**INITIAL ENVIRONMENTAL EXAMINATION**

**[PROGRAM/ACTIVITY DATA]{.underline}:**

**Program/Activity Number:** 663- 016

**Country/Region**: Ethiopia

**Program/Activity Title:**

-   Strategic Objective 16: Market-led Economic Growth and Resiliency
    Increased

**Funding to Begin:** FY 2004 Funding **End:** FY 2008 **LOP Amount:**
Financial info removed Million DA and Million Food Resource

**Sub-Activity Amount**: N.A.

**IEE Prepared By:** Mary Hobbs, Regional Environmental Officer, John
McMahon, USAID/Ethiopia/BEAT and Beth Dunford, USAID/Ethiopia/ALT

**Current Date**: June 22, 2004

**Other Relevant Environmental Compliance Documentation:** This IEE
references the following USAID environmental compliance documentation
that is already in effect for ongoing activities under USAID/Ethiopia SO
16:

-   *USAID/Ethiopia Crop Production and Pesticide Evaluation Report and
    Safer Use Action Plan*, File no.
    \_33Ethiopia2_PERSUAP_SO7_SO11.doc\_(8/4/03) ;

-   *USAID/Ethiopia Pesticide Evaluation Report and Safer Use Action
    Plan for Insecticide-Treated Materials in Ethiopia,*
    34Ethiopia2_LLITN_PERSUAP_SO14 and 16

-   *USAID/Ethiopia and CRS Guidelines for the Development of
    Small-scale Rural Water Supply and Sanitation Projects in Ethiopia
    (A Policy and Planning Framework for Activities funded by USAID
    under the Title II Program,*July 31, 2002

-   *USAID/Ethiopia Programmatic Environmental Assessment (PEA) of
    Small-scale Irrigation in Ethiopia being Carried Out by USAID-funded
    Title II Cooperating Sponsors* (September 1999)

-   *IEE for SpO 12, the Southern Tier Initiative*,
    31Ethiopia11_SPO_12_SC_Animal_Health (7/2/01)

-   *IEE for SO7 and SO11, Relief to Development (R2D) Program,*
    33Ethiopia1_R2D (1/09/03)

-   *IEE for SO 7 Rural Household Production & Productivity*,
    31Ethiopia_13_RHPP (8/10/01), including documentation for the
    *AMAREW Program,* 29Ethiopia_2_AMAREW

-   *IEE for the USAID/Ethiopia Water and Sanitation Program in Ethiopia
    (WSPE)/Millenium Water Alliance activities*, Program No.
    663-A-00-04-00419, (February 2004),

-   *Relief Society of Tigray (REST) Ahferom/Mereb Leke Weredas
    Tigray/Ethiopia Horn of Africa, Border Development Program Phase II,
    December 29, 2003*

-   *IEE for Mitigating the Effects of Disaster Strategic Objective*
    (MED SO) (2/15/01)

-   *Title II IEEs for DAPs implemented by CARE, CRS, REST, SCF/US and
    WV/E*

**IEE Amendment** (Y/N): \_\_\_[NO]{.underline}\_ If \"yes\", Filename &
date of original IEE: \_\_\_\_\_\_\_\_

**[ENVIRONMENTAL ACTION (S) RECOMMENDED:]{.underline}** (Place X where
applicable)

Exemption:

Categorical Exclusion: [X]{.underline} Negative Determination:
\_\_[X]{.underline}

Positive Determination: Deferral[:]{.underline}
\_\_\_[X]{.underline}\_\_\_

**[ADDITIONAL ELEMENTS:]{.underline}** (Place X where applicable)

EXEMP: \_\_\_\_\_\_\_\_\_\_ CONDITIONS: [X]{.underline} PVO/NGO:
[X]{.underline}

## SUMMARY OF FINDINGS {#summary-of-findings .unnumbered}

The goal of the USAID/Ethiopia Strategic Objective 16 is a key component
of the new Integrated Strategic Plan (ISP). Its aim is to accelerate
agricultural-based economic growth as a critical pathway to achieving
the ISP five year goal of reducing famine vulnerability, hunger and
poverty in Ethiopia. The underlying premise of SO 16 is that by
improving the economic circumstances and livelihood choices of the
poorest Ethiopians, they will be better enabled to survive shocks from
natural and man-made disasters and hence will be less vulnerable to the
effects of poverty, food insecurity and famine vulnerability.

The purpose of this IEE is to provide the necessary environmental
documentation, pursuant to 22 CFR 216 (Regulation 216) for
USAID/Ethiopia SO 16: Market-led Economic Growth and Resiliency
Increased, under the 2004-2008 USAID Integrated Strategic Plan for
Ethiopia. This document will ensure environmental compliance, and also
permit the implementation of the program activities in accordance with
USAID Environmental Policies and Procedures.

**1. A** **Categorical Exclusion** is recommended, pursuant to 22 CFR
216.2(c)(2)(i),(ii)(iii)and (v) for activities involving technical
assistance, analysis, advocacy, capacity building, resource provision
and training for the following types of interventions: climatic,
agricultural, environmental and economic monitoring; policy analysis and
reform advocacy; land certification procedures; land administration
capacity building; trade capacity development; business partnership
development; cooperative and business association strengthening;
livestock nutritional supplements; school retention strategies; adult
literacy and training of community health workers.

**2. A Negative Determination with Conditions** is recommended pursuant
to 22 CFR 216.3(a)(2)(iii) for physical interventions which includes:
improved access to input and product markets; improved production and
manufacturing processes; provision of credit to agricultural
cooperatives, agribusinesses and SMEs; micro-financing, strengthening
private sector seed and fertilizer input systems; support for the
creation of community-based seed production, seed banks, seed fairs and
seed vouchers; infrastructure development; micro, small and medium-scale
irrigation; water harvesting and conservation interventions; provision
of potable water and sanitation infrastructure; provision of rural
agricultural water supply; generation and dissemination of improved
agricultural technologies; support for expansion and improvements in
value-added processing; development of product storage facilities;
implementation of a small grants program for technology transfer; use of
direct transfers to encourage irrigation and other agricultural
technology improvements; use of direct transfers to fund labor for
public works such as road construction and other infrastructure
development; use of direct transfers to expand provision and use of
health care interventions such as vaccinations; and use of direct
transfers to encourage livelihood diversification activities.

***NB: Recommended mitigation measures are located in Section 4 of this
document.***

**3. A Deferral of a threshold determination,** per 22 CFR
216.3(a)(7)(iii), is recommended pending clearer identification of the
activities to be undertaken. The activity (ies) involved may not proceed
until the IEE is amended to remove the deferral, once the appropriate
environmental review has occurred. The following activities are
recommended for a deferred decision:

-   IR 16.2: "Expand rural marketing centers to help stimulate and grow
    the market"

**[Other Conditions]{.underline}:**

-   Among the conditions recommended in this IEE include the
    implementation of an environmental review process prior to
    undertaking certain activities that may have adverse environmental
    impacts. These activities are designated with a Negative
    Determination with Conditions, and prescribe use of USAID Africa
    Bureau Environmental Review Report (ERR), which is attached to this
    document as Annex 1.

> Proposed interventions for which the ERR is recommended are:
>
> a\) Infrastructure development, including road construction, storage
> facility development, and water source development, among others;
>
> b\) DCA-funded activities;
>
> c\) Irrigation and water/sanitation activities;
>
> d\) Development of agricultural and value-added processing facilities;
>
> e\) Small grants for technology transfer activities
>
> The rationale for using the screening process (ERR) is to determine
> the relative scale and potential negative environmental impacts from
> the specifically planned activities. Depending on the scale, these
> could range from significant to negligible.

-   Other conditions, which are described in Table 1, will include use
    of best practices guidelines as described in the USAID Africa Bureau
    document, *Environmental Guidelines for Small-Scale Activities in
    Africa*. This document may be located at:
    [www.encapafrica.org](http://www.encapafrica.org/).

-   Additionally, provision of an environmental management and
    mitigation (ENCAP) training course for implementing partners who
    will be undertaking activities likely to have adverse biophysical
    impacts is recommended.

-   New activities introduced into the project which are substantively
    different from those presented in this IEE will require submission
    of an amended IEE to the Ethiopia BEAT team leader. No activities
    will be conducted prior to receiving approval of the amended IEE.

**Existing USAID/Ethiopia Environmental Compliance Documents:** Several
resources for advising on environmentally-sound practices exist for
ongoing and future SO 16 activities. These are referenced above, but
reiterated here to emphasize the importance for implementing partners to
make use of these resources. The recommended resources are as follows:

-   Water and Sanitation: All activities within this category shall make
    use of the USAID/Ethiopia and CRS *Guidelines for the Development of
    Small Scale Rural Water Supply and Sanitation Projects in Ethiopia*,
    July 31, 2003

-   Agricultural Chemicals: All implementing partners who will be
    assisting with the supply and distribution of pesticides shall
    reference the crop production PERSUAP (see reference under
    "Pesticides" below);

-   Irrigation: All activities involving irrigation planning, design,
    funding and implementation are required to reference the
    recommendations as contained in the *USAID/Ethiopia Programmatic
    Environmental Assessment (PEA) of Small-scale Irrigation in Ethiopia
    being Carried Out by USAID-funded Title II Cooperating Sponsors*
    (September 1999)

-   Provision of insecticide-treated bednets: Some distribution of
    long-lasting insecticide-treated bednets is contemplated under the
    Productive Safety Net Program and Title II activities. These
    interventions are covered by the ***USAID/Ethiopia Pesticide
    Evaluation Report and Safer Use Action Plan for Insecticide-Treated
    Materials in Ethiopia,*** (34Ethiopia2_LLITN_PERSUAP_SO14 and 16),
    and are also addressed in the SO 14 IEE.

-   All relevant and applicable GFDRE environmental policy and
    regulations shall be adhered to by implementing partners. This
    includes the following: the Environmental Policy of Ethiopia (EPE),
    the Water Resources Policy (1992), and the Environmental Impact
    Assessment Proclamation no. 299 (2002).

    **[Title II Activities]{.underline}**:  Title II activities under SO
    16, IR 4 are covered under this IEE, and supplant the conditions as
    spelled out in the five existing Title II DAP IEEs. *Should these
    DAPs change significantly, or should a decision be made to go
    forward with Development Relief Plans (DRPs) for Ethiopia in FY05
    that encompass significantly different activities, then an amended
    SO 16 IEE will be required to incorporate these activities.*

**[Pesticides]{.underline}:** Facilitating procurement and use of
pesticides is expected under activities to: improve farmer access to
agricultural inputs and strengthen private sector input systems (IR 2);
generation and dissemination of improved agricultural technologies (IR
3); and promotion and adoption of improved production technologies (IR
4, which encompasses Title II, DA and Famine Fund resources for the
Productive Safety Net Program, PSNP).

To address statutory requirements for safe use and adequate training of
appropriate pesticides, USAID/Ethiopia commissioned the *USAID/Ethiopia
Crop Production and Pesticide Evaluation Report and Safer Use Action
Plan* (PERSUAP), which was approved in 2003.

The USAID/Ethiopia PERSUAP covers 28 pesticides proposed for use on
major crops in Ethiopia, and recommends a plan of action for minimizing
any potential adverse effects from such use. ***The document has been
and will continue to be required for use by all implementing partners
working with pesticides under USAID-funded programs.***

**NB: Some planned activities may also involve use of vaccinations and
other means to control ecto-parasites in livestock. Such activities may
be included under IR 16. 2---"provide assistance to improve farmers' and
pastoralists' access to input and product markets". If vaccinations
and/or other pesticide use is planned for control of ecto-parasites in
livestock, a new Pesticide Evaluation Report and Safer Use Action Plan
(PERSUAP) will be required to recommend permissible pesticides and their
safe application.**

**Monitoring and Evaluation:** As required by ADS 204.5.4, the SO team
will actively monitor ongoing activities for compliance with approved
IEE recommendations, and modify or end activities that are not in
compliance. If additional activities are added to this program that are
not described in this document, an amended environmental examination
must be prepared, as stated above.

**APPROVAL OF ENVIRONMENTAL ACTION RECOMMENDED:** (Type Name Under
Signature Line)

**CLEARANCE:**

Mission Director:
\_\_\_\_\_\_\_\_/s/\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Date: 07/21/04

> William Hammink

**CONCURRENCE:**

Bureau Environmental \_\_\_/cleared/\_\_\_\_\_\_\_\_\_ Date:
\_08/18/04\_\_\_\_

Officer: Paul DesRosiers Approved: \_\_X\_\_\_\_ Disapproved:
\_\_\_\_\_\_

**File No:** \_\_34Ethiopia3_SO16_EG.doc\_\_\_\_\_\_\_\_

**CLEARANCE**

General Council \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Date: \_\_\_\_\_\_\_\_\_\_\_\_

(Africa Bureau): Mary Alice Kleinjan

**ADDITIONAL CLEARANCE**

Mission Environmental Officer:
\_\_\_\_\_\_\_\_\_\_/s/\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Date: 07/19/04

John McMahon

Activity Manager:
\_\_\_\_\_\_\_\_\_\_\_\_/s/\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Date:
07/19/04

John McMahon

Regional Environmental Advisor:
\_\_\_\_\_\_/s/\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Date:
\_07/18/04\_\_\_\_ Mary Hobbs

Bureau Environmental \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Date: \_\_\_\_\_\_\_\_\_

Advisor: Brian Hirsch

**INITIAL ENVIRONMENTAL EXAMINATION**

PROGRAM/ACTIVITY DATA:

Program/Activity Number: 663-016

**Country/Region**: Ethiopia

**Program/Activity Title:** Strategic Objective 16: Market-led Economic
Growth and Resiliency Increased

**1.0 BACKGROUND AND PROJECT DESCRIPTION**

1.  **Purpose and Scope of IEE**

This IEE covers all DA and Title II-funded, planned activities under SO
16, "Market-led Economic Growth and Resiliency Increased", part of the
USAID/Ethiopia 2004-2008 Integrated Strategic Plan (ISP). Some ongoing
activities under the Southern Tier Initiative (STI), Relief to
Development Program (R2D), Border Development Program (Phase II) and
Rural Household Production & Productivity (RHPP) Program (including
AMAREW micro-enterprise activities) are covered under existing IEEs, as
referenced on the cover page of this document.

Finally, a few health and education-related activities that are included
under IR 16.4 are also covered by the IEE (in process) for SO 14, "Human
Capacity and Social Resiliency Strengthened".

2.  **Background and Description of Planned Activities**

USAID/Ethiopia submitted a new Integrated Strategic Plan (ISP) in late
February 2004 for the period FY 2004 -- FY 2008. This ISP sets a new
five-year goal to reduce famine vulnerability, hunger and poverty in
Ethiopia. Strategic Objective (SO) 16 - "Market-led Economic Growth and
Resiliency Increased"- is the key component of the ISP. It aims to
accelerate agricultural-based economic growth as a critical pathway to
achieving ISP's five year goal. Improving the economic circumstances and
livelihood choices of the poorest Ethiopians will better enable them to
survive shocks from both natural and man-made disasters and make them
less vulnerable to the effects of poverty, food insecurity and famine
vulnerability.

SO16 focuses on new ways to increase economic growth as a means to
reduce vulnerability to hunger and famine and increasing the ability of
households to survive shocks, such as drought; and create the economic
resources that will enable households to be self reliant through:

-   rapid economic growth in rural areas to increase food production and
    incomes;

-   market development that allows farmers and pastoralists to sell
    their products, that gets affordable food from surplus to deficit
    areas, and that allows commercial markets (domestic, regional,
    international) to play a fuller role in meeting food needs;

-   relief and development efforts (safety nets) that i) protect the
    productive assets of the food insecure by meeting their nutrition
    needs before they are forced to sell productive assets to survive;
    and ii) build their assets (social and economic) so that they are
    self reliant and are not dependent on safety net assistance over the
    long run;

-   appropriate land policy and land administration reforms; and

-   diversification of farm and non-farm economic opportunities that
    will create more opportunities for work and enable poor Ethiopians
    to grow their asset base.

USAID's duel approach to attack food insecurity and reduce famine
vulnerability will provide targeted food and non-food resources to move
one million of the chronically food insecure off emergency food
assistance over the next three years, moving them among those households
trying to stabilize and increase their income and asset base, while also
helping the transitory poor to increase their assets. USAID will also
help to put in place the systems and investments needed to accelerate
agricultural growth, build markets and raise agricultural productivity.
This dual approach is based on the premise that both the transitory poor
and stable poor can benefit in the near term from expanded production,
increased productivity, market access and more diverse options to raise
incomes.

To address the needs of the chronically food insecure, USAID will
support and work through a multi-donor productive safety net program.
USAID will target one million of the chronically food insecure in 20
districts with high levels of chronically food insecure people. USAID
resources, including Title II assistance and famine funds, will support
programs such as food for work or cash for work that are designed to
protect the poor's meager assets, and more importantly, to provide
resource transfers to allow them to build assets to move beyond the
chronically food insecure category. Title II assistance complemented by
DA and Famine Fund resources will be used to meet food needs in exchange
for public works, or participation in health or education activities
designed to build assets. In addition, Famine Fund resources will be
used to provide food insecure households with the means to invest in
productive assets. These assets will enable the chronically food
insecure to diversify and expand their livelihoods, which should
increase their access to food, even during times of hardship.

For the rural economy to grow, and address the needs of the transitory
and stable poor, credit must be more widely available, competitive
markets need to provide inputs and to link the producers with the
markets at all levels, new technology must be introduced and replicated,
infrastructure such as telecommunications and roads must be expanded,
market towns close to farmers need to be expanded, quality standards
must be met, and value needs to be added to the many agricultural
products produced in Ethiopia.

In making choices about the allocation of resources to support this
strategic objective, USAID will set priorities and focus efforts,
especially those efforts aimed at creating the conditions for broader
agricultural growth to occur, in line with the following criteria and
principles. Specifically, programs will be focused on:

-   A selected number of regions, including high potential regions
    (growth poles) and lower potential food insecure regions, and work
    to build growth linkages between them.

-   A selected number of food and agricultural commodity value chains.
    USAID will focus primarily on food grains (cereals, oilseeds, and
    pulses), horticulture, livestock and livestock products, and coffee.

-   Investments will be focused on the highest payoff and most efficient
    policy, institutional, market, and technology interventions to
    increase the incomes, productivity, competitiveness, and resiliency
    of rural small-holder farmers, pastoralists, agribusinesses and
    rural enterprises.

```{=html}
<!-- -->
```
-   Programs will be designed to: leverage partnerships and alliances
    with the private sector and government; promote cross sector
    linkages with education, health, disaster early warning and
    emergency response systems, and governance efforts to create
    synergy; facilitate the integration of relief and development
    resources to promote growth and enable the persistently poor to
    transition out of poverty; and address gender issues, including the
    economic and social empowerment of women.

    By focusing on selected high potential regions, which can serve as
    growth poles, the strategy will contribute to accelerating the
    growth of farm and non-farm jobs for the rural poor. By focusing on
    selected low potential regions that are especially vulnerable to
    drought and other shocks, the strategy will contribute to building
    the social and economic assets of the most vulnerable, enabling them
    to transition out of poverty. Building linkages between the various
    regions will be important to sustainably tackle the problem of food
    insecurity.

SO 16's program focuses on four main areas:

## I. Policy: Policy changes are critical to changing the development environment in Ethiopia. Farmers need secure land tenure and more control over their land as the foundation for increasing agricultural productivity, or to seek out alternative sources of income. Increasing the private sector's activity and presence in processing, marketing and input supply is also necessary to improve productivity and provide market-based incentives for increasing farm output and to balance distribution between food surplus and food deficit areas. Finally, market-led development and competition need to be encouraged by Government of the Federal Democratic Republic of Ethiopia (GFDRE) legal changes and infrastructure development to allow Ethiopian farmers, suppliers and processors access to regional, national and international markets. Increased exports will allow for greater imports of food and other materials to help Ethiopia better meet its own food security needs and to reduce reliance on international food aid and emergency relief efforts.  {#i.-policy-policy-changes-are-critical-to-changing-the-development-environment-in-ethiopia.-farmers-need-secure-land-tenure-and-more-control-over-their-land-as-the-foundation-for-increasing-agricultural-productivity-or-to-seek-out-alternative-sources-of-income.-increasing-the-private-sectors-activity-and-presence-in-processing-marketing-and-input-supply-is-also-necessary-to-improve-productivity-and-provide-market-based-incentives-for-increasing-farm-output-and-to-balance-distribution-between-food-surplus-and-food-deficit-areas.-finally-market-led-development-and-competition-need-to-be-encouraged-by-government-of-the-federal-democratic-republic-of-ethiopia-gfdre-legal-changes-and-infrastructure-development-to-allow-ethiopian-farmers-suppliers-and-processors-access-to-regional-national-and-international-markets.-increased-exports-will-allow-for-greater-imports-of-food-and-other-materials-to-help-ethiopia-better-meet-its-own-food-security-needs-and-to-reduce-reliance-on-international-food-aid-and-emergency-relief-efforts. .unnumbered}

Under Intermediate Result (IR) 1 "Selected Essential Policy Reforms
Implemented", USAID will provide technical and material assistance to
strengthen national, regional and local institutions and capacity in
Ethiopia to: 1) monitor climatic, environmental, agricultural and
economic trends in order to quickly respond to potential shocks or
crises; 2) undertake policy and investment analysis to offer policy and
investment options to decision-makers; 3) advocate for change in an
effective way, and 4) implement policies.

*This IR targets the improvement of policies, institutional capacity and
implementation of policies at various levels (federal, regional, local)
that are required for economic growth and resiliency. Areas for
potential support include those policies:*

-   Restricting enhanced land tenure security and transferability of use
    rights;

-   Limiting access to credit and micro-financing for producer groups,
    cooperatives, small- and medium-entrepreneurs, agribusiness and
    traders;

-   Constraining the entry of new private sector providers into
    agricultural input markets;

-   Preventing full participation in the Common Market for East and
    Southern Africa (COMESA) Free Trade Area;

-   Establishing food aid and crisis management procedures for relevant
    technical ministries at federal and regional level and regions;

-   Restricting private investment to increase trade competitiveness
    (i.e. transport, telecommunications); and

-   Relating to integrated water resources management, water services
    provision, land use and natural resources management.

## USAID will support activities aimed at the development of a rural economy knowledge support system (REKSS), land administration and land policy reform, Ethiopia's accession to the World Trade Organization (WTO), and other targeted policy related interventions (investment, food aid reform, trade competitiveness), that are needed to improve agriculture and enterprise productivity and market competitiveness, and economic resiliency.  {#usaid-will-support-activities-aimed-at-the-development-of-a-rural-economy-knowledge-support-system-rekss-land-administration-and-land-policy-reform-ethiopias-accession-to-the-world-trade-organization-wto-and-other-targeted-policy-related-interventions-investment-food-aid-reform-trade-competitiveness-that-are-needed-to-improve-agriculture-and-enterprise-productivity-and-market-competitiveness-and-economic-resiliency. .unnumbered}

## REKSS is a multi-donor supported program, carried out with assistance of the International Food Policy Research Institute (IFPRI), to increase the capacity of the GFDRE and other think tanks to improve policy and investment decision-making and performance monitoring of programs addressing famine vulnerability, hunger and poverty. Multi-donor support (USAID, World Bank, and European Union) will also be provided to assist the GFDRE meet requirements for accession to the WTO. Resources from USAID/Washington, i.e. the Bureau for Economic Growth, Agriculture and Trade (EGAT), USAID Regional Economic Development Services Office for Eastern and Southern Africa (REDSO/ESA) and USAID/Ethiopia will support trade capacity building for WTO accession. USAID programs in land administration will build upon the pilot activities of the Swedish development agency (SIDA) and USAID in the Amhara Region, strengthen the capacity of land administration authorities in one or more regions, support land administration policy development in multiple regions, and in one or two regions support land certification programs for small-scale farmers. USAID is also considering support for for property rights and may partner with the Institute for Liberty and Democracy (ILD) to implement a property rights program. USAID will also provide targeted support to improve trade and investment policies (i.e., telecommunications, transport) and policies for disaster mitigation and response in collaboration with SO 13 -- "Capacity to Anticipate and Manage through Shocks Increased", and land use and natural resource management policies. USAID will also provide targeted support of the GFDRE Integrated Framework's trade capacity action plan.  {#rekss-is-a-multi-donor-supported-program-carried-out-with-assistance-of-the-international-food-policy-research-institute-ifpri-to-increase-the-capacity-of-the-gfdre-and-other-think-tanks-to-improve-policy-and-investment-decision-making-and-performance-monitoring-of-programs-addressing-famine-vulnerability-hunger-and-poverty.-multi-donor-support-usaid-world-bank-and-european-union-will-also-be-provided-to-assist-the-gfdre-meet-requirements-for-accession-to-the-wto.-resources-from-usaidwashington-i.e.-the-bureau-for-economic-growth-agriculture-and-trade-egat-usaid-regional-economic-development-services-office-for-eastern-and-southern-africa-redsoesa-and-usaidethiopia-will-support-trade-capacity-building-for-wto-accession.-usaid-programs-in-land-administration-will-build-upon-the-pilot-activities-of-the-swedish-development-agency-sida-and-usaid-in-the-amhara-region-strengthen-the-capacity-of-land-administration-authorities-in-one-or-more-regions-support-land-administration-policy-development-in-multiple-regions-and-in-one-or-two-regions-support-land-certification-programs-for-small-scale-farmers.-usaid-is-also-considering-support-for-for-property-rights-and-may-partner-with-the-institute-for-liberty-and-democracy-ild-to-implement-a-property-rights-program.-usaid-will-also-provide-targeted-support-to-improve-trade-and-investment-policies-i.e.-telecommunications-transport-and-policies-for-disaster-mitigation-and-response-in-collaboration-with-so-13-capacity-to-anticipate-and-manage-through-shocks-increased-and-land-use-and-natural-resource-management-policies.-usaid-will-also-provide-targeted-support-of-the-gfdre-integrated-frameworks-trade-capacity-action-plan. .unnumbered}

# II. Markets and Enterprises: Creating more open and competitive markets leads to better distribution of resources and food across the country, encourages agricultural productivity by providing outlets for produce and helps diversify rural economies and livelihoods. Strengthening agribusinesses, cooperatives, and small and micro enterprises are crucial to make input and product markets work effectively, create and diversify livelihoods opportunities, and support rural economic growth. Market and enterprise programs will lead to better food security for targeted populations of the five million chronically food insecure and better economic security and resilience for targeted populations of the 26 million 'transitional poor' and 27 million "stable poor". 

Under IR 2 "Selected Input and Product Markets Strengthened", USAID will
help to improve farmers' and pastoralists' access to input and product
markets, reducing market transaction costs, promoting new market
opportunities, reducing volatility of select product markets, and
forging business partnerships between producers and others in the supply
chain. USAID will assist establishment of a grain warehouse receipts
system to counter the inevitable price crashes that have occurred in the
past when bumper cereal crops have been produced. USAID will provide
business development services and technical support to cooperatives,
producer organizations, commercial farmers, agribusinesses and small
entrepreneurs to improve production or manufacturing processes and
practices, increase access to market information and market intelligence
and improve the grades and standards of their product whether for
domestic, regional or international markets. Development Credit
Authority loan guarantees are envisioned to meet the short and
medium-term credit needs of agricultural cooperatives and marketing
groups, agribusinesses, and small and micro enterprise. Strengthened
cooperatives, business associations and chambers of commerce will help
to ensure long-term sustainability. Expansion of rural marketing centers
will help stimulate the demand and grow the size of the market.

Development of private sector seed and fertilizer input systems will
enable farmers to increase their productivity and improve the countries
food security and export potential. For high potential areas where the
provision of these inputs is profitable, technical support will likely
be through the International Fertilizer Development Center. In lower
potential food insecure areas where it may not be profitable for private
sector engagement, USAID may provide technical support through an
international research center such as the International Crops Research
Institute for the Semi-Arid Tropics (ICRISAT) in collaboration with
non-governmental organizations (NGOs) employing alternative strategies
like community-based seed production, seed banks, seed fairs, and seed
vouchers.

USAID will implement this IR in close collaboration with several other
donors who are supporting markets and enterprise development (EU,
International Fund for Agricultural Development, World Bank, African
Development Bank, and other bi-lateral donors).

USAID will also build upon its highly successful agricultural
cooperatives program. Through this IR, USAID will work with and
strengthen cooperative unions, targeted primary cooperatives, and rural
savings and credit cooperatives to provide services to members and link
agricultural producers to domestic and international markets. As part of
market systems development, USAID envisions multi-donor support for such
areas as a warehouse receipts system to stabilize commodity prices,
market information, infrastructure development, and cooperative
development. A consortium that will be determined in response to a fully
competitive RFP process will implement most activities, other than the
seeds and fertilizer. USAID will fold the ongoing Southern Tier
Initiative (STI) program into SO 16 to support livestock marketing and
strengthening of pastoralists's livelihoods. USAID will phase out the
Amhara Regional Food Security Program (AMAREW), which supports micro
enterprise development in select food insecure districts, in FY 2005.

III\. Agricultural Productivity: Ensuring sound use of natural resources
(crop land, pasture land, water, forests, and biodiversity) and
restoring the productivity of degraded natural resources is crucial for
improving food security and economic growth. New technologies and new
approaches to natural resource management are important for the
transitional as well as stable poor, helping them to preserve and to
build their productive assets. Irrigation projects coupled with the
introduction of drought resistant crops, for example, can help to raise
productivity and preserve soil fertility, building an economic floor
under farmers to prevent them from becoming chronically food insecure.
They can also increase the total amount of food available in Ethiopia,
and with better marketing structures, allow farmers to sustainably
increase their incomes and add to their assets. At the same time,
raising productivity of priority commodity systems is a driving force in
the agricultural growth process and requires focused attention.

## Under IR 3 "Natural Resource Management and Agricultural Productivity Improved", USAID will provide support for activities aimed at improved land and natural resource management, rural water development (including irrigation, water supply and community-based watershed management), and the generation and dissemination of more productive and resilient agricultural technologies, including both pre and post-harvest technologies.  {#under-ir-3-natural-resource-management-and-agricultural-productivity-improved-usaid-will-provide-support-for-activities-aimed-at-improved-land-and-natural-resource-management-rural-water-development-including-irrigation-water-supply-and-community-based-watershed-management-and-the-generation-and-dissemination-of-more-productive-and-resilient-agricultural-technologies-including-both-pre-and-post-harvest-technologies. .unnumbered}

## This IR integrates sound natural resource management with improved agricultural technologies and practices. Support for improved land use will strengthen land use policies and planning processes to address severe land degradation in targeted regions. USAID will support rural water development interventions to meet the requirements of households, communities, agricultural producers, and agro-enterprises. This will include micro, small and medium scale irrigation, water harvesting, water conservation, potable water and sanitation (in collaboration with SO 14 - Human Capacity and Social Resiliency Increased), rural water supply for agriculture, and community-based watershed management. USAID anticipates collaboration with the Israeli MASHAV Center for International Development in the irrigation area, as well as public/private partnerships for rural water development. Rural water interventions will enhance rural productivity and build resiliency to shocks. Collaboration between agricultural input providers, cooperatives, agro-processors, commercial farmers (who establish business relationships with small holders) and government institutions (research organizations, universities, extension services) will be strengthened to accelerate the identification, validation, demonstration and transfer of improved technologies. The Mission envisions having a competitive grants program for technology transfer in targeted sub-sectors to encourage public/private partnerships, innovation and accelerate the pace of technology adoption. The Mission also will collaborate closely with the technology transfer programs of other donors (i.e., WB, Canadian International Development Agency, German Technical Cooperation - GTZ, and SIDA) and select international agricultural research centers (i.e., International Center for Research in Agro-Forestry , International Livestock Research Institute, International Water Management Institute, and ICRISAT). Technologies will include agricultural production, value-added product processing, product storage, and environmental management. Improved incentives (i.e., land tenure security, market price stability, and regional and international market access), strengthened market systems and enterprises, and access to finance supported under other IRs will help to create a demand for improved technologies and contribute to the systems needed for sustained rural productive increases.  {#this-ir-integrates-sound-natural-resource-management-with-improved-agricultural-technologies-and-practices.-support-for-improved-land-use-will-strengthen-land-use-policies-and-planning-processes-to-address-severe-land-degradation-in-targeted-regions.-usaid-will-support-rural-water-development-interventions-to-meet-the-requirements-of-households-communities-agricultural-producers-and-agro-enterprises.-this-will-include-micro-small-and-medium-scale-irrigation-water-harvesting-water-conservation-potable-water-and-sanitation-in-collaboration-with-so-14---human-capacity-and-social-resiliency-increased-rural-water-supply-for-agriculture-and-community-based-watershed-management.-usaid-anticipates-collaboration-with-the-israeli-mashav-center-for-international-development-in-the-irrigation-area-as-well-as-publicprivate-partnerships-for-rural-water-development.-rural-water-interventions-will-enhance-rural-productivity-and-build-resiliency-to-shocks.-collaboration-between-agricultural-input-providers-cooperatives-agro-processors-commercial-farmers-who-establish-business-relationships-with-small-holders-and-government-institutions-research-organizations-universities-extension-services-will-be-strengthened-to-accelerate-the-identification-validation-demonstration-and-transfer-of-improved-technologies.-the-mission-envisions-having-a-competitive-grants-program-for-technology-transfer-in-targeted-sub-sectors-to-encourage-publicprivate-partnerships-innovation-and-accelerate-the-pace-of-technology-adoption.-the-mission-also-will-collaborate-closely-with-the-technology-transfer-programs-of-other-donors-i.e.-wb-canadian-international-development-agency-german-technical-cooperation---gtz-and-sida-and-select-international-agricultural-research-centers-i.e.-international-center-for-research-in-agro-forestry-international-livestock-research-institute-international-water-management-institute-and-icrisat.-technologies-will-include-agricultural-production-value-added-product-processing-product-storage-and-environmental-management.-improved-incentives-i.e.-land-tenure-security-market-price-stability-and-regional-and-international-market-access-strengthened-market-systems-and-enterprises-and-access-to-finance-supported-under-other-irs-will-help-to-create-a-demand-for-improved-technologies-and-contribute-to-the-systems-needed-for-sustained-rural-productive-increases. .unnumbered}

## IV. Livelihoods: Protecting and building the assets of the food insecure enables them to strengthen their livelihoods during good times and bad. In addition, secure land tenure will allow more livelihood choices for Ethiopian farmers and producers. For example, farmers who can lease surplus land or who can use their land use rights for loan collateral can, with commercialization and the creation of better market networks, move into different economic sectors as commodity processors or input suppliers. This will reduce the subsistence pressure on the land and diversify local income sources and opportunities for all of Ethiopia's rural poor.  {#iv.-livelihoods-protecting-and-building-the-assets-of-the-food-insecure-enables-them-to-strengthen-their-livelihoods-during-good-times-and-bad.-in-addition-secure-land-tenure-will-allow-more-livelihood-choices-for-ethiopian-farmers-and-producers.-for-example-farmers-who-can-lease-surplus-land-or-who-can-use-their-land-use-rights-for-loan-collateral-can-with-commercialization-and-the-creation-of-better-market-networks-move-into-different-economic-sectors-as-commodity-processors-or-input-suppliers.-this-will-reduce-the-subsistence-pressure-on-the-land-and-diversify-local-income-sources-and-opportunities-for-all-of-ethiopias-rural-poor. .unnumbered}

## Under IR 4 "Livelihood Options for the Food Insecure Protected, Diversified and Expanded", USAID will provide support for productive safety nets interventions for one million chronically food insecure people.  {#under-ir-4-livelihood-options-for-the-food-insecure-protected-diversified-and-expanded-usaid-will-provide-support-for-productive-safety-nets-interventions-for-one-million-chronically-food-insecure-people. .unnumbered}

Under this IR, USAID proposes three types of interventions for a
selected number of Ethiopia's chronically vulnerable, based on the
premise that reducing food insecurity requires:

-   [Protecting Assets:]{.underline} The primary goal of the livelihoods
    transition programs is to protect assets by meeting the basic needs
    of the food insecure through timely and targeted direct resource
    transfers that will prevent the sale or irreversible loss of
    productive assets. This could mean, for example, the provision of
    nutrient supplements or livestock fodder in times of shock to help
    pastoralists preserve their herds. The provision of food, cash or
    inputs could encourage risk adverse farmers to experiment with new
    technologies. Incentives could be provided to encourage the
    protection of natural resource assets such as soil and water from
    depletion or degradation. As women and men control different assets,
    it is important to be sure that resource transfers are provided to
    both. Title II food will provide the bulk of the resource transfers
    to meet basic needs and protect assets.

-   [Building Assets]{.underline}: The resource transfers will be made
    in exchange for productive behavior that is explicitly connected to
    the larger development agenda. Direct resource transfer is provided
    in exchange for labor or actions that will build assets important to
    future economic and social resiliency. Work on infrastructure and
    public works (i.e. market places, roads, bridges, ponds, water
    source development and protection, pasture rotation, and
    environmental rehabilitation that will promote markets and economic
    growth) can all be considered. Resource transfers can also be used
    to encourage children, especially girls, to stay in school or seek
    health services such as vaccinations, both essential if these
    populations are to increase their economic resiliency. It is
    important that labor-poor households (often women headed) are also
    able to participate in asset creation activities in exchange for
    resource transfers.

-   [Livelihood Diversification and Expansion Activities]{.underline}:
    Transition programs will also be used to diversify and expand
    livelihood options in an environmentally sustainable manner.
    Building upon assets protected and expanded by timely resource
    transfers to the food insecure, diverse and expanded livelihood
    options will increase resiliency to shocks and will pull people
    further up the economic ladder. A wide range of possible activities
    exist including agro-forestry, adoption of new drought-resistant
    crops, efficient irrigation technologies, seed nurseries,
    bee-keeping, improved livestock marketing or training in the range
    of new value-added businesses expected to emerge as a result of
    other activities under this SO. Livelihood diversification and
    expansion activities with direct links to SO 14 include adult
    literacy and CHW training. The gender division in livelihood
    strategies will be considered.

2.  **COUNTRY AND ENVIRONMENTAL INFORMATION (BASELINE INFORMATION)**

The topography and diverse climatic conditions of Ethiopia has created
habitats that are suitable for a diverse array of plant and animal
species. As a result, the country is in one of the biodiversity rich
parts of the world. In addition to its plant and wildlife populations,
Ethiopia is also one of the world's centers of crop genetic diversity.

The Ethiopian flora is estimated to contain nearly 7,000 species of
higher plants, of which about 12 percent are endemic. The vegetation
types with the highest proportion of endemics are the woodlands,
followed by the Afro-alpine and Sub-Afro alpine.

Ethiopia is the center of origin for various crop species including
Arabica coffee, Niger seed, and sorghum. Other crop species that have
high genetic diversity in the country are barley, wheat, fava bean,
field pea, lentil, linseed, and sesame. In addition, there are various
wild plants that are used by communities for various purposes, including
medicinal purpose (Environmental Protection Authority, 2003).

[Agriculture and Land Use]{.underline}

Approximately sixty-six percent of Ethiopia's total land area (112
million hectares) is potentially suitable for agriculture. However, only
fourteen percent is currently under cultivation and the largest use of
the land (over fifty percent) is for livestock grazing. Ethiopia's soils
are fertile, but are undergoing severe mining of nutrients from
intensive agricultural activities (Food and Agricultural Organization,
2003). The expansion of agriculture (in contrasts to agricultural
intensification) is one of the primary threats to Ethiopia's
biodiversity and tropical forests.

An estimated seven million smallholder farmers produce ninety percent of
the crops. The private sector and the state farms produce the remaining
ten percent. Crop resources play the major role in food security, income
generation, and provision of industrial raw materials as well as the
creation of employment opportunities.

Before the early 1960s, Ethiopia was a net exporter of food crops.
However, since the early 1970s, domestic production of food crops has
not been able to cover the minimum basic per capita human food
requirement of the population. As a result, the deficit is being
complemented through foreign purchase and food aid. Recurring drought
and environmental degradation are factors that have led to this
situation.

Traditional agriculture in the country has low productivity. A large
area of land has been put under cultivation to meet the food
requirements of the increasing population. This has resulted in the
destruction of forests, degradation of marginal lands, and erosion of
fertile soils by water erosion.

Ethiopia is also has the largest livestock population in Africa.
Livestock account for approximately thirty percent of the agricultural
gross domestic product (GDP) and sixteen percent of the national foreign
currency earning (second only to coffee).

Consequently, a major land use in Ethiopia is rangelands, which can be
defined as areas lying below 1,500 meters in elevation and where
rainfall is less than seven hundred millimeters per year. Drought is
also frequent in these areas. Ethiopia's rangelands often maintain
extensive areas of grassland with trees and shrubs. These areas are
generally too dry for sustainable rain fed agriculture. However, these
rangeland areas contain only about ten percent of Ethiopia's human
population.

One of the threats to some rangeland areas is the encroachment of
irrigation-based agriculture. Irrigation activities have forced the
pastoral communities to overgraze their rangelands. As a result, many
rangeland areas have become degraded.

[Forest Cover]{.underline}

In addition to overgrazing their existing rangelands, pastoralists are
expanding their grazing activities into marginal lands, National
protected areas, and naturally forested areas.

Natural forests once covered over 40 million hectares of Ethiopia\'s
total land area of 120 million hectares. However, the extent of
Ethiopia's natural forests is now approximately 4.4 million hectares
(World Resources Institute, 2004). The annual loss of natural forest
cover has been estimated to be 150,000 to 200,000 hectares.

There has also been a breakdown in forest management as a result of the
civil war. In recent years, deforestation has been particularly severe
due to the clearing of forests for agriculture, livestock grazing,
illegal cutting for timber, and fuelwood gathering. If the present rate
of deforestation continues, the area covered by natural forests in 2010
will be reduced to scattered stands of heavily disturbed forests in
remote parts of the country.

Forest resources provide numerous indirect economic benefits. Forest
resources are particularly beneficial for the production of incense,
gums, bamboo, honey and wild coffee. In addition, forests provide
fuelwood, medicinal plants, wildlife habitat and maintenance of water
regimes. Current data is not available regarding the contribution of
forest resources to Ethiopia's Gross Domestic Product (GDP). In the
early 1990's, a government study estimated that the contribution of
forest resources to the GDP was 2.5 percent and their contribution to
the agricultural sector was 5.5 percent. However, if all of the tangible
forest products and intangible benefits (e.g., watershed protection,
soil conservation) were assessed the contribution of forest resources to
GDP would be well over 10 percent (Mengistu, 2002).

One of the consequences of the continuous deforestation is the growing
scarcity of fuelwood and construction wood. In Ethiopia, wood is the
main energy source for both urban and rural people. Wood is also widely
used for construction and fencing. In 1990, annual wood production was
approximately four million cubic meters. Ninety percent of this wood was
utilized for fuelwood, seven percent for construction, and 3 percent for
processed industrial wood products (e.g., lumber, plywood, fiber board)
(Mengistu, 2002).

[GFDRE Environmental Management]{.underline}

The system of Government of the Federal Democratic Republic of (GFDRE)
is quite decentralized. The country follows a parliamentarian form of
government. The Federal GFDRE consists of nine National Regional States
(NRSs) delimited on the basis of the settlement patterns, language,
identity and consent of the concerned communities (Articles 45, 46, 47
of the Federal Constitution). Within the NRSs there are zonal and woreda
(District) administrative levels, with the woredas being the important
levels where local self government is exercised.

According to the Federal Constitution, all powers not given expressly to
the Federal government alone or concurrently with the NRSs are reserved
to the states. Thus, the states have the power to enact and execute
their own constitution and other laws as well as formulate and execute
their economic, social and development policies, strategies and plans.
However, they can only administer land and other natural resources in
accordance with Federal laws (Article 52). They have the power to
collect royalty from forest resources as well as share royalty form
mining and gas and petroleum operations with the federal government.

The Woreda's powers include examining and approving draft economic
development, social services as well as working plans and programs. In
particular they are responsible for following up on agricultural
development activities that are undertaken consistent with the
appropriate season and that conservation and care of natural resources
is carried out with special attention.

In general, the decentralized system is expected to facilitate
environmental management through ensuring the political, economic and
social empowerment of citizens at all levels. This is particularly
important for community and village levels to enable them to lead
developments in their areas.

Besides the overall mandate of the Federal government to formulate and
implement the country's policies, strategies and plans in respect to
overall economic, social and development matters, there are, among
others, specific provisions in the Federal Constitution which specify
Federal mandates over natural resources. These include the protection
and preservation of cultural and historical legacies and enacting laws
for the utilization and conservation of land and other natural
resources, historical sites and objects as well as the power to
determine and administer the utilization of the waters or rivers and
lakes linking two or more states or crossing the boundaries of the
national territorial jurisdiction (Article 51). In addition, the Federal
constitution enshrines the important principle that "all persons have
the right to a clean and healthy environment and that all persons who
have been displaced or whose livelihoods have been adversely affected as
a result of state programs have the right to commensurate monetary or
alternative means of compensation, including relocation with adequate
state assistance" (Article 44(1)).

[Environmental Policy and Regulation]{.underline}

At the Federal level there is the Environmental Policy of Ethiopia
(EPE). The elements included in the policy are extracted form the
Conservation Strategy of Ethiopia (CSE) completed in year the 2001. The
CSE was formulated with the intention of bringing about sustainable
management of natural resources in the context of development. The
policy is the result of a process of identifying and agreeing on the
major environmental issues through discussions in a series of workshops
and conferences and meetings with representative communities at the
grass roots level. The policy is designed to integrate environmental
concerns into development in a manner that will bring about a holistic
management approach with the objective of improving human and ecological
conditions and making the transition to a sustainable society.

Some of the major components of the EPE with direct relevance to
activities planned under USAID SO 16 concern: biodiversity, land use and
soil conservation, forests, and water resource management. These topics
are covered briefly below:

[Biodiversity:]{.underline} The general policy principle is that
biological diversity should encompass natural and human managed
ecosystems, species of domesticated and wild flora and fauna. It should
also encompass the genetic variation within individual species.
Biodiversity should be protected and conserved through *ex situ* and *in
situ* conservation of wild and domesticated biodiversity, the
establishment of protected areas and integrated biodiversity
conservation outside protected areas. Biodiversity should also be
protected as part of the development of strategic land use plans and
agricultural and pastoral production strategies. Involvement of
communities (living within and outside protected areas) is an important
principle of the EPE. In this respect, the development of eco-tourism as
a means of promoting conservation of biodiversity and generating revenue
for communities is considered important.

Natural ecosystems, particularly wetlands and upstream forests, the
interface between water bodies and land such as lake shores, river banks
and watersheds, are also recognized as fundamental in regulating water
quality and quantity. As such their rehabilitation and protection is to
be integrated into conservation.

Both the importation, exportation and exchange of genetic and species
resources is to be subject to legislation. The legislation should
safeguard community and national interests including the protection of
sovereign rights as well as ensure the fulfilling of international
obligations and quarantines. The relevance of the Convention of
Biological Diversity (CBD) is taken in to account.

[Land Use and Soil Conservation]{.underline}: With respect to land use,
the EPE and the Conservation Strategy of Ethiopia (CSE) require that
land use categories shall be recommended based on carrying capacity,
vulnerability to erosion, wetland values, biodiversity values, and
pollution hazards as well as social and economic considerations. Within
the framework of the National Regional State (NRS) Land Use Plans,
Woreda and community land use plans are to be prepared with assistance
from government. The NRS land use plans shall be the basis for the
Federal land use plan. Institutional responsibility shall be placed in
an agency which is impartial to all.

The policy emphasizes the importance of uninterrupted and continuing
access to the same land for peasants to take serious soil conservation
and investment measures*.* The environmental policy further recommends
recognition and protection of customary rights of access to and use of
land and natural resources which are constitutionally acceptable,
socially equitable and are preferred by local communities.

In addition, maintenance of soil productivity by protecting the soil
from erosion, desertification, salinization and promoting effective
ground cover is an essential element of the approach to improved soil,
crop and animal husbandry for sustainable agriculture. Stall cattle
feeding to protect the soil from trampling due to grazing and planting
trees are considered an important means of encouraging re-vegetation for
protecting and building up the soil.

The policy recommends the use of appropriate organic matter and nutrient
management for improving soil structure, nutrient status and
microbiology. The integrity of soil is to be safeguarded. Soil physical
and biological properties are to be protected through management
practices for the production of crops and livestock. For example,
attention should be paid to the proper balance in amounts of chemical
fertilizers and organic fertilizers (including green manure, farmyard
manure and compost). Indigenous systems of soil management have been
given recognition in the policy as a possible foundation for building
upon soil conservation measures. The policy also promotes full
environmental, social and economic impact assessments of all existing
irrigation schemes and the establishment of programs to correct their
negative impacts.

A shift of emphasis in crop breeding from single line plant varieties
and animal breeds to multiple lines involving as many different but
adapted lines as possible is recommended by the policy in order to
increase both resiliency in adapting to environmental variations, and
resistance to pests and diseases. In this regard, a careful and well
considered evaluation of the current extension package appears
appropriate in view of its promotion of monoculture high yielding
varieties in crops and animals in order to establish the extent of the
impact of such promotion on the sustainability of Ethiopian agriculture.

[Forests]{.underline}: The factors that affect forest resources include
population increases, expansion and growth of human settlements,
increased demand for farm lands in and near forest areas, reliance of
the large majority of the population on wood and charcoal for the
satisfaction of their energy requirements, and meeting the needs for
construction and industrial wood. Forest fires caused by human
activities as well as other factors are also serious problems.

With regard to forests, the Policy promotes sustainable forest
management principles. This entails conservation of natural forests by
management plans, determining which forests should be used for habitat
protection, conservation and production. Uncultivable lands are to be
afforested and felling and grazing therein to be controlled. While the
formulation of forestry strategies that integrate the development,
management and conservation of forest resources with those of land,
water, energy, ecosystem and genetic resources, as well as with crop and
livestock production is required, agricultural and other policies and
programs that reduce pressure on fragile wood land resources and
ecosystems are also to be pursued. Detailed sectoral forest policy is
not in place and a draft prepared some years back is still awaiting
approval.

[Water Resources]{.underline}: The planning and development unit for
water resources is the drainage basin and priority is to be given to
watershed management to control and conserve water and to regulate its
balance in the catchments. Integrated Water Resources Management (IWRM)
which emphasizes multi-purpose projects is adopted. The Policy also
gives recognition to the fact that natural ecosystems, particularly
wetlands and upstream forests, as well as the interface between water
bodies and land (e.g., lake shores, river banks and wetlands) are
fundamental in regulating water quality and quantity and to integrate
their rehabilitation and protection into the conservation, development
and management of water resources.

Planning of surface and ground water uses, artificially recharging
ground water aquifers, recycling water and not exceeding the sustainable
water supply in the course of water allocation are some of the policy
measures designed to maximize efficient use of the quantity and to
improve the quality of water.

There are also several policy prescriptions with regard to the
protection of water and related flora and fauna from harmful effects
such as the introduction of exotic species into water ecosystems.
Furthermore, the design, construction and use of dams and irrigation
systems and other water works should ensure the control of environmental
health hazards.

Currently, sectoral water resources development and protection policies,
strategies and water resources development action plans (including
drinking water and sanitation) are in place. In order to meet human and
financial needs of the water sector, the Arba Minch Water Technology
Institute and a Federal-level water fund have been established.

It should be noted that the National Regional States have their own
Regional Conservation Strategies tailored to their specific needs but
consistent with the EPE and the Conservation Strategy of Ethiopia.

Additionally a new Water Resources Policy was implemented by the GFDRE
in 1992. The overall goal of this policy is to enhance and promote all
national efforts towards the efficient, equitable and optimum
utilization of the available water resources of Ethiopia for significant
socio-economic development on a sustainable basis. Some of the important
objectives of this policy include the promotion of a comprehensive and
integrated water resources management (IWRM) and the use of a watershed
approach in water resources management.

**Environmental Impact Assessment Proclamation (Number 299, dated
2002)**

The main reasons for enacting this Proclamation are indicated below.

-   Environmental Impact Assessment serves to bring about thoughtful
    development by predicting and mitigating the adverse environmental
    impacts that a proposed development activity is likely to cause as a
    result of its design, location, construction, operation,
    modification and cessation.

-   A careful assessment and consideration of the environmental impacts
    of public documents prior to their approval, provides an effective
    means of harmonizing and integrating environmental, economic, social
    and cultural considerations and aspirations into the decision-making
    process in a manner that promotes sustainable development.

-   Implementation of the environmental rights and objectives enshrined
    in the Constitution requires the prediction and management of likely
    adverse environmental impacts, ways in which the benefits might be
    maximized, and the balancing of socio-economic benefits with
    environmental costs.

-   Environmental impact assessment serves to bring about administrative
    transparency and accountability, as well as involve the public and,
    in particular, communities in development planning decisions which
    may affect them and their environment.

The enactment of these Proclamations will help much in the effort to
bring about sustainable development in the country by ensuring that
development programs, projects and activities do not cause negative
impacts on the natural resource base and the environment in general.

The Environmental Protection Authority has also in draft form, effluent
and ambient standards for water, air, soil and noise as well as draft
regulations to facilitate the implementation of the Pollution Control
Proclamation with respect to pollution from industrial waste. However,
the draft regulations have yet to be approved and enacted and the
standards have yet to be backed by legislation to effectively support
the implementation and enforcement of the Proclamations described above.

The rate at which laws and regulations required for ensuring compliance
with and enforcement of the EPE requirements have been enacted has been
rather slow. For example, it is only recently that Environmental Impact
Assessment (EIA) has received legal backing with the issuance of
Proclamation Number 299 of year 2002. It is worthwhile noting, however,
despite the lack of a full-fledged EIA legislation, EPA has been
involved in reviewing EISs of proposed development projects submitted to
it by the Ethiopian Investment Authority and a few other government
organizations.

The revision of existing sectoral laws to ensure harmony with the
Environmental Policy of Ethiopia (EPE) and the drafting and enacting of
new laws and regulations has been also been too slow. Again, this is an
undertaking that should have commenced immediately after the approval of
the EPE and continued at a far urgent rate than is being observed. As a
result of these delays, the commencement of requiring compliance and
enforcement with the EPE prescriptions has yet to begin. In the mean
time actions that may result in serious damage to the environment will
continue unabated.

Again, no systematic evaluation and review of sectoral environmental
legislation has been made. For example, the wildlife sector is still
governed by an old and outdated legislation. Although the legislation
governing the forest sector has been revised in 1994 with the intention
of updating it (mainly in terms of providing for new types of forest
ownership), it has not yet been evaluated for the consistency of its
provisions with the new policy prescriptions and legal norms.

## The Federal and National Regional State (NRS) Institutional Framework for Environmental Management {#the-federal-and-national-regional-state-nrs-institutional-framework-for-environmental-management .unnumbered}

The Environmental Policy of Ethiopia (EPE) and the Conservation Strategy
of Ethiopia (CSE) prescribe the establishment, by law, of coordination
and management bodies form the federal down to the community level to
handle the sectoral and cross sectoral planning and implementation of
the issues identified therein. In addition, it is prescribed that the
institutional framework be designed in a manner that will determine the
arrangements for the formulation of natural resources development and
management strategies, legislation, regulation, monitoring and
enforcement.

The EPE and the CSE envisage environmental institutions with either
coordination, regulatory/monitoring or both powers from the Federal down
to the community level. The institutions are to consist of coordinating
committees/ councils with secretariat at regional, zonal, Woreda
(District) levels. At the community level, only a secretariat that takes
minutes and records the decisions made by the community is envisaged.
The committees at the various levels are to consist of community,
non-governmental organization (NGO), private sector as well as
government representatives.

**The Federal Environmental Protection Authority**

The Federal environmental institution is the Environmental Protection
Authority (EPA) established in 1995 (Proclamation No. 9 of year 1995).
Its powers and duties have recently been revised resulting in its
re-establishment (Proclamation No 295 of year 2002). The EPA has an
Environmental Protection Council (EPC). EPA's objective is formulating
policies, strategies, laws and standards which foster social and
economic development in a manner that enhance the welfare of humans and
the safety of the environment sustainably and to spearhead their
implementation.

EPA\'s enabling law still lacks clarity in some respects and does not
provide the Authority with strong powers required for effective
coordination and regulation. A reading of Proclamation No. 295 of year
2002 indicates that, while it is given the duty to coordinate measures
taken to ensure that the environmental objectives provided under the
constitution and the basic principles set out in the Environmental
Policy of Ethiopia (EPE), the manner it is supposed to carry out such
coordination is couched in terms such as \" In consultation with the
competent agencies\" or \"providing advice to the competent agencies\".
These terms do not amount to much since it is not clear what the
Authority can do if the competent agencies are reluctant to be part of
consultations or do not act in accordance with the provided advice.

It also appears that the administrative links required for ensuring and
enforcing the implementation of policies within the Federal mandate is
not clear. As a result, the EPA appears to be unable to secure a
responsive relationship based on the force of the law and depends only
on appealing to and cajoling the regions to get results.

**Ministry of Agriculture**

This ministry, which has been recently combined with the Ministry of
Rural Development to become a merged Ministry of Rural Development and
Agriculture, is a major lead organization at the Federal level in terms
of (renewable) natural resources management since it has mandates
regarding the management of forest and wildlife resources as well as the
protection and conservation of soil resources. Moreover, it is also
responsible for land use planning. The fact that this part of the
ministry's mandate is dominated by the agriculture mandate has been
pointed out on many occasions by natural resources management experts.
Indeed all major natural resources management activities are lumped
together under a single department. Such major activity areas as
forestry, soil conservation, and land use planning have been reduced to
team levels.

**The Ethiopian Agricultural Research Organization**

This organization both caries out research and coordinates research
activities carried out at the NRS levels. The research it carries out to
improve agricultural production also has relevance to natural resources
management (e.g. better soil conservation measures).

**Ministry of Water Resources**

The Ministry of Water Resources was established under Article 4 (15) of
Proclamation No 256 of year 2000. Unlike some other ministries and other
types of federal executing agencies, the Ministry of water development
is not under another super ministry. The Ministry has under it several
departments and units. The Ministry functions through these departments
and units to attain its mandates.

There are also autonomous entities operating under the Ministry. An
example is the Water Works Design and Supervision Enterprise established
by virtue of the Council of Ministers Regulations No. 42 of year 1998.
The Water Works Design and Supervision Enterprise are governed by the
Public Enterprises Proclamation No. 25/1992 and the Ministry of Water
Resources is its supervising body.

**Institute of Biodiversity Conservation and Research**

This institute is responsible for the conservation of biodiversity both
*ex-situ* and *in-situ* and carrying out research with regard to the
same.

The need to coordinate sectoral institutions concerned with biodiversity
is also recognized. Hence, a number of institutions at both Federal and
regional levels are directly or indirectly involved in eco-system
protection. At the Federal level the most important ones include the
Institute of Biodiversity Conservation and Research (IBCR), the
Ethiopian Wildlife Organization (EWCO), the Ministry of Agriculture
where mandate for Natural Resources is vested, and EPA.

3.0 EVALUATION OF PROJECT/PROGRAM ISSUES WITH RESPECT TO ENVIRONMENTAL
IMPACT POTENTIAL

**3.1 Capacity building, training and technical support**

Most of the activities proposed under IR 1, and other activities planned
under IR 2 and IR 4 involve analysis, technical assistance, capacity
strengthening, partnership development, provision of nutritional
livestock supplements, training, and adult literacy. These activities
are not likely to have any adverse impacts on the environment.

#####  {#section .unnumbered}

2.  **Activities likely to result in change in environment**

    Some activities mainly under IR 2, IR 3 and IR 4 will likely result
    in a change to the environment and they are analyzed here. Traffic
    on rehabilitated roads will have increased, and exports to national
    and regional markets will have increased from the assisted
    provinces. By the end of the ISP period, it is expected that a
    diversity of improved inputs and technologies will be widely adopted
    in targeted areas, with improved agricultural practices leading to
    increased production. Income levels from value-added activities and
    enhanced market linkages will have substantially risen. Also,
    planning and management skills imparted to cooperatives, businesses
    and community-based organizations will enhance the ability of these
    entities to organize, improve production, increase livelihood
    opportunities and access new markets.

    Below is a list of the proposed types of interventions and their
    potential for impacting the environment. Proposed interventions to
    mitigate potentially detrimental environmental impacts are provided
    in Section 4 of this document.

    **[Agricultural Chemicals (IR 16.2, 16.3 and 16.4)]{.underline}:**

Intensification of basic food production integrated with soil fertility,
though not specifically defined under this SO, often implies use of
chemical fertilizers and crop protection from pests during production
and post harvesting stages. While it is recognized that over-use of
chemical fertilizers in many rural societies in Africa is not foreseen
due to the high cost of the commodity, the use of pesticides if not
properly regulated is likely to result in serious environmental issues.

**[New varieties, seed supply, planting materials (IR 16.2, 16.3 and
16.4).]{.underline}**

Potential adverse environmental impacts are likely to result from
inappropriate seeds that can displace native and indigenous germplasm.
New materials could also result in introduction of exotic and/or
invasive species if not properly researched and monitored.

**[Biotechnology]{.underline}**

Potential risks include uncontrolled flow of genes to wild relatives;
development of herbicide, insect and virus resistance in wild relatives;
reduced *in situ* crop genetic diversity; increased use of herbicides
and other pesticides, increased pesticide residues in soils under
certain circumstances; and adverse effects on organisms that are not
pests, such as beneficial insects. A relatively small but expanding body
of evidence exists to assess the effects. Early estimates suggest that
transgenic crops will confer environmental benefits in some areas and/or
in some years -- for example, some crops appear to reduced use of toxic
pesticides and slightly increased yields on average.

**[Agricultural Processing and Value-Added Enterprises (IR 16.2, 16.3
and 16.4)]{.underline}**

The activities planned under this category will relate primarily to the
following sectors: horticulture, coffee, cereals, and animal production
(meat and dairy). Value-added processing in any of these sectors has
implications for considerable negative environmental impacts. In
horticulture this may include improper disposal of packing materials,
preservatives and pesticides during the processing phase. For coffee
this might involve improperly constructed washing stations which could
contaminate locate water bodies, and also generation of waste products
and potential for improper disposal of such. Cereal processing could
likewise generate waste products and pollution. Finally, meat and dairy
processing has the potential to generate wastes (including hazardous
wastes) and other forms of pollution that if not properly planned could
have seriously detrimental impacts for the surrounding environment. In
general, the following types of environmental problems may arise as a
result of processes involved with value-added enterprises: chemical and
hazardous waste, air pollution and particulate dust, water pollution,
soil erosion, natural resource depletion, solid waste, odor, noise and
health and safety issues. Mitigation of the above can be facilitated
through the introduction of cleaner production practices, as advised in
Section 4.

**[Development Credit Authority Activities]{.underline}**

Lending under the DCA loan guarantee program will be channeled through
Ethiopian commercial banks. Even though USAID will not be directly
disseminating the funds, the Agency is responsible for ensuring that
some type of environmental review process is carried out in conjunction
with the loan. The Environmental Review Report (ERR) could be used as a
model, and/or relevant GFDRE EIA procedures should be undertaken.

The environmental impacts arising from these loans will depend on the
type of activity that is undertaken. It is likely that infrastructure
development associated with processing and marketing for the
horticulture, livestock, dairy, oilseed and cotton sectors will be
contemplated. See environmental impacts associated with agricultural
processing and road building.

**[Micro-financing Activities]{.underline}**

Environmental impacts may result depending on the nature of activities
planned for support under micro-financing initiatives. Even though USAID
will not be directly disseminating the funds, the Agency is responsible
for ensuring that some type of environmental review process is carried
out in conjunction with the loan. The Environmental Review Report (ERR)
could be used as a model, and/or relevant GFDRE EIA procedures should be
undertaken.

**[Road Building]{.underline}**

Poor road construction and rehabilitation design may lead to the
following environmental impacts: increased soil erosion, degradation of
water quality, adverse effects on quantities of water, altered hydrology
and flooding, deforestation, damage to valuable ecosystems and habitats,
damage to scenic quality and tourism, adverse impacts on human health
and safety, and changes to local culture and society.

**[Infrastructure Development and Small-scale
Construction]{.underline}**

The details of the construction carried out in support of any particular
development activity or site will have a number of unique aspects.
Construction activities in general, however, share a set of common
features and potential adverse environmental impacts: damage to
ecosystems; sedimentation of streams and surface water; contamination of
water supplies; social impacts; spread of disease and damage to the
aesthetics of an area.

**[Irrigation]{.underline}**

A number of negative environmental consequences are associated with
irrigation development. For small-scale irrigation interventions such as
those planned for implementation by USAID/Ethiopia, the following
negative consequences may result: inefficient use of water due to
leakage; declining soil fertility and increased susceptibility to
erosion; increased soil salinity; and increased incidence of water
related disease hazards. Mitigation measures and optimal design guidance
are provided in Section 4 of this document.

**[Water and Sanitation Interventions]{.underline}**

The human health benefits of water and sanitation activities are
enormous, and generally far outweigh any potential negative impacts of
such activities. Still, the potential for adverse environmental impacts
from water and sanitation activities exists, and it is the
responsibility of program designers and implementers to avoid such
impacts to the extent possible. Potential adverse impacts from water and
sanitation activities can be summarized as follows:

> Potential adverse impacts from water supply activities:
>
> 1\. Depletion of fresh water resources (surface and groundwater)
>
> 2\. Chemical degradation of the quality of potable water sources
> (surface and groundwater)
>
> 3\. Creation of stagnant (standing) water
>
> 4\. Degradation of terrestrial, aquatic, and coastal habitats
>
> 5\. Increased human health risks (e.g. from arsenic content in
> groundwater)
>
> Potential adverse impacts from sanitation activities:
>
> 1\. Increased human health risks from contamination of surface water,
> groundwater, soil, and food by excreta, chemicals and pathogens
>
> 2\. Ecological harm from degradation of stream, lake, estuarine and
> marine water quality and degradation of land habitats

**[Natural Resource-based Enterprises]{.underline}**

If harvesting levels and methods are not closely monitored, certain
types of natural resource-based enterprises that involve the collection
of native plants and tree products could result in disturbance to
fragile plant and animal communities and the biological processes that
sustain them.

[**Agroforestry** (**IR 16.3 and 16.4**)]{.underline}

If the species of trees are not properly selected they can easily turn
to invasive species. Over harvesting of natural resources existing in
the forests or woodlands may lead to decreases in diversity.

**[Watershed Management]{.underline}**

Improved watershed management is necessary in Ethiopia in order to
mitigate soil erosion, deforestation, reduced soil fertility, and
increasing levels of siltation in lakes, rivers and streams. If not
properly undertaken, watershed management interventions, particularly on
hillsides, may lead to removal of natural cover leading to increased
soil erosion and vulnerability to landslides.

**[Animal Production and Health (IR 16.2 and 16.4)]{.underline}**:

Most of the interventions planned in the livestock sector are subsumed
under the Southern Tier Initiative (STI), which extends through FY06 and
is covered by an approved IEE (31Ethiopia11_SPO_12_SC_Animal_Health
(7/2/01). Under STI are included the following types of activities:
community animal health workers, provision of livestock vaccinations,
small scale construction, rural finance and economic diversification,
conflict resolution, livestock market price information, education, and
analysis for irrigation planning.

Of the above, only livestock vaccinations and small scale construction
have the potential to impact the environment in any significant way.
Livestock vaccinations may include the use of certain types of
pesticides including acaricides, de-wormers, antibiotics, etc. Poor
administration may likely result in under dosages resulting in
resistance in pests and bio-organisms. As well, the issue of disposal of
used drugs, drug containers, and syringes, if not properly handled can
result in adverse environmental impacts, including likely transmission
of zoonotic diseases to humans.

In general, the planned interventions under both the STI and the new ISP
are focused on improving the quality (over quantity) of grazing, and
also providing alternative livelihood options. Nevertheless, it should
be noted that there are negative environmental consequences that often
result from livestock production and grazing. When improperly managed,
livestock production may cause significant economic, social and
environmental damage. As described in the [Livestock Production
chapter](http://www.encapafrica.org/EGSSAAsectionsJan04/Env Guidelines Chapter 11 Livestock.pdf)
of the EGSSAA, following are the types of environmental problems often
associated with livestock production:

-   Land degradation;

-   Habitat damage and reduced biodiversity;

-   Harm to vegetation.

    **[Health care provision including vaccinations and pre-natal care
    (IR 16.4, Productive Safety Net Program):]{.underline}**

Although small-scale healthcare activities provide many important
benefits to communities, they can also unintentionally do great harm
through poor design and management of waste management systems.
Healthcare waste is dangerous. If handled, treated, disposed of
incorrectly it can spread disease, poisoning people, livestock, wild
animals, plants and whole ecosystems.

Currently, little or no management of healthcare wastes typically occurs
in small-scale facilities in Africa. Training and supplies are minimal.
Common practice in urban areas is to dispose of healthcare waste along
with the general solid waste or, in peri-urban and rural areas, to bury
waste, without treatment, in an unlined pit. In some cities small
hospitals may incinerate waste in dedicated on-site incinerators, but
often they fail to operate them properly. Unwanted pharmaceuticals and
chemicals may be dumped into the local sanitation outlet, be it a sewage
system, septic tank or latrine.

**[Malaria Prevention and Management]{.underline}**

There is the possibility that distribution of long-lasting insecticide
treated bednets (LLITNs) will occur within the context of the Productive
Safety Net Program, under IR 4 of SO 16. The principal environmental
risks result during the treatment and washing phase, and include
potential for seepage into groundwater or damage to aquatic life if nets
are washed or treated near natural water bodies. However because they
are long lasting, LLITNs do not require treatment, only periodic
washing. Additional risks are clearly described in the USAID/Africa
Bureau *Programmatic Environmental Assessment for Insecticide-Treated
Bednets*, which is available on the USAID website, as well as within the
USAID/Ethiopia PERSUAP for LLITN activities under SO 14 and SO 16.

4.0 RECOMMENDED THRESHOLD DECISIONS & MITIGATION ACTIONS (INCLUDING
MONITORING AND EVALUATION)

The table below summarizes the activities and recommended threshold
determinations

-   **TABLE 1: Threshold Determinations for Illustrative activities, by
    IR**

+----------------------------------+-----------------------------------+
| **Activities**                   | **Threshold Determinations**      |
+----------------------------------+-----------------------------------+
| **IR 16.1 Selected Essential     |                                   |
| Policy Reforms Implemented**     |                                   |
+----------------------------------+-----------------------------------+
| Provide technical and material   | **Categorical Exclusion per**     |
| assistance to monitor climatic,  |                                   |
| environmental, agricultural and  | 22 CFR 216.2 (c)2(i)(iii) and (v) |
| economic trends for improved     |                                   |
| crisis response and policy       |                                   |
| formulation                      |                                   |
+----------------------------------+-----------------------------------+
| Conduct analyses of policy and   | **Categorical Exclusion per**     |
| investment climates to inform    |                                   |
| policymakers' future options in  | 22 CFR 216.2 (c)2(iii) and (v)    |
| these areas                      |                                   |
+----------------------------------+-----------------------------------+
| *GDA activity to support an      | **Categorical Exclusion per**     |
| external business advisory       |                                   |
| council that would act as an     | 22 CFR 216.2 (c)2(iii) and (v)    |
| impartial advisor to the GFDRE*  |                                   |
+----------------------------------+-----------------------------------+
| Conduct constructive policy      | **Categorical Exclusion per**     |
| advocacy with the GFDRE          |                                   |
|                                  | 22 CFR 216.2 (c)2(i)(iii) and (v) |
+----------------------------------+-----------------------------------+
| Facilitate and inform the        | **Categorical Exclusion per**     |
| implementation of improved       |                                   |
| policies in the areas of land    | 22 CFR 216.2 (c)2(i)(iii) and (v) |
| tenure, credit, input markets,   |                                   |
| trade competitiveness, crisis    |                                   |
| management, private investment   |                                   |
| and water resources management,  |                                   |
| among others                     |                                   |
+----------------------------------+-----------------------------------+
| Provide technical and financial  | **Categorical Exclusion per**     |
| assistance for the development   |                                   |
| of a Rural Economy Knowledge     | 22 CFR 216.2 (c)2(i)(iii) and (v) |
| Support System (REKSS)           |                                   |
|                                  |                                   |
| (multi-donor activity            |                                   |
| implemented principally by       |                                   |
| IFPRI)                           |                                   |
+----------------------------------+-----------------------------------+
| Assist GFDRE with policy         | **Categorical Exclusion per**     |
| analysis and reform to meet      |                                   |
| requirements for accession to    | 22 CFR 216.2 (c)2(i)(iii) and (v) |
| the WTO                          |                                   |
+----------------------------------+-----------------------------------+
| Support trade capacity building  | **Categorical Exclusion per**     |
| to strengthen WTO accession bid  |                                   |
|                                  | 22 CFR 216.2 (c)2(i)(iii) and (v) |
+----------------------------------+-----------------------------------+
| Conduct capacity strengthening   | **Categorical Exclusion per**     |
| for land administration          |                                   |
| authorities                      | 22 CFR 216.2 (c)2(i)(iii) and (v) |
+----------------------------------+-----------------------------------+
| Support land certification       | **Categorical Exclusion per**     |
| programs for small-scale farmers |                                   |
|                                  | 22 CFR 216.2 (c)2(i)(iii) and (v) |
+----------------------------------+-----------------------------------+
| Partner with the Institute for   | **Categorical Exclusion per**     |
| Liberty and Democracy to         |                                   |
| implement a property rights      | 22 CFR 216.2 (c)2(i)(iii) and (v) |
| program                          |                                   |
+----------------------------------+-----------------------------------+
| **IR 16.2 Selected Input and     |                                   |
| Product Markets Strengthened**   |                                   |
+----------------------------------+-----------------------------------+
| *Provide technical assistance to | **Categorical Exclusion per**     |
| develop an Ethiopian commodity   |                                   |
| exchange (GDA)*                  | 22 CFR 216.2 (c)2(i)(iii) and (v) |
+----------------------------------+-----------------------------------+
| *Involve international           | **Negative Determination with     |
| businesses in helping to promote | conditions per**                  |
| investments in agricultural      |                                   |
| processing ventures, export      | 22CFR 216.3 (a)(2)(iii)           |
| partnerships, and regional       |                                   |
| investment*                      |                                   |
+----------------------------------+-----------------------------------+
| Support the establishment of     | **Negative Determination with     |
| cooperatives with ties to        | conditions per**                  |
| broader agri-business markets    |                                   |
| and input suppliers both         | 22CFR 216.3 (a)(2)(iii)           |
| established and newly created.   |                                   |
| Special emphasis on increasing   |                                   |
| involvement of women in the      |                                   |
| agricultural sector.             |                                   |
+----------------------------------+-----------------------------------+
| Provide assistance to improve    | **Negative Determination with     |
| farmers' and pastoralists'       | conditions per**                  |
| access to input and product      |                                   |
| markets                          | 22CFR 216.3 (a)(2)(iii)           |
+----------------------------------+-----------------------------------+
| Support business partnerships    | **Categorical Exclusion per**     |
| between producers and others in  |                                   |
| the supply chain                 | 22 CFR 216.2 (c)2(i)(iii) and (v) |
+----------------------------------+-----------------------------------+
| Provide business development     | **Negative Determination with     |
| services and technical support   | conditions per**                  |
| to cooperatives, producer        |                                   |
| organizations, commercial        | 22CFR 216.3 (a)(2)(iii)           |
| farmers, agribusinesses and      |                                   |
| small entrepreneurs to: 1)       |                                   |
| improve production or            |                                   |
| manufacturing processes, 2)      |                                   |
| increase access to market        |                                   |
| information and market           |                                   |
| intelligence, and 3) improve the |                                   |
| grades and standards of products |                                   |
| for domestic, regional, and      |                                   |
| international markets.           |                                   |
+----------------------------------+-----------------------------------+
| Use loan guarantees under the    | **Negative Determination with     |
| Development Credit Authority     | conditions per**                  |
| (DCA) to meet short and medium   |                                   |
| term credit needs of             | 22CFR 216.3 (a)(2)(iii)           |
| agricultural cooperatives,       |                                   |
| marketing groups,                |                                   |
| agribusinesses, and SMEs         |                                   |
+----------------------------------+-----------------------------------+
| Provide technical assistance to  | **Categorical Exclusion per**     |
| strengthen long-term viability   |                                   |
| of cooperatives, business        | 22 CFR 216.2 (c)2(i)(iii) and (v) |
| associations and Chambers of     |                                   |
| Commerce;                        |                                   |
+----------------------------------+-----------------------------------+
| Expand rural marketing centers   | **A Deferral** is recommended per |
| to help stimulate and grow the   | 22 CFR 216.3(a)(7)(iii)           |
| market;                          |                                   |
+----------------------------------+-----------------------------------+
| Provide technical, financial,    | **Negative Determination with     |
| and policy assistance to develop | conditions per**                  |
| and strengthen private sector    |                                   |
| seed and fertilizer input        | 22CFR 216.3 (a)(2)(iii)           |
| systems                          |                                   |
+----------------------------------+-----------------------------------+
| Provide technical and monetary   | **Negative Determination with     |
| support for the creation of      | conditions per**                  |
| community-based seed production, |                                   |
| seed banks, seed fairs, and seed | 22CFR 216.3 (a)(2)(iii)           |
| vouchers;                        |                                   |
+----------------------------------+-----------------------------------+
| Help to strengthen cooperative   | **Negative Determination with     |
| unions and rural savings and     | conditions per**                  |
| credit cooperative to provide    |                                   |
| services to members and link     | 22CFR 216.3 (a)(2)(iii)           |
| agricultural producers to        |                                   |
| domestic and international       |                                   |
| markets. Proposed services might |                                   |
| include:                         |                                   |
|                                  |                                   |
| 1)  establishing a warehouse     |                                   |
|     receipts system;             |                                   |
|                                  |                                   |
| 2)  improved market information  |                                   |
|     and dissemination;           |                                   |
|                                  |                                   |
| 3)  infrastructure development   |                                   |
|                                  |                                   |
| 4)  cooperative development      |                                   |
+----------------------------------+-----------------------------------+
| Incorporate activities under the | Covered by *IEE for SpO 12, the   |
| ongoing Southern Tier Initiative | Southern Tier Initiative*,        |
| (STI) to support livestock       | 31E                               |
| marketing and strengthening of   | thiopia11_SPO_12_SC_Animal_Health |
| pastoralist livelihoods;         | (7/2/01)                          |
+----------------------------------+-----------------------------------+
| Begin phase-out of the Amhara    | Covered by *IEE for SO 7 Rural    |
| Regional Food Security Program   | Household Production &            |
| (AMAREW) which has supported     | Productivity*, 31Ethiopia_13_RHPP |
| micro-enterprise development in  | (8/10/01), including              |
| food insecure regions;           | documentation for the *AMAREW     |
|                                  | Program,* 29Ethiopia_2_AMAREW     |
+----------------------------------+-----------------------------------+
| **IR 16.3 Natural Resource       |                                   |
| Management and Agricultural      |                                   |
| Productivity Improved**          |                                   |
+----------------------------------+-----------------------------------+
| Provide technical and material   | **Negative Determination with     |
| support for micro, small and     | conditions per**                  |
| medium scale irrigation          |                                   |
|                                  | 22CFR 216.3 (a)(2)(iii)           |
+----------------------------------+-----------------------------------+
| Provide technical and material   | **Negative Determination with     |
| support for water harvesting and | conditions per**                  |
| water conservation               |                                   |
| interventions, such as           | 22CFR 216.3 (a)(2)(iii)           |
| construction of cement rainwater |                                   |
| catchments.                      |                                   |
+----------------------------------+-----------------------------------+
| Provision of potable water and   | **Negative Determination with     |
| sanitation infrastructure (in    | conditions per**                  |
| collaboration with SO 14)        |                                   |
|                                  | 22CFR 216.3 (a)(2)(iii)           |
+----------------------------------+-----------------------------------+
| Provision of rural water supply  | **Negative Determination with     |
| for agriculture, including       | conditions per**                  |
| hand-dug wells and river/stream  |                                   |
| diversion through use of treadle | 22CFR 216.3 (a)(2)(iii)           |
| pumps and other basic            |                                   |
| technologies                     |                                   |
+----------------------------------+-----------------------------------+
| Provide technical and material   | **Negative Determination with     |
| support for community-based      | conditions per**                  |
| watershed management             |                                   |
| interventions                    | 22CFR 216.3 (a)(2)(iii)           |
+----------------------------------+-----------------------------------+
| Generation and dissemination of  | **Negative Determination with     |
| more productive and resilient    | conditions per**                  |
| agricultural technologies---both |                                   |
| pre- and post-harvest            | 22CFR 216.3 (a)(2)(iii)           |
+----------------------------------+-----------------------------------+
| Form partnerships between        | **Negative Determination with     |
| agricultural input providers,    | conditions per**                  |
| cooperatives, agro-processors,   |                                   |
| commercial farmers and           | 22CFR 216.3 (a)(2)(iii)           |
| government institutions to       |                                   |
| identify, validate, demonstrate  |                                   |
| and transfer improved            |                                   |
| agricultural technologies.       |                                   |
|                                  |                                   |
| Planned technologies for         |                                   |
| dissemination will include:      |                                   |
|                                  |                                   |
| 1)  agricultural production      |                                   |
|     technologies                 |                                   |
|                                  |                                   |
| 2)  value-added processing       |                                   |
|                                  |                                   |
| 3)  product storage              |                                   |
|                                  |                                   |
| 4)  environmental management     |                                   |
+----------------------------------+-----------------------------------+
| Implement a competitive small    | **Negative Determination with     |
| grants program for technology    | conditions per**                  |
| transfer                         |                                   |
|                                  | 22CFR 216.3 (a)(2)(iii)           |
+----------------------------------+-----------------------------------+
| **IR 16.4 Livelihood Options for |                                   |
| the Food Insecure Protected,     |                                   |
| Expanded and Diversified**       |                                   |
+----------------------------------+-----------------------------------+
| Provide nutrient supplements or  | **Categorical Exclusion per**     |
| fodder for livestock to help     |                                   |
| pastoralists preserve herds      | 22 CFR 216.2 (c)2(viii)           |
+----------------------------------+-----------------------------------+
| Capacity building activities for | **Categorical Exclusion per**     |
| local governments                |                                   |
|                                  | 22 CFR 216.2 (c)2(viii)           |
+----------------------------------+-----------------------------------+
| Establishment of micro-credit    | **Negative Determination with     |
| operations to help with          | conditions per**                  |
| diversification of livelihoods   |                                   |
|                                  | 22CFR 216.3 (a)(2)(iii)           |
+----------------------------------+-----------------------------------+
| Through use of direct transfers  | **Negative Determination with     |
| (cash or inputs), encourage      | conditions per**                  |
| farmers to experiment with and   |                                   |
| adopt new production             | 22CFR 216.3 (a)(2)(iii)           |
| technologies. These might        |                                   |
| include:                         |                                   |
|                                  |                                   |
| 1)  irrigation                   |                                   |
|                                  |                                   |
| 2)  agroforestry                 |                                   |
|                                  |                                   |
| 3)  soil erosion control         |                                   |
|                                  |                                   |
| 4)  water conservation methods   |                                   |
|                                  |                                   |
| 5)  introduction of improved     |                                   |
|     seeds                        |                                   |
|                                  |                                   |
| 6)  other agricultural           |                                   |
|     production-enhancing         |                                   |
|     interventions                |                                   |
+----------------------------------+-----------------------------------+
| Use direct resource transfers in | **Negative Determination with     |
| exchange for labor on            | conditions per**                  |
| infrastructure and public works. |                                   |
| Public work interventions may    | 22CFR 216.3 (a)(2)(iii)           |
| include:                         |                                   |
|                                  |                                   |
| 1)  small scale construction     |                                   |
|     (market places, bridges);    |                                   |
|                                  |                                   |
| 2)  road construction            |                                   |
|                                  |                                   |
| 3)  water sources development,   |                                   |
|     including digging for ponds  |                                   |
|     and other water points;      |                                   |
|                                  |                                   |
| 4)  pasture rotation (fence      |                                   |
|     building);                   |                                   |
|                                  |                                   |
| 5)  environmental rehabilitation |                                   |
|     (terracing, rock lines,      |                                   |
|     etc.)                        |                                   |
+----------------------------------+-----------------------------------+
| Use resource transfers to        | **Categorical Exclusion per**     |
| encourage school retention,      |                                   |
| particularly for girls           | 22 CFR 216.2 (c)2(i)(iii) and (v) |
+----------------------------------+-----------------------------------+
| Use resource transfers to        | **Negative Determination with     |
| encourage individuals to seek    | conditions per**                  |
| health services. This might      |                                   |
| include:                         | 22CFR 216.3 (a)(2)(iii)           |
|                                  |                                   |
| 1)  vaccinations;                |                                   |
|                                  |                                   |
| 2)  pre-natal care;              |                                   |
|                                  |                                   |
| 3)  *malaria prophylaxis (??)*   |                                   |
+----------------------------------+-----------------------------------+
| Provide technical assistance and | **Negative Determination with     |
| resources to facilitate          | conditions per**                  |
| livelihood diversification       |                                   |
| options such as:                 | 22CFR 216.3 (a)(2)(iii)           |
|                                  |                                   |
| 1)  agroforestry;                |                                   |
|                                  |                                   |
| 2)  adoption of                  |                                   |
|     drought-resistant crops;     |                                   |
|                                  |                                   |
| 3)  efficient irrigation         |                                   |
|     technologies;                |                                   |
|                                  |                                   |
| 4)  seed nurseries;              |                                   |
|                                  |                                   |
| 5)  bee-keeping                  |                                   |
|                                  |                                   |
| 6)  improved livestock           |                                   |
|     marketing;                   |                                   |
|                                  |                                   |
| 7)  training in value-added      |                                   |
|     business opportunities       |                                   |
+----------------------------------+-----------------------------------+
| Promote adult literacy           | **Categorical Exclusion per**     |
|                                  |                                   |
|                                  | 22 CFR 216.2 (c)2(i)(iii) and (v) |
+----------------------------------+-----------------------------------+
| Provide training for community   | **Categorical Exclusion per**     |
| health workers                   |                                   |
|                                  | 22 CFR 216.2 (c)2(i)(iii) and (v) |
+----------------------------------+-----------------------------------+
| Ongoing DAP activities, not      | **Negative Determination with     |
| explicitly covered by above      | conditions per**                  |
| activities include:              |                                   |
|                                  | 22CFR 216.3 (a)(2)(iii)           |
| CARE:                            |                                   |
|                                  | **NB:** All of these activities   |
| 1)  Warehouse construction       | are covered by the proposed       |
|                                  |                                   |
| 2)  Promotion of fuel-efficient  | Mitigation measures contained in  |
|     stoves                       | Section 4 below.                  |
|                                  |                                   |
| 3)  Shallow well construction    | Guidance provided in the existing |
|                                  | DAP IEEs continues                |
| 4)  Latrine construction         |                                   |
|                                  | To be relevant, but those         |
| 5)  Terrace and bund             | documents are supplanted by       |
|     construction                 |                                   |
|                                  | This all-inclusive SO 16 IEE.     |
| CRS:                             |                                   |
|                                  |                                   |
| 1)  Hillside terracing           |                                   |
|                                  |                                   |
| 2)  Pit latrines                 |                                   |
|                                  |                                   |
| 3)  Hand dug wells               |                                   |
|                                  |                                   |
| 4)  Health post construction and |                                   |
|     rehabilitation               |                                   |
|                                  |                                   |
| REST:                            |                                   |
|                                  |                                   |
| 1)  Livestock production (dairy  |                                   |
|     cows, poultry, small         |                                   |
|     ruminants)                   |                                   |
|                                  |                                   |
| 2)  School construction          |                                   |
|                                  |                                   |
| Save the Children:               |                                   |
|                                  |                                   |
| 1)  Livestock health activities  |                                   |
+----------------------------------+-----------------------------------+

**4.2 [Mitigating Measures]{.underline}:**

**1) Agricultural Chemicals (IR 16.2, 16.3 and 16.4):** Use of
pesticides is foreseen for improved management of pests in the field, as
well as possibly for post-harvest storage. A detailed action plan to be
used by implementing partners who will be using pesticides is contained
in the *USAID/Ethiopia Crop Production and Pesticide Evaluation Report
and Safer Use Action Plan* (PERSUAP), approved by USAID/W in August
2003. This document specifically recommends: training in proper use,
transport and storage of pesticides and other agricultural chemicals,
use only of one of the 28 pesticides approved by the USEPA and GFDRE and
covered by the PERSUAP, and use of Integrated Pest Management practices
where feasible. ***[NB: It is the responsibility of the SO16 Activity
Managers to ensure that implementing partners who will be using
pesticides have access to and apply the recommendations of the
PERSUAP.]{.underline}***

**Fertilizers** are frequently lumped together with pesticides under the
generic heading of "agro- or agrichemicals." From an environmental
compliance perspective (22 CFR 216), as well as from a field-level
implementation point of view, this is inappropriate, because it implies
that fertilizers require the same level of scrutiny reserved for
pesticides. Whereas pesticides are subject to clearly defined
environmental review procedures, and an approval process to promote
safer use and integrated pest management, such procedures do not apply
to fertilizers (procurement procedures do apply to quantity bulk
purchase). As with any technology, however, it is recommended that
fertilizers be thoughtfully employed according to best practice,
promoting integrated soil fertility management, within the context of
the prevailing biophysical and socio-economic conditions, as well as the
desired outcomes. This fact sheet was developed to assist in that
regard.

For introduction and dissemination of other agricultural chemicals such
as **fertilizers** (not including pesticides) training should be
provided in product knowledge regarding *best management practices for
soil fertility and health.* Here is a ***summary of best management
practices for soil fertility and health***:

-   Integrated Soil Fertility Management (ISFM) -- the use of both
    organic and inorganic sources of nutrients rather than either alone;

-   The use of legume cover crops (plus phosphorous) and green manures
    by fallow rotation or intercropping;

-   Agroforestry practices -- in addition to soil conservation and
    production benefits, agroforestry transfers/cycles nutrients from
    within the soil profile (deeper levels to surface);

-   The use of conservation tillage rather than deep plowing (although
    conservation tillage can be harmful for production systems in
    certain regions **^2^)**;

-   Use farm site manures and household wastes, with or without
    composting;

-   Choose crops and associated plants that have high nutrient use
    efficiency.

**2) New varieties, seed supply, planting materials (IR 16.2, 16.3 and
16.4).** For any introduction of new seed varieties, ensure that proper
field testing has been conducted, and respect the restrictions of
existing GFDRE law on introduction of new seed varieties, if such a law
exists. For new germplasm, suppliers shall use certified seed sources
and reputable suppliers such as the Ethiopian Agricultural Research
Organization (EARO), the National Agricultural Research and Extension
Services (NARES) and International Agricultural Research Centers,

**3) Biotechnology** **(IR 16.2, 16.3 and 16.4)** Because some of the
activities relate to improvements in agricultural technology and
agricultural inputs, it may develop that some biotechnology technologies
will be considered for use under SO 16. If biotechnology applications
are utilized, the following mitigation measures are to be followed:

-   SO 16 will not support the transfer of bio**-**engineered materials
    intended for planting without the host government's explicit
    advanced informed consent (indeed REDSO will promote such
    deliberative review processes).

-   SO 16 must assure that its grantees and contractors comply with
    national and international laws applicable to biotechnology research
    and testing.

-   No biotechnology interventions of any kind are to begin until the
    host countries and regional institutions involved have drafted and
    approved a regulatory framework governing biotechnology and
    bio**-**safety;

-   All USAID-funded interventions which involve biotechnologies are to
    be informed by the ADS 211 series governing \"Bio**-**safety
    Procedures for Genetic Engineering Research\". In particular this
    guidance details the required written approval procedures needed
    before transferring or releasing GE products to the field.

-   Biotechnology interventions to be carried out will have to follow
    existing regulations and guidelines governing recombinant DNA
    research, testing and commercialization, and trans-boundary movement
    of GMOs as outlined in the *National Institute of Health (NIH)
    Guidelines*:
    <http://www.od.nih.gov/oba/rac/guidelines_02/NIH_Guidelines_Apr_02.htm>.

**4) Agricultural Processing and Value-Added Enterprises (IR 16.2, 16.3
and 16.4):** A number of activities may be undertaken that will involve
providing technical assistance and/or financing for agricultural
processing and value-added enterprises. In line with the target
commodity sectors, likely interventions may include: coffee washing and
processing stations; leather processing and/or tanneries; oilseed
processing and refining; cotton and/or textile cleaning and
manufacturing; and dairy production and processing equipment.

Many if not all of the above activities are likely to have environmental
impacts that will require mitigation. The following mitigation measures
are to be undertaken:

a\) Use of the Environmental Review Report (ERR) screening process to
determine the nature and scope of environmental impacts arising from
each planned activity;

b\) Reference to best practices for micro and small enterprise
development as contained in the USAID/Africa *Environmental Guidelines
for Small Scale Activities in Africa* (EGSSA), Part III. The EGSSA is
available at: [www.encapafrica.org](http://www.encapafrica.org/).

c\) Compliance with all GFDRE environmental regulations governing the
above activities is required. This is likely to include application of
the Environmental Impact Assessment and Pollution Control procedures.

d\) Application of sector-specific environmental best practices for all
of the above activities.

**5) Development Credit Authority Activities**: Infrastructure
development and construction activities are likely under the loan
guarantees being negotiated by USAID/Ethiopia with two commercial
Ethiopian banks. Potential undertakings to be funded by these loans
could include (but are not limited to) the following: construction of
livestock holding facilities; tanning and leather processing facilities;
construction of abattoirs; purchase of dairy processing equipment;
coffee processing machinery and/or washing stations; grain warehouse
construction; value-added processing machines for grains and oilseeds;
packaging materials and facilities for the horticulture industry;
irrigation equipment; and cold chain storage equipment.

The Loan must not be used to finance any of the following:

-   Goods or services which are to be used primarily to meet military
    requirements or to support police or other law enforcement
    activities,

-   Surveillance equipment,

-   Equipment, research and/or services related to involuntary
    sterilization or the performance of abortion as a method of family
    planning, or

-   Activities which significantly degrade national parks or similar
    protected areas or introduce exotic plants or animals into such
    areas,

The Loan must not be used to finance any of the following without the
prior written approval of USAID:

-   Pharmaceuticals,

-   Pesticides,

-   Logging equipment,

-   Luxury goods (including alcoholic beverages and jewelry),

-   Establishing or expanding any enterprise that will export raw
    materials that are likely to be in surplus in world markets at the
    time such production becomes effective and that are likely to cause
    substantial injury to U.S. producers,

-   Activities which would result in the loss of forest lands due to
    livestock rearing, road construction or maintenance, colonization of
    forest lands or construction of dams or other water control
    structures,

Prior written approval of USAID is also required to finance activities
which are likely to have a significant adverse effect on the
environment, including any of the following (to the extent such
activities are likely to have a significant adverse impact on the
environment):

> \(a\) programs of river basin development,
>
> \(b\) significant irrigation or water management projects (including
> dams and impoundments),
>
> \(c\) agricultural land leveling,
>
> \(d\) major drainage projects,
>
> \(e\) large scale agricultural mechanization,
>
> \(f\) new lands development,
>
> \(g\) resettlement projects,
>
> \(h\) penetration road building or road improvement projects,
>
> \(i\) construction of powerplants or industrial plants, or
>
> \(j\) large scale potable water and sewerage projects,

**6) Micro-Financing** In order to ensure that adequate mitigation
measures are followed for activities that fall under micro-financing,
the use of the Environmental Review Report (ERR) or a similar screening
process is recommended for all awarded activities. The ERR is attached
as Annex 1 to this document

**7) Road Building** This will involve community participation in
infrastructure construction and rehabilitation. Depending on the scale
and materials used, these activities have a potential for significant
environmental impact if not properly designed and implemented: A
**Negative Determination with Conditions** is recommended on the basis
that the activities will have minimal negative effect on the environment
if the mitigating conditions are met.

New road construction is planned. For these activities, it is
recommended that the existing GFDRE environmental and social guidelines
for road building be adhered to. Oversight by the Ethiopian Roads
Authority and the GFDRE Environmental Protection Authority is advised.
Two additional sources for best practices should also be utilized by
partners: Chapter 14 on Rural Roads in USAID/AFR *Environmental
Guidelines for Small Scale Activities in Africa* (EGSSAA) located at:
*(*<http://www.encapafrica.org/SmallScaleGuidelines.htm>); and the U.S.
Forest Service *Low-Volume Roads Engineering: Best Management Practices
Field Guide*, by Gordon Keller and James Sherar, by the US Forest
Service for USAID and in collaboration with USDA. (July 2003) (see same
ENCAP website, or <http://www.fs.fed.us/global>, or
[[http://www.zietlow.com/]{.underline}](http://www.zietlow.com/)).

These best practices should be followed in the areas of road planning
and design and construction. Further, *a certified roads engineer will
be employed* to oversee activities and report to the MEO/USAID as
necessary

In order to determine the scale and exact nature of the above activities
prior to construction, the implementation of an environmental review
process prior to undertaking certain activities that may have adverse
environmental impacts. These activities are designated with a Negative
Determination with Conditions, and prescribe use of USAID Africa Bureau
Environmental Screening Form (ESF), which is attached to this document
as Annex 1.

**8) Small-scale Construction and Infrastructure Development**

-   All construction activities will be conducted following principles
    for environmentally sound construction, as provided in [*Chapter 3:
    Small Scale
    Construction*](http://www.encapafrica.org/EGSSAA/Construction.pdf)
    of the USAID Environmental Guidelines for Small-scale Activities in
    Africa, which can be found at
    [www.encapafrica.org](http://www.encapafrica.org/).

-   For the rehabilitation of existing facilities, and for construction
    of facilities in which the total surface area disturbed is less than
    10,000 square feet, the condition is that these activities will be
    conducted following principles for environmentally sound
    construction, as provided in the Small Scale Construction chapter of
    the USAID Environmental Guidelines for Small-scale Activities in
    Africa, which can be found at:
    [www.encapafrica.org](http://www.encapafrica.org/).

-   For the construction of any facilities in which the total surface
    area disturbed exceeds 10,000 square feet (1,000 square meters), the
    program will conduct a supplemental environmental review according
    to guidance in Annex G of the Africa Bureau Environmental Procedures
    Training Manual (EPTM). Construction may not begin until such a
    review is completed and approved by the Mission Environmental
    Officer.

**9) Irrigation:** Because of the potential for poorly sited and
designed irrigation interventions to have negative environmental
impacts, many considerations need to be undertaken to ensure that
mitigation measures are put into place. USAID/Ethiopia has the following
existing environmental documentation specifically relating to irrigation
activities, and they should be adhered to in the course of undertaking
these activities:

a\) Consult the *USAID/Ethiopia and CRS Guidelines for the Development
of Small-scale Rural Water Supply and Sanitation Projects in Ethiopia*,
July 31, 2002

b\) Consult and apply the guidance in the USAID/Ethiopia *Programmatic
Environmental Assessment for Small-scale Irrigation Activities* (1999).
In particular, the *Checklist for Planning Environmentally Sound
Small-Scale Irrigation (SSI) in Ethiopia*, contained in the PEA, should
be utilized.

c\) Follow the principles for environmentally sound small scale
irrigation design and implementation as contained in Part II, Chapter I
of the EGSSA, found at:
[www.encapafrica.org](http://www.encapafrica.org/).

d\) Adhere to GFDRE regulations governing water resource management,
including the GFDRE Water Resources Policy of 1992.

**10) Water and Sanitation Interventions** Construction of these
sanitation and drinking water-related facilities should be conducted in
a manner consistent with the best design and implementation practices
described in the EGSSAA, Chapter 16: Water Supply and Sanitation
([www.encapafrica.org](http://www.encapafrica.org/) ). Water quality
testing is essential for determining that the water from a constructed
water source is safe to drink and to determine a baseline so that any
future degradation can be detected. Among the water quality tests which
must be performed are tests for the presence of arsenic. Any
USAID-supported activity engaged in the provision of potable water must
adhere to USAID guidance on arsenic testing. The Africa Bureau has
packaged the guidance in a document titled, "[Guidelines for Determining
the Arsenic Content of Ground Water in USAID-Sponsored Well Programs in
Sub-Saharan
Africa](http://www.encapafrica.org/docs/Watsan/Arsenic testing guidelines AFR.doc)."
The SO team must assure that the standards and testing procedures
described in this guideline document are followed for potable water
supply activities under this program.\]

Strong guidance for the development of rural water supply and sanitation
interventions already exists within USAID/Ethiopia. These design
recommendations are described in detail in the *USAID/Ethiopia and CRS
Guidelines for the Development of Small-scale Rural Water Supply and
Sanitation Projects in Ethiopia*.

It is also advised that any construction of water conservation
technologies or water catchments undertaken in Ethiopia will be subject
to the GFDRE Ministry of Agriculture Regulations on Water Conservation
and Water Catchments.

In order to determine the scale and exact nature of the above activities
prior to construction, the implementation of an environmental review
process is required. Use of the USAID Africa Bureau Environmental Review
and Report (ERR) form is recommended. The ERR is attached as Annex 1 to
this document.

**11) Natural Resource-based Enterprises:** Extraction of nature-based
products such as plant materials, fruits and fibers, is to be monitored
where possible to ensure that only allowable quantities are harvested.
Some guidance on harvesting of non-timber forest products (NTFPs) is
located in Chapter 2 (CBNRM) and Chapter 7 (Forestry) of the EGSSA
([www.encapafrica.org](http://www.encapafrica.org/)).

**12) Agroforestry** (**IR 16.3 and 16.4**): Introduction of
agroforestry techniques will need to be subject to review to ensure that
no invasive species are introduced, and that no forest cover is cut as a
result of the USAID interventions. Optimal practices should be followed,
such as reflected in Chapter 7 of the USAID *Environmental Guidelines
for Small Scale Activities in Africa* (EGSSA) on Forestry: Including
Forest Management, Plantations, and Agroforestry. This document is
available at [www.encapafrica.org](http://www.encapafrica.org/).

**13) Watershed Management:** If practiced correctly, watershed
management interventions such as construction of terracing and rock
lines, planting of vetiver or other erosion-control activities such as
hillside tree planting have environmentally beneficial consequences.
However problems may result from poor design and execution of any of the
above, or from introduction of exotic and/or invasive species. As such,
the following mitigating actions are recommended:

a\) Best practices for soil and water conservation interventions as
contained in Chapter 1 on Agriculture and Irrigation in the USAID/Africa
*Environmental Guidelines for Small-Scale Activities in Africa* (EGSSA);

b\) Best practices for planning agroforestry interventions, as described
in Chapter 7 of the EGSSA, and under the "Agroforestry" section above;

c\) It is also advised that any construction of water conservation
technologies or water catchments undertaken in Ethiopia will be subject
to the GFDRE Ministry of Agriculture Regulations on Water Conservation
and Water Catchments.

d\) Where applicable, reference to the *USAID/Ethiopia and CRS
Guidelines for the Development of Small-scale Rural Water Supply and
Sanitation Projects in Ethiopia* should be made.

**14) Animal Production and Health (IR 16.2 and 16.4).** *Livestock
production*: Properly managed, livestock production can enhance land and
water quality, biodiversity, and social and economic well-being.
However, when improperly managed, livestock production may cause
significant economic, social and environmental damage. Refer to the
[Livestock Production
chapter](http://www.encapafrica.org/EGSSAAsectionsJan04/Env Guidelines Chapter 11 Livestock.pdf)
of the EGSSAA at [www.encapafrica.org](http://www.encapafrica.org/).

*Animal health*: Introduction or use of vaccinations or other actions
that might involve creation of biohazards will need to have a developed
plan for disposing of hazardous waste. See EGSSAA, Chapter 8,
[http://www.encapafrica.org/SmallScaleGuidelines.htm](http://www.africaencap.org/).

***Caveat***: Potential for Deforestation: In forested areas,
introduction of small livestock in mixed farming systems may be
promoted. Clearing of tree cover to expand rangeland is not acceptable
under this program, and if this is to be promoted, this would
necessitate amendment of this IEE to recommend a *Positive
Determination* and the need for an Environmental Assessment on such
activities.

attached to this document as Annex 1.

**15) Health care provision including vaccination and pre-natal care (IR
16.4/PSNP):** To the extent there are medicals services to be provided,
these are some expected Mitigating Conditions and Actions:

Provision of medical services, including immunizations, should be
accompanied by training and implementation of best practices for
handling healthcare waste, including hazardous waste. Consult the
following resources for implementing such a program: USAID Environmental
Guidelines for Small-Scale Activities in Africa (EGSSAA), chapter 9,
"Healthcare Waste: Generation, Handling, Treatment and Disposal". In
particular use should be made of the "Minimal Program Checklist and
Action Plan" for handling healthcare waste. The EGSSAA is available
online at:
[www.encapafrica.org/SmallscaleGuidelines.htm](http://www.encapafrica.org/SmallscaleGuidelines.htm),
or through the USAID website, Bureau for Africa, Office of Sustainable
Development, [www.afr-sd.org/](http://www.afr-sd.org/).

In addition, new guidelines are being developed for immunization
programs in Ethiopia by the U.S. Centers for Disease Control. These
guidelines, entitled *Guidelines for HIV/AIDS Infection Prevention* ,
which covers necessary practices for preventing risk of HIV/AIDS and
other disease transmission as a result of vaccination programs. Another
excellent source on this topic is the World Health Organization/UNAIDS
2001 document, *Universal Precautions for Prevention of Transmission of
HIV, Hepatitis B Virus, and Other Blood-borne Pathogens in Health Care
Settings*.

Finally, these activities are also covered by the Initial Environmental
Examination for USAID/Ethiopia SO 14: Human Capacity and Social
Resiliency Increased.

**16) Malaria Prevention and Management:** Some distribution of
long-lasting insecticide treated bednets (LLITNs) is contemplated under
the PSNP activities of SO 16, IR 4. If LLITNs are to be utilized, the
following mitigation measures will apply:

The use of Insecticide Treated Nets will likely involve the use of
pyrethroids, which though of low toxicity to humans, are very toxic to
fish, amphibians, arthropods and other aquatic life. However, in 2001,
the use of ITNs was a subject of Pesticide Evaluation Report and Safe
Use Action Plan (PERSUAP)(*31-Ethiopia1-ITN-PERSUAP USAID/W*), whose
recommendations are still valid. This PERSUAP has been updated to cover
the increasing use of Long-lasting ITNs (LLITNs). It is submitted with
this IEE. The SO 6 Health Team shall adhere to the recommendations
contained in the PERSUAP, summarized here:

The conditions to be met are listed in the Section 3 of the amended
PERSUAP as "Safer Use Action Plan" commitments. The main commitments are
as follows:

1.  LLITNs will increasingly be the net of choice, and are not expected
    to require re-treatment, thus greatly reducing any risks associated
    with their use.

2.  With conventional nets, which will continue to be in use for several
    years, educational materials distributed with do-it-yourself (DIY)
    treatment kits will advise of proper disposal procedures and project
    staff will be trained in using this procedure.

3.  Activities involving central net treatment will be required to
    follow World Health Organization (WHO) ITN recommendations
    **(**<http://www.who.int/ctd/whopes/relevant.docs.htm>).

4.  USAID/Ethiopia will ensure the quality and efficacy of the pesticide
    products and LLITN purchased and that they contain what they are
    supposed to contain, and that the LLITNs are achieving the level of
    mosquito control required to reduce transmission.

5.  USAID/Ethiopia will incorporate environmental questions into general
    health impact monitoring plan for ITNs.

USAID/Ethiopia will make all appropriate efforts to assure that the
packaging, storage, transport and disposal of ITN pesticides distributed
by its programs comply with WHO Pesticide Evaluation Scheme guidelines,
and the USAID PEA for ITM in Sub-Saharan Africa

**4.3 Environmental Screening and Review**

This IEE introduces the use of Environmental Screening and Review
procedures for all the activities under Negative Determination with
Conditions. These activities will be examined on an individual basis in
order to comply with the determinations of this IEE in accordance with
Reg 216, Section 216.3(a)(2). These procedures are intended to result in
environmental accountability and soundness, by requiring that the
USAID/Ethiopia/BEAT Office put in place specific mechanisms to promote
environmental capacity and other environmental capacity for implementing
partners. To ensure that interventions are designed in a sound and
sustainable manner the Project Manager will work with the appropriate
implementing partners to achieve compliance with these procedures.

The procedures are based upon utilization of an Environmental Review
Report, presented in Attachment

1\. This form is consistent with the \"Environmental Screening Form for
NGO/PVO Activities and Grant Proposals\" contained in the Africa Bureau
*Environmental Guidelines for Small-Scale Activities in Africa*; it can
be tailored to suit the needs of USAID-supported activities, based on
consultations by the REDSO/ESA Regional Environmental Advisor (REO)
and/or the Bureau Environmental Officer (BEO). The Mission will
facilitate the refinement of this form with the partners and the REDSO
REO/REA to meet project needs and to incorporate, where appropriate,
information that will serve to identify and satisfy needs for
environmental assessment in accordance with Ethiopia's environmental
impact assessment policy and legislation.

All sub-grants will be individually screened using the Screening Form,
which utilizes a four-tier categorization process consistent with Africa
Bureau \'s *Environmental Guidelines*, as defined below:

> *Category 1*: Activities that would normally qualify for a categorical
> exclusion under Reg 216 (e.g., community awareness initiatives,
> training at any level, provision of technical assistance, controlled
> experimentation exclusively for the purpose of research and field
> evaluation which is confined to small areas and carefully monitored,
> etc.). Certain, specifically defined, small-scale activities entailing
> rehabilitation of water points and construction or rehabilitation of
> facilities have also been placed in this category.
>
> *Category 2*: Activities that would normally qualify for a negative
> determination under Reg. 216, based on the fact that the sub-grantee
> used an environmentally-sound approach to the activity design and
> incorporated appropriate mitigation and monitoring procedures. For
> example, the design followed, and the manager has access to and will
> follow, a series of guidelines for the design of small-scale
> environmentally-sound activities in forestry, natural resource
> management, infrastructure, etc.
>
> *Category 3*: Activities that have a clear potential for undesirable
> environmental impacts and typically under Reg 216 require an
> Environmental Assessment, such as those involving land development,
> planned resettlement, penetration road building, substantial piped
> water supply and sewage construction, large-scale irrigation projects,
> and projects involving the procurement and/or use of pesticides, or of
> large-scale or area-wide application of pesticides. All activities
> listed in Reg. 216 (Sect. 216.2(d)(1)) are automatically included,
> unless they are small-scale and qualify for a negative determination
> in accordance with the criteria listed under Category 2.
>
> *Category 4*: This category groups activities that either USAID cannot
> fund or for which specific findings must be made in an Environmental
> Assessment prior to funding. Interventions that are likely to
> jeopardize a critical habitat for threatened or endangered species or
> degrade a protected area must be placed in this category. Category 4
> lists activities that trigger provisions of Sections 118 or 119 of the
> Foreign Assistance Act, which generally relate to degradation of
> national parks or protected areas, introduction of exotic species, or
> effects on tropical or undegraded forest lands.

The implementing agents responsible for the sub-grants will be
responsible for ensuring that the sub-grantees in collaboration with
their respective implementing partners employ the screening form (ERR)
\[Attachment 1\], as refined (in consultation with the REDSO/REO or
REA)\] and prepare the Environmental Review Reports if/as necessary as a
result of the categorization process. Preferably, the direct sub-grantee
will prepare the Screening Form and the Environmental Review Report.
Proposals seeking support must also comply with any approval criteria
and procedures set out in general, which will include the requirement
for environmental screening and review. The implementing agents will
evaluate the Screening Form and the Environmental Review Reports as part
of the overall evaluation and decision-making for grants.

An Environmental Review Report shall be prepared by the sub-grantee in
collaboration with the implementing partner for all Category 3 and 4
activities. The Mission Director, or Acting Director, on behalf of
USAID/Ethiopia, shall be responsible for clearances on the category
determination and Environmental Review Reports.

**4.3.3 Promotion of Environmental Review and Capacity Building
Procedures**

The procedures described above and incorporated within the Screening
Form are intended to ensure environmental accountability and soundness,
on the assumption that the Mission has the following additional elements
in effect to build environmental capacity within implementing partners.

\- The sub-grantees and other appropriate implementing partners will
help design, conduct, participate in, and apply environmental assessment
and management training, in conjunction with USAID and Ethiopia resource
organizations and agencies to assist grantees in properly fulfilling the
screening and review requirements in conjunction with concerned Ethiopia
organizations and agencies; sub-grantees, as appropriate, the
implementing partners, will also be required to apply appropriate
Ethiopia environmental assessment policies and procedures; and

\- A monitoring and evaluation process to follow-up on Environmental
Review Reports will be put in place and used by the sub-grantees and
implementing partners, in collaboration with concerned Ethiopia
authorities, as appropriate, and USAID project management.

**4.3.4 Environmental Responsibilities**

USAID/Ethiopia assumes responsibility for environmental screening,
review and decision-making for all USAID-assisted sub-grants as outlined
below:

-   Through the sub-grantees, and with the assistance of appropriate
    implementing partners, proposers will submit proposals that take
    into consideration potential environmental impacts and their
    mitigation, including avoidance, and will design the activities with
    an environmental monitoring system in place;

-   The proposer and the implementing partners will use the Screening
    Form to categorize proposals, and the MEO will review and pass on to
    the REO and BEO any Category 3 or 4 and, as he/she determines, any
    Category 2 activities for which further consultation is sought;

-   The proposer, with the assistance of implementing partners, as
    appropriate, will ensure implementation of agreed-upon mitigating
    measures and environmental impact monitoring;

-   The USAID Project Manager/Advisor will be ultimately responsible for
    monitoring environmental impacts of all project-financed sub-grants,
    as further specified below; and

-   Periodic visits of the REO or REA will also be requested for advice,
    refresher training and validation that environmental processes are
    in place.

**4.2.5 Monitoring, Evaluation and Mitigation**

An **environmental monitoring, evaluation and mitigation process** will
be established and used by the implementing partners in collaboration
with USAID. USAID-supported sub-grants shall incorporate appropriate
mitigation and monitoring procedures as listed below.

-   Proposers will be encouraged to utilize the *Environmental
    Guidelines for Small-Scale Activities in Africa* and other -specific
    information to assist them in determining what potential impacts
    should be of concern for different types of development activities
    in various settings;

-   The sub-grantee, with the assistance of appropriate implementing
    partners, must identify in each grant proposal all proposed
    environmental mitigation and monitoring requirements. The
    implementing agents will determine, based on the proposal, those
    impacts for which mitigation and monitoring are considered
    necessary;

-   The mitigative measures and monitoring procedures stated in the
    report shall be considered a requirement;

-   The sub-grantee, with assistance of the appropriate implementing
    partners shall be responsible for implementation of agreed-upon
    mitigation measures and monitoring of impacts;

-   All sub-grantees' periodic reports to the implementing agents and
    from them to USAID/ Ethiopia shall contain a section on
    environmental impacts, success or failure of mitigative measures
    being implemented, results of environmental monitoring, and any
    major modifications/revisions to the project, mitigative measures or
    monitoring procedures.

USAID/ Ethiopia is ultimately responsible for assuring conformity with
the procedures spelled out above, including environmental categorization
and review procedures. With particular respect to monitoring, evaluation
and mitigation, the Mission is responsible for:

-   Monitoring and evaluation of activities after implementation with
    respect to environmental effects that may need to be mitigated, a
    process which should be integrated into the overall SO8 or Mission
    Performance Monitoring Plan;

-   Evaluation of implementing agents\' and/or grantees\' reports with
    respect to results of environmental mitigation and monitoring
    procedures;

```{=html}
<!-- -->
```
-   Incorporating into Mission field visits and consultations with
    grantee periodic examination of the environmental impacts of
    activities and associated mitigation and monitoring (assistance of
    the REO or REA in preparing guidelines or assisting with the
    monitoring and evaluation can be solicited); and

-   Reporting on implementation of mitigation and monitoring
    requirements as part of the summary of activities and their status
    that is passed to the REO and BEO and which is to be summarized in
    the Mission\'s Annual Report.

**Annex 1: Environmental Review Report Form and Instructions**

INSTRUCTIONS FOR

AFRICA BUREAU ENVIRONMENTAL REVIEW AND REPORT (ERR) FORM

### Note to individuals adapting this form for use on a particular program/activity: 

-   These instructions accompany the generic "Environmental Review &
    Report Form."

-   The Environmental Review Form and these instructions are for use in
    the review and approval of subproject proposals that are (1) carried
    out under an "umbrella" project AND (2) defined and reviewed *after*
    approval of the overall or "umbrella project." Typical subprojects
    include microfinance activities or subgrants for small-scale
    development.

-   For primarily NRM-oriented programs, consider and use the
    Supplemental Environmental Review Form for NRM sector activities,
    especially those considering NRM-based enterprises, CBNRM,
    ecotourism, etc..

-   Underlined & [blue]{.mark}-highlighted text MUST be modified to
    reflect project and mission name.

-   [Yellow]{.mark} highlighted text is only put emphasis on the points
    highlighted, and can also be dropped

-   Both the form AND instructions should be reviewed and modified in
    general to reflect the needs of the specific umbrella project.

-   Both form and instructions must be appended to the Initial
    Environmental Examination for the overall project.

**[DELETE THIS PAGE BEFORE MODIFYING/DISTRIBUTING THIS FORM]{.mark}**

**INSTRUCTIONS FOR**

**AFRICA BUREAU ENVIRONMENTAL REVIEW AND REPORT (ERR) FORM**[^1]

# ![](media/image1.wmf){width="1.0006944444444446in" height="1.0118055555555556in"}USAID/[[mission or bureau name]{.underline}]{.mark} Instructions for environmental review of activities under the [[XXX project]{.underline}]{.mark} 

### Note: **These instructions accompany the "Environmental Review & Report Form for [[XXX Project]{.underline}]{.mark} Activities." Follow, but DO NOT SUBMIT, these instructions.**

### Who must submit the Environmental Review Form?

All organizations applying to implement activities on the [[XXX
Project]{.underline}]{.mark} must complete the "Environmental Review
Form" form UNLESS the project or activity is carried out to address an
emergency (e.g., international disaster assistance). *Emergencies are
determined by the US Ambassador or USAID, not by the applicant.*[^2]

### Importance

The proposed activity cannot be approved and no "irreversible commitment
of resources" can be made until the environmental documentation,
including any mitigation measures, is approved by the Mission
Environmental Officer (MEO). Approval by other authorities in USAID may
also be required.

NOTE: USAID may request modifications, or reject the documentation.

If the activities are found to have significant adverse impacts, a full
Environmental Assessment must be conducted.

### Step 1. Provide requested "Applicant information" **(Section A of the form)**

### Step 2. List all proposed activities

In Section B of the form, list all proposed activities. Include all
phases: *planning, design, construction, operation & maintenance*.
Include ancillary activities. (These are activities that are required to
build or operate the primary activity. Examples include building or
improving a road so that heavy vehicles can reach the project site,
excavation of fill material or gravel for construction, provision of
electricity, water, or sewage facilities, disposal of solid waste, etc.)

### Step 3a. Screening: Identify low-risk and high-risk activities

For *each* activity you have listed in Section B of the form, refer to
the list below to determine whether it is a listed low-risk or high-risk
activity.

If an activity is specifically identified as "very low risk" or "high
risk" in the list below, indicate this in the "screening result" column
in Section B of the form.

+-----------------------------------+----------------------------------+
| **Very low-risk activities\       | **High-risk activities\          |
| **(Activities with low potential  | **(Activities with high          |
| for adverse biophysical or health | potential for adverse            |
| impacts; including §216.2(c)(2))  | biophysical or health impacts;   |
|                                   | including §216.2(d)(1))          |
+===================================+==================================+
| Provision of education, technical | River basin or new lands         |
| assistance, or training. (Note    | development                      |
| that activities directly          |                                  |
| affecting the environment. do not | Planned resettlement of human    |
| qualify.)                         | populations                      |
|                                   |                                  |
| Community awareness initiatives.  | Penetration road building, or    |
|                                   | rehabilitation of roads          |
| Controlled agricultural           | (primary, secondary, some        |
| experimentation exclusively for   | tertiary) over 10 km length, and |
| the purpose of research and field | any roads which may pass through |
| evaluation confined to small      | or near relatively undegraded    |
| areas (normally under 4 ha./10    | forest lands or other sensitive  |
| acres). This must be carefully    | ecological areas                 |
| monitored and no protected or     |                                  |
| other sensitive environmental     | Substantial piped water supply   |
| areas may be affected).           | and sewerage construction        |
|                                   |                                  |
| Technical studies and analyses    | Major bore hole or water point   |
| and other information generation  | construction                     |
| activities not involving          |                                  |
| intrusive sampling of endangered  | Large-scale irrigation           |
| species or critical habitats.     |                                  |
|                                   | Water management structures such |
| Document or information           | as dams and impoundments         |
| transfers.                        |                                  |
|                                   | Drainage of wetlands or other    |
| Nutrition, health care or family  | permanently flooded areas        |
| planning, EXCEPT when (a) some    |                                  |
| included activities could         | Large-scale agricultural         |
| directly affect the environment   | mechanization                    |
| (construction, water supply       |                                  |
| systems, etc.) or (b)             | Agricultural land leveling       |
| biohazardous (esp. HIV/AIDS)      |                                  |
| waste is handled or blood is      | Procurement or use of            |
| tested.                           | [restricted use]{.underline}     |
|                                   | pesticides, or wide-area         |
| Rehabilitation of water points    | application in non-emergency     |
| for domestic household use,       | conditions under non-supervised  |
| shallow, hand-dug wells or small  | conditions. (Consult MEO.)       |
| water storage devices. Water      |                                  |
| points must be located where no   | Light industrial plant           |
| protected or other sensitive      | production or processing (e.g,   |
| environmental areas could be      | sawmill operation,               |
| affected.                         | agro-industrial processing of    |
|                                   | forestry products, tanneries,    |
| > **NOTE:** USAID guidance on     | cloth-dying operations).         |
| > potable water requires water    |                                  |
| > quality testing for arsenic,    | **\                              |
| > coliform, nitrates and          | High-risk and typically not      |
| > nitrites.                       | funded by USAID:**               |
|                                   |                                  |
| Construction or repair of         | Actions determined likely to     |
| facilities if total surface area  | significantly degrade protected  |
| to be disturbed is under 10,000   | areas, such as introduction of   |
| sq. ft. (approx. 1,000 sq. m.)    | exotic plants or animals         |
| (and when no protected or other   |                                  |
| sensitive environmental areas     | Actions determined likely to     |
| could be affected).               | jeopardize threatened &          |
|                                   | endangered species or adversely  |
| Support for intermediate credit   | modify their habitat (esp.       |
| arrangements (when no significant | wetlands, tropical forests)      |
| biophysical environmental impact  |                                  |
| can reasonably be expected).      | Conversion of forest lands to    |
|                                   | rearing of livestock             |
| Programs of maternal and child    |                                  |
| feeding conducted under Title II  | Planned colonization of forest   |
| of Public Law 480.                | lands                            |
|                                   |                                  |
| Food for development programs     | Procurement or use of timber     |
| under Title III of P.L. 480, when | harvesting equipment             |
| no on-the-ground biophysical      |                                  |
| interventions are likely.         | Commercial extraction of timber  |
|                                   |                                  |
| Studies or programs intended to   | Construction of dams or other    |
| develop the capability of         | water control structures that    |
| recipients to engage in           | flood relatively undegraded      |
| development planning. (Does NOT   | forest lands                     |
| include activities directly       |                                  |
| affecting the environment)        | Construction, upgrading or       |
|                                   | maintenance of roads that pass   |
| Small-scale Natural Resource      | through relatively undegraded    |
| Management activities for which   | forest lands. (Includes          |
| the answer to ALL SUPPLEMENTAL    | temporary haul roads for logging |
| SCREENING QUESTIONS (attached) is | or other extractive industries)  |
| "NO."                             |                                  |
+-----------------------------------+----------------------------------+

(This list of activities is taken from the text of Regulation 216 and
other applicable laws, regulations and directives)

### Step 3b: Identifying activities of unknown or moderate risk.

All activities NOT identified as "very low risk" or "very high risk" are
considered to be of "unknown or moderate risk." Common examples of
moderate-risk activities are given in the table below.

Check "moderate or unknown risk" under screening results in Section B of
the form for ALL such activities.

+------------------------------------+---------------------------------+
| **Common examples of               |                                 |
| [moderate-risk]{.mark}             |                                 |
| activities**                       |                                 |
+====================================+=================================+
| **CAUTION: If ANY of the           |                                 |
| activities listed in this table    |                                 |
| may adversely impact** **(1)       |                                 |
| protected areas, (2) other         |                                 |
| sensitive environmental areas, or  |                                 |
| (3) threatened and endangered      |                                 |
| species and their habitat, THEY    |                                 |
| ARE NOT MODERATE RISK. All such    |                                 |
| activities are HIGH RISK           |                                 |
| ACTIVITIES.**                      |                                 |
+------------------------------------+---------------------------------+
| Small-scale agriculture, NRM,      | Construction or rehabilitation  |
| sanitation, etc. [[\[define what   | of small-scale water points or  |
| is meant by "small-scale" for each | water storage devices for       |
| project\]]{.underline}.]{.mark}    | domestic or non-domestic use.   |
|                                    | (Covers activities NOT included |
| Controlled and carefully monitored | under "Very low risk            |
| agricultural experimentation       | activities" above.)             |
| exclusively for the purpose of     |                                 |
| research and field evaluation of   | > **NOTE**: USAID guidance on   |
| MORE than 4 ha.                    | > water quality requires        |
|                                    | > testing for arsenic,          |
| -   **[NOTE:]{.mark}** No          | > nitrates, nitrites and        |
|     *biotechnology testing or      | > coliform bacteria.            |
|     release* of any kind are to    |                                 |
|     take place within an assisted  | Support for intermediate credit |
|     country until the host         | institutions when indirect      |
|     countries involved have        | environmental harm conceivably  |
|     drafted and *approved* a       | could result.                   |
|     regulatory framework governing |                                 |
|     biotechnology and biosafety.   | Institutional support grants to |
|                                    | NGOs/PVOs when the activities   |
| -                                  | of the organizations are known  |
|                                    | and may reasonably have adverse |
| -   All USAID-funded interventions | environmental impact.           |
|     which involve biotechnologies  |                                 |
|     are to be informed by the ADS  | Small-scale use of              |
|     211 series governing           | USEPA-registered, least-toxic   |
|     \"Biosafety Procedures for     | general-use pesticides. Use     |
|     Genetic Engineering            | must be limited to              |
|     Research\". In particular this | NGO-supervised use by farmers,  |
|     guidance details the required  | demonstration, training and     |
|     written approval procedures    | education, or emergency         |
|     needed before transferring or  | assistance.                     |
|     releasing GE products to the   |                                 |
|     field.                         | > **NOTE**: Environmental       |
|                                    | > review (see step 5) must be   |
| -                                  | > carried out consistent with   |
|                                    | > USAID Pesticide Procedures as |
| Moderate scale construction or     | > required in Reg. 16 \[22 CFR  |
| rehabilitation of facilities or    | > 216.3(b)(1)\].                |
| structures [[(surface area to be   |                                 |
| disturbed exceeds 10,000 sq. ft    | Nutrition, health care or       |
| (1000 sq meters) but funding level | family planning, if (a) some    |
| is \$200,000 or                    | included activities could       |
| less]{.underline}).]{.mark}        | directly affect the environment |
|                                    | (e.g,, construction, supply     |
| Construction or rehabilitation of  | systems, etc.) or (b)           |
| rural roads meeting the following  | biohazardous healthcare waste   |
| criteria:                          | (esp. HIV/AIDS) is produced,    |
|                                    | syringes are used, or blood is  |
| -   Length of road work is less    | tested.                         |
|     than \~10 km                   |                                 |
|                                    |                                 |
| -   No change in alignment or      |                                 |
|     right of way                   |                                 |
|                                    |                                 |
| -   Ecologically sensitive areas   |                                 |
|     are at least 100 m away from   |                                 |
|     the road and not affected by   |                                 |
|     construction or changes in     |                                 |
|     drainage.                      |                                 |
|                                    |                                 |
| -   No protected areas or          |                                 |
|     relatively undegraded forest   |                                 |
|     are within 5 km of the road.   |                                 |
|                                    |                                 |
| Food for Development programs      |                                 |
| under Title II or III, involving   |                                 |
| small-scale infrastructure with    |                                 |
| the known potential to cause       |                                 |
| environmental harm (e.g., roads,   |                                 |
| bore holes).                       |                                 |
|                                    |                                 |
| Quantity imports of commodities    |                                 |
| such as fertilizers.               |                                 |
|                                    |                                 |
| Technical studies and analyses or  |                                 |
| similar activities that could      |                                 |
| involve intrusive sampling, of     |                                 |
| endangered species or critical     |                                 |
| habitats. (Includes aerial         |                                 |
| sampling.)                         |                                 |
+------------------------------------+---------------------------------+

### Step 4. Determine if you must write an Environmental Review Report

Examine the "screening results" as they are entered in Table 1 of the
form.

-   If ALL the activities are "very low risk," then no further review is
    necessary. In Section C of the form, check the box labeled "very low
    risk activities." Skip to Step 8 of these instructions.

-   If ANY activities are "unknown or moderate risk," you MUST complete
    an ENVIRONMENTAL REVIEW REPORT addressing these activities. Proceed
    to Step 5.

-   If ANY activities are "high risk," note that USAID's regulations
    usually require a full environmental assessment study (EA). Because
    these activities are assumed to have a high probability of causing
    significant, adverse environmental impacts, they are closely
    scrutinized. *Any* proposed high-risk activity should be discussed
    in advance with USAID.

    In some cases, it is possible that effective mitigation and
    monitoring can reduce or eliminate likely impacts so that a full EA
    will not be required. If the applicant believes this to be the case,
    the Environmental Review Report must argue this case clearly and
    thoroughly. Proceed to Step 5.

### Step 5. Write the Environmental Review Report, if required

The Environmental Review Report presents the environmental issues
associated with the proposed activities. It also documents mitigation
and monitoring commitments. Its purpose is to allow the applicant and
USAID to evaluate the likely environmental impacts of the project.

For moderate risk activities, the Environmental Review Report is
typically a SHORT 2--3 page document. The Report will typically be
longer when (1) activities are of higher or unknown risk, and (2) when a
number of impacts and mitigation measures are being identified and
discussed.

The Environmental Review Report follows the outline below:

A**. Summary of Proposal.** Summarize background, rationale and
outputs/results expected. (reference to proposal, if appropriate).

B. **Description of activities.** For all moderate and high-risk
activities listed in Table 1 of the form, succinctly describe location,
siting, surroundings (include a map, even a sketch map). Provide both
quantitative and qualitative information about actions needed during all
project phases and who will undertake them. (All of this information can
be provided in a table). If various alternatives have been considered
and rejected because the proposed activity is considered more
environmentally sound, explain these.

C. **Environmental Situation & Host Country environmental
requirements.** Describe the environmental characteristics of the
site(s) where the proposed activities will take place. Focus on site
characteristics of concern---e.g., water supplies, animal habitat, steep
slopes, etc. With regard to these critical characteristics, is the
environmental situation at the site degrading, improving, or stable? In
this section, also describe applicable host country environmental
regulations, policies and practices.

D.  **Evaluation of Activities and Issues with Respect to Environmental
    Impact Potential.** Include impacts that could occur before
    construction starts, during construction and during operation, as
    well as any problems that might arise with abandoning, restoring or
    reusing the site at the end of the anticipated life of the facility
    or activity.

    Explain direct, indirect, induced and cumulative effects on various
    components of the environment (e.g., air, water, geology, soils,
    vegetation, wildlife, aquatic resources, historic, archaeological or
    other cultural resources, people and their communities, land use,
    traffic, waste disposal, water supply, energy, etc.)

E. **Environmental Mitigation Actions (including monitoring).** Provide
a workplan and schedule identifying the following:

**Mitigation measures.** Identify the means taken to avoid, reduce or
compensate for impacts. (For example, restoration of borrow or quarry
areas, replanting of vegetation, compensation for any relocation of
homes and residents.) If standard mitigation or best practice guidance
exists and is being followed, cite this guidance.

**Monitoring** Indicate how mitigation measures will be monitored to
ensure that they accomplish their intended result. If some impacts are
uncertain, describe the monitoring which will be conducted to identify
and respond to these potential impacts.

**Responsible parties.** Identify *who* will undertake mitigation and
who will conduct the monitoring, and at what frequency.

F. **Other Information**. Where possible and as appropriate, include
photos of the site and surroundings; maps; and list the names of any
reference materials or individuals consulted.

(Pictures and maps of the site can substantially reduce the written
description required in parts B & C)

### Step 6. Based on the environmental review, reach a recommended determination for each high-risk or unknown/moderate-risk activity

For each high-risk or unknown/moderate-risk activity, the environmental
review will help you decide between one of three recommended
determinations:

-   **no significant adverse impacts**. The activity in question will
    not result in significant, adverse environmental impacts. Special
    mitigation or monitoring is not required. Typically, this conclusion
    is not appropriate for high-risk activities.

-   **no significant adverse impacts given specified mitigation and
    monitoring** With mitigation and monitoring as specified in the
    Environmental Review Report, the activities in question will not
    result in significant adverse environmental impacts.

-   **significant adverse impacts**. The activities in question is
    likely to cause significant adverse environmental impacts and cannot
    be mitigated with best practices or other measures. A full
    environmental assessment will be required.

For each high-risk or unknown/moderate-risk activity, indicate your
"recommended determination" in Section B of the form.)

### Step 7: Summarize recommended determinations

In section C of the form, summarize your recommended determinations by
checking ALL categories indicated in Table 1.

### Step 8. Sign certifications **(Section D of form)**

### Step 9. Submit form to USAID project officer. **Attach Environmental Review Report, if any.** 

### **Supplemental Environmental Review Form for Natural Resources Programs**

### 

### Note to individuals adapting this form for use on a particular program/activity:

-   This supplement is oriented around major resource/issue clusters and
    asks "leading questions" about the actual potential for unintended
    harmful impacts, especially of CBNRM/ ecotourism activities.

-   Underlined & [blue]{.mark} highlighted text MUST be modified to
    reflect project and mission name

-   Questions should be modified to respond to the needs of individual
    projects. This is intended to be a "living" document subject to
    adaptation.

    **[DELETE THIS PAGE BEFORE MODIFYING/DISTRIBUTING THIS
    FORM]{.mark}**

**Supplemental Environmental Review Form for Natural Resources
Programs**

# ![](media/image1.wmf){width="1.0006944444444446in" height="1.0118055555555556in"}USAID/[[mission or bureau name]{.underline}]{.mark} Supplemental screening questions for natural resources activities under the [[XXX project (or program)]{.underline}]{.mark}

### Purpose

This is a supplement to the "Instructions for Environmental Review under
the [[XXX project]{.mark}.]{.underline}" It is to be used for natural
resources-based activities, including:

-   Community-Based Natural Resource Management (CBNRM)

-   Ecotourism

-   Natural resources-based enterprise development with micro- and small
    enterprises

This supplement provides additional questions to ascertain whether these
proposed activities should be categorized as "very low risk:"

-   If the answers to ALL the questions that follow are "NO," then the
    proposed CBNRM or Ecotourism activity is considered "very low risk."

-   If the answer to ANY question is "YES," the activity CANNOT be
    considered "very low risk."

### **Screening questions **

  -----------------------------------------------------------------------------
  **Will the activities...**                                 **YES**   **NO**
  ---------------------------------------------------------- --------- --------
  **Natural Resources**                                                

  Accelerate erosion by water or wind?                                 

  Reduce soil fertility and/or permeability?                           

  Alter existing stream flow, reduce seasonal availability             
  of water resources?                                                  

  Potentially contaminate surface water and groundwater                
  supplies?                                                            

  Involve the extraction of renewable natural resources?               

  Lead to unsustainable use of renewable natural resources             
  such as forest products?                                             

  Involve the extraction of non-renewable natural resources?           

  Restrict customary access to natural resources?                      

  Reduce local air quality through generating dust, burning            
  of wastes or using fossil fuels and other materials in               
  improperly ventilated areas?                                         

  Affect dry-season grazing areas and/or lead to restricted            
  access to a common resource?                                         

  Lead to unsustainable or unnecessarily high water                    
  extraction and/or wasteful use?                                      

                                                                       

  **Ecosystems and Biodiversity**                                      

  Drain wetlands, or be sited on floodplains?                          

  Harvest wetland plant materials or utilize sediments of              
  bodies of water?                                                     

  Lead to the clearing of forestlands for agriculture, the             
  over-harvesting of valuable forest species?                          

  Promote in-forest bee keeping?                                       

  Lead to increased hunting, or the collection of animals or           
  plant materials?                                                     

  Increase the risks to endangered or threatened species?              

  Introduce new exotic species of plants or animals to the             
  area?                                                                

  Lead to road construction or rehabilitation, or otherwise            
  facilitate access to fragile areas (natural woodlands,               
  wetlands, erosion-prone areas)?                                      

  Cause disruption of wildlife migratory routes?                       

                                                                       

  **Agricultural and Forestry Production**                             

  Have an impact on existing or traditional agricultural               
  production systems by reducing seed availability or                  
  reallocating land for other purposes?                                

  Lead to forest plantation harvesting without replanting,             
  the burning of pastureland, or a reduction in fallow                 
  periods?                                                             

  Affect existing food storage capacities by reducing food             
  inventories or encouraging the incidence of pests?                   

  Affect domestic livestock by reducing grazing areas, or              
  creating conditions where livestock disease problems could           
  be exacerbated?                                                      

  Involve the use of insecticides, herbicides and/or other             
  pesticides?                                                          

                                                                       

  **Community and Social Issues**                                      

  Have a negative impact on potable water supplies?                    

  Encourage domestic animal migration through natural areas?           

  Change the existing land tenure system?                              

  Have a negative impact on culturally important sites in              
  the community?                                                       

  Increase in-migration to the area?                                   

  Create conditions that lead to a reduction in community              
  health standards?                                                    

  Lead to the generation of non-biodegradable waste?                   

  Involve the relocation of the local community?                       

  Potentially cause or aggravate land-use conflicts?                   
  -----------------------------------------------------------------------------

# ![](media/image2.wmf){width="1.0006944444444446in" height="1.0118055555555556in"}USAID/[[mission or bureau name]{.underline}]{.mark}: Environmental Review & Report Approval Form for [xxx]{.mark} Program/Activities 

### Note: Follow, but do not submit, the above instructions. 

### A. Applicant information 

  -------------- ----------------------- -------------- ---------------------
  Organization                           Parent grant   
                                         or project     

  Individual                             Address, phone 
  contact and                            & email (if    
  title                                  available)     

  Proposed                               Amount of      
  activity                               funding        
  (brief                                 requested      
  description)                                          

  Location of                            Start and end  
  proposed                               date of        
  activity                               proposed       
                                         activity       
  -------------- ----------------------- -------------- ---------------------

###  B. Activities, screening results, and recommended determination

+------------------------------------+---+---+---+-----+-----+-----+
|                                    | * |   |   | *   |     |     |
|                                    | * |   |   | *Re |     |     |
|                                    | S |   |   | com |     |     |
|                                    | c |   |   | men |     |     |
|                                    | r |   |   | ded |     |     |
|                                    | e |   |   | D   |     |     |
|                                    | e |   |   | ete |     |     |
|                                    | n |   |   | rmi |     |     |
|                                    | i |   |   | nat |     |     |
|                                    | n |   |   | ion |     |     |
|                                    | g |   |   | s** |     |     |
|                                    | r |   |   |     |     |     |
|                                    | e |   |   | (S  |     |     |
|                                    | s |   |   | tep |     |     |
|                                    | u |   |   | 6   |     |     |
|                                    | l |   |   | of  |     |     |
|                                    | t |   |   | i   |     |     |
|                                    | * |   |   | nst |     |     |
|                                    | * |   |   | ruc |     |     |
|                                    |   |   |   | tio |     |     |
|                                    | ( |   |   | ns. |     |     |
|                                    | S |   |   | Co  |     |     |
|                                    | t |   |   | mpl |     |     |
|                                    | e |   |   | ete |     |     |
|                                    | p |   |   | for |     |     |
|                                    | 3 |   |   | all |     |     |
|                                    | o |   |   | m   |     |     |
|                                    | f |   |   | ode |     |     |
|                                    | i |   |   | rat |     |     |
|                                    | n |   |   | e/u |     |     |
|                                    | s |   |   | nkn |     |     |
|                                    | t |   |   | own |     |     |
|                                    | r |   |   | and |     |     |
|                                    | u |   |   | hig |     |     |
|                                    | c |   |   | h-r |     |     |
|                                    | t |   |   | isk |     |     |
|                                    | i |   |   | ac  |     |     |
|                                    | o |   |   | tiv |     |     |
|                                    | n |   |   | iti |     |     |
|                                    | s |   |   | es) |     |     |
|                                    | ) |   |   |     |     |     |
+------------------------------------+---+---+---+-----+-----+-----+
| **Proposed activities\             | V | H | M | No  | W   | >   |
| **(continue on additional page if  | e | i | o | si  | ith |  Si |
| necessary)                         | r | g | d | gni | spe | gni |
|                                    | y | h | e | fic | cif | fic |
|                                    | L | - | r | ant | ied | ant |
|                                    | o | R | a | a   | mi  | > A |
|                                    | w | i | t | dve | tig | dve |
|                                    | R | s | e | rse | ati | rse |
|                                    | i | k | r | imp | on, | >   |
|                                    | s | \ | i | act | no  | imp |
|                                    | k | * | s |     | si  | act |
|                                    |   |   | k |     | gni |     |
|                                    |   |   | o |     | fic |     |
|                                    |   |   | r |     | ant |     |
|                                    |   |   | u |     | a   |     |
|                                    |   |   | n |     | dve |     |
|                                    |   |   | k |     | rse |     |
|                                    |   |   | n |     | i   |     |
|                                    |   |   | o |     | mpa |     |
|                                    |   |   | w |     | ct, |     |
|                                    |   |   | n |     |     |     |
|                                    |   |   | \ |     |     |     |
|                                    |   |   | * |     |     |     |
+------------------------------------+---+---+---+-----+-----+-----+
| 1\.                                |   |   |   |     |     |     |
+------------------------------------+---+---+---+-----+-----+-----+
| 2\.                                |   |   |   |     |     |     |
+------------------------------------+---+---+---+-----+-----+-----+
| 3\.                                |   |   |   |     |     |     |
+------------------------------------+---+---+---+-----+-----+-----+
| 4\.                                |   |   |   |     |     |     |
+------------------------------------+---+---+---+-----+-----+-----+
| 5\.                                |   |   |   |     |     |     |
+------------------------------------+---+---+---+-----+-----+-----+
| 6\.                                |   |   |   |     |     |     |
+------------------------------------+---+---+---+-----+-----+-----+
| 7\.                                |   |   |   |     |     |     |
+------------------------------------+---+---+---+-----+-----+-----+
| 8\.                                |   |   |   |     |     |     |
+------------------------------------+---+---+---+-----+-----+-----+
| 9\.                                |   |   |   |     |     |     |
+------------------------------------+---+---+---+-----+-----+-----+
| 10\.                               |   |   |   |     |     |     |
+------------------------------------+---+---+---+-----+-----+-----+
|                                    |   |   |   |     |     |     |
+------------------------------------+---+---+---+-----+-----+-----+

\*These screening results require completion of an Environmental Review
Report

### C. Summary of recommended determinations **(check ALL that apply)**

  ----------- ----------------------------------- --------------------------------
  **The                                           *(equivalent Regulation 216
  proposal                                        terminology)*
  contains. .                                     
  .**                                             

             Very low risk activities            *categorical exclusion(s)*

             After environmental review,         *negative determination(s)\**
              activities determined to have **no  
              significant adverse impacts\***     

             After environmental review,         *negative determination(s) with
              activities determined to have **no  conditions\**
              significant adverse impacts, given  
              specified mitigation and            
              monitoring\***                      

             After environmental review,         *positive determination(s)\**
              activities determined to have       
              **significant adverse impacts\***   
  ----------- ----------------------------------- --------------------------------

> \*[for these determinations, the form is not complete unless
> accompanied by Environmental Review Report]{.mark}

### D. Certification:

I, the undersigned, certify that:

1.  the information on this form is correct and complete

    2\. the following actions have been and will be taken to assure that
    the activity complies with environmental requirements established
    for this Project:

-   Those responsible for implementing this activity have received
    training in environmental review AND training and/or documentation
    describing essential design elements and best practices for
    activities of this nature.

-   These design elements and best practices will be followed in
    implementing this activity.

-   Any specific mitigation or monitoring measures described in the
    Environmental Review Report will be implemented in their entirety.

-   Compliance with these conditions will be regularly confirmed and
    documented by on-site inspections during the activity and at its
    completion.

[\
(Signature)]{.underline} [(Date)\
\
(Print name)]{.underline}

### BELOW THIS LINE FOR USAID USE ONLY 

### Clearance record

  ---------------- -------------------- --------------------- ------------
  USAID Project    (print name)         (signature)           (date)
  Officer\                                                    
   Clearance                                                 
  given\                                                      
   Clearance                                                 
  denied                                                      

  USAID MEO\       (print name)         (signature)           (date)
   Clearance                                                 
  given\                                                      
   Clearance                                                 
  denied                                                      

  USAID REO\*\     (print name)         (signature)           (date)
   Clearance                                                 
  given\                                                      
   Clearance                                                 
  denied                                                      

  USAID BEO\*\     (print name)         (signature)           (date)
   Clearance                                                 
  given\                                                      
   Clearance                                                 
  denied                                                      
  ---------------- -------------------- --------------------- ------------

\*REO and BEO approval required for all "high risk" screening results
and for determinations of "significant adverse impacts"\
**Note: if clearance is denied, comments must be provided to applicant**

###  

[^1]: See separate ERR Approval Form (2 p.) for submission. Also
    consider if the Supplemental NRM Screening Form applies.

[^2]: See 22 CFR §216.2(b)(1). Most activities carried out under
    emergency circumstances are considered EXEMPT from USAID
    environmental procedures, except for the procurement or use of
    pesticides