Note: This document may not always reflect the actual appropriations determined by Congress. Final budget allocations for USAID's programs are not determined until after passage of an appropriations bill and preparation of the Operating Year Budget (OYB).
PERU
FY 1997 FY 1998 FY 1999 Actuals Estimate Request Development Assistance.............. $18,626,000 $23,629,000 $26,372,000 Child Survival and Disease.......... $5,900,000 $7,131,000 $7,937,000 International Narcotics Control Fund $13,000,000 $10,000,000* $25,000,000 P.L. 480 Title II........................... $53,866,000 $53,981,000 $49,745,000
* initial allocation. Additional reprogramming to increase these funds is expected during FY 1998.
Introduction
USAID assistance to Peru is a crucial U.S. foreign policy instrument for promoting democracy and human rights, including reproductive rights, reducing the entry of illegal drugs into the United States, protecting and promoting human health while reducing the spread of infectious diseases, securing a sustainable global environment, and reducing poverty through broad-based economic growth. These actions contribute to the stability of a trading partner with one of the fastest growing economies in the region that is becoming increasingly important to the United States.
The Development Challenge
Although there has been considerable progress, much remains to be done to bolster a fragile and uneven democracy in Peru. The human rights situation continues to improve due to the elimination of the "faceless" courts and prisoner releases, but concerns still remain. USAID assistance has contributed to broader citizen participation in decision-making processes of local governments, the emergence of the Human Rights Ombudsman Office as one of the most respected Peruvian institutions, and the release of hundreds of individuals from jail who have been "unjustly" accused or convicted of terrorism.
Peru is one of the world's leading producers of illicit coca leaf and its cultivation, processing and trafficking has caused serious harm to Peru. To address this problem, joint U.S./Peru efforts have achieved a dramatic net reduction of 45,000 hectares of coca in the past two years. These efforts have consisted of effective law enforcement efforts to disrupt the illegal drug trade and USAID's Alternative Development (AD) Program which has offered coca farmers licit economic alternatives.
Macroeconomic improvement has been impressive, but continuing inequities, particularly in the poorest urban and rural areas of the country, indicate that much needs to be done to generate productive employment and income to meet the needs of those in poverty and eliminate constraints that prevent the poor from participating in the country's economic growth. In 1996, 51.3% or 12.3 million Peruvians lived below the poverty line, 4.5 million (18.9%) of them in extreme poverty conditions. USAID has been addressing the major causes of poverty by improving the capacity of the poor and incorporating them into the market economy. In 1997, over 20,700 USAID-assisted small farmers and microentrepreneurs increased their incomes by 30%, 15,000 new full-time jobs were created, and more than 2.3 million Peruvians, 400,000 of them children under five years of age, were assisted through food assistance programs.
Despite advances in national health indicators, urban-rural disparities persist. While the national average is 26%, chronic malnutrition of children in rural areas is 40%, and infant/child mortality and fertility in rural areas are twice as high as in urban areas. Unintended pregnancies among adolescents are also on the rise. Additionally, threats exist from new and reemerging infectious diseases and the El Niño phenomenon has increased them.
Uncontrolled urbanization, pollution and lack of adequate environmental polices and public awareness threaten the natural resources in a country with one of the richest diversity of habitats and largest forest areas in the world. USAID has addressed this global concern by supporting the 1997 passage of the first environmental regulation framework for the manufacturing industry and new laws for the sustainable use of natural resources, natural protected areas, and the conservation of biodiversity.
Peru's foreign debt was reduced from $35.5 billion in 1996 to $27.5 billion in 1997 due to successful debt negotiations. In 1997, the U.S. and the GOP signed Debt Swap/Buyback Program and Americas Fund Agreements that will permit Peru's repurchase of $176 million in USAID concessional loan debt.
USAID resource levels are projected to decline with an orderly phasedown of assistance once civil society and public sector capacity have developed sufficiently. However, the areas of extreme poverty, environment and alternative development will require continued assistance over the medium-term.
Other Donors
Net Official Development Assistance to Peru in 1996 was $410 million. The U.S. contribution was 12.4%, making it the second principal bilateral donor after Japan, which provided assistance mainly for infrastructure. The contribution of the United Nations, Germany, and the European Union was 52.9%, focusing on health and human resource development, rural development, microenterprise support and humanitarian assistance. The Inter-American Development Bank (IDB) and the World Bank played a major role in the areas of economic support, road rehabilitation, education and other areas.
FY 1999 Program
The FY 1999 program will focus on disadvantaged groups to achieve the following integrated objectives related to Agency Goals: broader citizen participation in democratic processes; increased incomes of the poor; improved health, including family planning, of high-risk populations; improved environmental management in targeted sectors; and reduced illicit coca production in target areas.
USAID assistance in democracy will increase the poor's access to justice, increase civic awareness, promote more accountable public institutions at the central and local government levels to make them more responsive to their constituents, and foster greater participation of disadvantaged groups in the upcoming electoral processes of 1998 and 2000. Activities in economic growth (including the Title II program) will increase incomes of the poor through improved nutrition, increased productivity and market access, improved policies (including basic education) and financial services for the poor, and improve the effectiveness of organizations assisting the poor. The AD Program will continue helping the Peruvians to accelerate licit economic activities and social/productive infrastructure to sustain coca reductions.
In population, health, and nutrition, USAID assistance will continue to support Peru's efforts in strengthening the quality, coverage, delivery and use of basic health care and related reproductive services to reduce fertility and maternal, infant/child mortality in poor urban and rural areas. Assistance in 1999 will also improve nutrition, promote a girl's education initiative, and enact a health strategy to identify, prevent and control outbreaks of emerging and reemerging diseases that, if left unattended, will likely result in epidemics. In environment, USAID will continue its special emphasis on environmental awareness, strengthening private and public environmental institutions (particularly the GOP's National Environmental Council as the country's leading environmental policy setting authority), developing new pollution prevention and management technologies, and improving the management of national parks.
PERU
FY 1999 PROGRAM SUMMARY
(000's)
USAID Strategic and Special
ObjectivesEconomic Growth and Agriculture Population and Health Environ-ment Democracy Human Capacity Develop-ment Human-itarian Assistance Total SO 1.
Broader Citizen Participation in Democratic
Processes
- DA
2,200
2,200
SO 2. Increased Incomes of the
Poor
- DA
- PL480 Title II
6,250
49,745
6,250
49,745SO 3. Improved Health Includ-ing Family Planning of High-Risk Populations
- DA
- CSD
12,822
7,687
250
12,822
7,937SO 4. Improved Environmental Conditions in Vulnerable Sectors
- DA
5,100
5,100
Sp.O 1.
Alternative Development
- INC
25,000
25,000
Totals
- DA
- CSD
- PL480 Title II
- INC
6,250
25,000
12,822
7,687
5,100
2,200
250
49,745
26,372
7,937
49,745
25,000
USAID Mission Director: Donald W. Boyd, Jr.
ACTIVITY DATA SHEET PROGRAM: PERU
TITLE AND NUMBER: Broader Citizen Participation in Democratic Processes, 527-SO01
STATUS: Continuing
PROPOSED OBLIGATION AND FUNDING SOURCE: FY 1999: $2,200,000 DA INITIAL OBLIGATION: FY 1995; ESTIMATED COMPLETION DATE: FY 2002
Purpose: To expand the participation of citizens in the myriad events that affect their lives, while also ensuring that government is more responsive to their needs.
USAID Role and Achievements to Date: Recent USAID assistance has focused on electoral reform, human rights, decentralization, civic education and public accountability. Technical and financial assistance were provided to public and private sector institutions to develop and discuss democratic reform issues. A total of 360 persons unjustly accused of terrorism have been released from jail through the efforts of the Pardon Commission and hundreds more have been released through the legal defense efforts of USAID-supported NGOs. In USAID-assisted municipalities, 51% of the local governments held public town meetings and budget hearings. This was a result of USAID-financed training of leaders of community organizations (30% women) as well as of municipal staff on their roles as elected and public officials. In addition, community participation in discussions of proposed municipal legislation and the development of local infrastructure projects continues to increase. Over 400 human rights promoters have been trained, who in turn, have trained more than 8,000 of their compatriots upon return to their communities. The Controller General has improved its functions and was recently certified to conduct audits of USAID and other donor-financed projects. USAID-sponsored legal clinics have provided free legal and mediation services to nearly 7,000 poor Peruvians, 70% of them women who were seeking alimony and protection mechanisms from abusive husbands. These pilot conciliation activities have been successfully established and well placed to serve as models given the recent passage of a law that will make conciliation obligatory in a variety of cases. Civic education activities have continued promoting greater citizen awareness and involvement reaching 35,000 people from marginalized groups, including women, youth, blacks and indigenous people. The U.S. Participant Training Alumni Association continues as an active, nationwide institution that promotes civic activities and transfers the experiences its members gained from training in the United States.
Description: The USAID strategy is implemented through three efforts which mobilize citizen interest and support in making public institutions more responsive. The Participatory Democracy (PARDEM) effort provides assistance to the GOP electoral bodies and nongovernmental organizations (NGOs) to strengthen the electoral system, to the Controller General to improve public accountability, to local NGOs to promote civic awareness, and to Congress to improve its functioning and citizens outreach. The Justice Sector Support (JUST) effort provides assistance to local human rights groups to defend those unjustly accused of terrorism, to inform citizens of their rights, and to promote the development of the Ombudsman Office. The Local Government Development (LGD) activity supports the decentralization process by strengthening local governments -- where most interaction between the state and citizens does and should occur -- and promoting community participation in governance.
In FY 1999, USAID will continue to focus in marginalized and vulnerable groups over four areas: greater access to justice, greater civic awareness, more accountable public institutions, and more responsive local governments. To promote greater access to justice, USAID will continue to assist private human rights groups, the Ombudsman, and public and private sector organizations that will address the needs of the poor for legal defense and for alternative dispute resolution mechanisms. To achieve greater civic awareness, USAID will provide assistance in civic education curriculum development as well as diversity sensitization activities. Efforts will continue to strengthen and consolidate the electoral system, primarily on activities to foment greater participation in the electoral processes of disadvantaged groups, such as indigenous populations. To foster more responsive local
governments, activities will continue to strengthen local governments to promote community participation, and to assist in the development of appropriate legislation in decentralization.
Host Country and Other Donors: USAID continues to be an important donor in the democracy sector. Recently, other donors have become more significantly involved in the sector, in part due to some increased GOP receptivity, USAID's ground-breaking in the justice and local government areas, and recognition of the importance of democratic reform as it relates to economic development. The World Bank (WB) has approved a large judicial reform project ($22.5 million), which will improve the performance of Peru's justice system by enhancing its access, quality, independence, efficiency and integrity. The Inter-American Development Bank (IDB) just began a $20 million program to modernize judicial administration in communities inhabited by the poorest population groups. The European Union (EU) is assisting in developing the Judicial Academy and is providing grants to local NGOs and human rights groups. The WB and IDB are designing several local government strengthening projects for a potential total of $240 million. The GOP is politically committed to this strategic objective, through its judicial reform process and provision of limited funding to key institutions (such as the Judicial Academy, the Ombudsman and the Judiciary Council).
Beneficiaries: Although targeted, democracy activities tend to benefit a wide segment of the population. Direct beneficiaries are individuals and community groups previously excluded from participating, and those who are the most vulnerable and marginalized, including indigenous groups, women, minorities and poor persons with little access to the justice system. By the end of 1999, 39% of Peruvians will be actively participating in resolving community problems; 29% will have confidence in national institutions; well under 300 innocents will remain in prison (down from over 1,000 in 1996); over 22% of citizens will feel that their local governments are responsive to their needs and demands; and 28% of Peruvians from disadvantaged groups (low income members of native Amazonian communities, Quechua and Aymara-speaking groups, and Afro-Peruvian populations and women) will know their basic rights and responsibilities as citizens. Other beneficiaries are human rights and democratic reform groups that implement activities and are being strengthened, local governments, key electoral bodies, the Controller General, the Ombudsman and congressional members and their staffs.
Principal Contractors, Grantees, or Agencies: USAID implements democracy activities through the U.S. NGO, IFES (International Foundation for Election Systems), local NGOs, the GOP Ministry of Justice, the Ombudsman, the Institute for National Development and the Peruvian Controller General Office.
Major Results Indicators: Baseline (1996) Target (2001) Valid votes cast as a percent of registered voters in presidential elections 60 (1995) 70 (2000) Percent of citizens who actively participate in resolving community problems 32 48 Number of incarcerated citizens who are "unjustly" accused of terrorism 1,048 250 Percent of citizens from disadvantaged groups who know their basic rights and responsibilities 19 35
ACTIVITY DATA SHEET
PROGRAM: PERU
TITLE AND NUMBER: Increased Incomes of the Poor, 527-SOO2
STATUS: Continuing
PROPOSED OBLIGATION AND FUNDING SOURCE: FY 1999: $6,250,000 DA; $49,745,000 Title II
INITIAL OBLIGATION: FY 1995; ESTIMATED COMPLETION DATE: FY 2001
Purpose: To provide access of the poor to income-generating opportunities which will result in reduced poverty and improved food security.
USAID Role and Achievements to Date: Through support to private sector and not-for-profit organizations since 1994 USAID has been responsible for increasing the value of agricultural production marketed by $45 million, the value of non-agricultural production (shoes, apparel, handicrafts) marketed by microenterprises by $17 million, accessing 25 new export markets, and creating 32,000 permanent full-time jobs. USAID is also providing services to 20,000 microcredit clients, mainly women, having mobilized $14 million of credit and $2 million of savings among target clients. More than 1.3 million food-insecure Peruvians are participating in USAID food-assisted programs, with 550,000 children benefiting from nutrition and growth monitoring activities and 100,000 graduating from feeding programs. Nearly 100,000 small farmers have instituted improved soil conservation and agroforestry practices on 25,000 hectares, 5,000 kilometers of access roads have been rehabilitated, and 154,000 temporary jobs have been created by Title II food-for-work projects, impacting positively on food security, nutrition and productive infrastructure. On the basis of USAID-funded studies to improve the policy environment, the GOP has: reduced a series of taxes on the private sector which made Peruvian export industries more price competitive in international markets; decided to concentrate large public sector procurements with small and microenterprises; simplified the property titling process; improved oversight and enforcement of competition and intellectual property rights in the marketplace; and facilitated the creation of the Lima Commodities Exchange. USAID support continues to improve the focus and monitoring of GOP social investments in the extremely poor regions of the country as a key poverty reduction measure. To date, 172 Peruvian NGOs from poor highland regions have been trained in strategic planning, financial management, monitoring and evaluation, approximately $2 million have been leveraged by these trained NGOs from other donors for development projects, and USAID has assisted the GOP in streamlining its NGO registration process.
Description: Under this program, USAID is focusing on poverty reduction and alleviation through various mechanisms: improving the policy environment for private sector-led growth, expanding access to markets, improving production, increasing productive and social investments in poverty areas, improving access to and distribution of food resources, and strengthening service delivery (inputs, credit, technology) in poverty areas. Based on the poverty map of Peru which identifies 419 extremely poor districts, by FY 1999 USAID will be focusing its activities in up to 10 economic corridors in the highlands and jungle where these poor districts are physically and economically linked with growing markets in intermediate cities. These economic corridors have potential to provide long-term job creation and increased income opportunities to the poor. Activities will support the establishment of business promotion centers in intermediate cities, which will facilitate access to financial services, information on markets, technical and management assistance, legal protection, and other trade/ production services, thus fostering productive investment, market access and increased job opportunities. The Title II nutrition and production activities, which will also be focused in these corridors, will enhance participating extremely poor family members' physical and productive capacity to take advantage of these opportunities. In addition, USAID will be collaborating with the GOP to improve public social investments in the same economic corridors. Particular emphasis will be given to the promotion of public policies and programs that improve the lives of poor people by focussing Peru's economic growth more towards higher labor productivity; investments in improved health status and in human capital-- especially basic education-- are essential towards this end. USAID will be
implementing expanded microfinance activities with target clients and microenterprises, with an emphasis on sustainability of credit institutions within the larger financial system. Policy dialogue will be focused on a few high-impact issues linked to GOP social investment, agricultural and microenterprise sector rules and regulations and market access.
Host Country and Other Donors: In 1997 the GOP allocated 40% of its budget to social investments, principally through the Ministry of the Presidency and its sectoral ministries. The GOP's Financial Development Corporation (COFIDE) is acting as a conduit to channel $450 million in credit to finance agricultural and microenterprise activities. The IDB and the World Bank are financing newly-signed agreements with the GOP in the areas of plant health ($42 million), coastal irrigation ($85 million), highland irrigation ($51 million), rural road construction and rehabilitation ($90 million), and poverty alleviation through FONCODES ($150 million). Considerable resources are also being provided by the European Union, Japan, Germany, Canada, the Swiss and the Dutch.
Beneficiaries: USAID clients under this program are poor people who are microentrepreneurs, small producers, rural laborers or unemployed, located principally, but not exclusively, in the highlands of Peru where poverty is the severest. By the end of 1999, beneficiaries will include 45,000 laborers with full-time employment, 25,000 microentrepreneurs and small producers being provided with technical assistance and training, 80,000 small farmers with improved production practices, 20,000 women with access to credit, 300,000 children receiving nutrition and growth monitoring assistance, and 90,000 individuals being employed temporarily through food-for-work activities.
Principal Contractors, Grantees or Agencies: Principal implementers of USAID-funded activities are: GOP Ministries of the Presidency, Industry and Commerce, Agriculture, and Health; the private sector Exporters' Association (ADEX) and Businessmen's Association (CONFIEP); U.S. PVOs CARE, CRS, TechnoServe, ACDI, PACT, ADRA; and local NGOs CARITAS and PRISMA.
Major Results Indicators: Baseline Target (2001) Value of expenditures per capita of the poor $447 (1994) $592 Percent of extremely poor in the population 18.9 (1996) 11.2 Value of exports of selected non- traditional export products ($000) $354 (1995) $800 Chronic malnutrition rates in rural areas 40 (1996) 36
ACTIVITY DATA SHEET
PROGRAM: PERU
TITLE AND NUMBER: Improved Health, including Family Planning, of High-Risk Populations, 527-SO03
STATUS: Continuing
PROPOSED OBLIGATION AND FUNDING SOURCE: FY 1999: $12,822,000 DA; $7,937,000 CSD
INITIAL OBLIGATION: FY 1995; ESTIMATED COMPLETION DATE: FY 2001
Purpose: To help low-income Peruvians, particularly children and women, enjoy longer lives and a higher quality of life, by making it easier for them to take appropriate preventive, promotive and curative actions, and by supporting the development of sustainable health systems that ensure access to quality services.
USAID Role and Achievements to Date: USAID supports interventions in child survival, family planning and wider reproductive health, infectious diseases and basic education. These investments have paid off. Over the five-year period 1991-96, infant mortality declined 22%, from 57 to 43 deaths per 1,000 live births. Under-five mortality fell 24%, from 78 to 59 deaths per 1,000 children. Chronic malnutrition (stunting, or low height for age) decreased by 30%; currently 26% of children under five are stunted, relative to 37% in 1991. Nationwide, immunization coverage of infants exceeded 95% in 1996. Immunization trends for 1997 point to a matching or surpassing of 1996 levels. Based on Ministry of Health data through September 1997, vaccination coverage of children under one should reach 95% for polio, DPT, measles and BCG (tuberculosis). Related data reveal that this year 54% of women living in high-risk areas will receive the required two doses of tetanus-toxoid vaccine, just below the USAID target of 55%.
Achievements in family planning are similarly encouraging. Total fertility (average births per woman over a lifetime) declined from an average of 3.9 in 1991 to 3.5 in 1996, a fall of 10%. Couple years of protection (CYP)--the generic way to measure contraceptive use and distribution--reached 1.9 million in 1996. Based on data available for the first nine months of 1997, CYP production should surpass the 1997 target of 2.1 million. Finally, a significant achievement in sustainability of family planning programs has been the commitment by the Ministry of Health to begin purchasing contraceptives for the first time in 1998; initial plans call for the GOP to procure contraceptives valued at $1.8 million.
Description: USAID's strategy takes an integrated, primary health care approach, focusing on decentralization and strengthening of civil society, seeking to remove constraints to demand and to improve quality of care, explicitly recognizing reproductive rights and gender issues, and espousing a pluralistic approach to service provision. USAID support in family planning is devoted in its entirety to helping people realize their reproductive intentions by exercising voluntary and informed consent in acceptance or not of any of the full gamut of contraceptive options, offered within a framework of quality of care.
Ongoing activities in health and family planning are aimed at the public and NGO sectors. USAID's support to NGOs includes efforts to: (1) aid NGOs in developing organizationally to deliver health services in a client-centered, quality way; (2) through community-based organizations, help the most disenfranchised in Peru become informed promoters of their own health and discriminating users of health services; and (3) increase the availability of health services, including the gamut of family planning methods, in a sustainable fashion.
USAID's assistance to the public sector seeks to: (1) improve child survival services (such as immunization, nutrition and diarrheal disease control) and maternal health services; (2) strengthen and expand the participation of public and private-sector entities in HIV/AIDS prevention; (3) enact a public health strategy that is capable of identifying risks and preventing and controlling outbreaks of infectious diseases that, left unattended, may result in epidemics; and (4) support the GOP in extending family planning programs in a quality manner.
Via 10 mutually-reinforcing activities in FY 1999, USAID will continue to support U.S. and local NGOs and Peruvian public sector institutions in efforts to: (1) strengthen the quality of basic health care services, including immunization, family planning, oral rehydration therapy for diarrhea and related reproductive, maternal and child health services; (2) extend the coverage of and increase the use of these services by population groups in which mortality and fertility have remained high; (3) promote health and nutrition in homes and communities; (4) encourage long-term sustainability by strengthening local organizations that deliver health services, including their ability to report and diagnose emerging diseases; (5) test new models of service delivery; (6) strengthen girls' education, for which Peru has been designated a USAID emphasis country; and (7) promote safe sex, expanding the participation of public and private-sector entities in HIV/AIDS prevention. A new activity in nutrition will work at the community level to promote the types of weaning practices that can prevent chronic malnutrition, Peru's major nutrition problem, from gaining a foothold during poor children's first year of life.
Host Country and Other Donors: USAID coordinates actively with other donors in Peru. Under an inter-agency committee for the immunization program, USAID (the major donor), UNICEF, the Pan American Health Organization (PAHO) and Rotary International plan together program activities with the Ministry of Health, which has progressively assumed the recurrent costs of annual immunization campaigns. Through a second committee, USAID, the World Bank and the IDB collectively coordinate with the Ministry of Health on their health projects and debate policy issues and recommendations for reforms. The IDB project aims to strengthen national systems, and the World Bank finances a health and nutrition project. Both are complementary to USAID projects. UNICEF supports micronutrient interventions in iodine deficiency, while USAID works actively in iron and vitamin A deficiency. The World Health Organization and PAHO provide focused technical assistance in policy and service delivery. USAID remains the largest donor in family planning, investing annually several times more than the second donor, the United Nations Fund for Population Activities (UNFPA). UNFPA and the Department for International Development (the United Kingdom bilateral agency) donate complementary contraceptives and supplies and fund small-scale activities in population research, management and service delivery. Over the past year, coordination with these two donors has been especially close in the area of contraceptive supply, as part of a concerted effort led by USAID to involve the GOP in direct contraceptive purchase. The Government of Japan, under the Common Agenda, is collaborating with USAID in the area of HIV/AIDS. Other bilateral donors, such as those from the Netherlands, Canada, Germany and France, as well as the European Union, hold regular meetings with USAID, particularly in reproductive health issues, following the Cairo and Beijing Plans of Action. Estimated host country and other donor contributions for the life of the strategic objective are over $100 million.
Beneficiaries: Children under age five number 2.9 million, or 12% of the Peruvian population. Women of child-bearing age total 6.4 million and represent 26% of the national population. In sum, three of every 10 Peruvians fall in one of these two target groups. Some USAID projects have a regional focus, complementing the work of other donors. The population in these priority regions is 7.7 million, or roughly 32% of the total population.
Principal Contractors, Grantees, or Agencies: Principal U.S. implementors include: CARE, Pathfinder International, Development Associates, MACRO International, Centers for Disease Control (CDC), NAMRID (Naval Medical Research Institute Detachment), John Hopkins University, Tulane University, University Research Corporation. Other entities responsible for implementing activities under this strategic objective include: local NGOs and universities, the Peruvian Ministry of Health, and UNICEF.
Major Results Indicators: Baseline (1991) Target (2001) Infant mortality per 1,000 live births 57 39 Mortality per 1,000 children under 5 years 78 48 Percent of infants fully vaccinated by age 1 85 95 Total fertility rate 3.9 3 Couple-years of protection (000s) 598 (1993) 2,600
ACTIVITY DATA SHEET
PROGRAM: PERU
TITLE AND NUMBER: Improved Environmental Management in Targeted Sectors, 527-SO04
STATUS: Continuing
PROPOSED OBLIGATION AND FUNDING SOURCE:FY 1999: $5,100,000 DA
INITIAL OBLIGATION: FY 1995; ESTIMATED COMPLETION DATE: FY 2004
Purpose: To improve protection of the natural resource base, fragile ecosystems, and biodiversity conservation, and to reduce urban and industrial pollution.
USAID Role and Achievements to Date: Through the Sustainable Environment and Natural Resources Management (SENREM) activity, USAID's strategy aims to improve the legal, policy, regulatory and normative environment and natural resource framework, promote pollution prevention in selected peri-urban and industrial settings, and protect natural resources including biological diversity and fragile eco-systems. Ongoing activities contributed to improving environmental management and conditions in Peru. The Pacaya-Samiria project in the Amazon, which ended in September 1997, made considerable progress towards conserving the Reserve's biodiversity. The Project laid the foundations for the local population's socio-economic development through environmentally sustainable income generating activities linked to the protection of natural resources. With the participation of public and private sector environmental organizations, USAID developed a Protected Areas Management Matrix, a tool which will be used under the SENREM's biodiversity component, to evaluate the progress in improving the efficiency of the parks system to protect and conserve biological diversity. In fact, this matrix independently concluded that Pacaya-Samiria is at present the best managed park in Peru. The first two pilot demonstration projects under SENREM were completed in 1997: the Solid Waste Management Pilot, which demonstrated highly effective and profitable new technologies, using women-owned microenterprises to manage solid waste in peri-urban areas; and the Lima's Comparative Risk Assessment, which analyzed, ranked and prioritized environment and natural resources (ENR) problems affecting health. The Paracas pilot project is also showing an impact in the fishmeal industry, with many plants switching to more efficient and cleaner technologies. With USAID assistance, Peru's first environmental policy framework for the manufacturing industry, which emphasizes best practices for pollution prevention, was approved in October 1997, and a program of technical assistance to the Ministry of Industry was launched to support the implementation of the new framework. Other key pieces of ENR legislation issued during the year included new laws for sustainable use of natural resource, for natural protected areas, and for the conservation and use of biodiversity.
Description: This program supports participatory policy debate, policy research and analysis, information dissemination and training, and development of innovative sustainable technologies in the green, brown and blue areas of the environment. Institutional capabilities of the Government of Peru (GOP) and private sector organizations are being strengthened, aiming at mobilizing public support for environmental change, sound policies and effective legislation, and cost-effective practices. The GOP's fledgling National Environmental Council (CONAM) is being provided with technical assistance to solidify Peru's environmental and natural resource legal and policy framework. GOP sectoral environmental units will be trained in the management of public participation processes and assessment methodologies. Research institutions will undertake analysis and outreach on environmental law and policy. An annual State of the Environment Report will be published focusing on environmental trend analysis. Sector-specific (mining, fishing, and manufacturing) sustainable industry seminars will continue to take place to discuss pollution prevention, incentives, and how private voluntary organizations (PVOs) can support private industry initiatives. At least four industrial plants will have programs to adopt ISO 14000 -- an international voluntary environmental business standard. Adoption of this international standard will also create opportunities for U.S. technology transfer and U.S.-Peruvian scientific cooperation. Municipalities will be trained in monitoring local environmental conditions, using low-cost techniques. Building on the Environmental Initiative for the Americas pilot activities, PVOs are being supported to develop successful and innovative practices in biodiversity andnatural resources conservation, reduction of urban and industrial pollution, and improved water management. At least 10 new demonstration projects will be initiated by April 1998. Results-oriented, sustainable activities with strong likelihood of replication throughout Peru will receive support, which will promote increased other donor investments to support sustainable environmental programs. New activities are considered for initiation in FYs 1998-1999: "Biological Diversity and Fragile Ecosystems Conservation and Management", directed to combat global warming and establish a balance between the conservation of biological diversity and fragile ecosystems and the sustainable use of their resources; and "Environmental Health", whose purpose is to help low-income Peruvians, particularly women and children, enjoy longer and higher quality lives, by addressing problems and risks to health, particularly derived from urban and industrial pollution. This activity will also promote increased environmental awareness, which will afford opportunities to engage in important environmental interventions, such as the phase-out of leaded gasoline and the management of hazardous wastes.
Host Country and Other Donors: Other donors are investing resources mainly in environmental health, conservation and reforestation areas, which will improve environmental conditions in Peru. The World Bank (WB) and Japan's International Cooperation Agency are providing $100 million and $121 million to rehabilitate Lima's water and sewage systems, respectively. The WB is also funding a wastewater treatment feasibility study that will lead to another $100 million loan to protect Lima's coastline, and is also channeling $5 million through the Global Environment Fund to the National Fund for Protected Areas. The IDB approved a $140 million project to improve basic sanitation services provided by 36 provincial water and sewerage firms; $1.4 million to develop options for the containment of mining-related environmental damage in the Mantaro Valley; and $1.8 million to assist CONAM in developing a master plan for the National Environmental System and a pilot environmental data system in the Grau Region. The German Cooperation Agency is helping the GOP's National Institute of Natural Resources develop a master plan for protected areas. Other donor assistance includes United Nations support of Agenda 21; Food and Agriculture Organization aid for reforestation and rural education; assessment from the EU and the Governments of the Netherlands and Switzerland for forestry, protected areas, and biodiversity; and, finally, assistance from the Governments of Canada and Finland for small debt swaps in the environmental area. Host country contributions are close to $ 4 million.
Beneficiaries: Large segments of Peruvian population will ultimately benefit from improved environmental conditions resulting from an improved environmental and natural resource legal, regulatory and policy framework; private sector participation; and validated innovative technologies. However, the pilot activities will directly benefit low-income, poor urban and rural populations where these programs will be implemented. By FY 1999, 20% of Peruvians will adequately understand and be concerned about environment and natural resources (ENR) management issues; local authorities in three areas of the country will have received training in techniques to rapidly assess and monitor ENR problems; 120 to 150 top-level industry leaders and managers will have received training aimed at increasing their awareness and involvement in ENR matters; and, ten pilot demonstration projects will be completed (or nearing completion) and another ten will be starting with thousands of beneficiaries across the country.
Principal Contractors, Grantees, or Agencies: Principal implementer of the SENREM activity is the GOP´s CONAM. In addition, a U.S. firm, Abt Associates, is providing technical assistance services, while a Peruvian consortium of NGOs, lead by ECOTEC S.A., is managing the private sector advocacy activities and the pilot demonstration projects.
Major Results Indicators: Baseline (1996) Target (2001) Number of biologically important national parks that have achieved management 0 5 improvements. Percentage of solid waste properly dis- posed of in sanitary landfills in Lima. 24.4 58 Percentage of industrial plants in tar- geted sectors that have adopted new pollution prevention practices. 0 15
ACTIVITY DATA SHEET
PROGRAM: PERU
TITLE AND NUMBER: Alternative Development, 527-Sp01
STATUS: Continuing
PROPOSED OBLIGATION AND FUNDING SOURCE: FY 1999 : $25,000,000 INC
INITIAL OBLIGATION: FY 1995; ESTIMATED COMPLETION DATE: FY 2001
Purpose: To promote an adequate social and economic environment in target coca-growing areas, to reduce voluntarily coca cultivation pursuant to the GOP National Drug Prevention and Control Plan.
USAID Role and Achievements to Date: Peru is widely recognized as a major success story in reducing coca production. The successes to date of the joint US/Peru counternarcotics strategy, of which USAID's Alternative Development Program is an integral part, are indisputable. In 1997 the area of coca leaf production fell by 27%, or nearly 25,400 hectares. The net reduction of over 45,000 hectares during the past two years--a 45% decrease from 1995 levels--signifies reductions of potential coca leaf production of 53,000 metric tons and potential cocaine production of 350 metric tons, thus reducing the flow of harmful drugs to the United States and elsewhere.
Currently, there are signed voluntary agreements with 239 communities in the most important coca growing areas to reduce coca hectarage over a five year period, while committing not to plant any new coca. More coca reduction commitments will be obtained as additional funding becomes available. Based on these agreements, USAID has trained over 5,500 municipal officials and community leaders in municipal management and program planning and implementation, constructed over 250 social infrastructure projects (schools, health clinics, potable water systems, irrigation canals, etc.), and rehabilitated 380 kilometers of farm-to-market roads and 12 bridges USAID has also provided 8,000 land titles and has initiated a three year program to provide training, production, and marketing assistance for over 35,000 hectares of licit cultivations, established a sustainable $14 million credit system for farmers, provided needed support to strengthen the GOP's new national drug coordinating entity, and increased the awareness among a majority of Peruvians that the illicit coca trade is a serious problem that needs to be addressed.
One of the most important successes of the program is that most of the coca reduction has occurred in the same areas as those targeted for assistance. In fact, in one of the poorest and most populated districts of the Apurimac Valley, the coca reduction rate is double that of other areas in the valley not receiving the same intensive assistance. This further demonstrates that a concentrated alternative development effort yields significant results in changing the economic behavior of coca farmers which will lead to a permanent, sustainable reduction in coca production.
Description: The counternarcotics strategy consists of a strong interdiction program to depress the price of coca leaf coupled with an Alternative Development (AD) Program aimed at restoring local authority, increasing licit economic alternatives, and improving economic and social infrastructure to ensure that farmers do not return to coca cultivation. The Alternative Development Program engenders a participatory methodology and includes a broad range of socioeconomic initiatives to alleviate poverty, generate licit employment alternatives, and improve the well-being of people in coca-producing areas. The program targets the major coca cultivation areas of Peru with initial intervention focused primarily in the three principal coca-growing areas where over 60% of coca leaf is produced: the Upper Huallaga, Aguaytia, and the Apurímac River Valley. Assistance is provided to communities that have expressed a willingness to reduce coca cultivation in exchange for development assistance packages.
The AD Program's six integrated components focus activities to strengthen local governments, meet immediate subsistence needs, provide increased income and employment opportunities, improve infrastructure, protect natural resources and increase awareness of the harmful effects of coca cultivation and the benefits of development. The first component, increased access to basic services,fosters voluntary coca reduction by improving access to basic services, supporting democratic structures, and promoting broad-based citizen participation. Through the second component, increasing licit economic activities, communities are assisted in increasing licit, profitable agriculture activities through a comprehensive program providing land titling, credit, and technical assistance in agriculture production, processing, and marketing. To support licit economic activities, a third component is placing increased emphasis on improved transportation and other productive infrastructure. A fourth natural resource component promotes awareness of environmental issues and educates former coca farmers on how to sustain their productive activities while protecting the environment. A critical fifth component of the program involves changing attitudes by increasing public awareness of the social and environmental damage caused by coca cultivation via social communication. The sixth component is designed to institutionally strengthen the GOP entity responsible for coordinating the National Plan for Alternative Development.
Host Country and Other Donors: Among the GOP and other donors, the U.S. is regarded as the leader in AD, both in terms of strategy and in funding. USAID maintains close relationships and coordinates with the principal donors (including the UN Drug Control Program-- UNDCP, Japan, Germany, and Canada) in the planning and implementation of alternative development activities. Other donor development assistance investments in the coca-growing areas is estimated at $24 million. Additionally, the IDB and the WB have recently approved loans for $239 million for construction of national main roads that will facilitate access to the coca-growing areas and to markets for licit crops. The GOP considers alternative development a high-priority and has committed to provide over 30% of the alternative development program costs-- a counterpart commitment of at least $33 million through 2001.
Beneficiaries: The AD Program is being implemented in the five major coca-growing areas of Peru: the Central Huallaga, Upper Huallaga, Aguaytia, Pichis-Palcazu, and Apurimac River Valleys. The indirect beneficiary population in these valleys includes 60,000 families living in 41 districts and approximately 1,600 villages. During 1997 some 8,000 families living in 200 villages benefitted directly from program activities that contributed to better physical infrastructure, increased licit economic opportunities, more responsive local governments, and improved security.
Principal Contractors, Grantees, or Agencies: USAID's AD Program is coordinated jointly with CONTRADROGAS, the primary GOP entity charged with planning and coordinating all alternative development activities in Peru. The National Development Institute (INADE), a unit of the GOP Ministry of the Presidency, is responsible for implementing activities designed to improve economic infrastructure and basic services provision. Other implementers include local governments, communities, women's clubs, producers associations, and NGOs. A U.S. PVO, Winrock International, provides training and technical assistance to the program, while the Center for Drug Education and Information (CEDRO), a local NGO, implements drug awareness activities in the coca areas. A private bank, BANEX, is responsible for implementing a $14 million commercial credit program to assist farmers in coca-growing areas to improve agricultural production and marketing of their products. PRISMA, an indigenous NGO, implements "safety net" activities in selected areas aimed at meeting the basic needs of the subsistence level families hardest hit by the drop in coca prices. ADEX, the Exporters' Association, also a local NGO, is implementing a major component of the program to promote the production and marketing of selected agricultural crops to provide an alternative, and sustainable, source of income and employment to those formerly involved in the coca economy.
Major results indicators: Baseline (1995) Target (2001) Hectares devoted to coca production 115,300 60,000 Coca leaf production (metric tons) 183,600 111,000 Number of communities represented in coca reduction agreements 0 1,006 Licit jobs generated in target areas 0 19,540
Footnote: 1 Average expenditures per capita per year of the poor. The poor are those whose per capita expenditure per year is below $1,570, which is the cost of a basic food nutritional basket plus the cost of other necessary goods and services.
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