PROJECT IDENTIFICATION FORM (PIF)

PROJECT TYPE: FULL SIZED PROJECT

THE GEF TRUST FUND

INDICATIVE CALENDAR
Milestones Expected Dates
Work Program (for FSP) April 2008
CEO Endorsement/Approval May 2009
GEF Agency Approval June 2009
Implementation Start July 2009
Mid-term Review (if planned) January 2012
Implementation Completion August 2014
Submission Date: 18 January 2008
Re-submission Date:      
PART I: PROJECT IDENTIFICATION
GEFSEC PROJECT ID1: 3276
GEF AGENCY PROJECT ID: PIMS NO. 3821
COUNTRY: Peru
PROJECT TITLE: Promoting Sustainable Land Management in Las Bambas
GEF AGENCY(IES): UNDP
OTHER EXECUTING PARTNER(S): XStrata Trust Fund, Provincial Governments
GEF FOCAL AREA (S): Land Degradation,
GEF-4 STRATEGIC PROGRAM(S): SO1, SP1
NAME OF PARENT PROGRAM/UMBRELLA PROJECT: N/A
A. PROJECT FRAMEWORK
Project Objective: Private sector, Government, NGOs and local communities interact constructively in support of SLM, taking advantage of
corporate responsibility programmes of the mining sector
Type Indicative GEF Indicative Co-
Project Expected Outcomes Expected Outputs Financing financing Total ($)
Components
($) % ($) %
1: Strengthening TA - 100% of funding proposals - Local Governments and community 1,500,000 33 3,000,000 67 4,500,000
capacities of approved by Las Bambas Trust organizations enabled to analyze LD
institutions and Fund Committee in accordance processes and propose solutions
community with SLM guidance document - Productive, social and infrastructural
representatives - 15 funding proposals (worth $ 6 development and spatial ordination
in Las Bambas million) actively promoting SLM plans incorporating SLM
to plan, propose developed, approved and applied considerations
and evaluate in the 2 Departments with funding - Planning processes in support of
initiatives in from the XStrata trust fund SLM, integrated between municipal
support of SLM - $2m invested by XStrata in and community levels
support of SLM in addition to the - Guidance documents on
Trust Fund incorporation of SLM considerations
- 50% of the area of the 2 into funding proposals
Departments (2,372km2) subject to - Feasible and attractive funding
plans for productive, social and proposals in support of SLM
infrastructural development and - Technical Committee with capacities
spatial ordination which to evaluate funding proposals
incorporate SLM considerations adequately
2: Strengthening TA - 100% of Government - Farmers and farmer organizations, 1,500,000 13 10,400,000 87 11,900,000
capacities of extension programmes in the 2 with capacities to develop and apply
farmers in Las Departments applying SLM solutions and evaluate externally
1
Project ID number will be assigned initially by GEFSEC .

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 Bambas to apply participatory methodologies in
SLM support of SLM
- 20 communities in the 2
Departments (15% of the total)
with functioning regulatory
mechanisms for natural resource
management
- 20 communities in the 2
Departments (15% of the total)
with mechanisms for
formulation, evaluation and
validation of SLM systems
3: Developing TA - Best practice code for private
nationwide best sector-community-Government
practice for cooperation in support of SLM
interactions adopted by the National Mining
between the Society
private sector, - 6 mining ventures nationwide
Government and applying best practice code for
farmers in private sector-community-
support of SLM Government cooperation in
support of SLM
- Participatory extension
methods in support of SLM
mainstreamed into Government
and NGO programmes under
similar conditions nationwide
- SLM criteria mainstreamed
into rural finance programmes
under similar conditions
nationwide
4. Project
management
Total Project Costs
generated SLM solutions
- Revitalized mechanisms for
regulation of natural resource mgnt.
- Extension agents applying and
supporting participatory processes of
problem analysis and technology
validation
- Modified extension processes in
Govt. and NGOs in support of SLM
- Consolidated small businesses based
on SLM-friendly products, with
necessary equipment, technical support,
market access and credit
- Code of best practice for promoting 600,000 37 1,000,000 63 1,600,000
constructive relations between private
sector, Government and local
communities in support of SLM
- Multi-stakeholder body advising on
relations between private sector,
Government and local communities
400,000 20 1,600,000 80 2,000,000
4,000,000 20 16,000,000 80 20,000,000

B. INDICATIVE FINANCING PLAN SUMMARY FOR THE PROJECT ($)

Project Preparation* Project Agency Fee Total
GEF 126,575 4,000,000 412,657 4,539,233
Co-financing 127,788 16,000,000 16,127,788
Total 254,363 20,000,000 412,657 20,667,021
* Please include the previously approved PDFs and planned request for new PPG, if any. Indicate the amount already approved as
footnote here and if the GEF funding is from GEF-3.
C. INDICATIVE CO-FINANCING FOR THE PROJECT (including project preparation amount) BY SOURCE and
BY NAME (in parenthesis) if available, ($)

Sources of Co-financing Type of Co-financing Amount

Project Government Contribution Grant 1,000,000
GEF Agency(ies) Grant 127,788
Bilateral Aid Agency (EU) Grant 1,500,000
Multilateral Agency (IFAD) Soft Loan 4,000,000
Private Sector Grant 8,000,000
NGOs Grant 1,500,000
Total co-financing 16,127,788

PART II: PROJECT JUSTIFICATION

A. THE ISSUE, HOW THE PROJECT SEEKS TO ADDRESS IT, AND EXPECTED GLOBAL ENVIRONMENTAL BENEFITS:

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1. The central issue to be addressed is that large areas of land throughout the Andean region of Peru are affected by
severe processes of land degradation and extreme conditions of poverty; opportunities exist for these problems to be
addressed with the support of the corporate responsibility programmes of mining companies, but to date Government,
local communities and the mining sector have not defined how to work together towards this goal and at present there is a
risk that corporate responsibility funds will be invested in ways that undermine SLM.
2. The imminent establishment by the Swiss mining company XStrata of an opencast copper mining venture in Las
Bambas, in the Department of Apurímac in central/southern Peru, provides an important opportunity to define mutually
beneficial relationships in support of sustainable land management between the Government, local stakeholders and the
private sector which will be applicable throughout Peru. The Las Bambas area is typical of conditions throughout much
of the Peruvian Andes: its inhabitants (who are mostly indigenous) are largely dependent on small scale agriculture,
chiefly of a subsistence nature, and the open-range grazing of camelids (including alpacas, llamas, guanacos and
vicuñas). Land tenure is largely communal, and natural resource management (e.g. agriculture, irrigation and grazing) is
traditionally subject to community-based controls. The planned upgrading of nearby access routes linking Brazil to the
coast is likely in the future to affect the viability of smallholder agriculture by increasing labour costs and product prices.
3. In common with large areas of the Peruvian Andes, the forms of land degradation and their underlying causes in
the area surrounding the proposed Las Bambas mine are diverse. Camelid pastures are subject to localized overgrazing,
resulting from the replacement of camelids by other forms of livestock which have greater impacts on pastures and soils.
This is due to reduced productivity of camelids, resulting from poor herd management, genetic degradation, climatic
events and epidemics. In addition social and demographic upheavals have led to the erosion of traditional systems of
regulation which provide for pasture recovery. Climate change has led to reductions in water availability (from runoff,
springs and precipitation), which has limited the ability of pastures to recover from pressure. The remaining patches of
woodland and scrub are subject to indiscriminate extraction of firewood and building materials , which has increased in
recent years due to localized population growth, which is partly attributable to Government sponsored initiatives aimed at
repopulating rural areas affected by political violence in previous decades. Agriculture on steep lands, practised with
inadequate provision for soil conservation, is leading to soil erosion; traditional terracing systems, which previously
limited erosion, have suffered neglect due to limited labour availability resulting from permanent or seasonal emigration,
and the decline of traditions of communal work and regulation due to social and cultural breakdown. Terraces have also
been damaged by aggressive exotic plant species with invasive roots, and trampling by non-camelid forms of livestock
such as cattle. Soil erosion is also exacerbated by the use of inefficient irrigation systems with high rates of cross-surface
flow. Soil health is affected by the excessive use of agrochemicals, due to the introduction of “green revolution”
approaches to agricultural development in the area, supported by the Government. Finally, the use of inefficient irrigation
systems such as the blanket flooding of peat bogs (bofedales), combined with glacier recession due to climate change,
and the breakdown of traditional systems of communal water management, is leading to declines in water resources.
4. The long term solution to the problems of degradation that affect lands throughout the Peruvian Andes would
involve local people having the capacity to develop, modify and apply SLM practices, that build upon indigenous
traditions and experience and at the same time are adapted to changing demographic, economic and climatic conditions,
and to generate appropriate support as necessary from public and private sources.
5. The barriers to this solution being achieved are as follows:
i) Institutions and community representatives have limited capacities to define how to use funds in support of SLM.
6. Experience throughout Peru to date has shown that the funds provided under the corporate social and environmental
responsibility programmes of mining companies tend not to be well used, due to the existence of limited capacities for
the development of viable proposals for their application. This is explained by the existence of inadequate access to, and
ability to interpret, information on natural and social conditions and development trends; limited understanding of or
ability to analyze complex land degradation problems; and limited specific awareness of the range of available options
for SLM. This situation is particularly significant given the complex nature of land degradation issues, which are
determined by a combination of biophysical, productive, social, cultural, microeconomic and macroeconomic factors, as
are their solutions. These limitations affect local and regional Governments, who have the overall responsibility for
planning and regulating natural resource use and infrastructural and productive development; local communities and their
organizations, who are responsible for generating proposals for the use of corporate responsibility funds; and the bodies
governing the use of corporate responsibility funds (in the case of Las Bambas, the Trust Fund Governing Board) which
are responsible for vetting proposals submitted to them for the use of the funds. A typical result of these limited
capacities is that initiatives that are approved have limited effectiveness and may in some cases exacerbate rather than
solve problems, generating “perverse incentives” for land degradation. Examples of types of investment that might cause
such negative impacts are poorly located access routes for productive initiatives, which damage fragile ecosystems such

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as bofedales; irrigation projects which result in excessive water extraction and undermine traditional structures for
regulation water use and distribution; and agricultural or livestock intensification projects which increase soil degradation
by agrochemicals or further displace traditional camelid grazing systems.
ii) Producers have limited capacities to apply and develop production systems capable of adapting to changing
demographic and economic conditions
7. Farming communities in the Las Bambas area, as in most of highland Peru, have millennia of experience of the
management of soil, water and vegetation resources; however in many cases their traditional systems have proven
inadequate for ensuring SLM in the face of changing climatic, social and macroeconomic conditions. Their abilities to
incorporate new practices or to modify their existing practices in response to these changes are limited by the limited
coverage of extension support provided by the Government and NGOs, which in turn is a function of the logistical
difficulty of reaching remote mountain villages with poor access routes; the limited capacities of extension agents to
match the support which they provide to the true needs of the target population, a situation which is largely due to the
professional profile of many extension agents, which focus principally on technical and productive issues rather than
social and livelihood aspects; the vertical nature of much of the technical support that has been provided to producers to
date, which has failed adequately to take into account the huge resource of traditional knowledge and experience that
exists in rural communities, or to develop the capacities of the target population to identify solutions to their problems.
This situation is further exacerbated by the progressive breakdown of traditional mechanisms for the regulation of
resource use and distribution (for example water bailiffs) in the face of social and demographic change (particularly the
exodus of population from the area in the 1980s and 1990s and the recent (Government-supported) return of refugees.
iii) Relations between industry, Government and local stakeholders are defined in a piecemeal manner across the
country
8. The situation in Las Bambas is repeated widely across the country, however there is little evidence of lessons having
been learnt or applied from experiences to date with corporate responsibility programmes under such conditions. Mining
initiatives are carried out by a wide diversity of foreign companies, which have little motivation to interchange
experiences or agree on common codes of conduct, and are under no obligation from the Government to do so. The result
is that unsatisfactory experiences are often repeated, a situation which is unfavourable both for the local communities in
the areas affected and for the companies themselves, as they are often faced by entrenched opposition due to mistakes
committed by other companies. There is an increasing level of unity between grassroots organizations nationwide in
response to proposals for mining ventures, however these local responses are commonly dominated by protest and there
is limited evidence of nationwide increases in capacities to propose win-win strategies whereby advantage is taken of the
opportunities offered by corporate responsibility programmes.
9. The main objective of GEF support will be to achieve effective collaboration between the private sector, the
Government (at national, regional and local levels) and local communities in support of SLM, in areas such as Las
Bambas which are characterized by high levels of land degradation and poverty and where corporate responsibility funds
are available. The project will focus initially on the Las Bambas area, given its coincidence with the startup of the
XStrata mine, but by its end the models applied there will have been scaled up to national level, resulting in positive
impacts on private/Government/local relationships throughout the Peruvian Andes.
Component 1: Strengthening capacities of institutions and community representatives to plan, propose and evaluate
initiatives in support of SLM
10. The support provided under this component will be directed principally at local Governments and community
organizations in the Las Bambas area. The project will provide members of these entities with training in LD and SLM
issues, which will enable them to formulate initiatives in support of SLM which reflect the true nature of land
degradation processes and their underlying causes, and take into account the biophysical, agronomic, social and
economic context in an appropriate and integrated manner. In order to ensure that such initiatives respond to other
development needs and reflect spatial variations in the context, support will also be provided to local Governments in the
incorporation of SLM considerations into planning processes, including productive, social and infrastructural
development plans and spatial ordination plans. Training, equipment and software will be provided in order to develop
their capacities for the identification and collation of the information needed to guide planning processes, and for the
integration of this into maps and databases tailored to their needs. This information will include aspects such as soils,
hydrology, vegetation cover, land use, access, infrastructure, cultural conditions, demographic changes, livelihood
systems and market trends. The project will also support the integration of different levels of planning systems: on the
one hand, opportunities and mechanisms will be identified to enable information managed at the level of local
Government to be fed into community-level planning processes, and on the other, planning systems at local Government
level will be developed in such a way as to be able to include diverse and qualitative information generated at local level.

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11. In order to enable these initiatives to receive the funding support that they need, local Government staff at
Department, Province and District levels will be provided with training on project preparation. The aim of this will be to
ensure that proposals presented to the Trust Fund or other funding sources incorporate SLM considerations adequately,
reflect the results of the planning processes described above, and correspond to the needs and formats of potential
funding sources. The importance of a programmatic, rather than project-specific, approach will be emphasized, with the
aim of maximizing the potential for individual initiatives to complement each other at macro level.
12. The project will also provide technical backup and information support to the Technical Committee responsible for
vetting investment proposals to be submitted to the Trust Fund Management Committee, in order to ensure that these are
subject to adequate appraisal of their environmental and social impacts and that appropriate and adequate mitigation
measures are stipulated where required.

Component 2: Strengthening capacities of farmers to apply SLM

13. Project support at this level will be aimed principally at farmers in the Las Bambas area, and at the entities
(Government and NGOs) which provide them with technical support. Activities will build upon successful experiences
already gained to date, within the project area and in comparable areas elsewhere, in pasture management and
agricultural practices in high Andean communities. These experiences include traditional systems, which in some cases
have been abandoned due to social and demographic changes. The value added that the project will confer will be the
application of a highly participatory and integrated approach, resulting in SLM solutions which accurately respond to
farmers’ needs and conditions.
14. The project will support the development of capacities for participatory situation analysis, enabling farmers to
identify needs, problems and key stakeholders (for example absentee community members as well as the current in situ
population), and to predict the potential impacts of land management proposals (such as the possible social impacts of
fencing off areas of communal pastures in response to overgrazing, and the impacts on traditional agricultural systems of
the introduction of high yield varieties and new crops). Linked to this will be the development of capacities for
participatory research, building on experiences to date in Peru and other parts of Latin America with methodological
approaches such as field schools, farmer-to-farmer interchanges and participatory action learning. The benefits of this
approach will be twofold: firstly, the technologies which result are likely to be relevant to farmers’ needs and conditions;
and secondly, the communities involved will acquire capacities to innovate, which will be of particular importance in the
project area due to the non-static nature of conditions there. The project will also support the systematization, evaluation,
revival and adaptation of traditional knowledge and practices, such as raised-field systems, manuring and community-
based mechanisms for the planning and regulation of camelid pasturing, and the management and regulation of irrigation
water, which in some cases have declined due in part to the demographic and social upheavals associated with the
political violence of previous decades.
15. The project will also support the development of capacities for the introduction and adaptation of new land
management practices, in order to ensure that these are compatible with needs, cultural conditions and tenure patterns: for
example, the establishment of family woodlots to address the problem of over-exploitation of tree resources on
communal lands, and the application of systems for rotating camelids between grazing communal pastures and feeding
on crop residues in fallowed agricultural fields, in order to alleviate problems of local overgrazing on communal pastures.
The project will support the formation of local processes for the participatory validation of introduced practices, and also
the training of extension agents and the modification of extension processes in order to ensure that these make adequate
provision for true local participation in the stages of context analysis, the formulation, selection and validation of
technologies and the provision of technical support and problem solving.
16. In the specific case of upland pastures, actions will be taken under the GEF alternative to increase the relative
competitiveness of camelid production, in order to reverse the process of replacement of camelids by cattle, sheep and
goats which have more serious impacts on pasture and soil conditions. Emphasis will be placed on increasing the levels
of income per animal rather than increasing stocking levels, in order to avoid promoting overgrazing. To this end, GEF
and co-financed support will be provided for consolidating small business management capacities at community level,
improvement of product quality through training in fibre handling and processing, and identification of stable niche
markets. As appropriate, equipment may also be provided (using co-financing from the mining trust fund) to enable local
people to add value to camelid products locally in pilot ventures, and advice will be provided on accessing and managing
credit for additional equipment as needed. In order to ensure significant reductions in processes of pasture degradation,
these investments in increasing in the relative competitiveness of camelid production will have to be complemented by
investments in support of traditional systems of pasture management and regulation, as proposed above.

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17. Subject to the provisions of the planning frameworks to be developed under Component 1, and using where possible
the co-financing resources available through the Trust Fund, productive infrastructure will also be developed under the
GEF alternative in order to make camelid production more viable and sustainable. This may include, for example, roads,
irrigation canals for pastures, and reservoirs to allow dry season irrigation and will be co-financed using resources from
the mining trust fund. Using the capacities developed under Component 1, integrated impact predictions will be carried
out of this productive infrastructure in order to ensure that it does not deliver unintended “perverse incentives” leading to
the increased application of damaging practices instead of its intended positive impacts on camelid production, and if
necessary modifications will be made to the design and siting of such infrastructure accordingly.
Component 3: Developing nationwide best practice for interactions between the private sector, Government and
farmers in support of SLM
18. Through the actions proposed under this component, the project will ensure that capacities are developed nationwide
for enabling mining companies, the Government and local communities to work together constructively in support of
SLM, incorporating the experiences generated in the Las Bambas area. A code of best practice will be developed, which
will provide mining companies with guidance on the steps necessary to ensure constructive relations with local
stakeholders in support of SLM. The multi-sector Governmental body PROINVERSION (the Peruvian Agency for the
Promotion of Private Investment) will act as the principal channel for the communication of this code throughout the
mining industry, to present and prospective investors. The formulation of this best practice code will in itself be a
participatory process: the project will promote the formation of a multi-stakeholder advisory group, including
representatives from the mining industry, the Government, NGOs, environmental organizations and indigenous
organizations, to monitor and analyse the processes set in action in Las Bambas and to identify, discuss and synthesize
recommendations for action applicable in comparable circumstances elsewhere in the country. Building on the
experiences developed in the Las Bambas area under Component 2, and the experiences to date elsewhere in the country
and the region, the project will also support the mainstreaming of participatory extension methodologies in support of
SLM into programmes of Government and NGOs nationwide, and the mainstreaming of SLM criteria into rural finance
programmes of the Government and NGOs nationwide.
19. Benefits: The project will lead to permanent increases in the recovery and adoption of technologies which are
compatible with sustainable land management, leading to reductions in trampling and grazing pressures on fragile upland
pastures, and reductions in the depletion of water resources and soil fertility due to the recuperation of traditional systems
of soil and water management. As a result, local people will enjoy more sustainable livelihoods, with increased capacity
to adapt to social, demographic and economic trends. At national level, the project will generate a model of how
communities can respond to and take optimum advantage of opportunities such as those presented by mining ventures
with social responsibility programmes. It will thereby contribute to social equity and stability by improving conditions in
high Andean communities. In global terms, the project will contribute to the sound management of fragile upland
ecosystems, which are crucial to the survival of large numbers of vulnerable people throughout the length of the Andean
mountain chain.
20. Sustainability: The project will result in impacts which are financially sustainable by focusing on the promotion of
productive practices which are financially viable, rather than depending on unsustainable temporary incentives. The
project will assist local people to develop capacities for adapting their production systems to changing economic
circumstances in order that they continue to have access to financially sustainable systems. Although the Las Bambas
Trust Fund will represent the principal source of co-financing for the project, the project will not be completely
dependent on the existence of the trust fund, but rather will seek to create long-term capacities which can be applied
beyond the life of the fund. Social sustainability will be ensured by working with and strengthening local institutions and
community-based organizations, and supporting the participatory development of technologies and resource management
systems which will be compatible with existing social structures. Environmental sustainability will be ensured by
supporting the development and application of management practices which respond to the capacities and opportunities
offered by the area’s natural resources, and by supporting the development of capacities for analysis, innovation and
monitoring which will allow practices to be adapted as appropriate, depending on their effectiveness in delivering
environmental benefits. Institutional sustainability will be ensured by working with local Governments and other existing
institutions, including non-governmental organizations with long term presence, wherever possible.

B. CONSISTENCY OF THE PROJECT WITH NATIONAL PRIORITIES/PLANS:

21. Peru published its National Action Programme for the Combat of Desertification in 1996. This identified the 19
westernmost Departments of the country, including the Department of Apurímac, as the priority area for the combat of
desertification, due to the presence there of arid and semi-arid and dry/sub-humid conditions. A Development Strategy

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was developed for Cotabambas and Grau Departments in 2006, through a highly participatory process supported by
UNDP at the request of the Agency for the Promotion of Private Investment (PROINVERSIÓN). The present proposal
will be in full conformity with the priorities identified in that Strategy, in particular the conservation of water, high
Andean soils and biodiversity; the training of producers and the economically active population in general; institutional
strengthening; and the production of alternative products.

C. CONSISTENCY OF THE PROJECT WITH GEF STRATEGIES AND STRATEGIC PROGRAMS:

22. The project will contribute to Strategic Objective 1 under the Land Degradation Focal Area, that an enabling
environment will place SLM in the mainstream of development policy and practice at regional, national and local levels,
as it will create an enabling environment of cooperation between private sector, Government and local stakeholders
which will result in investments by the private sector and Government being channeled effectively in support of SLM,
and local communities having the capacities to respond to external initiatives and adapt to changing conditions. It will
target mountains and upland watersheds, which are highlighted in GEF guidance as a high priority agro-ecological zone.
Specifically, it will target Strategic Program 1: Supporting Sustainable Agriculture and Rangeland Management, focusing
on priority element c) Sustainable management of mountain ecosystems.

D. COORDINATION WITH OTHER RELATED INITIATIVES:

23. This project will complement the proposed UNDP/GEF project “Developing capacities for adaptation to climate
change in high mountain ecosystems in Peru”. That project will strengthen national capacities for monitoring climate
change and its effects, and for developing adaptations to such changes. The outputs of that project will be adopted by the
project proposed here, with the result that producers in the project area have increased capacity to adapt to changes in
climate as well as social, demographic and economic conditions. UNEP (which will form part of the project steering
committee) is currently preparing a regional GEF project “Sustainable Development and Land Management in the
American Puna”, covering the puna (high altitude steppe) ecoregion of the central Andes (Argentina, Bolivia, Chile,
Ecuador and Peru). UNEP is also implementing a regional GEF project “Conservation of the Biodiversity of the Páramo
(high altitude savanna) in the Northern and Central Andes”, under the Biodiversity focal area. There will be important
opportunities to exchange lessons learnt between the present project and these two UNEP regional projects. The project
will also complement the proposed inter-agency project “Integrated and Adaptive Management of Environmental
Resources in High Andean Catchments”, financed by the UNDP/Spain MDG Fund, whose area coincides in part with
that of this project (UNEP and UNDP are implementing agencies of that project, together with FAO and the Panamerican
Health Organization). Additionally, UNDP and UNEP have a joint agreement with CONAM and a number of mining and
petrol companies to promote and implement sustainable development initiatives in areas adjacent to extractive industries.

E. VALUE-ADDED OF GEF INVOLVEMENT IN THE PROJECT DEMONSTRATED THROUGH INCREMENTAL

REASONING
24. Under the baseline situation, the Las Bambas Trust Fund would be invested in ways that did not contribute to, or
actively undermined, the sustainability of land management in the area, a situation that would be repeated in numerous
similar situations nationwide. Local communities, meanwhile, would be unable to adapt to changing social, economic,
demographic and climatic conditions and would as a result suffer increased problems of unsustainable production
systems and livelihood breakdown, leading to emigration. Under the GEF alternative, corporate responsibility
programmes of mining companies would support only initiatives which were compatible with SLM principles, while
local communities would have the capacities to interact effectively with the private sector and the Government and to
innovate in response to changing conditions. The value added of GEF involvement would consist of the incorporation of
SLM principles into private sector and Government investments; the strengthening of local capacities for interaction and
innovation; increased recognition and dissemination of the value of traditional land management processes; and increased
application of participatory and integrated methodologies in the actions of Government agencies and NGOs.

F. RISKS, INCLUDING CLIMATE CHANGE RISKS, THAT MIGHT PREVENT THE PROJECT OBJECTIVE(S) FROM
BEING ACHIEVED, AND RISK MEASURES THAT WILL BE TAKEN :
RISK SEVERITY MITIGATION MEASURES
Increased competition from cheap foodstuffs Medium/Low Development of farmers’ capacities for innovation, the
imported from neighboring countries as a result of participatory development of technologies suited to

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increased infrastructural integration, reducing the changing conditions and the interchange of knowledge,
viability of smallholder production systems allowing them to diversify their productive options
Increasing labor costs as a result of rural-urban Medium/Low As above
emigration and the return of displaced people
accustomed to urban wage rates, reducing the
viability of smallholder production systems
Reduced rainfall and availability of irrigation Medium/Low As above, plus support to revitalizing community-
water due to climate change based controls on the use of scarce water resources
Limited private sector commitment to Low Dissemination sector-wide of lessons from Las Bambas
incorporating SLM considerations into corporate
responsibility programmes

G. EXPECTED COST-EFFECTIVENESS OF THE PROJECT:

25. Through a GEF investment of $4 million, the project will result in the mainstreaming of SLM considerations into
corporate responsibility funds applicable over an area of 4,744km 2 and a population of 71,602 people, leading eventually
to the application of models for relations between private sector, Government and local communities throughout the
Andean region of Peru. The project’s strategy of working directly with a corporate responsibility programme offers the
opportunity to anticipate and avoid the negative impacts which programmes of that type might otherwise generate, an
approach which is much more cost effective than assisting the Government, NGOs and local communities subsequently
to take remedial measures. The project’s focus on building capacities among local communities to adapt to change, using
and modifying as appropriate existing traditional, socially sustainable land management systems, is also likely to be
much more effective than the provision of incentives to support artificially static or exogenous land management systems
which are likely to be unsustainable in the long term.

H. COMPARATIVE ADVANTAGE OF GEF AGENCY:

26. The project is highly compatible with UNDP areas of specialty, particularly with regards to human resource
development, institutional strengthening, and non-governmental and community participation. It is of particular relevance
to the following of UNDP’s six priority areas in its Energy and Environment practice area: i) frameworks and strategies
for sustainable development (the project will support the integration of sustainable management of environment and
natural resources into sector strategies); ii) effective water governance (specifically, improving national and local water
resources management for poverty reduction and sustainable development, and adapting to climate change) and iii)
sustainable land management.

PART III: APPROVAL/ENDORSEMENT BY GEF OPERATIONAL FOCAL POINT(S) AND GEF

AGENCY (IES)

A. RECORD OF ENDORSEMENT OF GEF OPERATIONAL FOCAL POINT (S) ON BEHALF OF THE

GOVERNMENT(S): (Please attach the country endorsement letter(s) or regional endorsement letter(s) with this template).

José Antonio González Norris Date: January 14th, 2008

GEF Operational Focal Point
National Environment Council
CONAM

B. GEF AGENCY (IES) CERTIFICATION

This request has been prepared in accordance with GEF policies and procedures and meets the GEF
criteria for project identification and preparation.

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 Lyes Ferroukhi
Regional Technical Advisor
UNDP-GEF LAC Regional Coordination Unit
Project Contact Person
John Hough
UNDP-GEF Deputy Executive Coordinator,
a.i.
Date: 18 January 2008 Tel. and Email: 507-302-4576
lyes.ferroukhi@undp.org