81308767-Support of agricultural enterprises along selected agricultural value chains of Lao PDR

Lao Peoples Democratic Republic (Lao PDR) is a landlocked Least Developed Country (LLDC) economically dependent on natural resources, especially forestry, agriculture, hydropower and mining. Forests are among the most important economic sectors, providing income, a source of nutrition, and livelihoods for the rural population. Northern Lao PDR is at high risk of climate change due to its high exposure, low capacities, and high sensitivity. This region is among the poorest in the country, and the agricultural sector largely depends on rainfed upland cultivation. The mountainous terrain is highly sensitive to climate change. At the same time, high rates of deforestation and forest degradation further exacerbate the northern regions" vulnerability. Six provinces, namely Bokeo, Houaphan, Luang Prabang, Luang Namtha, Sayabouri and Oudomxay experienced more than 40% of the country"s deforestation and forest degradation during the period from 2005-2015. Deforestation and forest degradation exacerbate the risk of climate-related natural hazards and reduce the provision of key ecosystem services that could otherwise strengthen the coping capacity of local ecosystems and the persons who depend on them.

The BMZ-financed project "Climate Protection through Avoided Deforestation" (CliPAD) was launched in 2009 to support the Lao Government in its readiness for the Reducing Emissions from Deforestation and Forest Degradation (REDD+) process at national and sub-national levels. In 2019, CliPAD Phase IV received its first out of two co-financing contributions of the Green Climate Fund (GCF FP117, 2020-2025). Due to the different phases and the donor structure, two names are now in use for the same project: CliPAD for communication with BMZ as well as "Implementation of the Lao People's Democratic Republic (Lao PDR) Emission Reductions Programme through improved governance and sustainable forest landscape management" (I-GFLL) for communication with GCF. The second GCF co-financing (GCF FP200, 2023-2027) is referred to as "Scaling Up the Implementation of the Lao People's Democratic Republic Emission Reductions Programme through improved governance and sustainable forest landscape management" (SU-I-GFLL).

The program is expected to mitigate 11.7 million t CO2eq from May 2020 until March 2027 and will have a positive impact on 273,700 direct and 723,382 indirect beneficiaries in six provinces: Houaphan, Luang Prabang, Sayaboury, Bokeo, Luang Namtha and Oudomxay. The mitigation of emissions will enable the government of Lao PDR to get access to REDD+ results-based payments provided by the Forest Carbon Partnership Facility (FCPF).

The project focuses on the following areas: 1) Strengthening the enabling environment for REDD+ through three principal means: enhancing the availability of financing for a transformation in the way Lao PDR manages its forest landscapes; revising and strengthening the legal and regulatory framework for forestry; and improving the enforcement of the new regulatory framework. 2) Supporting deforestation-free agriculture and agroforestry by enhancing productivity, increasing farmers" integration into agricultural value chains, and improving access to finance and private sector participation in economic activities that reduce pressure on forests. Here, the activities of the agriculture component are currently implemented through Promotion of Sustainable Agricultural Practices (PSAP).

3) Supporting the implementation of sustainable forest landscape management and forest landscape restoration on over 1.5 million ha of degraded forest lands. As part of the forestry component, the project introduces participatory planning for land and forest use and establishes a system to measure and monitor progress.