressing environmental and sustainability issues Extension 10. Agricultural extension services are effectively reaching private farmers with Good Agricultural Practices Annex Soil 11. Government has a substantial program to address issues of soil erosion, management desertification, etc. 2: Analysis Nutrient 12. Are any of the following in place, and how effectively do they work? management Research programs on reducing environmental impacts of agriculture or on of recycling nutrients (N and P) Questionnaires Regulations on the timing and amount of fertilizer applications so as to minimize nutrient runoff Extension advice or farmer training on the timing and amount of fertilizer 45 applications to minimize nutrient runoff (continued on next page) 46 Integrating Annex Table 2.3: Integration of Environmental Considerations into the Agricultural and Forestry Sectors, SEE Countries and Territories, 2006 (continued) Bosnia & Environment Subject Question Albania Herzegovina Bulgaria Croatia Kosovo Macedonia Poland Romania Serbia Turkey Regulations on the management, storage, treatment, and disposal (including field application) of organic manure Extension advice or farmer training on the management, storage, treatment, and disposal (including field application) of organic manure into Programs to capture methane gas emissions Agriculture Water management 13. Are any of the following in place and how effectively do they work? Programs to rehabilitate and improve irrigation and drainage systems and Programs to improve water use efficiency Forestry: Control of lower level systems by water user associations Programs to reduce land salinization and mitigate its effects Progress Pest management 14. Is integrated pest management (IPM) being widely used, and does the ministry of agriculture provide adequate support through research and extension? and 15. Are any of the following in place and how effectively do they work? Prospects System for registering all imported and locally manufactured pesticides System for packaging and labeling pesticides, including hazard levels in Regulations for operator training and certification and protective clothing for the Eastern application of hazardous products Regulations for the disposal of surplus and outdated pesticides Europe Forestry Institutional 16. There are inter-ministerial working groups where forestry and environment and issues are discussed Central 17. Ministry of forestry staff have received training on environmental issues 18. Environmental responsibilities of the ministry of forestry are dealt with by a Asia specialized unit (continued on next page) Annex Table 2.3: Integration of Environmental Considerations into the Agricultural and Forestry Sectors, SEE Countries and Territories, 2006 (continued) Bosnia & Subject Question Albania Herzegovina Bulgaria Croatia Kosovo Macedonia Poland Romania Serbia Turkey Policy/Strategy 19. The ministry of forestry has provided significant input to strategic reports produced by the ministry of environment in the last three years 20. The ministry of environment has provided significant input to strategic reports produced by the ministry of forestry in the last three years 21. Forest management plans and harvesting plans are subject to EIA, with public participation Research 22. Forestry research is addressing environmental and sustainability issues Extension 23. Forestry advisory services are effectively reaching private owners with sustainable forestry practices and supporting certification Forest health 24. Effective programs are in place to combat fire, pests, and diseases Illegal logging 25. Effective programs are in place to combat illegal logging Sustainable 26. Effective regulations and enforcement systems are in place to ensure harvesting sustainable harvesting Certification 27. Voluntary certification is in general use Source: World Bank Questionnaires answered by local consultants. Annex Color Legend: Yes Partial Yes 2: No Analysis of Questionnaires 47 Annex Table 2.4: Combined Table for Questions Common to OECD and World Bank Questionnaires. EECCA and SEE Countries and 48 Territories, 2006 Integrating Subject Question ARM AZE BEL GEO KAZ KYR MOL RUS TAJ TRK UKR UZB ALB BiH BUL CRO KOS MAC POL ROM SER TUR Agriculture Environment Institutional 1. There are inter-ministerial working groups where .. agriculture and environment issues are discussed 2. Ministry of agriculture staff have received training on .. environmental issues into 3. Environmental responsibilities of the ministry of .. agriculture are dealt with by a specialized unit Agriculture Policy/Strategy 4. The ministry of agriculture has provided significant .. input to strategic reports produced by the ministry of environment in the last three years 5. Policies, including price support and subsidy schemes, .. and are subject to Strategic Environmental Assessment, with Forestry: public participation 6. Farm operations and investments are subject to EIA procedures Progress Soil management 7. Government has a substantial program to address .. .. issues of soil erosion, desertification, etc. and Nutrient management 8. Are any of the following in place and how effectively do they work? Prospects Research programs on reducing environmental impacts of agriculture or on recycling nutrients (N and P) in Regulations on the timing and amount of fertilizer applica- Eastern tions so as to minimize nutrient runoff Extension advice or farmer training on the timing and amount of fertilizer Europe applications to minimize nutrient runoff Regulations on the management, storage, treatment, and and disposal (including field application) of organic manure Central Extension advice or farmer training on the management, storage, treatment, and disposal (including field applica- tion) of organic manure Asia Programs to capture methane gas emissions Water management 9. Are any of the following in place and how effectively do they work? Programs to improve water use efficiency .. .. (continued on next page) Annex Table 2.4: Combined Table for Questions Common to OECD and World Bank Questionnaires. EECCA and SEE Countries and Territories, 2006 (continued) Subject Question ARM AZE BEL GEO KAZ KYR MOL RUS TAJ TRK UKR UZB ALB BiH BUL CRO KOS MAC POL ROM SER TUR Pest management 10. Are any of the following in place and how effectively do they work? System for registering all imported and locally manufactured pesticides System for packaging and labeling pesticides, including hazard levels Regulations for operator training and certification and protective clothing for the application of hazardous products Regulations for the disposal of surplus and outdated pesticides Forestry Institutional 11. There are inter-ministerial working groups where forestry and environment issues are discussed 12. Ministry of forestry staff have received training on .. .. environmental issues 13. Environmental responsibilities of the ministry of forestry .. .. are dealt with by a specialized unit Policy/ strategy 14. The ministry of forestry has provided significant .. input to strategic reports produced by the ministry of environment in the last three years Annex 15. Forest management plans and harvesting plans are subject to EIA, with public participation 2: Sustainable harvesting 16. Effective regulations and enforcement systems are in .. .. Analysis place to ensure sustainable harvesting Certtification 17. Voluntary certification is in general use .. .. of Questionnaires Notes and sources: EECCA data are from the OECD questionnaires given to the ministries of environment and from the supplementary questionnaires to local consultants for the mainstreaming study. SEE data are from questionnaires sent to local consultants for the mainstreaming study. ".." means no answer was provided. Color Legend: 49 Yes Partial Yes No Annex Explanation of Indicators 3 A study of this kind uses indicators for two pur- For the purposes of quantitative analysis, four poses: indicators were chosen for agriculture and four for forestry. They were: i) to show progress over time of mainstreaming in each country. Agriculture ii) to allow comparisons between countries, in · Reduction in soil erosion (percent) order to identify good practice examples and · Reduction in nutrient (N and P) exports (per- countries that need further support. cent) · Improvement in irrigation water use efficiency Two complementary approaches were con- (percent) sidered: · Effective coverage of IPM (percent of vulner- able cropped area) A. The scenario approach.28 This would use a process of expert consultation to derive scenarios Forestry or frameworks for progressing from a Soviet · Protected areas (ha, percent of total area) model to an ideal western model, using dimen- · Forest health (percent of area affected by sions such as soil management, water manage- disease, fire) ment, and forest management. Countries would · Certification (percent covered) be awarded points based on how far along the · Sustained yield (percent of Annual Allowable continuum they had progressed. However, since Cut felled) data available at the outset of the mainstream- ing study were not sufficient to support this Agricultural indicators were the result of approach, it has been deferred to the final stage consideration by the study team of published of the study. documents and their discussions with col- leagues. Forestry indicators were taken from a B. The key indicators approach. In this ap- World Bank report.29 Such a small set of indica- proach, a small set of key variables is chosen tors cannot cover all dimensions of the integra- to represent major mainstreaming themes. In tion problem and, in hindsight, it is evident that principle, the variables should be either deter- the selected variables do not cover important ministic (yes/no) or quantifiable. Deterministic issues such as salinity management, biodiversity variables are well suited to policy and institutional in agriculture, organic farming, food safety, il- issues, such as the ones covered by the OECD legal logging, and carbon sequestration. Questionnaire for EECCA Countries. Annex 2 describes how this approach was used for both 28 Adapted from World Bank (2000a). sub-regions. 29 World Bank (2005). 51 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia Local consultants in each country were given Explanation of Agricultural and the following guidance on indicators: Forestry Indicators AND Indicator: The ideal report would have time-series, Indicator A.1: Soil protection quantified data for each indicator, going back The major problem is soil erosion from wind and 10 to 15 years. As this ideal is unlikely, con- water. Other problems, such as changes in soil sultants should report, in summarized form fertility and structure (e.g., compaction from heavy and quantified wherever possible, available equipment use), should be assessed in the report information on each subject. For example, if but not as part of this indicator. data are only available for one or a few years, The ideal erosion indicator would be in t/ha then that should be reported. If no numerical of arable land. The next best, which seems to data can be found, a qualitative assessment be more widely available in the region, is percent should be given, for example, "Soil erosion is of arable land affected by erosion. In either moderately severe, especially in the southern case, absolute figures are of less importance part of the country, and is gradually getting than trends: e.g., is the problem getting better or worse." In addition, specific guidance notes worse? are given below each indicator. Indicator A.2: Nutrient conservation In most cases, the consultants had consider- The nutrients of concern are nitrogen (N) and able trouble obtaining quantified information phosphorus (P). The two main agricultural sources on many of the agricultural indicators and even are excess organic or mineral fertilizers applied more trouble getting time-series or trend data. to cropland and livestock waste. Data on total The situation in forestry was somewhat better, fertilizer use and livestock numbers (especially although it should be noted that the team had a where production is intensive, i.e., large numbers lot of trouble obtaining up-to-date data on indi- of animals in a limited space) are a useful starting cator F.3 (certification). It appears that neither point for indicating the total nutrients applied in ministries of agriculture/forestry nor ministries of the farming system. Ministries of agriculture will environment have yet recognized the importance normally have these data. However, the variable of of monitoring variables such as the above as a real interest is the proportion of applied nutrients way of measuring mainstreaming progress. For that is released into water bodies: rivers, lakes, example, soil erosion is a major problem in nearly seas, and aquifers. These data are likely to be found all the countries studied. In the EECCA sub- as water quality data compiled by ministries of en- region data are normally in the form of "percent vironment or, possibly, health, as excessive nitrate of agricultural land severely eroded, moderately in drinking water is a public health concern. As eroded..." which gives little idea of the economic there is a considerable time lag between changes impact. Although SEE countries tend to use the in applied nutrients and changes in runoff, because more relevant formulation of t/ha/yr, no time of storage in the soil profile, trends in runoff are series were found. likely to be subtle. As a result, it was not possible to present quantified data on the indicators. Instead, trend Indicator A.3: Water use efficiency indicators (up or down arrows) were used in the This is only relevant in countries where irrigation summary (Table 3). This is an area with consider- is practiced. Water use efficiency may be defined able potential for further study. as water used by the crop as a percentage of total water delivered at the head of the sys- 52 Annex 3: Explanation of Indicators tem, although other definitions may be used, as it Albania (ALB) is trends that we are looking for. This indicator is Nutrient conservation. The use of fertilizers in a proxy for the effectiveness of irrigation system agriculture is relatively low, 120­150 t/yr, while management and for waterlogging and salinity agricultural needs are for 380­450 t/yr. The total management. Data on the latter problems should number of livestock has decreased somewhat be reported in the main text. since 2001 (from 728,000 to 655,000 head of cattle, and from 3,450,000 to 2,701,000 sheep and goats Indicator A.4: Integrated pest manage- by 2005). Assessments of ground water quality ment coverage (rivers, streams, lakes) show low levels of nitrates Most countries have programs to promote IPM (State of the environment 2003­2005, MEFWA techniques, but many have had limited success in 2007). These data did not vary significantly during implementing them. Measures of progress might the last years 2001­2005 (State of environment include percent of agricultural land where IPM 2000­2002; 2003­2005, Ministry of Environment, is practiced; percent of farmers trained in Forests and Water). The same report concludes IPM; percent of farmers practicing IPM; and that agriculture and livestock production have amount of beneficial insects released. These very low impact on water pollution (local consul- measures are likely to be imprecise estimates. tant's report, p. 24). Indicator F.1: Protected areas Azerbaijan (AZE) Data on protected areas as a percentage of Nutrient conservation. The amount of fertilizers total forest areas, by year, should be relatively used have decreased dramatically since the late easy to obtain. 1980s, i.e., from about 166 kg/ha of mineral fertil- izers in 1985 to 5 kg/ha in 1999. Agricultural run- Indicator F.2: Forest health off of nutrients and chemical substances to rivers Forest departments should be a good source of and groundwater is likely to be low because of the data on areas affected by fires, pests, and dis- reduced use of pesticides and fertilizers over the eases, year by year, as a proportion of total past years. However, actual levels of contamina- forest area. tion in water bodies and even in soils still need to be confirmed. Unfortunately, monitoring systems Indicator F.3: Certification for these purposes are lacking (Azerbaijan Country This indicator is the percentage of forest pro- Review, S. Pedroso-Galinato, pp. 11­12). duction certified by an accredited agency as having been produced in an environmentally Bosnia and Herzegovina (BiH) sustainable manner. Nutrient conservation. Currently, there is no evidence that nutrient levels in drinking water are Indicator F4: Sustained yield anywhere near the maximum allowed concentra- This is defined as the actual amount of timber tions, or that they fluctuate significantly. Based on harvested, as a percentage of annual in- trends in the last 30 years, as reported by water cremental growth. Harvested amounts should utility companies, no special measures to combat include illegal fellings. this sort of pollution are necessary or envisaged (local consultant's report, p. 41). Annotations on Indicators in Table 3 Sources of information for Table 3 include the Water use efficiency. Selected areas are covered following: by Water Users Associations. Until 1990, irriga- 53 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia tion covered only 11,600 ha, or 2 percent, of total one-third of pre-independence levels. In 2006, on arable land, compared to the world average of 15 an average 45,000 ha of agricultural land, fertilizer percent. The potential for irrigation of arable land applications were less than half of the amounts in this region has been estimated at approximately applied during the Soviet era 20 to 50 years ago. 155,000 ha (local consultant's report, p. 93, and The use of organic fertilizers has also diminished questionnaire). significantly since the collapse of the Soviet Union. In the 1980s, about 3.5 million tons of manure Bulgaria (BUL) collected from local cattle ranches and poultry Nutrient conservation. Since 2000, the applica- farms were applied throughout Georgia on a yearly tion of fertilizers has stabilized at a low amount basis. Currently, the use of manure in agricultural that does not threaten the environment. Applica- production is estimated to be 0.5 million tons tion of mineral fertilizers in 2005 totaled 35.80 per year (Georgia Country Review, E. Montanari- kg/ha, of which nitrogen accounts for 30.29 kg/ Stephens, p. 18). ha, phosphorus for 4.77 kg/ha, and potassium for 0.73 kg/ha. The fact that N dominated could Kosovo (KOS) lead to changes in soil balance and quality. The Water use efficiency. Water use efficiency is presence of N in surface waters is an indicator of not measured during irrigation. Significant losses nitrate pollution. Data from the national monitor- occur because the irrigation system is not fully ing system show that 92 percent of samples taken repaired or properly maintained. The largest losses in 2002­2005 are below 5 mg/l, which corresponds occur in open channels, especially in earthern to a category-I water body. Data also show that channels which are widespread in Kosovo, spe- there are no samples containing more that 50 mg/l, cifically in "Drini I Bardhë" company in Pejë/Pec which corresponds to a category-III water body (local consultant's report, p. 21). (EEA, Green book, 2005; local consultant's report, p.20, Table 6). Macedonia (MAC) Nutrient conservation is not subjected to a Croatia (CRO) monitoring system, and the use of fertilizers and Nutrient conservation. The use of mineral fertil- manure is not regulated. There are no data on the izers fell significantly after the war, and amounts impact of fertilizer applications and practices on currently applied are still much below pre-war water quality (though there are data on ground levels. Therefore, it may be concluded that nega- and surface water). tive impact from this source is not a serious envi- ronmental issue (local consultant's report, Figure Water use efficiency is very low (60­80 percent) 2, p. 11). depending on irrigation schemes and the irriga- tion techniques applied. Efficiency is highest in Water use efficiency. Data on total amounts closed-pipe networks and drip irrigation (about 80 of water used are not reliable, with water use ef- percent) and lowest in open channels and surface ficiency estimated at 70 percent (local consultant' irrigation (less than 60 percent in some cases). report, p.11). Waterlogging is common on more than 9,500 ha. Georgia (GEO) Moldova (MOL) Nutrient conservation. Between 1989 and 2005, Nutrient conservation. The use of mineral fertilizer use (nitrogen, potassium, and phospho- and organic fertilizers has decreased drastically rus) dropped from 200,000 to 60,000 tons, or about in the last two decades (see "Additional Indica- 54 Annex 3: Explanation of Indicators tors: Use of Mineral and Organic Fertilizers" in not support the development and implementa- Annex 5), from 38,000 tons in the 1980s to 3,000 tion of alternative pest management methods. tons in 1996 and 2,700 tons in 2004. The use of Farmers use a number of traditional methods to pesticides and fertilizers has shown a stable de- control insect pests, including tillage practices; clining trend for the last four to five years. As of burning straw and crop waste; converting straw today, approximately 30 percent of agricultural into organic matter; manual weeding of crop lands register a lack of phosphorus, contained fields; use of lure boxes to collect worms and in organic fertilizers, which seriously affects soil caterpillars; and handpicking of eggs, caterpil- fertility (Georgia Country Review, E. Montanari- lars, and larvae during periods of high infestation. Stephens, p. 12). To promote IPM in the country, it is crucial to invest resources and train staff to disseminate Tajikistan (TAJ) information on the safe use of biological pest Nutrient conservation. Management of soil control techniques; and promote traditional weed organic matter, as well as commercial pesticides control methods and the use of organic fertilizers and fertilizers is very weak on irrigated lands. Poor to reduce consumption of agro-chemical inputs farm management may cause expensive chemical (ibid, p. 21). inputs to be washed away before crops absorb them. This, in turn, triggers economic losses for Forest health. In the forestry sector, the most the farmer and environmental damage down- pressing environmental problems are deforesta- stream. Mineral fertilizers discharged into fresh- tion and desertification. In many areas where wood water bodies contribute to their mineralization has been cut, grazing has taken over, preventing and eutrophication (Tajikistan Country Review, forest regeneration. Land slides, fires, pests, and E. Montanari-Stephens, pp. 18 and 20). flooding have increased in recent years (ibid, p. 28). Water use efficiency. Irrigation and drainage infrastructure seriously deteriorated during the Protected areas. Protected areas now cover 1990s. Destroyed irrigation networks and water about 510,000 ha, or 28.3 percent, of the total for- pumping stations plus broken irrigation and est area. Between 1996 and 2006, protected areas drainage pipes and canals have become a serious increased by 1,800­2,000 ha (local consultant's problem. Poor management and an underperform- report, p. 45). ing drainage infrastructure cause salinization and waterlogging problems, both of which affect soil Turkey (TUR) fertility. Currently, collection and drainage net- Soil protection. Erosion, salinity, and soil pol- works cover less than half of the total irrigated lution are worsening, the budget to implement land. As a result, about 15 percent of irrigated lands erosion measures is limited, and coordination are over-saturated every year. Salinization affects among institutions is needed. There is no substan- approximately 16 percent of Tajikistan's irrigated tive funding for preventing pollution caused by lands (ibid, pp. 18 and 19). agriculture. IPM coverage. Limited research funding, the Nutrient conservation. In Turkey fertilizer appli- poor conditions of bio-control laboratories, and cation levels are low, staying at around 10 million the lack of qualified staff have left the country tons over the last decades (Figure 4). In the mid without the capacity to control pests using bio- 1990s, nitrogen and phosphate use per hectare logical methods. At present, the government does of arable land was among the lowest in OECD 55 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia countries.30 Also, the removal of input subsidies Protected areas. Although the proportion of may have promoted more efficient fertilizer use in protected areas is still low, new areas such as recent years (Oskam et al. 2004).. However, fertil- Artvin Camili have been added. In addition, NGOs izer use is unevenly distributed across regions. In have started to play an important role in raising addition, Turkey's rivers that empty into the Black awareness. More needs to be done, but the trend Sea are key sources of phosphorus and nitrogen is positive. pollution. It is estimated that Turkey discharges 38,000 t/yr of N and 5,800 t/yr P into the Black Forest health. Afforestation/reforestation efforts Sea. These amounts constitute approximately 20 are continuing. Degraded forests have increased percent and 12 percent of the total N and P pro- by 450,000 ha, while the area of healthy forests duced in the non-Danube-Black Sea Basin (local declined by 55,000 ha between 1999 and 2004. consultant's report, p. 6 and Table 4). 30 Average fertilizer consumptions per agricultural land Water use efficiency. See sections of the local in 1995 were: England: 283 kg/ha; France: 240 kg/ha; China: 207 kg/ha; Mexico: 201 kg/ha; Spain: 155 kg/ha; consultant's report on water overuse, over-extrac- Greece: 155 kg/ha; India: 120 kg/ha.; Brazil: 95 kg/ha; tion of ground water, and declining water quality Turkey: 85 kg/ha; World: 116 kg/ha (Turkey State Plan- (pp. 7 and 8). ning Organization 2000). 56 Annex The Issue of Abandoned Land 4 The Abandoned Farmland Issue lective farms collapsed, some land was abandoned across the SEE Region when ownership was not granted to individual Land abandonment occurs when farmers cease farmers. Abandonment is also driven by demo- to use land for agricultural purposes. It is a wide- graphic change. As the older generation of farmers spread phenomenon with a variety of economic retires, younger generations have sought work in and social causes. Lack of active management other occupations, frequently migrating to cities often results in the regrowth of tall grasses, or abroad in search of better financial rewards. scrub, and, eventually, forest. This generally has Land abandonment can accelerate the economic positive environmental externalities; however, and social decline of communities. As the area negative consequences may result if biodiversity of abandoned land increases, communities can is diminished. become further isolated and marginalized. Abandonment is largely an economic event, as Abandonment is a widespread phenomenon farmers abandon farmland when it no longer yields in the SEE region. However, precise official data a positive economic return, or when the farming on the extent of abandonment are unavailable for system is no longer viable when faced with new many countries in the region. One reason data are forms of competition. Abandoned land typically difficult to obtain is that there is no agreed-upon includes steeper, rocky, infertile soils and areas definition of abandoned land, and the definitions farthest from market. Soils that are too wet or too used by each country may not account for land dry are also more likely to be abandoned. that is subject to "semi-abandonment," that is, land In the SEE region, the lack of viability began that is not formally abandoned but receives mini- decades ago but accelerated during the collapse mal management (DLG 2005, p. 23). Some experts of state-owned and collective farms in the early think that the amount of semi-abandoned land may 1990s. That transition resulted in a significant de- be at least as great as the expanse of abandoned cline in agricultural production and particularly in land in Central and Eastern Europe (DLG 2005, the number of livestock in the region (DLG 2005, p. 23). Data in the following table were reported p. 22). Abandonment is likely to continue as re- by World Bank consultants in each country. In the gional economies continue to evolve. For example, nine countries for which we obtained data, aban- before the transition, the government of Albania doned land ranges from 6 percent to 23 percent, emphasized food self-sufficiency over economic and averages 8 percent of total agricultural land. efficiency. As Albania and other countries in the The range of abandoned land as a percentage region have abandoned the goal of self-sufficiency of agricultural land in Annex Table 4.1 is consistent and opened up to trade, some lands are not ef- with estimates of abandoned land in the following ficient enough to produce at world prices. countries: Estonia, 10 percent in 2002; Lithuania, Uncertainties over land ownership can also 10 percent in 1999; Latvia, 21 percent in 2002; Hun- lead to abandonment. After state-owned and col- gary, 10 percent in 2002 (DLG 2005, p. 23). 57 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia Annex Table 4.1: Abandoned Farmland across the SEE Region, Various Years Country Total area* Agricultural land* Abandoned land** Abandoned land as % of and Territories (1,000 ha) (1,000 ha) (1,000 ha) agricultural land Albania 2,875 7001-1,121 1102 10-16 Bosnia and Herzegovina 5,121 2,148 5023 23 Bulgaria 11,099 5,326 4614 9 Croatia 5,654 3,137 146-1755 6 Hungary 9,303 5,866 5876 10 Kosovo*** 1,100 265 247 9 FYR Macedonia 2,571 1,242 1318 11 Poland 31,269 16,169 1,0575 7 Romania 23,839 14,717 736-1,4726 10 Serbia and Montenegro**** 10,217 5,595 n/a n/a * Data refer to 2003 unless otherwise indicated and were taken from FAOSTAT, http://faostat.fao.org/site/418/DesktopDefault.aspx?PageID=418. ** Data derived from local consultants' reports in each SEE country. Unfortunately, there is some doubt that they accurately report on abandoned arable land because arable land is intensively cultivated land, and the literature review conducted shows that extensively farmed agricultural land, not intensively cropped arable land, is most likely to be abandoned. The former generally includes pasture and, occasionally, cultivated land. Hence, it is most accurate to report abandoned land as a percentage of agricultural land. *** Data for Kosovo were reviewed in the consultant's report: Deda, Shkipe, "Mainstreaming Environment into Forestry and Agriculture Policies and Operations," April 14, 2007, p. 4 and Annex 10 on "Agricultural Surface Areas and Yields: 1980­2005." **** Data for Serbia and Montenegro predate the separation of the State Union of Serbia and Montenegro in 2006. 1 Data from the Ministry of Agriculture, Albania. 2 Estimate for 2005. 3Reported for 2001. 4Reported for 2005 as a % of total agricultural area. 5Reported for 2005. 6Calculated as % of agricultural area in 2006. 7Calculated as % of agricultural area in 2005. 8Reported for 2007. Land Abandoned because of War might take several generations before rural In Annex Table 4.1, the country with the highest areas are again completely safe. percent of abandoned land is Bosnia and Her- A clear agriculture policy response to the zegovina, one of the most heavily land-mined tragic problem of land mines in rural areas has countries in the world. A recent FAO (2002) yet to be developed. It is estimated that there review of agriculture in Bosnia and Herzegovina are around 670,000 landmines and 650,000 summarizes the impact of landmines on agri- unexploded ordnance remaining in BiH over culture: more than 2,000 square kilometers. As urban areas and infrastructure have priority for Large tracts of strategically important agricul- current de-mining activities, the de-mining of tural land and forest areas remained mined agricultural land proceeds at a slower-than- after the war and therefore cannot be used. average pace. De-mining of the thousands of minefields may require many years to complete. Estimates do Landmines continue to kill and injure civilians suggest that at current rates of de-mining, it throughout the country, and farmers and herders 58 Annex 4: The Issue of Abandoned Land are the most frequent casualties of landmines Historical Perspective: Land Abandon- (SAC and HI 2003). The Bosnia and Herzegovina ment in Western Europe Mine Action Center reports that from May 2002 Abandonment of agricultural lands is a world- to May 2006, there were 187 mine-related inci- wide process, frequently reflecting the decline of dents.31 traditional agricultural methods. Abandonment Landmines are a widespread phenomenon is a long-term trend in many Western European across the Former Yugoslavia region. In Kosovo, countries, as farmers have left land that is remote, during the civil war of 1998­99, land that used to less fertile, and on steep slopes. It is estimated be farmed remained idle. After 2000, the same that forested areas in Switzerland have increased plots remained uncultivated because of fear of by one-third over the last 150 years; much of that mines and cluster bombs left from the war. Farm- expansion has been on abandoned agricultural ers often burn the land as a de-mining measure land (Gellrich et al. 2007). From 1951 to 1981, 11 which highly contributes to the spreading of fires percent of farmland in Sweden was abandoned.33 in Kosovo's forests. Only in the year 2000, 3,980 ha Although the trend toward abandonment has were affected by forest fires, a major environmen- abated in the EU since the CAP was implemented, tal problem in Kosovo. abandonment may increase in the future due to Serbia and Montenegro acceded to the Mine demographic changes and CAP reform. Ban Treaty in 2003 and began destroying its stock- pile of antipersonnel mines in August 2005. By Positive and Negative Environmental March 2006, it had destroyed 649,217 mines, almost Consequences of Land Abandonment half of its stockpile (MAC 2006). Abandonment will cause positive environmental Mine contamination is also a legacy of the externalities in intensively farmed land as use of armed conflict in Croatia during the period of fertilizers and pesticides ceases. However, inten- 1991­1995. De-mining initiatives have so far sively farmed land is less likely to be abandoned progressed slowly, focusing primarily on settle- than extensively farmed land, which generally ments and roads. Farmland and forests have been produces lower economic returns. targeted only marginally. Minefields are an eco- Abandoning farmland that is marginally pro- nomic burden for the government. It is estimated ductive due to a steep gradient or lack of water that, as of 2005, there were approximately 1,200 may have positive environmental consequences km2 of minefields nationwide.32 According to a as erosion is reduced and natural vegetation takes recent report by the Land Mine Monitor (2006), over the land. In many instances, afforestation of minefields can be found in 12 of the 21 counties marginal farmland will increase biodiversity, but in of Croatia; four of these counties are located in the agriculturally fertile region of Slavonia, which also has oil and natural gas reserves. About 1.1 31 Consulted in: http://www.mineaction.org/country. million inhabitants are believed to live in 121 asp?c=4). This website quotes the Bosnia Herzegovina mine-affected municipalities across the country Mine Action Center (BHMAC) statistics. (MAC 2006). 32 Data consulted in Matosevic, Ratko, consultant's Finally, in FYR Macedonia, the northwestern report on "Croatia: Mainstreaming Environment into border is the main area affected by mines as a Agriculture and Forestry," Table 13. The total surface of minefields includes the following categories: settlements; result of the conflict between government forces infrastructure; agricultural land; forest land; meadows and ethnic-Albanian insurgents in 2001. and pastures. 33 Consulted at: erae.oxfordjournals.org/cgi/ reprint/19/3/351.pdf. 59 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia certain types of land, abandonment may negatively the framework of the United Nations Framework affect biodiversity. Convention on Climate Change. In Romania and Extensively farmed land, such as pastures Moldova, for instance, the World Bank is actively and meadows that have been used for cattle graz- involved in implementing carbon finance projects. ing, tends to be biodiversity-rich in both flora and In Romania, the Bank administers a Carbon Fund fauna. Over time, many species have adapted to a to afforest over 60,000 ha of state-owned degraded mosaic landscape that includes both extensively lowlands in seven counties. Soils are stabilized by farmed land and forests, but many species, includ- planting semi-naturalized species and native tree ing birds and butterflies, need grasslands in order species. In Moldova, the Prototype Carbon Fund to survive. Abandoning pastures and meadows and the BioCarbon Fund are being used to reforest that have been used for grazing can reduce the approximately 20,000 ha of eroded state-owned necessary habitat for these species. Thus, biodi- and communal agricultural land, as well as to versity may decline if these lands are abandoned plant 14,500 ha of degraded pastureland. Overall, (EEA 2004). in addition to global benefits, both initiatives aim In recent years, policy makers in the EU have at restoring degraded lands, improving sustainable focused on the impact of land abandonment on supplies of forest products to local communities, biodiversity as one element of their efforts to and building community management capacity conserve biodiversity. These efforts have centered (World Bank 2007a). upon "high nature value" (HNV) farmland areas, The amount of carbon that can be sequestered which are "areas where farming practices are asso- through the afforestation of abandoned farmland is ciated with high biodiversity" (EEA and JRC 2006). difficult to calculate because it will vary according The European Environmental Agency (EEA) has to soil and other conditions of the land. One expert defined three different types of HNV areas: has noted that "Soils of eroded or degraded sites generally have low carbon levels and therefore · Farmland with a high proportion of semi- a high potential to accumulate carbon; however, natural vegetation. revegetation of these types of sites will pose tech- · Farmland dominated by low-intensity agricul- nical challenges" (Hidalgo 2006). ture or a mosaic of semi-natural cultivated land and small-scale features. Future Scenarios · Farmland supporting rare species or a high Land abandonment in countries in transition pres- proportion of European or world popula- ents important challenges as well as opportunities tions. for environmental policy makers. Broadly speak- ing, the following policy options exist for aban- The EEA estimates that roughly 15­25 percent doned land, each of which may have positive or of the European countryside qualifies as HNV farm- negative environmental consequences, depending land, and that considerable areas of HNV farmland upon specific circumstances. are located in Eastern Europe (EEA and JRC 2006, p. 2). Nevertheless, since HNV farmland accounts 1. Return abandoned land to agricultural for only a portion of all abandoned farmland, there use. For some farmland, the process of land is significant potential to increase biodiversity abandonment may be a temporary phase of the through the regrowth of forests on land that is not economic and social transition. Once new struc- HNV farmland. tures are fully developed for the sale and leasing Afforestation of abandoned land also offers of land and the financing and marketing of crops, opportunities for carbon sequestration within farmers may find it beneficial to resume agricul- 60 Annex 4: The Issue of Abandoned Land tural production on much of the abandoned land. Encouraging Environmental Steward- If abandoned land is farmed more intensively when ship of High Nature Value Land it is returned to use, biodiversity may suffer, and To maintain HNV landscapes such as semi-natural there may be additional negative consequences grasslands, additional economic incentives may from fertilizer and pesticide use. However, if the be needed to encourage continued maintenance land is HNV land dependent upon active man- through activities such as mowing. While incentive agement for the preservation of its semi-natural programs are likely only relevant to a small portion habitat, biodiversity may benefit. It should be of currently abandoned land, the incentives may noted that, since HNV land is only a small portion be necessary to preserve the environmental ben- of all farmland, environmental reasons would not efits that have resulted from traditional extensive justify returning most abandoned farmland to ac- agricultural practices (EEA 2004). tive farming. Conclusion 2. Natural revegetation. The natural process Some abandonment of land is inevitable in the of the regrowth of native species of tall grasses, transition to a market economy. Land abandon- shrubs, and trees will result in forest covering the ment is a human problem with environmental abandoned land in most parts of SEE. This is the dimensions; its causes are diverse, as are its most likely scenario for much abandoned farm- environmental impacts. National governments in land, absent economic incentives to return the the SEE region must assess their environmental, land to agricultural production, and absent formal social, and economic objectives when developing programs of afforestation. For most abandoned policies to address land abandonment. land, this natural process is likely to produce posi- tive environmental benefits. · National inventories of abandoned land should be prepared to inform policy making. 3. Planned afforestation. If properly planned · Local and regional land use plans should be and implemented, actively converting abandoned developed that balance economic, social, and farmland into forests can produce a number of eco- environmental goals. nomic and environmental benefits. Economic ben- · Broader rural development policies are needed efits of forests may include the harvest of timber to address social and economic issues in rural products, tourism, and revenues from emissions communities facing land abandonment. traded for carbon sequestration. Environmentally, · High nature value farmland should be identi- afforestation can result in more rapid growth than fied using a consistent analytical framework the natural regrowth of native vegetation. If proper across countries. attention is paid to the species of trees that are · Strategies for abandoned land should consider planted, afforestation can increase biodiversity. high nature value farmland and its role in pre- serving biodiversity. · Policy makers should evaluate carbon seques- tration opportunities. 61 Annex Sub-Regional Comparisons 5 Good practice: SEE: EECCA: Subject Poland, Hungary All countries All countries Polices and strategies Fully aligned with EU Generally satisfactory re sustainability, except Generally satisfactory re sustainability perhaps Bosnia & Herzegovina Privatization of farmland Poland traditionally private Generally complete or nearly so; Macedonia an Above 70 percent only in four countries, reliance on (96 percent); Hungary, 88 exception leasehold and corporate farms not radically different to percent the former collective farms. Forest ownership Poland 18 percent private Private forests 18.5 percent but ranges from 0 Full state ownership to 50 percent Interagency Limited Limited but gradually improving Limited but gradually improving cooperation Public awareness of Moderately good Generally inadequate Generally inadequate agriculture and forestry sustainability issues Public participation in Follows EU requirements but Increasingly aligned with EU standards on paper Some participation, e.g. on EIA, but generally limited, policy, program, and may be pro forma but may be less in reality especially in less democratic states project formulation Agricultural research Active involvement Moderate emphasis on sustainability/conserva- Emerging emphasis on sustainability/ tion issues conservation issues Agricultural extension/ Poland has large, A mix of conventional services, with modest Some countries have essentially none, except top-down advisory services conventional extension capabilities, and public-private partnerships of directives; others experimenting with innovative, low-cost service but effectiveness various kinds; varying impact; possibly better on options involving private sector, but too early to see full is limited, especially on business advice than on sustainability impact; questions on sustainability after donor projects sustainability finish Soils management: Limited programs, with EU Erosion problems prevalent in more arid Erosion problems widespread in nearly all erosion assistance countries; some efforts to address with EU countries; limited available data indicates assistance; Turkey making some progress worsening trends; almost no programs to address this Soils management: Acidification an important Fertility has declined due to reduced use of Fertility has declined due to sharply reduced use of fertility issue in Poland chemical and organic fertilizers; acidification an chemical and organic fertilizers; some programs to issue in northern countries address this but few results as yet Nutrient management Pilot Bank/GEF project Diagnostic studies and a few pilots Diagnostic studies under Baltic and Black Sea programs bloomed into national under Danube-Black Sea program but national and some pilot projects underway, especially in Russia program in Poland with EU programs not yet developed, except in Romania and Georgia; follow-up limited; not a major issue in support; action program in Central Asia Hungary. 63 Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia (continued) Good practice: SEE: EECCA: Subject Poland, Hungary All countries All countries Pest management: Full regulation Full regulation Full regulation but enforcement variable regulation Pest management: Program for disposal in Inventories underway in several countries; Inventories comleted or underway in several countries; disposal of obsolete stocks Poland now 50 percent disposal programs in Albania, Croatia and disposal programs starting in Armenia, Georgia and complete Romania Moldova Pest management: Limited use in Poland in fruit Pilot projects in Bosnia & Herzegovina, Kosovo, Early efforts in whole Soviet Union not sustained except integrated pest manage- and vegetable production; Macedonia, and Turkey in Moldova, Turkmenistan, and Uzbekistan, which have ment area covered in Hungary effective full-scale programs, especially on cotton; efforts increasing rapidly elsewhere quite limited Water management: National agricultural Efforts to rehabilitate systems, with some im- In Russia, Ukraine, and Georgia, irrigated area declining irrigation research system pact on efficiency, including pricing mechanisms: and efficiency receiving little attention; in Central Asia, underway in most countries, generally through donor-funded efforts to improve efficiency and introduce donor projects pricing are effective but do not yet cover a large proportion of the area Water management: National agricultural A problem in parts of Turkey but programs are Major issue in nearly all countries with irrigation; efforts salinity research system being implemented to improve efficiency and rehabilitate/expand drainage will alleviate salinity albeit on a limited area to date; long-term sustainability will require a broader approach, especially in Turkmenistan and Uzbekistan Forestry: protected areas Improving Improving Improving, especially in Ukraine Forestry: forest health Declining in Poland Situation varies from year to year, but is Situation varies from year to year, but is basically under basically under control control Forestry: sustainable Fully satisfactory Satisfactory in most countries Illegal logging a problem in nearly all countries but management promising programs to address this in most cases Forestry: certification Fully satisfactory In place in some countries; Starting in Russia, Ukraine, Belarus; other countries 90 percent coverage in Croatia. export little or no wood Forestry: sustainable yield Harvesting considerably less Harvesting considerably less than annual Harvesting considerably less than annual increment, than annual increment increment especially in Russia Carbon sequestration Potential both in methane Potential both in methane capture and Potential both in methane capture and reforestation; capture and reforestation reforestation, especially in large areas of apart from Moldova, little action to date abandoned farmland; little action to date, except in Romania Organic farming Programs moving Several countries have promising pilot projects; Several western EECCA countries have promising pilot beyond pilot stage with EU some full-scale projects. subsidies. 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The Office of the Publisher follows the · 361 pounds of net greenhouse recommended standards for paper usage set by the Green gases Press Initiative, a nonprofit program supporting publishers · 1,500 gallons of waste water in using fiber that is not sourced from endangered forests. For more information, visit www.greenpressinitiative.org. · 193 lbs of solid waste In the transition countries of Eastern Europe and Central Asia, environmental considerations are lagging behind other factors in the agriculture and forestry sectors. The cost of increasing soil salinity in one country is estimated at $1 billion per year, the cost of soil erosion in another at $40 million per year. Agriculture and forestry will also be highly sensitive to changes in climate. There is therefore a critical need for the countries in this region to proactively integrate environmental concerns into policies, programs, and investments in the agriculture and forestry sectors. According to a World Bank study, this critical need has arisen from inadequate policy incentives, insufficient human and institutional capacities, and lack of funding. Integrating Environment into Agriculture and Forestry: Progress and Prospects in Eastern Europe and Central Asia presents 10 recommendations for local and international stakeholders on how to address these problems. Among the recommendations are the need to advance to full-scale implementation of strategic documents, the imperative of using economic cost-benefit analysis as a basis for decision making, and the urgency of scaling up successful pilot projects. Included with the book is a CD containing a compilation of 21 in-depth reviews of environmental integration in agriculture and forestry in Eastern European and Central Asian countries. ISBN 978-0-8213-7743-7 THE WORLD BANK SKU 17743