INITIAL ENVIRONMENTAL EXAMINATION (IEE)

PROJECT/ACTIVITY DATA: Activity Name: The Eastern Plain Keo Seima Wildlife Sanctuary Conservation ProjectCountry/region: Cambodia Start Date: 03/1/2018 End Date: 02/28/2021 Life of Project Amount ($): 2,000,000.00 IEE Prepared by: Menglim Kim Date: 12/13/2017Amendment: no ENVIRONMENTAL ACTION RECOMMENDED: (Place X where applicable) Categorical Exclusion: [ X ] Negative Determination with Conditions: [ X ] Positive Determination: [ ] Deferral: [ ] Purpose and Scope The purpose of this document, in accordance with Title 22, Code of Federal Regulations, Part 216 (22 CFR 216), is to provide a preliminary review of the reasonably foreseeable effects on the environment, as well as recommended Threshold Decisions, for the activities detailed below. This document provides a brief statement of the factual basis for Threshold Decisions as to whether an Environmental Assessment or an Environmental Impact Statement is required for the activities managed under the scope of this document. The activities under review are recommended for the threshold decisions indicated above in the “Environmental Action Recommended” section. Background and Description of Activities The Eastern Plain Keo Seima Wildlife Sanctuary Conservation Project will include forests and biodiversity conservation activities in and around Keo Seima Wildlife Sanctuary in Mondulkiri province.

This IEE covers the following three activity-level objectives:

1. Improved biodiversity conservation and ecosystem health in the Eastern Plains Keo Seima Wildlife Sanctuary and its corridors

This Activity Objective aims to preserve and protect the biodiversity and overall ecosystem health in the Keo Seima Wildlife Sanctuary (KSWS) and its extended landscape, including the main catchments of the Mekong River Basin. The Recipient will monitor populations of vulnerable, endangered, or critically endangered species to determine whether interventions are achieving results to stabilize or increase the populations of these species. Interventions will be based on a stated theory of change, and will directly address threats to biodiversity, such as poaching and illegal logging, the lack of accurate, timely and

actionable information on biodiversity and natural resources, and the lack of understanding of the value of ecosystem goods and services in the target geographic area. Interventions may support reforestation or restoration of degraded Community Forests and Community Protected Areas, where it is practical and feasible. The Recipient must promote the use of innovative technology and state-of-the-art methods to protect biodiversity and improve landscape management.

2. Increased sustainable and equitable economic opportunities, community livelihoods, and natural capital reinvestment in the Eastern Plains Keo Seima Wildlife Sanctuary

This Activity Objective seeks to increase reinvestment in natural capital within the target geographic area through market-oriented economic opportunities. This Objective aims to strengthen selected natural resource-based value chains to capitalize on sustainable, climate-smart economic opportunities. This Objective is intended to protect or restore catchment basins, increase carbon stocks in the extended landscape, promote agroforestry or ecotourism, promote sustainable community livelihoods, and/or enhance payment mechanisms for Reducing Emissions from Deforestation and Forest Degradation (REDD+) or Payments for Environmental Service schemes (PES). In alignment with Cambodian national strategies, policies and regulations, interventions in this Objective will also support Cambodian communities and sub-national authorities to create and manage transparent financial mechanisms to prevent or mitigate environmental degradation from economic development activities.

Extraction of natural resources is the main source of income for the people living in and around the forests of the KSWS of the Eastern Plains, therefore, this is a logical entry point for strengthening sustainable forest management and while considering income generation opportunities for local communities and marginalized populations such as women, youth, and indigenous groups. Interventions should focus on economically feasible and innovative ways to increase income generation that also support sustainable forest management. Livelihood activities should emphasize sound environmental friendly business principles, diversification, and participation by affected (direct and indirect) and under-represented groups living in and around KSWS. Mechanisms to strengthen REDD+ and potential PES should develop adequate social and environmental safeguards, including mechanisms that support equity in benefit sharing. Success will require the Recipient’s ability to ensure that value chain actors, especially microenterprises owned or operated by women, youth, or indigenous groups have access to competitive and fair market opportunities resulting in a sustainable and profitable source of income to incentivize reinvestment back into the extended landscape.

3. Strengthened inclusive and effective landscape governance and management of the Eastern Plains Keo Seima Wildlife Sanctuary and its corridors

This objective will empower communities and key stakeholders (including but not limited to sub-national authorities, civil society, women, youth, and indigenous groups) to understand and engage in the development and enforcement of laws, policies, and strategic management plans for biodiversity conservation and sustainable landscape management in the KSWS and its extended landscape. Communities, civil society, and other key stakeholders will have access to timely and actionable data and information regarding natural resources, biodiversity, forest cover, climate adaptation and mitigation, and other relevant data to inform decision-making processes for biodiversity conservation and landscape management in the target area. Appropriate attention must be given to the inclusion of women, youth, indigenous groups and other marginalized populations in decision-making processes for natural resource management, and the equitable sharing of benefits from improved natural resource management. Interventions should also support legal designations (land titles, CF and CPA management plans and zoning) for the use and management of forests for communities to secure land tenure and land use rights for sustainable economic activities. Interventions to support this Objective will be linked to other Activity Objectives and will use innovative and state-of-the-art methods increase meaningful citizen participation

in legal frameworks and evidence-based strategic planning for the protection of biodiversity and improved landscape management in the target geographic area.

All objectives will include activities that do not impact the environment, including training, technical assistance, studies, meetings, and workshops. Under objective 1 and 2, there may be activities with some potential impacts, including small and medium enterprises; and activities that concern livestock, agriculture, ecotourism and forestry.

Climate Risk Management

Cambodia is still largely reliant on the agriculture and natural resources sectors for livelihoods, food security and economic growth. These sectors have the potential to have significant impact on climate change. Other development priorities identified in the National Strategic Development Plan (NSDP), 2014-2018 and Rectangular Strategy Phase III, such as rural infrastructure and water management, are also climate-sensitive.

Climate change is already considered a cross-cutting issue in such plans; and the recent Cambodia Climate Change Strategic Plan (CCCSP) and the line ministries’ Sectoral Climate Change Strategies take a whole-of-government approach to mainstreaming climate change adaptation and mitigation across development, declaring a need to “ensure that national development priorities can be achieved under a changing climate” (RGC 2013, p. 3).

Key vulnerabilities

Cambodia has been identified as highly vulnerable to the effects of climate change in regional and global indexes. According to the World Risk Report, Cambodia ranks eighth among the top 15 countries with the highest risk of impact from climate change (Alliance Development Works 2012). Cambodia was also ranked as highly vulnerable in an influential regional study of Southeast Asia, largely due to its low adaptive capacity (Yusuf and Francisco 2009).

There have been several efforts to assign relative vulnerability to the different provinces of Cambodia. Yusuf and Francisco (2009) ranked Mondulkiri among the most vulnerable due to expected changes in temperature and precipitation, as well as low adaptive capacity. USAID’s Mekong ARCC project (2013) concurred and also identified Kampong Thom and Stung Treng as highly vulnerable.

Observed and projected climate change should be viewed against the context of existing climate variability. Traditionally, Cambodia has two seasons, hot and dry (November-April) and wet/monsoon (May-October); temperature and precipitation vary considerably during and within those seasons. The timing of events, such as the onset of the rainy season, varies from year to year. Natural extreme events such as droughts, floods, and storms occur periodically and can cause considerable damage; the severe floods of 2011, for instance, resulted in an estimated $451 million in damage, affected more than 1.5 million people, and damaged about 400,000 hectares of rice paddy (ADB 2003; Diepart et al. 2015).

Cambodia’s climate has been changing over the past few decades. Mean annual temperatures increased by 0.8°C between 1960 and 2003. The frequency of hot days and nights has increased, and the frequency of cold days and nights has decreased, especially during the dry season (World Bank et al 2011).

Future climate change projections for Cambodia can be summarized briefly as follows:1

1 This information is drawn from preliminary SimCLIM analysis carried out on behalf of USAID by Stratus Consulting (2015); as well as from World Bank et al. 2011 and Mekong ARCC 2012. The SimCLIM analysis was based on an ensemble of 38 GCMs, CMIP5 data, mid-sensitivity, for RCP 8.5. Projections are changes in mean temperature and precipitation from baseline

Increased average temperatures of about 1.5°C by 2050

Increased annual daily maximum temperatures of 2 to 4°C Further increases in the frequency of days and nights that are considered ‘hot’ in the current

climate, with hot days increasing by 14 to 49% and hot nights increasing by 24 to 68% by 2060 Further decreases in the frequency of days and nights that are considered ‘cold,’ with these events

becoming exceedingly rare Increased annual precipitation of about 2.6% by 2050, with more frequent and intense

precipitation events during the rainy season Seasonal changes in precipitation, e.g. projected rainfall increase of 11% during wet season and

projected decrease of 3 to 10% during dry season around 3S Rivers Basin Expected increased annual flows along the mainstream Mekong River Modest increases in flood depth and duration in the central floodplain Increases in the frequency and intensity of droughts Average sea-level rise of 0.2 to 2 meters by 2100

These projections have likely implications for a number of sectors of interest to USAID. Drawing on Cambodia’s NAPA (2006) and other sources, the most risk and potentially impacted sectors include: Agriculture, Water, Ecosystems, Inland fisheries, Infrastructure (urban and rural), Settlements, Human health, and Coastal.

Recognizing that a shift toward more sustainable and resilient development pathways is a medium-to-long-term endeavor, the project will build an evidence base of effective methodologies, practices, and results that contribute to better management of climate risks.

The project will implement a climate risk assessment to identify measures to integrate into activity design and to ensure that risks are adequately addressed. The table below summarizes the potential illustrative activities, climate risks and mitigations that could occur during the implementation phases. However, in collaboration with line government agencies, the project implementing partner will work together to identify the concrete climate risks with mitigation measures during the implementation.

(1995).

Activity-Level Climate Risk Management Summary Table

Tasks/ Defined or Illustrative Interventions

Climate RisksList key risks related to the defined/ illustrative interventions identified in the screening and additional assessment.

Risk RatingLow/ Moderate/ High

How Risks Addressed Describe how risks have been addressed in activity design and/or additional steps that will be taken in implementation. If you chose to accept the risk, briefly explain why.

Opportunities to Strengthen Climate ResilienceDescribe any opportunities to achieve multiple development objectives by integrating climate resilience or mitigation measures

Development of a management plan to protect forests and biodiversity,sustaining ecosystem services and its catchment basins

Climate change is likely to act as a threat multiplier for a number of ecosystems’ services.

Changes in the fire regime may affect the dry forests of the Keo Seima Wildlife Sanctuary.

Species composition may change through

Moderate Work with implementing partners and line government agencies to fully assess the risks in the Keo Seima Wildlife Sanctuary

Integration of adaptation into watershed planning and management

Building local adaptive capacity and supporting climate-resilient planning and practices

Measures to minimize the potential impact of fire, insects and diseases, increased afforestation and reforestation, creation of biodiversity corridors and rehabilitation of degraded forests.

Vulnerability assessments and increased preparedness for disasters

Forest Management plans must incorporate uncertainty and the increased probability of extreme

the arrival of invasive species like bamboo in degraded forest areas.

More frequent floods and longer submersion may alter the dynamics of flooded forests, though this will interact significantly with infrastructure development.

Wetlands and seasonal water sources may dry up earlier and longer in droughts, limiting the availability of water for wildlife and ecosystems.

events, as well as the periodic comparison of projections against the evolving reality so as to update targets and methods.

Intensive monitoring can provide early warning of forest dieback and of pest and disease outbreaks, help reduce uncertainty in planning, and minimize losses.

Support species to adapt to changing climate patterns and sudden climate events by providing refuges and migration corridors

In a changing climate, protected areas will take on added importance as safe havens for biodiversity by offering good-quality habitats less vulnerable to climate extremes, by providing refuge for threatened species and by conserving important gene pools. It will also become more important to protect reference landscapes – ecosystems on which restoration planning is based, and which provide a basis for evaluating the success of restoration.

Provide technical assistance to communities for management, co-patrol, forest restoration

More frequent floods and longer submersion may affect the participation of local community members

Moderate Work with implementing partners and line government agencies to fully assess the risks in target provinces

Building local adaptive capacity and supporting climate-resilient planning and practices

Consider support potential value chains as viable economic

Livestock, ecotourism and agriculture systems are considered vulnerable to

Moderate Work with implementing partners and line government

Building local adaptive capacity and support climate-resilient planning and practices.

opportunities (i.e. agriculture, ecotourism, livestock, NTFP)

more severe floods and droughts

agencies to fully assess the risks in target provinces

If a country’s natural habitat is destroyed by climate change impacts, its economy will suffer. A recent study found that the gross domestic product (GDP) of a number of countries could be negatively affected by sea level rise, saltwater intrusion and natural disasters attributed to climate change. In helping to protect natural habitat, protected areas indirectly help to protect the national economy.

Strengthened inclusive and effective landscape governance (i.e. training, studies, meetings and workshops)

More frequent floods and longer submersion may affect the participation of local community members in trainings, meetings, workshops, etc.

Moderate Work with implementing partners and line government agencies to fully assess the risks in target provinces

Building local adaptive capacity and support climate-resilient planning and practices.

Design and management plans for protected areas will need to focus more on local community engagement, linkages with the national development agenda and alternative forms of protected area management such as private-sector or community management.

Governance schemes for protected areas may need to be modified for greater effectiveness and for conflict resolution. Decision-makers need to ensure that institutional and legal conditions enable people to benefit directly from protected areas

The project will incorporate climate risk management measures into the Environmental Mitigation and Monitoring Plan (EMMP).  The activity will not involve the use and/or procurement of pesticides.

Country Information 1. The legal requirements for Environmental Impact Assessments (EIAs) in Cambodia are set out in the

Law on Environmental Protection and Natural Resource Management, 1996 (Chapter III) (EPNRM Law) and the Sub-Decree on Environmental Impact Assessment, 1999 (EIA Sub-Decree). There are also a number of Prakas (regulations promulgated by a Ministry to implement a law) on the procedures implementing the EIA Sub-Decree 1999:• Prakas on Guidelines for Conducting EIA Report (49 Ministry of Environment, March 2000);• Prakas on Determination of Service Charge for Environmental Impact Assessment Report Review and Follow-up and Monitoring of Project Implementation (No. 745, October 2000);• Prakas (Declaration) on General Guidelines for Conducting Initial and Full Environmental Impact Assessment Reports (No. 376 BRK.BST 2009);• Prakas on Registration of Consulting Firms for Studying and Preparing Environmental and Social Impact Assessment Report (No. 215 Brk MoE 2014); and • Prakas on Establishment of the Technical Working Group for Reviewing and Commenting on the EIA Report (No. 063 Pr.k MoE 2014).

2. There is also a Sub-Decree 146 on Economic Land Concessions (ELC), 2005, which requires environmental assessment of ELCs. Article 7, clause 5 of Sub-Decree 146 states that “if the initial environmental and social impact assessment indicates a medium or high degree of adverse impact, arrange for the conduct of a full environmental and social impact assessment.”

3. The National Forestry Law, 2002, which includes a framework for management, harvesting, use, development and conservation of the forests in the Kingdom of Cambodia. This law can be accessed at the following website:http://www.cambodiainvestment.gov.kh/law-on-forestry_020930.html

4. The National Biodiversity Strategy and Action Plan, 2016, which aims to enhance Cambodia’s biodiversity and its ecosystem services by 2050

5. The National Forest Program (NFP) 2010-2030 identifies nine strategic objectives, which are to be achieved through the implementation of six programs, each divided into several sub-programs

6. Law on Nature Protection Area, February 2008 defines the framework of management, conservation and development of protected areas: http://www.cambodiainvestment.gov.kh/law-on-nature-protection-area-protected-areas-law_080104_080104.html

7. Cambodia is currently preparing an Environmental Code with an EIA component.8. Tropical forests and the conservation of biodiversity play a fundamental role in sustainable

development. As such the U.S. Foreign Assistance Act (FAA) of 1961, as amended by Sections 118 and 119, requires that all USAID Missions conduct a periodic country analysis of the conservation and sustainable use of tropical forests and biological diversity. These analyses can help inform project design and implementation.

The USAID Cambodia Tropical Forestry and Biodiversity (118/119) Assessment can be accessed at the following website:

http://pdf.usaid.gov/pdf_docs/pnaea955.pdf Analysis of Potential Environmental Impact While development activities are intended to provide benefits for targeted recipients, when managed ineffectively they may cause adverse impacts that can offset or eliminate these intended benefits. Impacts can be direct, indirect, or cumulative. They can also be beneficial or negative. The USAID Sector environmental guidelines are good resources in finding more information on potential impacts for various sectors. The following link is to all sector guidelines: http://www.usaidgems.org/sectorGuidelines.htm The following are summaries of potential environmental impacts for respective sector(s) that are related to the scope of this IEE. Support to small / medium enterprisesAlthough many small and medium enterprises (SMEs) do relatively little direct environmental damage, some can cause significant environmental and related public health difficulties, which vary as broadly as the types of enterprises. SMEs can be more pollution-intensive than larger enterprises (per unit of production). When they are numerous and/or concentrated in particular areas, they can create environmental problems of alarming proportions.

The adverse environmental impacts of SMEs can impose heavy social and economic burdens on their communities—degrading the ecosystem and food sources, undermining the health of neighbors and workers, and consuming fuel and resources beyond the point of renewability. These burdens in turn place significant costs upon not only the culpable SMEs but also other businesses—such as costs of procuring fuel and costs of lost worker productivity due to sickness or injury. Environmental problems that may be caused by SMEs include:

• Chemical and hazardous waste• Air pollution and particulate dust• Water pollution• Soil erosion• Natural resource depletion• Solid waste• Odor• Noise• Health and safety risks

Many decisions made by SMEs have the potential to harm the environment and public health. Specific examples may include:

• Location decisions • Purchasing decisions• Processing/manufacturing decisions• Housekeeping decisions• Waste disposal decisions

Overall, adverse impacts are often caused by poor practices that go uncorrected because people do not have the right technical information. Insufficient knowledge can lead to improper use of chemicals, inadequate treatment or disposal of solid and liquid waste, uncontrolled chemical air pollution, and

production techniques that make intensive use of nonrenewable resources. Health and safety problems, in particular, are compounded by ignorance of industrial safety and environmental standards, as well as by lack of awareness of protective devices that are generally inexpensive and easy to obtain.

AgricultureThe following are some potential adverse impacts from mismanaged agriculture development projects:

• Destruction or degradation of natural habitat, including deforestation, desertification, and drainage of wetlands and destruction of protected areas • Loss of biodiversity• Introduction of exotic and non-native animal and plant species• Erosion and loss of soil fertility• Siltation of water bodies• Reduction in water quality or changes in local hydrology• Increased Greenhouse Gas (GHG) emissions

Stagnant water pools are breeding places for disease vectors (e.g., mosquitoes that carry malaria, etc.). They can also increase transmission of water-related diseases.

National agricultural and economic policies alter the costs and benefits of particular agricultural investments and practices. Poorly designed policies can inadvertently discourage environmentally-sound agriculture and livestock husbandry practices, or may unwittingly reinforce others that have adverse impacts on the environment and the land’s long-term productivity. Aspects of the policy environment that may cause unintended harm include:

• Uncertainties about land tenure• Agricultural subsidies/payments and pricing• Resettlement programs in fragile lands • A focus on agricultural expansion. Policies that promote conversion of new lands into agricultural use instead of measures to intensify yields on existing plots, frequently resulting in destruction or degradation of ecosystems.

LivestockThe following are some potential adverse impacts from mismanaged agriculture development projects:

• Large areas of land degraded – such as overgrazing; use of marginal lands; • Damaged habitat and reduced biodiversity – such as harm to wildlife and domestic stock and loss of wildlife habitat; slaughter of wildlife by livestock managers; potential spread of disease to wildlife; extinction of local livestock breeds; • Harm to vegetation – such as clearing of forest and wild lands; loss of rangeland fertility; damage to riparian soil and vegetation; introduction of invasive plant species;• Decrease in water quality and supply – contamination from manure; degradation of water quality and reduction in water supplies; harm to human health;• Odor; and• Increased GHG emissions

National livestock and economic policies alter the costs and benefits of particular investments and practices. Poorly designed policies can inadvertently discourage environmentally-sound livestock husbandry practices or may unwittingly reinforce others that have adverse impacts on the environment and the land’s long-term productivity. Aspects of the policy environment that may cause unintended harm include:

• Uncertainties about land tenure• Subsidies/payments and pricing• Resettlement programs in fragile/degraded lands • A focus on agricultural expansion. Policies that promote conversion of forest for agricultural use, instead of measures to intensify yields on existing plots, frequently result in the destruction or degradation of ecosystems.

EcotourismThe following are some potential adverse impacts from mismanaged ecotourism projects:

• Soil erosion, from poorly designed or managed roads and trails• Water quality deterioration• Deforestation• Loss of unique flora• Changes in animal behavior• Increased pollution• Undermining the cultural and economic integrity of the local community• Uncontrolled population growth and in-migration

ForestryThe following are some potential adverse impacts from mismanaged re-forestry and forestry development projects:

• Loss of local biodiversity, including useful niche species• Introduction of exotic or non-native tree species• Conversion of natural forest to tree plantations• Disruption of local communities’ current land uses

Recommended Threshold Decisions I. Justification for Categorical Exclusion RequestSome of the activities described justify a Categorical Exclusion, pursuant to 22 CFR 216.2(c)(1) and (2), for which an Initial Environmental Examination or an Environmental Assessment are not required because the actions do not have an effect on the natural or physical environment. Specifically, as currently planned, these activities fall into the following classes of action: - Education, technical assistance, or training programs except to the extent such programs include activities directly affecting the environment - Analyses, studies, academic or research workshops and meetings - Document and information transfers The activities under review that justify Categorical Exclusion include:

1. The following activities under “objective 1”: Support relevant authorities to develop management plans for the protected areas through a

transparent, inclusive, participatory process Engage with Economic Land Concession owners within the protected areas on shared

management activities that contribute to sustaining ecosystem services Support replication of management planning tools and processes in the other protected areas

in Mondulkiri province and its catchment basins

Technical assistance and capacity building in research and analysis, for example on conducting biodiversity surveys, hydrological surveys, spatial planning, and ecosystem restoration technologies

Provide technical assistance to communities for management, particularly where a community management designation is in process or has been granted, including for conservation and production/livelihoods, given the biodiversity context in the site and the resources available

Review and assess existing datasets, methodologies and information Support Royal Government of Cambodia counterparts and other stakeholders to produce

targeted data, maps, scenarios, and/or analyses required for interventions Create easy-to-understand syntheses of expected changes from land conversion and

infrastructure to inform policy makers, advocacy organizations, and sub-national government units including communities to enable them to understand and advocate for their interests.

2. The following activities under the “objective 2”: Conduct preliminary screening of potential value chains for consideration as viable economic

opportunities in Mondulkiri province Conduct value chain or subsector analyses of priority value chains to be recommended for

strengthening support through the project Develop and implement market-oriented support interventions for approved value chains Provide ongoing support to and monitoring of implementation of interventions, including

documentation of reinvestments into the sustainability of ecosystem services Establish sustainable community financing mechanisms by which communities can cover

their management costs. Develop an appropriate system of trainings/scholarships/internships to increase the technical,

finance, business, and vocational skills of enterprise operators, including women, youth, and cultural minorities

Support stakeholder access to and understanding of climate services, market and credit information, or other information sources supporting viable enterprise operation

Develop and conduct a set of analyses as appropriate to adequately document natural capital reinvestments and their effects on ecosystem values, including carbon stocks

Conduct an institutional assessment of climate service providers and users in the target areas, looking at capacities, needs, and opportunities at the national and sub-national levels.

3. All activities under the “objective 3”: The activities under this component will focus on providing technical assistance, for instance: support implementation of effective and inclusive governance processes; strengthen capacity of communities and relevant stakeholders to engage in governance processes; produce relevant and actionable information to influence key stakeholders; build a broader constituency for environmental protection in Cambodia.

II. Negative Determination with Conditions Activities with potential impacts to the environment under the following sectors are recommended for a Negative Determination with Conditions threshold determination. When implemented ineffectively these activities may cause adverse impacts that can offset or eliminate the intended benefits. Mitigating environmental impacts with these activities requires a participatory approach to activity/program design and management. Strong technical design of the projects is also critical. The following are specific conditions to mitigate the potential negative impacts for respective sectors. Support to small / medium enterprises

Chapters with specific guidance in this area include:• Introduction of MSEs and the Environment: http://usaidgems.org/Documents/SectorGuidelines/ENCAP/mse_introduction.pdf• Mechanisms for MSEs to Control Environmental Impact: http://usaidgems.org/Documents/SectorGuidelines/ENCAP/mse_controlmechanisms.pdf• Institutionalizing Environmental Capacity: http://usaidgems.org/Documents/SectorGuidelines/ENCAP/mse_institutionalizing.pdf

The following are conditions and best practices that should be implemented for activities involving SMEs:

• Activities shall be conducted following principles of USAID small scale guidelines chapters • In applying environmental oversight to SME activities, USAID will support business development services (BDS) and credit providers in developing screening of their activities to categorize the SME’s work to the types and seriousness of environmental impacts they generate. A BDS or credit provider needs to ensure that assistance for SME complies with local, national, USAID, or its own organizational environmental policies. Yet, it is unreasonable to expect BDS and credit providers to conduct a detailed assessment of the impacts of every SME they work with. The goal of the screening phase is to determine quickly and easily assess if an assistance request from an SME (for a loan, business planning, accounting training, etc.) will need environmental review before it can be approved. The chapter on “Institutionalizing Environmental Capacity” provides more guidance in this area. • The table on page 10 of the Introduction MSEs and the Environment chapter outlines how the consideration of environmental issues aligns with mitigation measures and the steps each actor can take to contribute to environmental compliance. This includes BDS providers, SME Direct Lenders; Intermediate Credit Institutions (ICIs) and USAID. This chapter can be found at the following link: http://usaidgems.org/Documents/SectorGuidelines/ENCAP/mse_introduction.pdf• With activities involving hazardous materials, the implementing partner should work with the business to develop a written plan to ensure appropriate procurement, storage, management and/or disposal of these materials.

AgricultureThe following are conditions and best practices that should be implemented:• All agriculture development activities shall be conducted following principles for environmentally sound agriculture development, as provided in the USAID Sector Environmental Guidelines – Agriculture. This document can be found at: http://www.usaidgems.org/Sectors/agriculture.htm• Design of activities should address soil erosion and soil and water conservation (guidance on this can be found starting on page 14 of the environmental guidelines).• Activity design and implementation should factor climate change (guidance on this can be found starting on page 22). • An Environmental Monitoring and Mitigation Plan (EMMP) shall include the principles of the agriculture guidelines.

LivestockThe following are conditions and best practices that should be implemented:

• All livestock development activities shall be conducted following principles for environmentally sound agriculture development, as provided in the USAID Sector Environmental Guidelines – Livestock. This document can be found at: http://www.usaidgems.org/Sectors/livestock.htm • Consider climate, terrain and ecosystem• Evaluate policy, legal, customary and cultural context• Assess current and proposed species and breeds

• Evaluate current and proposed livestock management practices• Assess impacts of market linkages and processing• Mitigate potential disease • Minimize greenhouse gas emissions and maximize sequestration• An Environmental Monitoring and Mitigation Plan (EMMP) shall include the principles of the livestock guidelines.

EcotourismThe following are conditions and best practices that should be implemented with ecotourism activities:• Activities shall be conducted following principles for environmentally sound development, as provided in the USAID Chapter in the Sector Environmental Guidelines – Ecotourism. This document can be found at the following site: http://usaidgems.org/Sectors/ecotourism.htm• An Environmental Monitoring and Mitigation Plan (EMMP) shall include the principles of the guidelines.• Common mitigation measures for different components of an ecotourism activity can be found on page 7 of the guidelines,

ForestryThe following are conditions and best practices that should be implemented:

• All forestry development activities shall be conducted following principles for environmentally sound development, as provided in the USAID Sector Environmental Guidelines – Forestry. This document can be found at the following site: http://usaidgems.org/Sectors/forestry.htm • Implementation of forestry activities should strive to reduce greenhouse gas emissions and maximize sequestration. • An Environmental Monitoring and Mitigation Plan (EMMP) shall include the principles of the Forestry guidelines.• Common mitigation measures for different types of forestry activities (ex. Sustainable Forestry Management; Agroforestry; Reforestation and plantation Forestry) can be found on page 31 of the guidelines,

Monitoring and Implementation In addition to the specific conditions enumerated in the Negative Determination with Conditions section, the threshold determinations recommended are contingent on full implementation of the following general monitoring and implementation requirements:

USAID Requirements 1. Environmental compliance actions and results in USAID solicitations and awards. The Contract/Agreement Officer will include language and reference to this IEE in appropriate solicitations and awards. Suggested language for use in solicitations and awards can be found at the following link: http://www.usaid.gov/ads/policy/200/204sac2. Implementing Partner (IP) Briefings on Environmental Compliance Responsibilities. The Contract/Agreement Officer’s Representative (C/AOR) will provide the IP with a copy of this IEE; the IP will be briefed on their environmental compliance responsibilities by their C/AOR. During this briefing, the IEE conditions applicable to the IP’s activities will be identified.3. Compliance Monitoring. As required by ADS 204.3.4, USAID will actively monitor and evaluate, by

means of desktop reviews and site visits, whether there are new or unforeseen consequences arising during implementation that were not identified and reviewed in accordance with 22 CFR 216 (Reg. 216). USAID will also monitor the need for additional review. If additional activities not described in this document are added to this program, an amended environmental examination will be prepared in a timely manner and approved. 4. Compliance Reporting. A summary report of the Mission’s compliance relative to this IEE will be sent to the BEO on an annual basis, normally in connection with preparation of the Mission’s annual environmental compliance report required under ADS 203.3.8.5 and 204.3.3. The BEO or his/her designated representative may conduct site visits or request additional information for compliance monitoring purposes.

Implementing Partner (IP) Requirements

1. Development of Environmental Mitigation and Monitoring Plan (EMMP). For activities that are subject to one or more conditions set out in the “Recommended Threshold Decision” section of this IEE, the IP will develop and provide an EMMP for USAID C/AOR review and approval, documenting how their project will implement and verify all IEE conditions that apply to their activities. The EMMP will also identify how the IP will assure that IEE conditions that apply to activities supported under subcontracts and sub-grants are implemented. (In the case of large sub-grants or subcontracts, the IP may elect to require the sub-grantee/subcontractor to develop their own EMMP.)2. Integration and implementation of EMMP. The IP will integrate the EMMP into their project work plan and budgets, implement the EMMP, and report on its implementation as an element of regular project performance reporting. The IP will ensure that sub-contractors and sub-grantees integrate implementation of IEE conditions, where applicable, into their own project work plans and budgets and report on their implementation as an element of sub-contract or grant performance reporting.3. Integration of environmental compliance responsibilities in sub-contracts and grant agreements. The IP will ensure that sub-contracts and sub-grant agreements reference and require compliance with relevant elements of the IEE and any attendant conditions.4. Assurance of sub-grantee and sub-contractor capacity and compliance. The IP will ensure that sub-grantees and subcontractors have the capability to implement the relevant requirements of this IEE. The IP will, as and if appropriate, provide training to sub-grantees and subcontractors in their environmental compliance responsibilities and in environmentally sound design and management (ESDM) of their activities.5. New or modified activities. As part of its initial Work Plan, and all Annual Work Plans thereafter, the IP, in collaboration with their C/AOR, shall review all planned and ongoing activities to determine if they are within the scope of this IEE. If any IP activities are planned that would be outside the scope of this IEE, an amendment to this IEE addressing these activities will be prepared for USAID review and approval. No such new activities will be undertaken prior to formal approval of this amendment. Any ongoing activities found to be outside the scope of the approved Reg. 216 environmental documentation will be halted until an amendment to the documentation is submitted and written approval is received from USAID. This includes activities that were previously within the scope of the IEE, but were substantively modified in such a way that they move outside of the scope.6. Compliance with Host Country Requirements. Nothing in this IEE substitutes for or supersedes IP, sub-grantee and subcontractor responsibility for compliance with all applicable host country laws and regulations for all host countries in which activities will be conducted under the USAID activity. The IP, sub-grantees and subcontractor must comply with each host country’s environmental regulations unless otherwise directed in writing by USAID. However, in case of conflict between the host country and USAID regulations, the latter shall govern.7. Compliance Reporting. IPs will report on environmental compliance requirements as part of their routine project reporting to USAID.

Revisions and Limitations If during implementation, project activities are considered outside of those described in this document, an amendment shall be submitted. Pursuant to 22CFR216.3(a)(9), if new activities are added and/or information becomes available which indicates that activities to be funded by the project might be “major” and the project’s effect “significant,” this determination will be reviewed and revised by the C/AOR of the project, and submitted to the Mission Environmental Officer and Bureau Environmental Officer for approval and, if appropriate, an environmental assessment will be prepared. It is the responsibility of the C/AOR to keep the Mission Environmental Officer and the BEO informed of any new information or changes in the activity that might require revision of the IEE.

APPROVAL OF INITIAL ENVIRONMENTAL EXAMINATION

Acting FSE Office Director, Clearance _cleared by email_ 12/20/2017__

Sang Lee Date Mission Environmental OfficerClearance _ cleared by email _ _12/20/2017___ Menglim Kim Date

Director, Program Office:Clearance: _Cleared by e-mail__ 01/04/2018____

Alison Bird Date

Resident Legal OfficerClearance _Cleared by email_ 01/07/2018 Brandon Miller Date Deputy Regional Environmental AdvisorClearance __Cleared________ _ 01/16/2018____ Michael T. Weaver Date Acting Deputy Mission DirectorClearance __ Cleared by e-mail _01/5/2018__ Adam Schumacher Date

APPROVAL: Acting Mission Director ________________ _________________Veena Reddy Date

CONCURRENCE: Bureau Environmental Officer ________________ _________________William Gibson Date