Unlocking the Potential of Guyana’s Inland and Mangrove Forests to further Reduce Emissions and to Build Resilience to Climate Change (‘the Project’)

Guyana | Conservation International

28 June 2018

Please submit the completed form to fundingproposal@gcfund.org, using the following name convention in the subject line and file name: “CN-[Accredited Entity or Country]-YYYYMMDD”

Project/Programme Title: Unlocking the Potential of Guyana’s Inland and Mangrove Forests to further Reduce Emissions and to Build Resilience to Climate Change (‘the Project’)

Country(ies): Guyana

National Designated Authority(ies) (NDA): Minister Joseph Harmon, Minister of State

Accredited Entity(ies) (AE): Conservation International

Date of first submission/ version number: 2018-06-28 V.1.0

Date of current submission/ version number 2018-06-28 V.1.0

PROJECT / PROGRAMME CONCEPT NOTE Template V.2.2

Notes

• The maximum number of pages should not exceed 12 pages, excluding annexes. Proposals exceeding the prescribed length will not be assessed within the indicative service standard time of 30 days.

• As per the Information Disclosure Policy, the concept note, and additional documents provided to the Secretariat can be disclosed unless marked by the Accredited Entity(ies) (or NDAs) as confidential.

• The relevant National Designated Authority(ies) will be informed by the Secretariat of the concept note upon receipt.

• NDA can also submit the concept note directly with or without an identified accredited entity at this stage. In this case, they can leave blank the section related to the accredited entity. The Secretariat will inform the accredited entity(ies) nominated by the NDA, if any.

• Accredited Entities and/or NDAs are encouraged to submit a Concept Note before making a request for project preparation support from the Project Preparation Facility (PPF).

• Further information on GCF concept note preparation can be found on GCF website Funding Projects Fine Print.

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A. Project/Programme Summary (max. 1 page) A.1. Project or programme ☒ Project

☐ Programme A.2. Public or private sector

☒ Public sector ☐ Private sector

A.3. Is the CN submitted in response to an RFP?

Yes ☐ No ☒ If yes, specify the RFP: ______________

A.4. Confidentiality1 ☐ Confidential ☒ Not confidential

A.5. Indicate the result areas for the project/programme

Mitigation: Reduced emissions from:

☐ Energy access and power generation

☐ Low emission transport

☐ Buildings, cities and industries and appliances

☒ Forestry and land use Adaptation: Increased resilience of:

☒ Most vulnerable people and communities

☐ Health and well-being, and food and water security

☐ Infrastructure and built environment

☒ Ecosystem and ecosystem services

A.6. Estimated mitigation impact (tCO2eq over lifespan)

12 MtCO2e

A.7. Estimated adaptation impact (number of direct beneficiaries and % of population)

465,000; 60% of national population

A.8. Indicative total project cost (GCF + co-finance)

Amount: ~ USD 45 M

A.9. Indicative GCF funding requested Amount: ~ USD 35 M

A.10. Mark the type of financial instrument requested for the GCF funding

☒ Grant ☐ Reimbursable grant ☐ Guarantees ☐ Equity ☐ Subordinated loan ☐ Senior Loan ☐ Other: specify___________________

A.11. Estimated duration of project/ programme:

a) disbursement period: 2020-2024 b) repayment period, if applicable:

A.12. Estimated project/ Programme lifespan

5 years

A.13. Is funding from the Project Preparation Facility requested?2

Yes ☒ No ☐ Other support received ☐ If so, by who:

A.14. ESS category3 ☐ A or I-1 ☐ B or I-2 ☒ C or I-3

A.15. Is the CN aligned with your accreditation standard?

Yes ☒ No ☐ A.16. Has the CN been shared with the NDA? Yes ☒ No ☐

A.17. AMA signed (if submitted by AE)

Yes ☒ No ☐ If no, specify the status of AMA negotiations and expected date of signing:

A.18. Is the CN included in the Entity Work Programme?

Yes ☒ No ☐

A.19. Project/Programme rationale, objectives and approach of programme/project (max 100 words)

Guyana’s forests have a critical role to play in mitigating climate change and underpinning ecosystem-based adaptation. The Project will support measures detailed in Guyana’s Nationally Determined Contributions to reduce emissions from forests and to increase resilience against coastal zone flooding by scaling-up mangrove restoration and protection. The Project will be executed primarily by the government agencies responsible for the forest and mining sectors, working closely with civil society organizations. The Project will deliver 12 MtCO2e avoided emissions and make 465,000 people more resilient to floods.

1 Concept notes (or sections of) not marked as confidential may be published in accordance with the Information Disclosure Policy (Decision B.12/35) and the Review of the Initial Proposal Approval Process (Decision B.17/18). 2 See here for access to project preparation support request template and guidelines 3 Refer to the Fund’s environmental and social safeguards (Decision B.07/02)

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B. Project/Programme Information (max. 8 pages) B.1. Context and baseline (max. 2 pages) Guyana is one of few countries that are highly forested (>85%) with low deforestation rates (<0.1% per annum)4, and is globally significant as a net carbon sink5. Its forests stock an estimated 19.5 GtCO2eq5,6, and the average annual emissions from deforestation between 2001 and 2012 was 8.09 million tCO2eq6. This status is however under threat as gold mining – particularly at the artisanal, small and medium scales – and logging, both economic activities upon which Guyana relies heavily, drives deforestation and forest degradation. Gold mining alone was responsible for 88% of the forest lost between 2009 and 2014. Gold mining and logging activities occur beyond the coastland and mostly in the forested hinterland where the majority of Guyana’s indigenous population reside. Indigenous peoples constitute 10.5% of Guyana’s population and 90% of them live in the forested interior. The indigenous peoples depend on forests and other ecosystems for much of their provisioning such as clean water, food, medicines, recreation, and livelihoods, though many are in transition, interfacing with the mainstream economy and involved themselves in extractive activities. The mining and logging sectors, the former much more than the latter, of Guyana are currently characterized by high levels of inefficiency5 resulting in relatively low yields and high levels of damage to forests. These inefficiencies exist in almost all areas of the sector from land allocation to land management and extraction practices. They are compounded by limited capacity to understand, access, and employ improved practices; by limited data and resultant poor planning within the sector; and by indigenous populations’ limited capacity, opportunity, and resources to represent their interests in various decision-making processes and platforms and limited alternative livelihood opportunities. Importantly also, Guyana’s coastal and riverine mangrove forests play significant roles in carbon sequestration and coastal protection. Guyana’s mangroves sequester and store large amounts of carbon and provide protection for about 400 kilometers of the Atlantic coast. Yet, anthropogenic loss of mangroves continues through land conversion, over-harvesting and other impacts. Current estimates reveal that the mangrove cover has reduced significantly from 80,432 hectares in 1992 to 22,632 hectares over the twenty-year period ending 20097. Guyana’s coast is highly vulnerable to the impacts of climate change with a low-lying coastline – on average 1.5 meters below current sea level. Guyana is projected to experience 2-5 times the global average in Sea Level Rise (80cm to 2m) by the end of the century and is the fourth most exposed country to natural disasters in the Latin American and Caribbean region primarily due to the high exposure to and experience of flooding.8,9 With approximately 90% of the population living near the coast and 90% of the agricultural sector concentrated in coastal areas providing livelihoods for some 25,000 households7, mangroves are vital to Guyana’s coastal resilience. Guyana’s coastal zone relies primarily on engineered (hard) and natural mangroves sea defense structures to protect from the Atlantic Ocean. Coastal mangrove fringes are particularly at risk from sea–level rise because their natural response to rising sea levels, moving slowly landward, is hindered by development on the coast including the hard defense infrastructure. Mangrove loss exposes more of the coast to damage from saltwater inundation, storm surges, and reduces the nursery habitat for commercial fishing.10 In addition to functioning as natural breakwaters along the coast and protection for the seawall, mangroves also support fisheries and other sources of livelihoods.11 Climate models project increased storm surges and higher numbers of extreme weather events in Guyana.10 Flooding in 2005 caused damage estimated at US$ 465 million (60% of GDP) and an estimated 10% of GDP is lost each year as a result of flooding.12 Estimates suggest that, by 2030, Guyana could be exposed to cumulative annual flood-related losses totalling

4 Guyana Forestry Commission (2015). Guyana REDD+ Monitoring, Reporting and Verification System (MRVS): 5 Year Interim Measures Report. 1 January 2014-31 December 2014. 5 Government of the Cooperative Republic of Guyana (2015). Guyana’s Revised Intended Nationally Determined Contributions. 6 Government of the Cooperative Republic of Guyana (2014). The reference level for Guyana’s REDD+ Program. This figure does not include emissions from forest degradation. 7 A GEF funded project Setting the foundations for zero net loss of the mangroves that underpin human wellbeing in the north Brazil Shelf LME aims to establish an accurate baseline. 8 Government of the Cooperative Republic of Guyana (2012). Second National Communication to the United Nations Framework Convention on Climate Change. 9 Climate change and extreme weather events in Latin America: An Exposure Index. (2013). Inter-American Development Bank, Department of Research and Chief Economist, available here: http://publications.iadb.org/bitstream/handle/11319/5654/Climate%20Change%20and%20Extreme%20Weather%20Events%20in%20Latin%20America%3a%20An%20Exposure%20Index.pdf;jsessionid=9948B56530A6C92002B8CB8BFC8039EB?sequence=1. 10 Guyana Country Profile. The World Bank. https://data.worldbank.org/guyana 11 Government of the Cooperative Republic of Guyana (2015). Draft Climate Resilience and Action Plan (Draft document) 12 Government of the Cooperative Republic of Guyana (2012). Second National Communication to the United Nations Framework Convention on Climate Change.

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US$150 million and that an extreme event could result in some US$0.8 billion in losses and harm to more than 320,000 people.11 Adaptation costs are projected to be a relatively small fraction of the potential losses if nothing is done. For context, US$0.8 billion is equivalent to 35% of Guyana's GDP in 2010.10 Guyana’s mitigation-focused contributions under its NDC focus on two sectors: Forests and Energy. This Project will support a large part of the implementation of Guyana’s NDC related to the Forest sector by supporting conditional contributions through the conservation and sustainable management of forests. It will also support adaptation priorities through mangrove restoration. The project will support the country’s overall commitment to green development, to be captured in its Green State Development Strategy. This Strategy is currently under development. The guiding framework for the development of the strategy is underpinned by Guyana’s international commitments, including those under the Paris Agreement on Climate Change and the United Nations Sustainable Development Goals (UNSDGs). It is also informed by national strategies and priorities including the country’s draft Climate Resilience Strategy and Action Plan, commitment to decentralization and Plans of Action for Regional Development, Sustainable Villages initiative for hinterland development and empowerment of indigenous peoples, and the development of a Sovereign Wealth Fund. This project will also be informed by and assist in the implementation of a Technology Action Plan(TAP) for the forest sector which is currently being developed. The TAP provides a plan for the uptake and diffusion of technologies that will contribute to the country’s social, environmental and economic development and to climate change mitigation and adaptation. The Project will complement the Guyana-Norway Partnership by providing additional support to help the country limit deforestation, addressing areas not previously supported. The following barriers are preventing Guyana from achieving its mitigation targets, and addressing its greatest vulnerabilities to climate change: Governance barriers

• UNFCCC commitments not fully integrated in sector policies, strategies, and programs; • Limited clarity on mandates and roles, as well as limited coordination between agencies; • Decentralization must be prioritized and implemented at multiple levels, including stakeholder engagement and

evidence-driven decision-making processes; • More government supported incentives are needed to shift to more sustainable practices and strategies in the

Forestry sector; • Policies and other instruments are developed and implemented in siloes with lack of integration.

Information barriers

• Limited information on climate change costs and benefits in sectoral approaches such as Protected Areas management and Mining to inform decision-making;

• Limited information and understanding of the value of the goods and services that ecosystems provide to the national economy (i.e. there is a lack of Natural Capital Accounting to support decision-making and policy formulation).

Capacity barriers

• Indigenous Peoples’ and local communities’ capacity building is needed to realize rights, represent interests in various sectors and ensure that IPs and local forest-dependent communities will benefit from and contribute to Guyana’s UNFCCC commitments;

• National and regional government agency staff lack capacity on climate change issues; • Limited resources for sustainable management of forests.

Long term Sustainable Finance barriers

• Absence of a long term financial mechanism to support climate mitigation and adaptation action for future generations

The Project will make a major contribution to advancing Guyana’s Nationally Determined Contribution (NDC) by supporting the implementation of conditional contributions outlined for the Forest Sector in Guyana’s NDC. It will also complement unconditional commitments and support conditional commitments for adaptation, particularly for coastal protection. The Project aims to contribute up to 50% of the conditional mitigation contributions identified under the Forests sector in Guyana’s Nationally Determined Contributions (NDC) as well as key adaptation contributions, especially as it relates to mangroves. This Project will support the implementation of the Emissions Reduction Programme (ERP) detailed in the NDC and centered around avoided deforestation through a National REDD+ Programme. Guyana’s National REDD+ programme

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can deliver 48.7 MtCO2eq of avoided emissions annually if adequate incentives are provided over the long term to reform the timber and mining industries. These priorities captured within the NDC inform the country’s overarching national development framework, the Green State Development Framework. The Project aims to reach up to 465,000 indirect and direct beneficiaries with its Adaptation activities, which equals approximately 60% of Guyana’s total population. Because of increased resilience against extreme weather events and a reduction in the occurrence and damage by floods, the Project is expecting to avoid annual losses of up to 5% of the GDP. The Guiana Shield is the largest remaining block of intact primary tropical forest on Earth. It has a critical role to play in mitigating climate change and securing livelihoods and globally important biodiversity. Given that there is growing recognition that tropical forests may provide as much as 37% of the solution to the climate crisis13, it is not just wise, but essential that countries like Guyana are provided the greatest opportunity to do everything possible to conserve their forests into the future. B.2. Project/Programme description (max. 3 pages) The Project’s overall objective is to harness Guyana’s inland and mangrove forests to enhance climate change mitigation and ecosystem-based adaptation, resulting in 12 MtCO2e avoided emissions and 465,000 people who are more resilient to floods. To accomplish these goals, the Project proposes a set of activities that were identified through extensive consultation with government agencies, private sector representatives, indigenous peoples’ groups and non-governmental organizations who are familiar with the current paradigm. The Project builds on Guyana’s strengths and opportunities while it aims to address key drivers of deforestation, forest degradation and the impacts of climate change by removing the critical information, capacity, governance and sustainable finance barriers cited in Section B.1. The Project will support the implementation of conditional contributions outlined in Guyana’s NDC in the Forests Sector. It will also complement unconditional commitments and support conditional commitments for adaptation particularly on coastal protection. It will ensure that additional emissions avoidance, reductions and removals are being achieved, beyond, and complementary to, those that are funded by existing initiatives, for example through the bilateral Agreement with Norway. While the bilateral Agreement provided funding for the initial steps to transition to a low carbon and green economy, the current Project will have a strong focus on implementation of activities that will result in avoidance of forest carbon emissions that were not directly supported by the bilateral agreement. The Project will transform Guyana’s current approach to the management of its forest, including mangroves. It will integrate a full range of activities related to forests, including sustainable forest management, Reduced Impact Logging (RIL), an expansion of the Protected Areas system, improved mining practices, and the full participation and benefit sharing by Indigenous Peoples in REDD+. Roughly 90 percent of Guyana's population lives in the low–lying coastal region. The coastal plain is home to almost all the country's agricultural production—critical for both food and export. Without improved sea and river defenses and drainage systems, the coastal plains of coastal Guyana face serious flooding—if not complete inundation—owing to higher sea levels and increased intensity of precipitation projected under worst case climate model scenarios. For example, the capital and primary economic center, Georgetown, is on average 2m below sea level and at risk of increased flooding due to the impacts of climate change. The Project will include interventions to complement existing infrastructure and sea defenses by restoring and protecting mangrove forests. Finally, the Project will also build on Norway’s investment in the country’s Monitoring, Reporting and Verification System (MRVS), which provides an excellent basis for the close monitoring of additional mitigation impacts related to forests. It will support the maintenance and further development of the MRVS, which is recognized as one of the most advanced of its kind. Project Components The Project will build on existing climate change and sector plans and programs to address the barriers noted in Section B1. Overall Project Objective: To harness Guyana’s forests (including mangroves) to enhance climate change mitigation and ecosystem-based adaptation, resulting in 12 MtCO2e avoided emissions and 465,000 people who are more resilient to floods. Outcomes: Outcome 1 (Forests/mitigation Component): Deforestation and forest degradation from mining and logging activities reduced.

13 Griscom B.W. et al. (2017). Natural Climate Solutions. Proceedings of the Natural Academy of Sciences of the USA.

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This outcome will contribute to the realization of Guyana’s commitments to the global efforts to combat climate change within the forest sector as detailed in Guyana’s NDC. Four outputs are included in the NDCs and have been confirmed as priorities by stakeholders who participated in the development of this Concept Note. These Stakeholders include representatives from government agencies, NGOs, the private sector and Indigenous Peoples’ groups (see Section B.4).

Output 1.1 Sustainable Management of Forests is supported to reduce illegal logging.

Guyana’s GSDS recognizes that forests remain an important source of income and potential for development of the nation. There is therefore an important role for Sustainable Forest Management (SFM) to be implemented and monitored to ensure the optimum benefits of Guyana’s forest resources are derived, while continuing to contribute to the global fight in combatting the effects of climate change through REDD+. The Guyana Forestry Commission has identified 4 types of illustrative interventions that the Project will support to achieve SFM and reduce illegal logging:

• Development and implementation of new codes of practice to inform effective forest resources management in forest harvesting activities to maintain low rates of deforestation and forest degradation;

• Improve implementation of forest monitoring activities to ensure conformance with sustainable forest management (SFM) guidelines and EU/FLEGT requirements;

• Advance the promotion of value added initiatives within the sector, and the use and promotion of lesser used species, to assist in creating higher potential for carbon storage in long term wood products;

• Promote use of Reduced Impact Logging (RIL) through training and industry development to contribute to avoided deforestation as part of Guyana’s Emission Reduction Program (ERP). Output 1.2. Additional forests are protected as part of the national protected area system.

This output will support Guyana’s plans to conserve an additional 2 million hectares within the National Protected Area System and other effective area-based conservation measures such as protection of conservancies, reservoirs and their watersheds, and the watersheds upstream of new hydro-power sites. Existing mangrove forests will be counted in this target and the mangrove restoration program along the vulnerable coast will be expanded (see Output 2.1 below). The Protected Areas Commission has developed a strategy for the expansion of the protected area system that is expected to receive approval later in 2018. There is a broad recognition within Guyana that Protected Area expansion will need to be done in consultation with all stakeholders and that there is an important role to play for community-owned areas within a national protected area network. In particular, the protected areas system expansion will need to be done without infringing on Indigenous Peoples rights and observing the principles of Free, Prior and Informed Consent (FPIC). Further work will be needed during the Full Project Proposal (FPP) development to define which of the interventions would be seeking support from GCF funding and which would be co-financed.

Output 1.3. Integrated planning, management, and monitoring of the mining sector reduces deforestation.

This output will focus on policy reforms, education, and incentives for integrated planning and management of the mining sector. This will support the transformation of the mining sector and include actions to:

• Enhance mineral mapping in the mining districts to identify economically exploitable deposits using modern technologies. This will significantly reduce deforestation by avoiding clearing of forest cover from lands which contain only marginal mineral deposits. A significant portion of Guyana’s deforestation results from forest clearing for mining that does not generate a profit;

• Implement awareness programs to encourage adoption of more efficient technologies and practices in the mining industry. This will include replacing inefficient mercury-based technology with more efficient technologies that can increase gold recovery rates. Currently, low recovery rates cause miners to often return to previously mined areas when technology or economic circumstances favor them doing so. Improved recovery efficiency would make reprocessing of sites unnecessary and better facilitate cost-effective reforestation and recovery of mined sites;

• Support the implementation of policies and programs that institute mandatory, nation-wide land reclamation and reforestation of mined areas to minimize negative environmental impacts;

• Improve monitoring of active and non-current mining sites to ensure compliance with the Mining Act, environmental prescriptions and GGMC guidelines;

• Enhance coordination amongst natural resources, agricultural, housing, land management and regulatory agencies to enable improved decision-making actions that address overlapping land uses and ownership (including the rights of Indigenous Peoples), and the impact of each sector on climate change resilience and livelihoods. Output 1.4. Enabling conditions for stewardship of territory by Indigenous Peoples are strengthened to ensure that they accrue benefits from REDD+.

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This output will focus on the full participation and benefit sharing by Indigenous Peoples in REDD+. Indigenous Peoples are recognized as the stewards of the forest and should hold a more prominent role in decision making at multiple levels. REDD+ benefit sharing will support Indigenous Peoples to sustainably develop their communities, including securing sustainable livelihoods and the nature they depend on. The Project will build on existing Indigenous Peoples governing and decision-making bodies ensuring that Guyana’s indigenous population will continue to play a key role as stewards of the forests at a local as well as national level. This output will include actions to:

• Further strengthen the capacity of Indigenous Peoples to enhance well informed decision-making as well as strengthening capacities to ensure adequate implementation of forest carbon mitigation measures;

• Support for livelihood activities that increase resilience to inland flooding and improve food security for hinterland communities;

• Strengthen the enabling conditions for Indigenous ownership of land; • Develop mechanisms to ensure that REDD+ benefits accrue over the long term rather than being limited to short

term actions. This mechanism will also need to address providing benefits for other non-indigenous forest dependent communities.

Outcome 2 (Ecosystem-based Adaptation Component): Resilience of communities vulnerable to flooding is improved.

This outcome focuses on integrated coastal zone management and the expansion of ecosystem-based adaptation measures to reduce coastal flooding. Specifically, the outcome will include mangrove restoration, which was identified as a priority in the NDC. There is a recognition that a fundamental shift in approach towards coastal vulnerability problems is required to restore and secure sustainable and climate-resilient economic development. A more holistic and long-term solution is needed that addresses both the root causes of the problem, while taking into account the economic and social well-being of coastal communities.

Output 2.1: Improved capacity for planning and sustainable management of the coastal zone This output will address gaps in the understanding of bio-physical processes on Guyana’s coastline and to strengthen integrated coastal zone management to address threats from rising sea levels. Illustrative actions under this output will be: • Facilitate a sound understanding of the bio-physical processes governing the coastal system, including an outlook to

longer time scales with respect to the response of the coastal system to climate change, in particular sea level rise;

• Collaborate with national and international institutions in the field of coastal zone management and other related disciplines to enhance the country’s capabilities in addressing the challenging environmental and socio-economic problems prevailing on the coast;

• Adopt integrated planning and management of the coastal zone taking into consideration increased economic activity related to development of the oil and gas sector, urban development and increased industrial activities.

Output 2.2: Mangrove forests important for coastal flood prevention are restored through implementation of Building with Nature (BwN) solutions

This output will expand and scale -up successful pilot projects14 to conserve and restore mangroves that provide a low-cost approach for addressing climate impacts15. In addition, activities under this output will promote local mangrove-based economies for local communities. Because of deteriorated and fragmented natural barriers – particularly mangrove forests, but also salt marsh and other ecosystems - coastal communities and the economic sectors in the coastal zone are left more vulnerable to climate change impacts. Illustrative activities for this output will be: • Restore 1500 hectares16 of mangrove forests through the adoption of Building with Nature solutions. Building with

Nature is an integrated coastal zone management approach that provides resilience by combining smart engineering and ecological rehabilitation, while introducing sustainable land use practice.

14 http://mangrovesgy.org/home/ 15 World Bank Group (2016) Mangroves as Protection from Storm surges in a Changing Climate. 16 Mangrove will be restored along approximately 30km of priority coastal zone

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• Promote local mangrove-based economies, recognizing that mangrove ecosystems provide critical sources of income, including for women and vulnerable groups, through sustainable shrimp, crab and other fisheries, tourism and other local industries.

Output 2.3: Increase capacity of coastal communities to mainstream adaptation This output will enhance the capacity of coastal communities to adapt to the threats posed by climate change and sea level rise. This will be achieved through the development of climate information products, training and capacity building of local municipalities to mainstream climate change into their planning and management.

Outcome 3 (Monitoring and Reporting Component): Use of climate information in decision-making is increased. A comprehensive and robust Monitoring, Reporting and Verification System (MRVS), one of the most advanced of its kind, has been developed under Guyana’s REDD+ program. The development of this system has contributed considerably to the global understanding of how small forested tropical countries can reliably and cost-effectively measure and report on their forest carbon emissions. Guyana seeks to build on the lessons learned thus far to maintain, improve and expand the use of its MRVS. There will be two outputs under this outcome.

Output 3.1. MRV System maintained to reliably and cost effectively measure and report on forest carbon emissions.

Funding for Guyana’s MRVS is currently available until 202017. Under this output, the MRV system will be maintained and refined for a third phase to ensure that Guyana is able to routinely monitor and provide credible estimates of forest-related emissions. Illustrative activities that have been identified by GFC to include in this output are:

• Regular and updated reporting in accordance with IPCC/UNFCCC guidelines; • Continue verification as defined by UNFCCC guidance; • Refine the measurement and reporting of forest degradation and reforestation/forest regrowth; • Improve emission factors such as ground-based measurements on forest carbon stocks and stock changes,

allometric equations and estimates related to soil carbon emissions; • Engage in dedicated research on evolving technologies to improve emissions estimates; • Expand national monitoring to include other sector agencies, local communities and stakeholders.

Output 3.2. MRV System mainstreamed into decision making for land-use management.

The MRVS was designed and is principally for measuring and reporting on emissions from the forest estate. However, it has the potential to be a more important tool to inform decision-making about land-use management. In particular, there are opportunities to expand its use for monitoring mining and forestry concessions. Illustrative activities that have been identified by the GFC to include in this output are:

• Refine methods to quantify afforestation and carbon accumulation on abandoned mining sites, linking to mining reclamation actions (link to output 1.3.);

• Develop near-real time monitoring for high priority sites; • Develop an information platform for access to MRVS results and data to encourage use and sharing of data between

agencies, communities and for housing near-real time deforestation updates; • Develop platform and mechanism for use of MRVS data and results for forest concession monitoring and

management. In addition to the outcomes and outputs identified for the Project, a number of cross cutting themes have been identified that need to be integrated into the Project design at the FPP development phase. These are:

• Promote greater participation and benefit sharing by Indigenous Peoples in Guyana’s UNFCCC commitments; • Build human and institutional capacity to implement forest-based climate change mitigation and adaptation; • Assist in developing the enabling conditions to transition to a diversified, green and climate resilient economy that

ensures that additional oil revenues will further solidify the sustainable development interests of Guyana; • Ensure that the project adds to and complements, the past, ongoing and future work under the Guyana-Norway

Agreement; • Mainstream gender to enhance the efficacy of planned mitigation and adaptation interventions and ensure that

gender co-benefits are obtained;

17 MRVS Phase 2 runs until 2020 supported by the Norwegian Agency for Development Cooperation (NORAD). GFC is therefore seeking support for phase 3 of the MRVS from 2020.

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• Ensure that the project supports early action under the Green State Development Strategy (GSDS) and within the guidance provided by the Low Carbon Development Strategy and the GSDS Framework.

History of the Accredited Entity in Guyana Conservation International (CI) addresses root causes of climate change and adaptation to its impacts as part of its mission of safeguarding nature for human well-being. CI's mitigation efforts incorporate the conservation and restoration of forest ecosystems, the implementation of climate-smart agriculture and the protection and restoration of coastal ecosystems (blue carbon). CI also supports vulnerable populations' efforts in adapting to climate change via conservation and restoration activities, as well as providing solutions for adaptive and sustainable management of key service-providing ecosystems (i.e. coral reefs, mangroves, and wetlands). Conservation International Foundation Guyana Inc. (CI-Guyana) has been registered in Guyana as a not-for-profit company since 1996 and is a subsidiary of Conservation International. CI-Guyana has a Memorandum of Understanding with the Government to support a wide range of conservation initiatives including supporting indigenous and community owned land and conservation concessions, capacity building, awareness raising, and environmental policy and planning. CI-Guyana has supported site level efforts, particularly in the Rupununi region of Southwestern Guyana, as well as national level initiatives. Much of CI-Guyana’s recent work has been to support the development of the institutional and human capacity for the implementation of the country’s Low Carbon Development Strategy and REDD+ initiatives. CI-Guyana is currently working with government agencies and civil society partners on several pilot initiatives relevant to the proposed Project including support on development of the national REDD+ strategy, reduced impact mining projects, and mangrove restoration. Implementing Arrangements Implementing arrangements will be detailed during Full Project Development, however CI-Guyana and government agencies, including the Guyana Forestry Commission (GFC), the Guyana Geology and Mines Commission (GGMC), the Protected Area Commission (PAC), the Ministry of Finance and the Mangrove Unit of the National Agriculture Research and Extension Institute (NAREI), and the Guyana Lands and Surveys Commission will have important roles in executing specific outputs of the Project. All of these organizations have helped to identify priority interventions for the Project. The Office of Climate Change will have an oversight role in the Project. Additional partners, including Indigenous Peoples’ groups, will also be chosen through a tender process to deliver specific activities. CI-Guyana has a long and successful history of providing grant funding to government agencies and civil society organizations in Guyana. Risks Operational risks are low for this project. All of the project activities are well aligned with existing national policies and strategies. Most of the Project interventions have already been tested as part of pilot projects or best practice is well established and this Project will provide an opportunity to scale them up to ensure significant impact. Financial risks are low for the Project. Conservation International has well established grant management procedures that mitigate financial risk by ensuring that grantees have the necessary financial management skills and procedures and processes in place prior to grant awarding. CI also provides support and monitors grantees during grant implementation to ensure compliance with financial policies. If deemed necessary, training is provided to strengthen grantees’ financial management skills. Political risks are low for this project. Despite political changes in the recent past within Guyana, the underlying policies and support for action on climate change have remained constant. The interventions planned in this Project enjoy broad support across the political spectrum. An environmental and social impact screening has not been undertaken at this stage but will be done during Full Proposal development according to CI’s Environmental and Social Management Framework for GCF projects. Based on previous experience, this Project is not expected to cause any major environmental impacts. Indeed, many of the Project activities will be focused on putting in place policies and processes to reduce environmental impacts of forestry and mining operations. During Full Project design, particular attention will need to be paid to ensuring that activities that could impact on rural communities and/or the rights of Indigenous Peoples adhere to the principle of Free, Prior and Informed Consent. An Indigenous Peoples Plan will be required as part of the Full Project development that responds to GCF’s Indigenous Peoples Policy and Guyana’s Amerindian Act.

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B.3. Expected project results aligned with the GCF investment criteria (max. 3 pages) The Project is expected to make a significant contribution to the climate change strategies in Guyana as set out in the NDC. Further work to refine the expected Project results will be undertaken as part of the Full Project Proposal (FPP) development. Based on initial estimations, the Project is expected to make a significant contribution to reducing GHG emissions from deforestation while also providing important adaptation benefits from the planned mangrove restoration and protection activities along the vulnerable coast. Further work will be done on determining impact, outcome, output and activity indicators during the project development. The figures below are based on initial calculations that will be further refined during the FPP development phase. The GCF Performance Measurement Framework impact indicators that are relevant to the project are as follows:

• 12 million 18 tons of carbon dioxide equivalent (tCO2e) emissions avoided from forest protection, sustainable management and mangrove restoration activities (Outcomes 1 and 2);

• Up to 2 million hectares of ecosystems strengthened, restored and protected from climate variability and change (Outcomes 1 & 2);

• 465,000 indirect and direct beneficiaries less vulnerable to flooding, representing approximately 60% of Guyana’s population (Outcome 2).

Paradigm Shift Potential Guyana is on the cusp of becoming an oil producing country that may make it prone to the so-called resource curse: the paradox that countries with an abundance of natural resources like fossil fuels, tend to have less economic growth, less democracy, and worse development outcomes than countries with fewer natural resources.19 The country seeks to avoid having an economy that is overly dependent on revenue from a volatile and finite resource. Another potential scenario is that the extractives sector will crowd out other productive sectors, resulting in declining exports and increased economic vulnerability, also known as the Dutch Disease. The country recognizes that while oil and gas resources can provide a critical economic boost, a low emissions development is the best pathway for making development truly sustainable. Given Guyana’s commitment to the global climate change agenda, the recent volatility in oil prices, and the global trend of economies shifting away from growth models based on ever increasing carbon-dioxide emissions, Guyana has chosen a path that will achieve growth while diversifying away from the extractives sector. In this context, the country’s extractives sector is viewed as a trigger for sustainable development through economic diversification.20 This vision that the extractive sector should be serving as a catalyst to improve opportunities and growth in other parts of the economy is championed by President Granger. Sustainable Development Further work to quantify expected co-benefits will be done during the FPP development phase. The Project will help the Government of Guyana meet targets related to the UN Framework Convention on Climate Change, the UN Convention on Biological Diversity and the Sustainable Development Goals. Gender equality and equity will be fully integrated into the project design during the FPP development to ensure that the respective roles of men and women are considered in all aspects of the project interventions. In addition, other determinants of inequality such as social status, origin, age, ethnicity and religion will be considered. The Project will include a specific output to enable Indigenous Peoples to accrue benefits from forest-based mitigation activities (output 1.4). Needs of recipient The Project is well aligned with national policies and strategies. The Government of Guyana has recognized the country’s potential to contribute significantly to global mitigation efforts as exemplified in its Nationally Determined Contribution21 under the Paris Agreement, its Memorandum of Understanding with the Government of Norway22 in which it prioritizes

18 This figure needs further verification during FPP development. This preliminary estimate is based on the proposed activities achieving 5% of the total 48.7MtCO2e annually estimated in the NDC. 19 Stevens P., Lahn G. & Kooroshy J. (2015) The Resource Curse Revisited. Energy, Environment and Resources, Chatham House 20 Government of the Cooperative Republic of Guyana (2017). Framework of the Guyana Green State Development Strategy and Financing Mechanisms 21 Government of the Cooperative Republic of Guyana (2015). Guyana’s Revised Intended Nationally Determined Contributions. 22 Memorandum of Understanding between the Government of the Cooperative Republic of Guyana and the Government of the Kingdom of Norway (2009).

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avoided deforestation as one of the two main pillars, and its national Green State Development Framework which reinforces that development will be linked to commitments under the Paris Agreement. Country ownership Government agencies (OCC, GFC and Ministry of Finance) have been intimately involved in developing the Project concept to date to ensure that it responds to national priorities and is integrated with other relevant projects and programs. Input to the concept note has also been sought from other government agencies, civil society organizations and the private sector (see Section B.4.). Efficiency and Effectiveness Estimated cost per tCO2e for the Project = USD 45 M/ 12 M tCO2e = USD 3.75 per tCO2e This price is lower than the long-term average for existing subnational REDD+ initiatives and to the typical cost paid for emissions reductions on the voluntary market. For example, Ecosystem Marketplace’s tracking of carbon prices indicates that since records began the average price per tCO2e has been approximately USD 5.80. Similarly, GCF itself has based its pilot results-based REDD+ program on a price of USD 5 per tCO2e. Estimated cost per beneficiary for the project = USD 45 M/465 000 people = USD 96.77 per beneficiary B.4. Engagement among the NDA, AE, and/or other relevant stakeholders in the country (max ½ page) This concept note is the product of extensive consultations and participation of key Guyanese stakeholders. Conservation International developed the Project Concept Note in close collaboration with Guyana’s Office of Climate Change (OCC), which acts as the secretariat for the GCF NDA. At the invitation of the OCC, the CI-GCF agency and the CI Americas team led a scoping mission in Guyana in October 2017 that included a meeting with the NDA, Minister Harmon. The overall objective of the mission was to assess viability for a potential GCF project related to climate change and the sustainable management of forests in Guyana. Meetings were held with 16 government agencies and civil society organizations to understand their priorities for action on climate change. On the basis of the mission, an initial paradigm shift for a GCF project was identified and an agreement was formalized as a communiqué between CI and OCC to move forward with developing a project that would support implementation of Nationally Determined Contributions (NDC) that relate to forest ecosystems. Following the initial consultations with potential partners, a core group of individuals within the OCC, the Guyana Forestry Commission (GFC), the Ministry of Finance and CI-Guyana developed a Project Idea Note that outlined the initial priorities identified for the project and provided a foundation for the development of the Concept Note. During the Concept Note Development (10 May-25 June 2018), further stakeholder engagement has taken place through a combination of face-to-face meetings and a Stakeholder workshop organized on 23 May 2018 in Georgetown, Guyana. Groups consulted include government agencies, civil society organizations including Indigenous Peoples groups and private sector representatives from the Mining and Forestry Sectors. The objectives of the consultation phase were:

• Identify stakeholders and elicit feedback on the priorities for the project; • Improve understanding of stakeholder concerns; • Elicit feedback on proposed project objective, outcomes and outputs; • Collect information useful for the concept note development.

Overall, stakeholders acknowledged that the proposed Project can make an important contribution to advancing national priorities such as the NDCs. The proposed objectives, outcomes and outputs for the project as described in section B.2. were discussed with stakeholders at the workshop on May 23 and have been modified from their original wording to take into account stakeholder comments. A total of 29 separate organizations represented by 47 people (25 men; 22 women) have provided input into the Concept Note development. A first draft of the concept note was distributed to stakeholders with an invitation to comment on it. A presentation of the concept note was given on 21 June. The concept note was then further refined based on the feedback and comments received up until 24 June 2018.

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C. Indicative Financing/Cost Information (max. 3 pages) C.1. Financing by components (max ½ page) Please provide an estimate of the total cost per component/output and disaggregate by source of financing.

Component/Output

Indicative cost (USD)

GCF financing Co-financing Amount (USD)

Financial Instrument

Amount (USD)

Financial Instrument

Name of Institutions

Forests/mitigation Component

27.40 M 21.9 M Grant 5.5 M Grants and In Kind

Various donors; Government of Guyana

Ecosystem-based Adaptation Component

12.05 M 8.3 M Grant 3.75 M Grants and In Kind

Various

Decision-making Component

5.55 M 4.8 M Grant 0.75 M In Kind Government of Guyana

Indicative total cost (USD)

45 Million 35 Million 10 Million

Further work to refine Project costs and identify co-finance will be undertaken as part of the Full Proposal Development.

C.2. Justification of GCF funding request (max. 1 page) Guyana is on the cusp of a major change as it is set to become an oil and gas producing country. Whether Guyana will follow the path that many resource-rich nations have taken, resulting in increased carbon emissions, non-sustainable use of other natural resources, and livelihoods that are unchanged or even worse off, depends on investments and decisions that will be taken in the next few years. At the highest levels within the Government of Guyana, there is a conviction that now is the time to start investing in a pathway that will achieve growth while diversifying away from the extractives sector. Guyana’s Green State Development Framework outlines the path to realize green development through climate-responsive economic transformation. This pathway will depend on the availability of new knowledge and capacities needed to transform the management of forests that will result in lower emissions, increased resilience to climate change, and sustainable improvements in livelihoods. Guyana is classified as a Small Island Developing State (SIDS) and the UNFCCC and GCF recognize that SIDS require significant help from the international community to address the challenges of climate change. While Guyana’s long-term vision is to fund climate-relevant priorities defined within the Green State Development Framework through the national budget once oil revenues are available, currently there is insufficient public funding to undertake all the Project activities. However, as indicated in section C.1. some public funding will be available as co-financing for the Project. Given the public goods nature of the Project interventions, they are not expected to generate revenues and are therefore not suitable for private sector investment, for loans or for reimbursable grants. As such, Conservation International seeks grant funding from GCF to achieve the Project outcomes and outputs described in section B.2. CI will in turn provide grants to the executing partners, thereby ensuring that the same level of concessionality is passed on to end-users. C.3. Sustainability and replicability of the project (exit strategy) (max. 1 page)

The sustainability of the project lies with the removal of the information, capacity, governance and long term financial barriers noted in Section B.1. Several of the Project outputs focus on removing information barriers and to provide tools that will allow better governance/decision-making. Capacity building of the executing entities and other project partners will contribute towards the sustainability of the Project interventions and enable future replication.

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Long term sustainability of the Project interventions is also highly likely because all of the interventions have already been identified as high priorities by government agencies and included in official government documents (e.g. the NDC and also sector strategies on forestry and mining). Future support for the Project interventions is therefore more likely because they are already identified as government priorities and are expected to be integrated into the Green State Development Strategy. Sustainability of forest protection activities also requires involvement of the local users and forest stewards. The high level of organization of Guyana’s Indigenous Peoples and their ownership and management of some 14% of Guyana’s forested lands, provides an opportunity to directly involve local stewards of the forest in the sustainable management of these lands. Guyana is currently establishing a Sovereign Wealth Fund, a game-changing mechanism to manage revenues from oil and gas production for the long-term benefit of Guyanese. This Fund will finance implementation of Guyana’s national development strategy, the Green State Development Strategy (GSDS). The GSDS is informed by the commitments within the NDC as well as the CRSAP, including under the Forestry sector. The Fund will also support approaches on Natural Capital Accounting (NCA) at the national level. The Ministry of Finance has expressed its interest and commitment to incorporating natural capital into national accounts to support informed decision-making on natural resource management in the context of climate change. This strong commitment to NCA as well as the establishment of the Fund will create the enabling conditions for Guyana to ensure the value of natural capital is linked in the future to green development and financial planning. Protecting the coastal region will also enhance the mitigation investments in forests. Transitioning to a green economy in which conservation and climate change is deeply imbedded requires time and other resources. By building resilience on the coastal region, the climate mitigation investments in the forest ecosystems will be secured further, and people would have more time to develop alternative renewable and lower-carbon footprint economic activities.

D. Supporting documents submitted (OPTIONAL) ☒ Map indicating the location of the project/programme ☒ Diagram of the theory of change ☐ Economic and financial model with key assumptions and potential stressed scenarios ☐ Pre-feasibility study ☐ Evaluation report of previous project ☐ Results of environmental and social risk screening

Self-awareness check boxes

Are you aware that the full Funding Proposal and Annexes will require these documents? Yes ☒ No ☐ • Feasibility Study • Environmental and social impact assessment or environmental and social management framework • Stakeholder consultations at national and project level implementation including with indigenous

people if relevant • Gender assessment and action plan • Operations and maintenance plan if relevant • Loan or grant operation manual as appropriate • Co-financing commitment letters Are you aware that a funding proposal from an accredited entity without a signed AMA will be reviewed but not sent to the Board for consideration? Yes ☒ No ☐

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Annex 1. Theory of Change for the Project

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Annex 2. National Vegetation Cover Map of Guyana

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Annex 3. Map of Mangrove forest in Guyana