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CBFF/AFRICAN DEVELOPMENT BANK by T6Goo3

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									  CONGO BASIN FOREST FUND                                                                           2010 ANNUAL REPORT




                                  2010 ANNUAL REPORT


                                                         Tunis
                                                       April 2011




        13, Avenue du Ghana, Angle des Rues Pierre de Coubertin et Hédi Nouira - BP 323 - Tunis Belvédère 1002 - Tunisia
                Tel.: (216) 71 10 3219 / 71 10 3433 – Fax: (216) 71 10 3721 – Internet : http://www.cbf-fund.org/
                                                E-mail: cbffsecretariat@afdb.org


Congo Basin Forest Fund
Administered by the African Development Bank
Angle de l’avenue du Ghana et des rues Pierre de Coubertin et Hédi Nouira
BP 323 – 1002 Tunis Belvédère (Tunisia)
Tel : + 216 71 10 3219 – Fax : + 216 71 10 3721
E-mail: CBFFSecretariat@afdb.org
Web site: www.afdb.org or www.cbff-fund.org
CONGO BASIN FOREST FUND                                                                                  2010 ANNUAL REPORT


                                                     Table of Contents

EXECUTIVE SUMMARY ...............................................................................................................I

1           INTRODUCTION ...............................................................................................................1

2           ORGANIZATION ...............................................................................................................1

2.1        Organizational and Administrative Structure of the Fund ..................................... 1

2.2        Strategic Planning and Direction ............................................................................... 2

2.3        Building Partnerships .................................................................................................. 3

2.4        Management and Communication Tools ................................................................... 4

2.5        Other Organizational Activities.................................................................................. 4

2.6        Human Resources ........................................................................................................ 5

3          OPERATIONAL STATUS .................................................................................................6

3.1        Project Selection ........................................................................................................... 6

3.2        Project Implementation ............................................................................................. 11

3.3        Outputs of On-going Projects ................................................................................... 14

4          FINANCIAL POSITION AS AT 31 DECEMBER 2010 .......................................... 16

5          CONCLUSION ................................................................................................................... 17



                                                                                                                        Number of Pages

Appendix 1 : CBFF Logical Framework ........................................................................................................ 3
Annex 1a : Criteria for Assesment of Proposals of the Second Call for Proposals ................................. 1
Annex 1b : Detailed Proposal Rating Scales ............................................................................................. 1
Annex 2a : List of Government and Regional Projects Approved by the Governing Council in
              November 2010 Following the Second Call for Proposals ..................................................... 1
Annex 2b : List of Civil Society Projects Approved by the Governing Council in November 2010
              Following the Second Call for Proposals ................................................................................ 1
Annex 3    : Breakdown by Country and Thematic Area of Projects of the Second Call for Proposals .... 1
Annex 4    : Status of the Ten On-going Projects as at 31 December 2010 ............................................ 20
Annex 5    : Consultative Meetings Attended by the CBFF Secretariat in 2010 ....................................... 1
Annex 6    : Support Provided by the Bank in 2010 .................................................................................. 1
Annex 7    : Independent auditors’ report on the Special Purpose Financial Statements ……………..                                             10
CONGO BASIN FOREST FUND                                           2010 ANNUAL REPORT


                          ACRONYMS AND ABBREVIATIONS

ADAPEL               Likende Agricultural and Fisheries Development and
                     Environmental Protection Action
ADB                  African Development Bank
AWF                  African Wildlife Foundation
BCI                  Bonobo Conservation Initiative
BI                   Bioversity International
CAM-ECO              Cameroon Ecology
CAR                  Central African Republic
CBFF                 Congo Basin Forest Fund
CBFP                 Congo Basin Forest Partnership
CI                   Conservation International
COMIFAC              Central African Forest Commission
COP16                Sixteenth Conference of Parties to the United Nations Framework
                     Convention on Climate Change
DFID                 Department for International Development (UK)
DRC                  Democratic Republic of Congo
ECCAS                Economic Community of Central African States
FAO                  United Nations Food and Agriculture Organization
FCPF                 Forest Carbon Partnership Fund
FMA                  Fund Management Agent
FTNS                 Fondation pour le Tri-National de la Sangha (Sangha Tri-National
                     Foundation)
GC                   CBFF Governing Council
MRV                  Monitoring, Reporting and Verification
NGO                  Non-governmental Organization
OPED                 Organization for Environmental and Sustainable Development
OSAN                 Agriculture and Agro-Industry Department (ADB)
REDD                 Reducing Emissions from Deforestation and Forest Degradation in
                     Developing Countries
RIFFEAC              Network of Institutions for Training on Forests and Environment
                     in Central Africa
ROCAME               Network of Campo-Ma’an and Vicinity NGOs
R-PP                 Readiness Preparation Plan
SFM                  Sustainable Forest Management
UN-REDD              United Nations Programme for Reducing Emissions from
                     Deforestation and Forest Degradation in Developing Countries
WRI                  World Resources Institute
ZSL                  Zoological Society of London
                                EXECUTIVE SUMMARY

I.      2010 Achievements

1.0      This report, prepared in accordance with the provisions of Section 9.3 of the
Operational Procedures of the Congo Basin Forest Fund (CBFF), presents the Fund’s
operational and organizational achievements in 2010. On the operational front, the CBFF
Secretariat devoted its efforts to improving its project portfolio by appraising government and
regional projects, preparing grant agreements for projects from the first Call for Proposals
and monitoring projects under implementation. Organizational achievements include holding
three CBFF Governing Council meetings, preparing a draft Operational Strategy and
updating communication tools, as described in paragraphs 1.1 to 1.6 below.

1.1      New Projects Approved: in 2010, the CBFF Governing Council (GC) approved
twenty-five (25) new projects from the second Call for Proposals, inclduing 13 government
and regional and 12 civil society projects for a total value of of EUR 63,136,587. The
breakdown by country and by thematic area shows that Forest Management and Sustainable
Practice, Livelihoods and Economic Development Are the major themes, although seven (7)
projects specifically cover Reducing Emissions from Deforestation and Forest Degradation
(REDD): six (6) REDD pilot projects in the Democratic Republic of Congo (DRC) and the
REDD Process Multi-Player Participation Support Project in Cameroon, Gabon, Congo and
the Central African Republic.

1.2      Projects Appraised in 2010: ten (10) government and regional projects were
appraised in 2010 and the draft appraisal reports were available on 31 December 2010. The
project review process began in 2010 and will continue in 2011 to have projects ready for
approval by the Bank’s Board of Directors.

1.3     Grant Agreements Signed in 2010: as at 31 December 2010, ten (10) grant
agreements had been signed of the fifteen (15) projects from the first Call for Proposals.
These ten projects are being implemented by four (4) local non-governmental organizations
(NGOs) and six (6) international NGOs. The other five (5) grant agreements that were being
processed as at 31 December 2010 are with the Network of Campo-Ma’an and Surrounding
NGOs (ROCAME), Zoological Society of London, (ZSL), Bioversity International (BI),
Conservation International, (CI) and Bonobo Conservation Initiative, (BCI). These
agreements should be signed in the first half of 2011.

1.4      Disbursements for Projects: as at 31 December 2010, total disbursements for the ten
(10) projects being implemented was EUR 2 258 983, representing a rate of 27% in relation
to the total grant amount of EUR 8,379,971). This low rate is due mainly to difficulties
encountered by the beneficiary NGOs in properly justifying the use of their first cash
advances and is expected to improve in 2011 with the close supervision and assistance
provided by the CBFF Secretariat as well as the Fund Management Agent (FMA), whose
contract is expected to be signed in the first quarter of 2011. Similarly, to remedy the weak
fiduciary and procurement capacity, a training workshop for NGO accountants and
procurement experts will be organized in the first quarter of 2011.

1.5     Status of Ongoing Projects: most activities relating to the ten projects being
implemented started in January and February 2010 although for three NGO projects started in
March and May 2010: African Wildlife Foundation (AWF), World Resources Institute (WRI)
                                              ii


and Rainforest Alliance. On the whole, progress as at 31 December 2010 was generally
satisfactory but only fairly satisfactory for four projects implemented by the following NGOs:
Nature Plus, Rainforest UK, Rainforest Alliance and Sangha Tri-National Foundation
(FTNS). Reasons for this level of performance include: (i) delays in signing agreements with
partners and with some local communities and NGOs (the case of Nature Plus); (ii) delays in
disbursing the second tranche of funds; (iii) delays in establishing the project coordination
structure, difficulties in transporting production equipment and gaining access to the project
area for want of adequate logistics (the case of Rainforest Alliance); and (iv) delays in
recruiting key staff for the FTNS and difficulties in fulfilling conditions precedent to grant
disbursement related to the three parks of the Sangha Tri-National (TNS) and civil society
organizations working in the TNS that are responsible for implementing activities.

1.6      Organizational Achievements: in 2010, the CBFF Secretariat also recorded other
achievements, the most important of which are the organization of a training workshop for
NGO grant recipients on ADB procurement and disbursement rules and procedures,
preparation of the draft CBFF Operational Strategy, preparation of the regional project
document “Monitoring, Reporting and Verification” (MRV), development of simplified
CBFF operational procedures, organization of three ordinary CBFF GC meetings, updating
communication tools (website and production of 3000 CBFF brochures, updating project data
in the Bank’s Data Management System (SAP) and participation in regional and international
consultative meetings.

II.     Lessons Learned and Challenges to be Addressed

2.1      Project Pre-selection: the first stage of the second Call for Proposals resulted in
about 400 concept notes whose quality was unsatisfactory in some cases. As a result, the
deadline was for registering the concept notes and the preliminary selection was extended,
with the attendant impact on the workload of the CBFF Secretariat. The challenge in 2011
will be to ensure better project quality right from the concept phase, especially through
revised project selection criteria and involvement of the FMA to strengthen the Secretariat’s
capacity.

2.2      Disbursement Rate: the disbursement rate for projects under implementation
remains low particularly because of difficulties encountered by the NGOs in justifying the
use of the first advances received. Improving the disbursement rate is a major challenge for
CBFF in 2011. The factors that will help to improve the disbursement rate are the
identification of causes, including internal remedial measures from now on, the involvement
of the FMA in managing projects valued under EUR 2 500 000, and the implementation of
government and regional projects from the Second Call for Proposals.

2.3      Project Appraisal: the appraisal stage helps to consider and agree with project teams
on the project concept and implementation details. This phase provides information and data
that makes it possible to prepare an appraisal report that meets Bank requirements. CBFF
Operational Procedures provide for a desk appraisal that is complemented, if needed, by an
appraisal on the ground. A desk appraisal was carried out for projects from the first Call for
Proposals but there were no ground appraisals, which has had repercussions on the
performance of ongoing projects, especially delays in disbursing the second advance. This
appraisal method will be reviewed for future projects. Similarly, the duration and
composition of appraisal teams will also be reviewed objectively so as to substantially
improve the preparation of appraisal reports.
                                              iii



2.4       Human Resources: there was an imbalance between the human resource capacity of
the CBFF Secretariat and the volume of work required in 2010. To reduce the imbalance, the
CBFF Secretariat called on short-term consultants and Bank staff (experts and/or assistants)
to assist in performing some tasks. However, given the limited financial resources under this
budget item and the need to ensure continuity in monitoring activities at the end of
consultants’ contracts, this option cannot be pursued. The CBFF review, scheduled for 2011,
will have to review the administrative and organizational structure of the Secretariat in order
to increase the efficiency of carrying out the CBFF mission and better management of the
project portfolio.

III.    Conclusions and Prospects

3.1       The CBFF made significant progress in increasing its portfolio from fifteen (15) in
2009 to forty (40) projects in 2010 following the approval in November 2010 by the CBFF
GC of twenty-five (25) new projects from the second Call for Proposals . Likewise, efforts
were made to ensure efficient management of ongoing projects, resulting in overall
satisfactory performance, despite difficulties encountered by some NGOs and mostly
attributable to delays in disbursing the second tranche of funds. There should be fewer of
these problems in 2011 with closer assistance and supervision on the ground by the CBFF
Secretariat and the FMA.

3.2      CBFF’s 2011 prospects are based on the principles summarized below and should
allow for better portfolio management and achievement of set objectives:

             Ensure project quality right from the new project design phase.

             Oversee efficient project implementation and speed up disbursements by close
              project monitoring system coordinated by the CBFF Operations Officers based
              in Yaoundé and Kinshasa, and directly overseen by the FMA for projects
              costing below EUR 2,500,000.

             Adopt an operational strategy that establishes priorities by intervention area o
              and defines objectively verifiable goals and interim indicators, taking into
              consideration the general objectives to be achieved in the short and long terms.

             Adopt simplified operational procedures to foster more rapid implementation
              of activities financed by the Fund.

             Establish a communications approach between the Secretariat, the FMA and
              beneficiary NGOs to improve inter-professional relations between all
              interested parties.
1        INTRODUCTION

1.1     This report was prepared in accordance with the provisions of Section 9.3 of the
CBFF Operational Procedures. It presents CBFF’s activities and achievements in 2010
reviews CBFF’s organizational, operational and financial situation.

1.2      An appendix with the CBFF logical framework and four annexes present: (1)
assessment criteria and rating scales for detailed proposals from the second Call for
Proposals; (2) a list of projects approved by the GC at its meeting of November 2010; (3)
breakdown of projects from the second Call for Proposals by country and thematic area; (4)
detailed status of ongoing projects; (5) list of consultative meetings attended by the CBFF
Secretariat in 2010, and (6) support provided by the Bank for CBFF activities in 2010.

1.3    Experts from the Agriculture and Agro-Industry Department (OSAN) of the African
Development Bank (ADB) reviewed this report and their comments have been integrated.

2        ORGANIZATION

2.0      This section reviews the activities that ensure that the CBFF functions efficiently: .
its organizational and administrative structure, strategic planning and direction, building
partnerships within the Bank and at the regional and international levels. This section also
describes the human resources situation and achievements on CBFF’s management and
communication tools.

2.1      Organizational Structure and Fund Management

2.1.1     The CBFF was launched in London on 17 June 2008 with an initial capital of nearly
EUR 118 million from the Climate Change Funds of Great Britain and Norway, with the
support of ministries responsible for forestry in the Central African Forest Commission
(COMIFAC) member states.          The CBFF seeks to address the challenges associated with
climate change by reducing and eventually reversing the rate of deforestation in the Congo
Basin forests, and to alleviate poverty. CBFF activities complement some strategic priorities
of the COMIFAC Convergence Plan. To this end, the CBFF works in close cooperation with
the governments of Central African countries, COMIFAC, the Economic Community of
Central African States (ECCAS), technical partners of the Congo Basin, development finance
institutions, NGOs and the private sector.

2.1.2   The CBFF has a (i) Governing Council, co-chaired by The Right Honourable Paul
Martin (former Prime Minister of Canada) and Professor Wangari Maathai (Nobel Peace
Prize Laureate); and (ii) a Secretariat, headed by a Coordinator under the supervision of the
AfDB Director of the Department of Agriculture and Agro-Industry and assisted by core staff
responsible for implementing activities.

2.1.3     The GC is responsible for setting the strategic direction of the Fund and ensuring
broad development partner and stakeholder participation. Its specific functions and mandate
as defined in the Framework Document for the Establishment of the Fund are as follows: (i)
set the strategic direction of the Fund; (ii) set objectives and milestones; (iii) ensure financial
oversight and review budget proposals to ensure consistency with the strategic direction; (iv)
carefully vet projects proposed by the Secretariat to be included in the work plan, including
Secretariat budget approval and control; (v) build coherence among stakeholders; (vi)
                                               2

contribute to advocacy and leverage of resource mobilization initiatives aimed at securing
contributions to the Fund; and (vii) approve the CBFF annual budget and financial
statements.

2.1.4   The CBFF Secretariat is currently hosted by the ADB’s Department of Agriculture
and Agro-Industry in Tunis. It comprises seven persons, including two Operations Officers
based in the Bank’s field offices in Yaoundé and Kinshasa. The CBFF Secretariat manages
the Fund’s activities. Administratively, the Coordinator is answerable to the OSAN Director
regarding: (1) CBFF administrative and operational matters relating to strategies, work plans,
budgets and Operational Procedures approved by the Governing Council; and (2)
management of the use of resources in accordance with the Bank’s Rules and Procedures.

2.1.5    As Fund Administrator, the ADB Board of Directors is responsible for its general
operations, and takes certain decisions of an operational nature, in line with the provisions
and thresholds approved in the Fund’s Instrument and Framework Document.

2.1.6   CBFF finances projects that help to reduce the rate of deforestation, alleviate poverty
among forest-area populations and reduce greenhouse gas emissions while maximizing
carbon sequestration. Its focus and scope of activities are described in the Logical Framework
(Annex 1).

2.2      Strategic Planning and Direction

CBFF Draft Operational Strategy

2.2.1   In accordance with the CBFF’s Operations Manual and 2010 work programme, in
April 2010 the CBFF Secretariat initiated the preparation of its operational strategy, which
aims to more precisely define and describe its general policy, operational direction, activities
and areas of intervention in the short, medium and long term. The strategy will also provide
an overview of the implementation plan and define the resources needed to implement it
through 2018, the sunset date of the CBFF’s first phase.

2.2.2     The strategy was prepared by a team of consultants under the supervision of the
CBFF Secretariat. The exercise involved REDD and SFM national and regional players from
the Congo Basin sub-region, and led to a draft document that was reviewed and enriched by
all players during a regional workshop held in October 2010 in Cameroon. On the
instructions of the GC, the draft will be enriched after the completion of the CBFF
institutional review scheduled for 2011 and the review of the COMIFAC Convergence Plan,
the results of which are expected end June 2011.

CBFF Governing Council Meetings

2.2.3    In 2010, the CBFF Secretariat organized three ordinary meetings of the Governing
Council (7th, 8th and 9th Meetings) on 2 March 2010 in Tunis, 7 July 2010 by
teleconferencing and 15 and 16 November 2010 in Libreville, respectively.

2.2.4   The seventh ordinary meeting afforded the opportunity to take stock of actions
undertaken since the sixth Governing Council meeting in November 2009, consider the
concept notes received following the second Call for Proposals, and present the first draft of
the 2009 CBFF Annual Report and the 2010 work plan.
                                              3


2.2.5     During the eighth meeting, projects from the second Call for Proposals were
shortlisted and the 2009 CBFF Annual Report was approved. The Secretariat was also
instructed to prioritize the projects recommended, emphasizing REDD projects and those that
could have an impact on poverty reduction by developing income-generating activities.

2.2.6   During the ninth meeting, projects to be funded under the second Call for Proposals
were approved, the implementation status of the ten (10) ongoing projects reviewed and the
recruitment process of the FMA validated .

2.3      Building Partnerships

Preparation of the Regional Project on the Development of Monitoring, Reporting and
Verification (MRV) Systems

2.3.1    In accordance with Governing Council instructions, the Secretariat, in cooperation
with FAO, the Brazilian Space Agency (INPE) and COMIFAC, initiated the preparation of
the regional project document on the development of MRV systems in each COMIFAC
member country. A regional workshop was organized in October 2010 in Cameroon to define
the work methodology and to agree on the key activities to be retained, interested national
players in each of the ten Congo Basin countries concerned, the structure of the draft project
document as well as the road map for finalizing the document. At its ninth ordinary meeting,
the Governing Council reviewed the draft document and provided guidelines for finalizing it
in 2011.

Participation in Regional and International Consultative Meetings

2.3.2    In line with the CBFF’s goals of combating deforestation and reducing poverty, and
with GC instructions issued at its sixth ordinary meeting in November 2009 in Yaoundé, the
Secretariat promoted REDD developments and consolidated Sustainable Forest Management
(SFM) practices, through its active participation in international forums, conferences and
discussions initiated by COMIFAC and its partners throughout 2010. As a result, REDD is
being included in national and regional strategies of COMIFAC member countries. The
Secretariat also took part in other regional and international consultative meetings and the
Bank’s Annual Meeting. For a list of the main meetings attended by the Secretariat, see
Annex 5.

Cooperation with the Bank

2.3.3    In 2010, the Agriculture and Agro-Industry Department (OSAN) and other Bank
departments and field offices, notably the Cameroon Regional Office (CMFO) and the
Democratic Republic of Congo Regional Office (CDFO) participated more actively in the
CBFF. Bank support (Annex 6) was provided on preparing grant agreements, reviewing
appraisal reports, administrative assistance in organizing CBFF GC meetings, reviewing
procurement plans, assessing the financial management capacity of grant beneficiaries,
disbursement monitoring, participation in supervision missions of ongoing projects, and
administrative and technical assistance in organizing training workshops.

2.3.4    The CBFF Secretariat also participated in OSAN’s weekly meetings, chaired by its
Director. and attended by the Department’s Division Managers, at which a number of
                                               4

decisions and guidelines concerning the CBFF were taken. They also addressed such issues
as preparing project review and approval plan (APPS), monitoring project activities and
disbursements and tentative solutions to specific problems related to the administrative
management of the Fund.

2.4      Management and Communication Tools

Simplifying the CBFF Operational Procedures

2.4.1    The CBFF Operational Procedures Manual adopted by the ADB Board of Directors
on 26 October 2009 defines the rules and procedures guiding CBFF operations. Section 7.
states, “The Bank’s practices and guidelines on programming and operation would, in
principle, be applied to CBFF. Nevertheless, these will be simplified as much as possible to
allow for faster implementation of the activities financed by the Fund.” However, the
application of these provisions reveals that CBFF projects are subject to the same review and
approval process as Bank projects in terms of stages, project processing deadlines, procedures
for the procurement of goods, services and works, appraisal report format, etc. Their strict
application slows the process and delays the approval of small projects. To address this
problem, a process of simplifying CBFF operational procedures has been initiated.

Updating CBFF Projects in the Bank’s Data Management System (SAP)

2.4.2     The CBFF Secretariat input the fifteen (15) projects from the first Call for Proposals
and the eleven (11) government projects from the second Call for Proposals into the SAP
system. The ten (10) projects that are already active in the SAP system are regularly updated
as data from supervision missions and reports transmitted by the NGOs concerned become
available. In addition, the CBFF Secretariat regularly manages relevant data recorded in the
SAP system (key performance indicators (KPIs), disbursement data, etc.) by various Bank
units to ensure enhanced decision-making.

Updating Communication Tools

2.4.3     To boost the Fund’s outreach and visibility, the Secretariat began to update CBFF
communication tools in 2010. Thus, 3000 copies of the updated CBFF Brochure were
produced for the CBFF Secretariat’s participation in the 2010 ADB Annual Meetings held in
Abidjan (Cote d’Ivoire) on 27 and 28 May 2010. Brochures were also distributed in Cancun
(Mexico) during the 16th Conference of the parties to the United Nations Framework
Convention on Climate Change (COP 16) and are distributed on all occasions considered
favourable by the CBFF Secretariat. Similarly, the Secretariat has transferred the CBFF
website, initially hosted in London, to a new local host so that it can monitor and update the
site regularly.

2.5      Other Organizational Activities

Recruitment of a Fund Management Agent

2.5.1   In accordance with CBFF Operational Procedures stipulating that projects valued
below EUR 2,500,000 be managed by a FMA, the CBFF Secretariat continued the FMA
recruitment process initiated in December 2008 with a call for tender that was deemed
unsuccessful. Following a second call issued in September 2009, Pricewaterhouse & Coopers
                                               5

Consortium and SNV Netherlands Development Organisation was selected and approved by
the Bank’s Procurement Committee in December.

2.5.2    In 2010, the CBFF Secretariat organized negotiations with the selected candidate
and prepared a contract with support from the Bank’s Legal Services Department. It is also
noteworthy that before finalizing the recruitment process, the Secretariat had to wait for the
GC to approve the amount negotiated for a three-year period. The contract with the FMA will
be signed in the first quarter of 2011.

Audit of 2009 Financial Statements

2.5.3    Section 9.4 of the CBFF Operational Procedures, approved on 26 October 2009,
stipulates that the CBFF shall be subject to the internal and external audit procedures of the
Bank. The Bank therefore mandated an international auditing firm (KPMG International) to
conduct the CBFF 2009 external audit. The auditors expressed unqualified opinion and the
Bank’s Board of Directors approved the audit report on 13 December 2010.

2.6      Human Resources

2.6.1    The CBFF Secretariat is hosted by the ADB’s Department of Agriculture and Agro-
Industry (OSAN). Fund activities are managed by seven (7) staff, including a Coordinator, a
Forestry Management and Climate Change Expert, an Administrative and Financial Expert,
three Operations Officers and an Operations Assistant. The CBFF organization chart provides
that two Operations Officers will be transferred to the Bank’s field offices in Yaoundé and
Kinshasa. An Operations Officer was posted to the Yaoundé office in June 2010. Another
Operations Officer is expected to be in Kinshasa before the end of the first quarter of 2011.

2.6.2    The CBFF Secretariat benefitted from significant support from the Bank’s experts
and short-term consultants. The assistance of the Bank’s experts focused on the review of
project appraisal reports related to the second Call for Proposals. Short-term consultants were
recruited to develop simplified operational procedures and to assist in the appraisal of
projects from the second Call for Proposals.

2.6.3    Despite such technical support to the Secretariat, there was an imbalance between its
human resource capacity and the volume of work required throughout 2010. The use of
consultants cannot last, given the limited financial resources under this expenditure item.
Moreover, consultants recruited for a short period cannot ensure the continuity of activities in
the long run. The recruitment of an FMA in 2011 to manage projects below EUR 2 500 000
is expected to enhance the CBFF Secretariat’s working capacity.

2.6.4   However, the need for additional human resources could still be felt following the
approval of new government and regional projects, and particularly those worth below EUR
2 500 000 that must be managed directly by the CBFF Secretariat team. The CBFF review
scheduled for 2011 should consider the administrative and organizational structure of the
CBFF Secretariat for greater efficiency in performing its mission and improved management
of the CBFF portfolio.
                                                   6


3          OPERATIONAL STATUS

3.1         Project Selection

3.1.1    In 2010, the CBFF Secretariat managed the second Call for Proposals that increased
its project portfolio from fifteen (15) in 2009 to forty (40) as at 31 December 2010. The
second Call for Proposals included two distinct bidder categories: “civil society” projects and
government and regional projects.

3.1.2   Project selection process: the selection process included several stages as
summarized in Table 3.1 which shows that between approximately nine (9) months elapsed
between the reception of concept notes and CBFF GC approval of selected projects (March
to November 2010).

             Table 3.1 Project Selection and Approval Period – Second Call for Proposals
    Stages/Months                                                  2010 Dates
    Receipt of Concept Notes                                         28 February
    Governing Council opinion on the Concept Notes selected          2 March
    Assessment of Concept Notes received                             March
    Preparation of detailed proposals by the candidates selected      26 March-30 April
    Assessment of detailed proposals                                 May
    Governing Council’s comments and opinion on the project          June-July
    proposals selected
    Prioritization of projects in accordance with CBFF Governing     July
    Council instructions
    Governing Council comments on prioritized projects and           November
    approval of projects by the Governing Council


3.1.3   Bank Approval: in accordance with the CBFF Operational Procedures Manual, the
Bank approves all grants according to values and levels of approval authority:
                 Amount < EUR 500 000                  :   OSAN Director
                 EUR 500 001 - EUR 1 000 000           :   Vice-President
                 EUR 1 000 001 - EUR 2 000 000         :   President
                 EUR 2 000 001 - EUR 15 000 000        :   Board of Directors on lapse-of-time basis
                 Amount > EUR 15 000 000               :   Board of Directors’ meeting

3.1.4    Upon CBFF GC approval of projects, the Secretariat prepares appraisal reports that
are reviewed at various levels in the Bank before their final approval. The period between the
preparation of a project appraisal report and its approval by the Bank varies according to the
levels of approval authority. Overall, the process takes an estimated 91 working days over
about four months. Table 3.2 summarizes the stages of the Bank’s internal approval process.
                                                        7



                                  Table 3.2. ADB Project Approval Process
Phases                                                  Working Days               Comments
Preparation of appraisal report                              21
Bank Review of appraisal report                               7
CBFF Verification of appraisal report Coordinator             3
Approval by OSAN Director or verification before              3        Depending on the amount, the
transmission to the Vice-President of Operations                       Director approves the project or
                                                                       forwards it to the Vice-President of
                                                                       Operations for verification
Approval by the Vice-President of Operations or               5        Depending on amount and
verification before transmission to OpsCom or to                       approval threshold, VP approves
the President                                                          or forwards project to OpsCom,
Approval by the President                                    7         Depending on amount
Review by the Operations Committee (OpsCom)                  10
Translation, negotiations with the beneficiary on the        21
content of the Appraisal Report and the draft Grant
Agreement
Transmission of project documents to the Bank’s              14        Documents must be transmitted 14
Board of Directors                                                     days before Board of Directors
                                                                       meeting
Total number of days                                         91

Selection of Civil Society Projects
3.1.5     This category includes projects from NGOs and other national or international
institutions. The Secretariat recorded 381 concept notes at the end of the first stage of the Call
for Proposals process. After their assessment, 82 concept notes were considered to be
consistent with the requirements of the first stage and in compliance with CBFF assessment
criteria indicated in Annex 1a. The selected bidders were invited to submit detailed proposals.
At the end of this second stage, 76 detailed proposals were received and assessed based on
criteria in the CBFF Framework Document and Operational Procedures and the guidelines
communicated beforehand to candidates (cf. assessment criteria and rating scales in Annex
1b). After assessment, 35 projects were selected and submitted to the CBFF GC .
3.1.6   Table 3.3 summarizes the geographic distribution of concept notes, detailed
proposals and projects recommended by the CBFF Secretariat. Nineteen of the 35
recommended projects or 54% come from DRC and Cameroon due to the number of concept
notes and detailed proposals received form these two countries, (71% of concept notes or
(272/381) and 64% of detailed proposals received, or 49/76).
                                               8

Table 3.3 Geographic Distribution of Concept Notes, Detailed Proposals and Recommended Projects
                                   Second Call for Proposals

                                            Concept Notes            Detailed
                         Concept Notes                                                   Projects
 Country                                   Selected After the        Proposals
                           Received                                                   Recommended
                                           First Assessment          Received
 DRC                                158                         26               24              6
 Cameroon                           114                         28               25             13
 Regional (2 to 6
                                     47                         10               10                 8
 countries)
 CAR                                 24                          7                7              3
 Congo                               19                          2                2              0
 Burundi                              8                          6                5              3
 Gabon                                5                          0                0              0
 Equatorial Guinea                    3                          1                1              1
 Rwanda                               3                          2                2              1
 Sao Tome and Principe                0                          0                0              0
 Chad                                 0                          0                0              0
 TOTAL                              381                         82               76             35



Project Breakdown by Country




              Breakdown of Recommended Projects per Country




Selection of Government and Regional Projects
3.1.7    Following the Governing Council’s instructions to encourage the identification of
projects from Governments and regional projects that could have a more visible impact on
CBFF’s objectives, the CBFF Secretariat fielded an identification mission in January 2010 to
various countries where the CBFF is operating. At the end of the mission, about thirty
concept notes were recorded. After a preliminary analysis of the notes, twenty-three (23)
projects were selected and detailed proposals prepared. Table 3.4 below shows the
geographic distribution of the projects: twenty-one (21) projects come from the ten
                                                        9

COMIFAC member countries and two (2) projects were submitted by the Network of
Institutions for Training on Forests and Environment in Central Africa (RIFFEAC) and the
COMIFAC Executive Secretariat.
     Table 3.4. Geographic Distribution of Government and Regional Project Proposals

                                                              Number of Projects
                   Country/Institution
                                                               Recommended
                   DRC                                               9
                   Cameroon                                          2
                   Burundi                                            1
                   Rwanda                                             1
                   Gabon                                              1
                   Congo                                              2
                   CAR                                                2
                   Equatorial Guinea                                  1
                   Sao Tome and Principe                              1
                   Chad                                               1
                   COMIFAC Executive Secretariat                      1
                   RIFFEAC                                            1
                   Total Number of Projects                          23


Projects Approved by the Governing Council Following the Second Call for Proposals

3.1.8     At the end of the project selection phase, the CBFF Secretariat proposed fifty-eight
(58) projects in total, including twenty-three (23) projects from governments and regional
institutions, and 35 from civil society (for a total EUR 105,893,047, of which EUR
72,381,312 for government and regional projects and EUR 33,511,735 for civil society
projects). However, given the available financial resources (EUR 93 000 000) and to ensure
their more judicious distribution, the Eighth Governing Council Meeting, organized as a
teleconference on 7 July 2010, instructed the Secretariat to prioritize the projects, giving
preference to those that can: (i) generate visible and significant results on the ground; (ii)
move countries that have already made progress in the REDD+ process forward; and (iii)
have an impact on poverty reduction by developing income-generating activities.

3.1.9    Twenty-five (25) projects were ultimately approved at the Ninth Governing Council
Meeting on 15-16 November, 2010 in Libreville for a total EUR 63 136 587. Table 3.5 shows
the breakdown of projects by category. For a detailed project list, see Annexes 2a and 2b.

        Table 3.5 Number of Projects and Budget Approved by the CBFF Governing Council

Project Category                                 Projects   Projects Approved by   Amount Approved
                                              Recommended          the GC          by the GC (EUR)
  Government and regional projects                 23               13                51 950 592
       Civil society projects                      35               12                11 185 995
               Total                               58               25                63 136 587
                                                 10

Breakdown of Project Portfolio from the Second Call for Proposals

3.1.10 Annex 3 provides the breakdown by country and thematic area of the twenty-five
(25) new projects from the second Call for Proposals. Table 3.6 shows that seventeen (17)
projects accounting for 60% of the total amount approved went to Forest Management and
Sustainable Practice and Livelihoods and Economic Development projects. Seven (7) other
projects specifically concern REDD: six (6) REDD pilot projects in DRC and the “Support
for the Participation of Multi-actors of the REDD Process in Cameroon, Gabon, Congo and
CAR”.

   Table 3.6 Breakdown of Projects from the Second Call for Proposals by Thematic Area

                                                                         Amounts
                                                                                       %
 Key Areas of Intervention                                  Projects   Approved (in
                                                                                      Total
                                                                          EUR)
 Specifically REDD Projects                                    7        17 931 257    28 %
 Forest Management and Sustainable Practice + Livelihoods
                                                              17       37 580 345     60 %
 and Economic Development
 Building Human Resource Capacity in SFM and Combating
                                                               1        7 624 985     12 %
 Climate Change (RIFFEAC Project)
 Total                                                        25       63 136 587     100%



                             Projects Retained by Thematic Area




3.1.11 CBFF gives pride of place to projects simultaneously addressing poverty reduction
and deforestation, which explains the number of projects dealing with forest management,
sustainable practice, livelihoods and economic development. In addition, as countries move
slowly towards REDD, sustainable forest management projects whose results could be built
on later in the REDD development process have been emphasized. Of course, Congo Basin
countries have adopted REDD as a mechanism for combating climate change, but translating
wishes into action remains timid. Only DRC and Congo have a validated REDD preparation
paper (R-PP). DRC also has a priority action plan for REDD development which requires
                                                     11

testing six (6) REDD pilot projects in DRC to fast-track the development strategy at the
national level.

Appraisal of Projects from the Second Call for Proposal

3.1.12 As summarized in Table 3.7, ten (10) projects in the government and regional
project category were appraised in 2010; draft appraisal reports were available on 31
December 20101. The review of the reports, which began in 2010 will continue in 2011 to
finalize them for approval by the Bank’s Board of Directors. The projects are scheduled for
start-up during the second half of 2011.

                         Table 3.7 Projects Appraised as at 31 December 2010

         Country       Project Title                                          Grant Amount   Grant Amount
                                                                              Approved by     at Appraisal
                                                                               the GC (in      (in EUR)
                                                                                 EUR)
    1                  Geographically-Integrated REDD Pilot Project
                       "EcoMakala +"                                             2 495 100       2 494 891
    2                  Luki Biosphere Reserve Integrated REDD Pilot
                                                                                 2 339 214       2 339 105
                       Project in Mayombe Forest
    3                  South Kwamouth REDD Agroforestry Pilot Project            2 500 000       2 490 310
    4                  Civil Society and Government Support Project
                                                                                 3 213 123       3 195 775
                       under REDD in Equateur Province
    5       DRC        Isangi Integrated REDD Pilot Project                      2 498 600       2 298 215
    6                  Mambasa Integrated REDD Pilot Project                     2 982 300       2 956 091
    7      Gabon       Gabon Sustainable Forest Resources Management
                                                                                 5 989 000       5 989 000
                       Support Project
    8     Regional     Support to the Expanded Programme for Training
         (RIFFEAC)     in Forest Resource Management in the Congo                7 624 985       7 624 985
                       Basin
    9      Congo       Multi-resource Forest Inventory for Preparation of a
                       Land Allocation Plan in Congo                             2 415 674       2 415 674

    10     Rwanda      Rwanda Sustainable Woodland Management and
                                                                                 4 592 336       4 590 083
                       Natural Forest Restoration

3.2        Project Implementation

3.2.1     This section analyses the different phases of implementation of the 15 projects from
the first Call for Proposals after Bank approval fourteen (14) were approved by the Bank as at
31 December 2010. The project submitted by the Zoological Society of London is still being
processed and must be approved by the Bank’s Board of Directors as the grant amount
exceeds EUR 2,000,000. The initial project document needed to be reformulated in order to
prepare an appraisal report in line with the Bank’s standards, and review the report in the
Bank before submission to the Board of Directors.




1
 Three other projects were not appraised as at 31 December 2010: (1) Community Forestry Development in the
Central African Republic; (2) Support for Community Forestry Implementation in DRC; and (3) Community
Agroforestry in DRC.
                                                 12

                     Table 3.8 Projects Approved by the Bank as at 31 December

                                              Type of NGO        Grant Amount     Date of Approval by
              Beneficiaries                                      Approved (in          the Bank
                                                                 EUR)
1     Cameroon-Ecology                    Local                        283 628             04/11/2009
2     OPED                                Local                        274 315             04/11/2009
3     ADAPEL                              Local                        338 000             04/11/2009
4     TNS Sangha                          Local                        661 000             05/11/2009
5     AWF                                 International              1 101 220             11/11/2009
6     Rainforest Foundation (UK)          International                519 384             12/11/2009
7     Rainforest Alliance                 International              1 221 271             13/11/2009
8     World Resources Institute (WRI)     International              1 243 033             13/11/2009
9     Nature + Asbl                       International              1 275 225             13/11/2009
10    Stichting Fern                      International              1 462 273             13/11/2009
11    Bonobo Conservation Initiative      International              1 322 401             07/04/2010
12    Conservation International          International              1 351 225             09/06/2010
13    ROCAME                              Local                        166 327             17/06/2010
14    Bioversity International            International              1 530 588             09/06/2010
15    Zoological Society of London        International              2 318 217        Not yet approved
                               TOTAL                                15 068 729

3.2.2    Signature of Grant Agreements: as at 31 December 2010, ten (10) grant agreements
had been signed out of fifteen (15) projects from the first Call for Proposals. As at 31
December 2010, the signing process was underway for the other five (5) grant agreements.
This concern grant agreements with the following NGOs: Network of Campo-Ma’an and
Vicinity NGOs (ROCAME), Zoological Society of London (ZSL), Bioversity International
(BI), Bonobo Conservation Initiative (BCI) and Conservation International (CI). The absence
of on-the-ground appraisal during the approval process created these constraints that the
Secretariat tried to address from the office but with many difficulties and on the
incomprehension of the beneficiary NGOs. The supervision mission that the Secretariat
conducted in October-November 2010 helped to address pending issues with four of the five
interested NGOs, with the exception of ZSL. This mission ensured that the information
needed to finalize draft grant agreements for ROCAME, BCI and BI was obtained by
December 2010.

3.2.3    Grant Effectiveness: Table 3.9 shows that eight (8) of the ten (10) grants were
effective in November-December 2009 and the other two (2) in January 2010. In general,
grants became effective within the prescribed period of three months (or 90 calendar days).

                               Table 3.9 Grant Effectiveness Timeframes

                                                      Date of Approval       Date of      Timeframe
                    Beneficiaries                       by the Bank       Effectiveness   (Calendar
                                                                                            Days)
 1          Cameroon-Écology                                04/11/2009      13/11/2009             5
 2          OPED                                            04/11/2009      13/11/2009             5
 3          TNS Sangha                                      05/11/2009      18/11/2009            11
 4          ADAPEL                                          04/11/2009      20/11/2009            14
 5          AWF                                             11/11/2009      20/11/2009             7
 6          Rainforest Foundation (UK)                      12/11/2009      03/12/2009            19
 7          Rainforest Alliance                             13/11/2009      13/11/2009             0
 8          Nature + Asbl                                   13/11/2009      15/12/2009            30
 9          Stichting Fern                                  13/11/2009      21/01/2010            66
 10         World Resources Institute (WRI)                 13/11/2009      29/01/2010            74
                                                                  13


      3.2.4     Project Disbursements: as at 31 December 2010, total disbursement amounted to
      EUR 2,258,883 for the ten (10) on-going projects, a 67% disbursement rate in relation to
      2010 annual forecasts (based on estimates). This rate is generally considered to be
      satisfactory and can be explained by the fact that amounts disbursed for some projects
      (ADAPEL, AWF, Nature Plus) exceeded annual forecasts. However, the disbursement rate as
      a ratio of the total grant amount is relatively low at 27% due to the difficulties the NGOs have
      in properly justifying the use of their initial advances. It is expected to improve by the end of
      2011 with close supervision and assistance from the CBFF Secretariat and the FMA.
      Likewise, to remedy these weaknesses, the Secretariat has scheduled a training workshop for
      NGO accountants and procurement experts during the first quarter of 2011.




                        Table 3.10 Project Disbursements as at 31 December 2010 (in EUR)

                                                                            Amount Disbursed as at 31        % of            %
                                          2010 Projections                                                   Total       Disbursed
                                                                            December 2010 (in EUR)
   Grant        Total Grant                                                                                  Grant      in Relation
Beneficiaries    Amount         First         Second          Total        First     Second       Total     Amount        to 2010
                              Disburse-      Disburse-       Estimate    Disburse-   Disburse   Disburse-   Disbursed   Projections
                                ment           ment                        ment       -ment       ment

Cam-Eco            283 628       56 726          56 726        113 451      54 463          -      54 463       19%           48%
OPED               274 315       54 863          54 863        109 726      72 256          -      72 256       26%           66%
TNS                661 000      132 200        132 200         264 400     132 900          -     132 900       20%           50%
ADAPEL             338 000       67 600          67 600        135 200      99 157     41 823     140 980       42%          104%
AWF              1 101 220      220 244        220 244         440 488     531 218          -     531 218       48%          121%
Rainforest
                   519 384      103 877        103 877         207 754     128 515          -     128 515       25%           62%
UK
Nature Plus      1 275 225      255 045        255 045         510 090     524 930          -     524 930       41%          103%
Rainforest
                 1 221 271      244 254        244 254         488 508     200 947          -     200 947       16%           41%
Alliance
WRI              1 243 033      248 607        248 607         497 213     216 004          -     216 004       17%           43%
Stichting
                 1 462 895      292 579        292 579         585 158     256 770          -     256 770       18%           44%
Fern
Total            8 379 971     1 675 994      1 675 994      3 351 988   2 217 160     41 823   2 258 983       27%           67%
                                              14

                   Disbursement Rate by Project as at 31 December 2010


          50%

          40%

          30%

          20%

          10%

           0%




3.2.5     Project Implementation and Supervision: of the ten (10) on-going projects, seven
(7) began activities in January-February 2010. The three projects implemented by WRI and
Rainforest Alliance began their activities in March and April respectively, about four (4)
and two (2) months after their respective dates of effectiveness of 20 November 2009 and 9
January 2010. Rainforest Alliance launched its project activities in May 2010, or six (6)
months after grant effectiveness on 13 November 2009. The delay was essentially due to the
deadline for establishing the project coordination structure and the need to update the action
plan. The CBFF Secretariat undertook a project supervision mission in October-November
2010 that helped to: (i) discuss pending problems and make recommendations for a more
efficient implementation and achievement of expected outputs, and (ii) advise and assist the
concerned players in preparing progress reports, detailed budgeting and financial
management of the CBFF portfolio.

3.3      Ongoing Project Outputs

3.3.1     The output matrices for the ten (10) ongoing projects as at 31 December 2010 (see
Annex 4) show overall satisfactory performance for more than half of the projects. Most
activities planned for 2010 were implemented. However, some projects require special
attention and closer monitoring in 2011 because of slippages in implementing their 2010
annual programme because of delays in:

         (i)    Signing partners and cooperation agreements with some local communities
                  and NGOs (Nature Plus);

         (ii) Disbursing the second tranche of funds;

         (iii) Establishing the project coordination structure, difficulties in transporting
               production equipment and gaining access to the project area, for lack of
               adequate logistics (Rainforest Alliance); and

         (iv) Recruiting key FTNS staff and difficulties in fulfilling conditions prior to grant
              disbursement for three parks in the Sangha Tri-National (TNS) and civil
              society organizations working there to implement project activities.
                                             15

3.3.2   The ten (10) projects carried out multiple activities in many areas, as follows:

             Training and raising awareness of project beneficiaries and other stakeholders:
              more than 50 training sessions and workshops on various themes organized.

             Production of seedling trees and plantations: 13 tree nurseries established,
              10,300 seedling and fruit trees produced, 50 forest tree and 25 fruit tree
              seedlings planted, nursery of 1000 young ndjanssan trees, 770 trees planted as
              part of the reforestation of degraded spaces (Nature Plus, CAM-ECO);

             Beekeeping : 96 beehives built (CAM-ECO);

             Technical support in forestry works and renewal of Simple Management Plans
              (SMP);

             Construction of improved smokehouses: 107 smokehouses built (OPED);

             Aquaculture : 10 aquaculture cages built (OPED) ;

             Biochar production: 8 pyrolytic ovens built and 160 tonnes of biochar
              produced (ADAPEL);

             Support in preparing community forest exploitation contracts: 6 exploitation
              contracts negotiated (Nature Plus);

             Validation of Sangha Tri-National Land Use Planning (TNS);

             National studies on the legal context of property rights conducted in
              Cameroon, Gabon and Congo (Rainforest UK);

             Local studies on customary rights of forest communities conducted in
              Cameroon, Gabon and Congo (Rainforest UK);

             Studies on wildlife inventories and human activities in Equateur Province in
              DRC (AWF);

             Socio-economic surveys for analysing Non-timber Forest Products with high
              economic potential (AWF);

             Assessment of national deforestation and forest degradation levels in the
              Republic of Congo, and development of carbon-level measuring tools (WRI);

             Support to Congo’s civil society to understand REDD and prepare for national
              and international discussions (FERN).
                                                    16


4              FINANCIAL POSITION AS AT 31 DECEMBER 2010

Funding Commitments

4.1       As indicated in Table 4.1, the funds pledged by the two donors (DFID/UK and
Norway) stood at EUR 118.4 million, of which EUR 57.4 million were effectively received
as at 31 December 2010. DFID pledged GBP 50 million (EUR 58.6 million), of which EUR
16,802,080 were disbursed in 2009, representing the first and second instalments of its
contribution to the grants. Norway pledged NOK 500 million (EUR 59.8 million), of which
EUR 40,658,154 were disbursed as at 31 December 2010 (EUR 8,449,514 in 2008, EUR
11,891,179 in 2009 and EUR 20,317,461 in 2010), representing the first, second and third
instalments of its contribution to the grants.
Table 4.1 Donor Pledges and Funds Received by the CBFF as at 31 December 2010 (EUR Million)

               Donor             Amount Pledged*            Total Funds            Outstanding Pledges as
                                                          Received as at 31         at 31 December 2010
                                                           December 2010
 DFID/UK                              58.6                      16.8                        41.8
 Norway                               59.8                      40.6                        19.2
 Total                                118.4                     57.4                        61.0
* At December 2010 exchange rate.

4.2     Interest generated by donors’ contributions as at 31 December 2010 stood at EUR
175,028 giving total CBFF revenues of EUR 57,635,263 as at 31 December 2010.

Staff and Administrative Costs as at 31 December 2010

4.3     The CBFF administrative budget categories are shown in Table 4.2 with real
amounts up to 31 December 2010 and their use. In total 70% of the budget was used.

       Table 4.2 CBFF Administrative Budget and Expenditures as at 31 December 2010 (in EUR)
                    Activities          Budgeted Amount*         Actual Amount              Balance

    Governing Council meetings                   198 427                    128 507                    69 920
    Salaries                                     995 962                    853 561                   142 401
    Consultants’ fees                            556 908                    293 565                   263 343
    Equipment                                    133 500                          0                   133 500
    Operating costs                              460 311                    307 860                   152 451
    Cash expenditure                            2 345 108                  1 583 493                  761 615
    ADB overhead costs                           199 343                    199 343                        0
    Contingencies                                         0                        0                        0
    TOTAL                                     2 544 451                1 782 836                      761 615

* Cumulative budget amount

4.4      ADB Overhead costs are administrative and staff support provided by the ADB to
the CBFF, and financial support for activities related to the implementation of CBFF
operational and management activities: (i) staff seconded by the Bank; (ii) funding of project
                                                               17

identification missions; (iii) project appraisal and supervision; and (iv) organization of
Governing Council meetings. Overhead costs include offices and other miscellaneous
expenses.

 Table 4.3CBFF Portfolio, Staff and Administrative Expenditures as at 31 December 2010 (in EUR)
                                           Expenditure Category                    Expenditure to
                                                                                       Date
    Cash Administration and staff costs                                                 1 583 493
    ADB’s allocation for overhead costs (offices and others)                              199 343
    TOTAL STAFF AND ADMINISTRATIVE COSTS                                                1 782 836
    First grant tranches disbursed as at 31 December 2010                               2 258 983
    TOTAL PORTFOLIO, STAFF AND ADMINISTRATIVE EXPENDITURE                               4 041 819
    Amount committed for subsequent tranches (for the 15 projects)                     12 809 746
    TOTAL PROJECT COMMITMENTS AND DISBURSEMENTS                                        16 851 565



5            CONCLUSION

5.1       The CBFF made significant progress in increasing its project portfolio since the
second Call for Proposals, to speed up the signature of the five (5) grant agreements from the
first Call for Proposals and to ensure that the ten (10) on-going projects from the first Call for
Proposals are effectively managed. Other achievements concern strategic planning, building
of partnerships, simplification of operational procedures and communication.

5.2      Concerning the growth in the size of the portfolio, the Secretariat’s proposals
resulted in the approval of twenty-five (25) new projects by the November 2010 GC, of
which ten (10) were appraised as at 31 December 2010. The CBFF project portfolio grew
from fifteen (15) projects in 2009 to forty (40) in 2010. Furthermore, the Secretariat
processed the five grant agreements from the first Call for Proposals and succeeded in
collecting technical and financial information to accelerate the signing of the grant
agreements.

5.3       Regarding project management for the ten (10) ongoing projects, after the first year
of implementation, more than half of the projects have generally satisfactory performance.
Four (4) projects require special attention given the slippages recorded in implementing their
2010 annual programme. The reasons for the slippages vary from one project to another and
include: delays in disbursing the second tranche of funds, delays in recruiting key project
staff, delays in signing agreements with partners (TNS and Nature Plus) and difficulties in
gaining access to the project area (Rainforest Alliance). The projects will benefit from
enhanced monitoring in 2011. The CBFF Secretariat will conduct a mid-term review mission
in the second half of 2011 of all projects (to enable the FMA to take part) to evaluate the
performance of all the projects after about one and a half years of implementation, and update
project matrices, confirming the relevance of objectively verifiable indicators and proposing
adjustments to improve project performance.

5.4      The Secretariat made progress on preparing the Operational Strategy, the draft of
which was considered by the Governing Council meeting of November 2010, promoting
dialogue for REDD and SFM in the Congo Basin, recruiting the FMA which should be
effective in the first quarter of 2011, simplifying operational procedures and transferring the
CBFF website so that the Secretariat can update it directly .
                                           18

5.5     The CBFF’s 2011 prospects, based on the principles below, should make it possible
to improve the management of CBFF portfolio and achieve the set objectives:

            Ensure project quality right from the new project design phase.

            Oversee efficient project implementation and speed up disbursements by
             closely monitoring projects systematically, coordinated by the CBFF
             Operations Officers based in Yaoundé and Kinshasa, and directly overseen by
             the FMA for projects worth less than EUR 2,500,000.

            Adopt an operational strategy that sets priority intervention areas and defines
             objectively verifiable goals and interim indicators, taking into consideration
             general objectives for the short and long terms.

            Adopt simplified operational procedures to speed up implementation of
             activities financed by the Fund.

            Establish an approach for communication between the Secretariat, the FMA
             and beneficiary NGOs to improve inter-professional relations between all
             interested parties.

            Enhance dialogue to promote REDD and SMF in the Congo Basin.
                                                                                                                                                                             Appendix 1
                                                                                                                                                                               Page 1/3
                                                                                CBFF Logical Framework

          Objectives               Expected Outputs,       Reach (Beneficiaries)                  Performance Indicators                   Bank’s Indicative Targets        Assumptions, Risks and
                                  Impacts and Results                                             (Means of Verification)                      and Time Frame               Bank Mitigation Measures
Strategic Goal
                                                                                         Average rate of deforestation
The overall goal of the CBFF is to  Effective              Central African                                                                Reduce the average
alleviate poverty and address        participation of        countries and               Average rate of forest degradation                deforestation rate in the
climate change through reducing      Congo Basin             population                                                                     Congo Basin from 0.19 to
the deforestation and degradation    Forest countries in                                 Forestry sector value as percentage of GDP        0.10% annually, and
rate of Congo Basin forests.         climate change         Population of Africa                                                           substantially reduce forest
                                     initiatives deriving    and the rest of the     Data sources                                           degradation by the CBFF
                                     benefits for            world (in the long       Global Forest Resource Assessment (FAO)              sunset date;
                                     resource                term)                    Congo Basin Forest Partnership (CBFP),
                                     conservation and                                   COMIFAC                                             Forestry sector value added
                                     enhancing the                                    WWF, World Bank,                                     as percentage contribution to
                                     livelihoods of forest                            Ministry of Foreign Affairs, France                  GDP increased by 15% to
                                     dwellers.                                        International Tropical Timber Organization           20%.
                                                                                        (ITTO)

Purpose                             Drivers of                                                                                           Reduce logging density       Failure to mobilize
                                    deforestation                                                                                        rates from 0.5 to 4 trees per   sufficient financial
i) Slow and eventually reverse      understood and           Central African        Data sources:                                       hectare (CBFF, 2006) to 0.5     resources due to donor
     the rate of deforestation in   applied to               countries                Bank’s Annual Report                              to 2 trees per hectare over     fatigue , inadequate
     the Congo Basin                sustainably                                       International statistics and reports              the life of the CBFF            contributions from
                                    decrease the             Population in forest    Donor and NGO reports                            Double community-owned          Central African
ii) Support forest conservation     deforestation rate        areas and               IUCN data and reports                             and administered forest         countries, lack of
     mechanisms                    Models for                surrounding urban                                                          lands in the Basin              support from ECCAS
                                    improved                  centres                                                                                                    and/or lack of
iii) Maintain benefits to local     ecosystem                                                                                           Reduce forestry-related         prioritization of the
     communities                    management in                                                                                        revenue losses by 50% over      forestry sector in
                                    place                                                                                                the programme period,           national programmes
                                   Financing                                                                                            from the current level of USD   and PRSPs. The
                                    mechanisms for                                                                                       25 million annually             Council of African
                                    improved                                                                                             (WB/WWF, 2003)                  Ministers of Forestry
                                    ecosystem                                                                                                                            must articulate the
                                    management in                                                                                                                        important role that the
                                    place                                                                                                                                CBFF will play, and
                                                                                                                                                                               Appendix 1
                                                                                                                                                                                 Page 2/3

          Objectives                Expected Outputs,        Reach (Beneficiaries)               Performance Indicators                      Bank’s Indicative Targets        Assumptions, Risks and
                                   Impacts and Results                                           (Means of Verification)                         and Time Frame               Bank Mitigation Measures
                                    Promote                                                                                                                                     must follow up on
                                      appropriate                                                                                                                                donor commitments
                                      livelihoods                                                                                                                                through the CBFF
                                      compatible with the                                                                                                                        made at the Tunis
                                      preservation and                                                                                                                           Conference.
                                      protection of forest
                                      ecosystems
Inputs and Activities                                                          Amount of funds collected by the CBFF                         Reduction of average               Possible delay due to
                                       CBFF is             African                                                                          domestic energy needs met           staff recruitment. The
 Establishment of CBFF with           operational,          Development Bank  Number of projects eligible for the Fund, by                  from fuelwood from 87%              Bank’s enhanced
  an operational Secretariat in        attracts new                             country                                                       (2000) to 75% by 2018;              recruitment policy will
  AfDB, and expansion through          partners and         COMIFAC and its                                                                                                      be utilized.
  attraction of other donors           donors and funds      associated        Number of eligible projects financed
                                       innovative projects   organizations                                                                    50% increase in                    Possible delays in
 Provide funding to innovative                              (RAPAC, CEFDHAC,  Development of internationally credible                       employment in the forestry          getting master funds
  eligible projects which:                                   RIFFEAC)           baselines                                                     sector across the Congo             retroceded from the
                                                                                                                                              Basin, from current levels of       GBP 800 million in the
   - Improve knowledge of the                                                            Number of studies and researches to identify        100,000 (MFA, France,               World Bank Strategic
     resource, baselines and                                     NGOs and private       specific country priorities                          2005)                               Climate Fund; this will
     monitoring capability                                       sector                                                                                                           be mitigated by current
                                                                                          Number of replicable models for sustainable                                            and subsequent DFID
   - Develop alternative                                                                 livelihood diversification piloted                   At least six Congo Basin           interventions.
     livelihoods compatible with                                 Donors and funding                                                          countries have access to the
     conservation for poverty                                    agencies that are     Number of appropriate finance/carbon credit           global carbon market                Inadequate absorptive
     alleviation                                                 part of the CBFP and     models developed                                                                        capacity of CBFF
                                                                 others                                                                       30% of women's                     resources: will require
   - Develop innovative funding                                                       Data sources                                            associations involved in            institutional
     mechanisms appropriate for                                                        FAO, for forest resources and livelihoods             Congo Basin forest                  strengthening
     the Congo Basin Region,                                                           Bank’s Annual report                                  management will have
     increasing capacity to                                                            National statistics and reports                       access to the Fund.
     access global resources                                                           Reports by donors, NGOs, and international
                                                                                         and funding agencies.
   - Increase capacity to access
     global resources and funds
                                                                                                    Annex 1a

               Criteria for Assessing Proposals of the Second Call for Proposals

Below is an extract of proposal assessment criteria from the guidelines sent to applicants:

(i)      How will the proposal contribute to CBFF overall goals? Will the project slow the rate of
         deforestation and reduce poverty among forest communities?

(ii)     Is the proposal consistent with the COMIFAC Convergence Plan, particularly strategic areas 2, 6 and
         9?

(iii)    How will the proposal contribute to CBFF thematic areas? (1) Forest Management and Sustainable
         Practice; (2) Ecological and Socio-economic Monitoring and Baseline Data; (3) Carbon Market
         Benefits and Payments for Ecosystem Services; (4) Livelihoods and Economic Development;

(iv)     How innovative is the proposal? How transformative is the proposal?



(v)      Does the project show a clear understanding of context? Does the project complement national
         commitments of each Congo Basin State to develop and implement holistic national strategies to
         combat deforestation and also mitigate climate change and adaptation? Does the project contribute to
         the understanding of global, regional, national and local needs and priorities, and does it establish a
         sufficient link with the on-going and planned activities of other parties involved?

(vi)     Does the project reflect a strong commitment of beneficiaries and various stakeholders in its concept
         and planned implementation? Has there been sufficient analysis of the parties involved in the project
         concept and work plan? Has a gender analysis been conducted and evidence of awareness of gender
         differentiation taken into account in the concept and implementation process?

(vii)    Does the project reflect a high quality and excellence in given areas of intervention? Do the
         institution(s) and staff show evidence of technical and managerial capacity, based on past
         performance, to implement the proposed activities?

(viii)   Does the organization submitting the project have institutional capacity? Does it have appropriate
         organizational capacity and management, including a management board? Is there evidence of a
         sound financial system - including clear accounting and budgetary standards, financial statements, a
         transparent budgeting process, audited accounts and other indicators confirming its ability to assume
         fiduciary responsibility for CBFF?

(ix)     Has sufficient analysis been conducted to identify risks that could undermine project success, and have
         corresponding measures been incorporated into the project concept to reduce the risk? Has an
         environmental and social risk assessment (see the reference to environmental and social assessment on
         the ADB Website) been conducted and risk mitigative measures incorporated into the project concept?

(x)      Does the project provide specific elements allowing effective undertaking of the project work plan and
         general framework? Is it profitable? Is there an indication of cost-sharing by the beneficiary
         institutions? Does the level of corresponding funds reflect aspects of beneficiary commitment and
         ownership of the project?

(xi)     Does the project give a clear indication of Outputs within a stable deadline, based on
         systems/approaches to ensure sustainability?
                                                                                  Annex 1b

                         Detailed Proposal Rating Scales


                         Weighting
Criteria                             Sub-criteria                                 Mark
                          Mark
Background                  15
                                     Project origin                                  10
                                     Background                                      10
                                     Problem identification                          30
                                     Beneficiaries and stakeholders                  50
                                     Sub-total                                      100
Project                     35
                                     Logical framework                               25
                                     Project risks                                   10
                                     Innovation                                      5
                                     Transformation                                  10
                                     Compliance with CBFF objectives and themes      25
                                     Budget                                          25
                                     Sub-total                                      100
Project implementation      35
                                     Previous implementation experience              15
                                     Institutional roles/responsibilities            10
                                     Key staff                                       25
                                     Implementation programme                        25
                                     Monitoring and evaluation                       25
                                     Sub-total                                      100
Project benefits            15
                                     Compliance with the COMIFAC Convergence
                                                                                     35
                                     Plan
                                     Coordination with existing initiatives          30
                                     Sustainability                                  35
                                     Sub-total                                      100
Total                      100
                                                                                             Annex 2a

      List of Government and Regional Projects Approved by the Governing Council in
                   November 2010 following the Second Call for Proposals

Government and Regional Projects
                                                                                              Amount
        Country           Grant Beneficiary                    Project Title               Approved by the
                                                                                            GC (in EUR)
1         DRC                 Government         Geographically-Integrated "EcoMakala "           2 495 100
                                                 REDD+ Pilot Project
2         DRC                 Government         Integrated REDD+ Pilot Project Around            2 339 214
                                                 the Luki Biosphere Reserve in Mayombe
                                                 Forest
3         DRC                 Government         Project to support Civil Society and             3 213 123
                                                 Government within the REDD
                                                 Framework in Equateur Province
4         DRC                 Government         South Kwamouth REDD Agroforestry                 2 500 000
                                                 Pilot Project
5         DRC                 Government         Isangi Geographically Integrated REDD            2 498 600
                                                 Pilot Project
6         DRC                 Government         Mambasa Geographically Integrated                2 982 300
                                                 REDD Pilot Project
7         Gabon               Government         Sustainable Forest Resource Management           5 989 000
                                                 Support in Gabon
8    Nine COMIFAC             RIFFEAC            Support to the Expanded Programme for            7 624 985
     member countries                            Training in Forest Resource Management
                                                 in the Congo Basin
9        Rwanda               Government         Rwanda Sustainable Woodland                      4 592 336
                                                 Management and Natural Forest
                                                 Restoration
10        Congo               Government         Multi-resource Forest Inventory for the          2 415 674
                                                 Development of a Land Use Plan in
                                                 Congo
11        CAR                 Government         Community Forestry Promotion in                  1 700 260
                                                 Central African Republic
12        DRC                 Government         Community Agroforestry                           6 000 000

13        DRC                 Government         Local Community Forest Development in            7 600 000
                                                 DRC
           Total grant amount approved for government and regional projects                      51 950 592
                                                                                                                 Annex 2b

       List of Civil Society Projects Approved by the Governing Council in November 2010
                                      following the Second Call for Proposals

Civil Society Projects
                                                                                                                    Amount
            Country             Grant Beneficiary                   Project Title                                 Approved by
                                                                                                                  GC (in EUR)
1    Equatorial Guinea, Chad,   United Nations Food and             Enhancing the Contribution of Non                 3 369 267
      Rwanda, Burundi, Sao-     Agriculture Organization (FAO)      Timber Forest Products to Food
       Tome and Principe                                            Security in Central Africa
2            Burundi            Association Tubane de Gikuzi        Harvesting of the JATROPHA Plant in                 113 000
                                                                    Burundi
3           Cameroon            The Forest Trust (formerly          Catalysing Rural Development through              1 005 828
                                Tropical Forest Trust-TFT)          Economic and Commercial Integration
                                                                    of Community Forests
4           Cameroon            Manguen II Development              CODEMA II Reforestation Project                     228 674
                                Committee

5           Cameroon            Wildlife Specialists Training       Tcheboa Biological Interest Area                    150 001
                                School                              Rehabilitation and Sustainable
                                                                    Management Project
6     Cameroon and Congo        Global Water Partnership Central    Forest Rebus Development in Central Africa        1 500 000
                                Africa (GWP)

7       Equatorial Guinea       Amigos de la Naturaleza y del       Sustainable Management of High                      527 803
                                Desarrollo de Guinea Ecuatorial     Socio-economic Value Ecosystems in
                                (ANDEGE)                            the Río Campo Natural Reserve

8             CAR               Grassroots Communities              Improved Beekeeping and                             265 856
                                Integrated Development              Reforestation Around Bagandou Forest
                                Committee (CODICOM)
9             CAR               Organisation Centrafricaine de la   Participatory Management and                        150 000
                                Défense de la Nature (OCDN)         Restoration of Degraded Forest
                                                                    Landscapes of the Basse Lobaye
                                                                    Biosphere Reserve
10            DRC               Terres Sans Frontières- RDC         VAMPEEM- Development of African                   1 574 896
                                /BDA Foundation / WWF-DRC /         Medicinal Plants for Mainstreaming
                                PharmAfrican                        Entrepreneurship and Environmental
                                                                    Management in DRC
11 Cameroon, CAR, Congo, International Union for                    Supporting Multi-stakeholder                      1 902 920
          Gabon          Conservation of Nature and                 Participation in the REDD Process in
                         Natural Resources (IUCN),                  Cameroon, Gabon, Congo and CAR
                         Cameroon Programme
12 Cameroon, Equatorial Cocoa Masters C.I.G.                        Eliminating Firewood Consumption in the             397 750
   Guinea and Sao Tome                                              Cocoa Sector: Passive Solar + Biogas
       and Principe                                                 Combo Ovens

                            Total grant amount approved for civil society projects                                  11 185 995
                                                                                          Annex 3

                           Breakdown by Country and Thematic Area of
                            Projects from the Second Call for Proposals

Country                               Number of   Key Area of Intervention
                                       Projects
                                      Approved
Government and Regional Projects
DRC                                       6       REDD Pilot Projects
DRC                                       2       Forest Management and Sustainable Practices +
                                                  Livelihoods and Economic Development
Gabon                                     1       Forest Management and Sustainable Practices +
                                                  Livelihoods and Economic Development
CAR                                       1       Forest Management and Sustainable Practices +
                                                  Livelihoods and Economic Development
Congo                                     1       Forest Management and Sustainable Practices
Rwanda                                    1       Forest Management and Sustainable Practices +
                                                  Livelihoods and Economic Development
Nine COMIFAC member countries             1       Building the Capacity of Human Resources in
(RIFFEAC)                                         Sustainable Forest Management and Combating
                                                  Climate Change
Total Government and Regional            13
Projects
Civil Society Projects
Burundi                                   1       Forest Management and Sustainable Practices +
                                                  Livelihoods and Economic Development
Cameroon                                  3       Forest Management and Sustainable Practices +
                                                  Livelihoods and Economic Development
Equatorial Guinea                         1       Forest Management and Sustainable Practices +
                                                  Livelihoods and Economic Development
CAR                                       2       Forest Management and Sustainable Practices +
                                                  Livelihoods and Economic Development
DRC                                       1       Forest Management and Sustainable Practices +
                                                  Livelihoods and Economic Development
Cameroon and Congo                        1       Forest Management and Sustainable Practices +
                                                  Livelihoods and Economic Development
Cameroon, CAR, Congo, Gabon               1       REDD
(IUCN)
Cameroon, Equatorial Guinea and           1       Forest Management and Sustainable Practices
Sao Tome and Principe
Equatorial Guinea, Chad, Rwanda,          1       Livelihoods and Economic Development
Burundi, Sao Tome and Principe
(FAO)
Total Civil Society Projects             12
Total Number of Projects                 25
Approved by the GC
                                                                                     Annex 4
                                                                                    Page 1/20


               Status of the Ten On-going Projects as at 31 December 2010


1.      Alternatives    to Mangrove Destruction for       Women’s Livelihoods in Central
        Africa

         This project is being implemented by the NGO OPED (Organization for
Environment and Sustainable Development) in partnership with World Fish Centre and
Sterling University. Its objective is to reduce poverty and the African equatorial forest
degradation rate by facilitating the adoption by vulnerable women (who rely on mangrove
forest ecosystems for their livelihoods) of production techniques that ensure the conservation
of these forests. Project activities are grouped into the following two components: (1)
reduction of mangrove wood consumption by improving fish smoking technologies; and (2)
prawn farming development and improvement of women’s entrepreneurship.

          Project activities took off in December 2009. As at 31 December 2010, project
performance is generally satisfactory. The ten planned aquaculture cages were built. Of the
100 smokehouses scheduled for the year, 107 were built and all households concerned were
happy to adopt the new technology. Preliminary analyses indicate a nearly 30% increase in
smoked fish outlets in villages; more women are involved in marketing smoked fish m (70
women benefit from the new fish smoking technology and are involved in smoked fish trade);
smoking time has been halved and product quality increased; gradual adoption of alternative
smoking energy sources (sawdust and other household waste); and an average 44% reduction
in wood consumption. There are also good prospects for the prawn farming component since
women are widely adopting the new technology. They are organized into common initiative
groups and embrace this activity as the basis of their income. The preliminary diagnosis made
with stakeholders shows that there is a real market for freshwater prawns, and that the current
offer is far from satisfying local demand. At this juncture, a market analysis has identified
about ten hotels as business partners whose prawn order projections range from four
kilograms to 25 kilograms weekly in addition to the demand of direct consumers.

         The following table shows 2010 achievements and achievement rates against annual
projections.
                                                                                                                           Annex 4
                                                                                                                          Page 2/20

                                 OPED - Matrix of Project Achievements as at 31 December 2010

      2010 Projections                2010 Achievements        Achievement                                 Observations
                                                                   Rate
Output 1: Reduction of mangrove destruction and household firewood consumption
100 smokehouses built by          107 smokehouses built             107%         Nothing to report (NTR)
women
10% increase in employment         Constant raising of              NA          This indicator will be assessed at mid-term. However, out of 70
level among women involved          women’s awareness                            women who have already benefited from smokehouses, 15 have
in the project                                                                   today converted to buying and selling
20% increase in smoked fish         Constant raising of             NA          Reduced expenditure on wood purchase resulting in increased
sales                                women’s awareness                           income for women. Women beneficiaries are delighted to gain
                                                                                 in smoking time (reduced by more than half) and product
                                                                                 quality
25% increase in retail outlets     Constant raising of             120%         About 30% increase in retail outlets (in Nziou pilot village for
                                    women’s awareness                            example,      the   number      of   outlets    has    increased
                                                                                 from 8 to 11)
50% adoption of the new fish      100% adoption of the              150%         All 70 women who currently have smokehouses have given up
smoking technology by             improved smoking                               the drums and trays they used previously. Since the installation
women                             technology                                     of the first smokehouses, OPED has so far received nearly 50
                                                                                 applications from women who want to use them.
33% reduction in mangrove         Constant monitoring of            147%         Preliminary results show a 44% decrease in consumption. The
wood consumption among            household firewood                             awareness of all women who have smokehouses was raised to
women trained                     consumption                                    the use of mangrove wood alternatives. Today, sawdust, coconut
                                                                                 debris, and banana and cassava skins are used for fish smoking
30% increase in the income of     Data evaluation/collection         67%         Preliminary results show large profit margins and about 20%
women involved                    underway                                       increase in income.
                                                                                 Women beneficiaries are delighted to gain in smoking time
                                                                                 (reduced by more than half) and product quality
Output 2: Increased income and capacity of women involved in aquaculture
100 women have adopted            Five women involved in         Testing phase   The new option to build cages was tested very positively with
prawn farming                     prawn farming                                  this sample of women. This year, emphasis will be placed on
                                                                                 extending it to a larger number of women.
20 prawn farming cages            Ten aquaculture cages              50%         Instead of developing enclaves as originally planned, and based
functional at the end of the      already built with nine                        on the scientific recommendations of Stirling University and the
second year                       functional and one burgled                     results of the pilot project funded by GEF Small Grants, the
                                                                                 solution is to install floating cages. The indicator retained
                                                                                 following the CBFF monitoring mission is "twenty prawn
                                                                                 farming cages functional at the end of the second year "
10% increase in prawn             To be assessed at end of           NA          Initially, emphasis will be laid on the production sector. The
wholesale price                   project                                        massive adoption of the activity by women will enable the
                                                                                 establishment of a batch selling system that can allow a
                                                                                 significant impact on prices.
50 kilograms of prawns sold       Four storage cages were                        The indicator proposed following the CBFF monitoring mission
per beneficiary household at      drained three times,                           is "ten kilograms of prawns sold by each beneficiary household
end of project                    producing 98 kilograms for                     at end of project".
                                  all the three drains, giving
                                  an average of four
                                  kilograms per cage per
                                  week.
25% increase in retail outlets    To be assessed at end of           NA          NTR
                                  project
10% increase in prawn             To be assessed at end of           NA          NTR
wholesale price                   project
                                                                                      Annex 4
                                                                                     Page 3/20



2.       Cameroon-Ecology: Reforestation of Degraded Areas and Developing Non-
         Timber Forest Products in the Sanaga Maritime Region of Cameroon

          This project is being implemented by the NGO Cameroon-Ecology (Cam-Eco). Its
goal is to promote sustainable participatory management of reforestation of degraded areas of
community forests, and the domestication and use of Non-Timber Forest Products (NTFP).
Project activities started in earnest in February 2010. The slippage observed between the
initial project implementation schedule proposed by Cam-Eco (July 2009) and the effective
start-up of activities (2010) showed that Cam-Eco’s planning for the first six months of the
project was very ambitious. Too many activities were planned in relation to the absorptive
capacity of communities, effective project start-up, difficult access to certain localities
considering their remoteness and the complexity of certain activities. It should also be noted
that ndjassan collection was bad this year because the ndjassan natural trees virtually did not
produce.

          Despite these difficulties, project performance is satisfactory overall for this
implementation period. Particularly, achievements include: organization and structuring of
groups involved in the production of honey and ndjassan (Ricinodendron heudelotti),
development of action plans of the six communities covered by the project, mapping of areas
to be reforested, training of population (in nursery techniques, hive production and
installation, ndjassan harvesting and processing techniques or ndjassan domestication),
establishment of ten village nurseries and production of 10 300 seedling forest and fruit trees,
production of 96 beehives, and planting of 770 trees representing about 2 hectares reforested.
It is worth noting that some expected outputs such as 50% reduction in illegal logging and
reforestation of degraded areas of community forests in the project area seem ambitious. A
mid-term review to be organized in 2011 should consider these indicators and propose
necessary adjustments.

         The following table shows 2010 achievements and achievement rates against annual
projections.
                                                                                                       Annex 4
                                                                                                      Page 4/20

   Cameroon-Ecology –Project Achievements as at 31 December 2010

    2010 Projections           2010 Achievements          Achievement                    Observations
                                                              Rate
Output 1: Communities are informed and sensitized on the project, and adhere massively to it
Organization of an          Twelve information and           100%         NTR
information and             awareness-raising sessions
awareness-raising           are organized in five
session in each             communities
community before the
end of the first quarter of
2010
Output 2: Communities have developed their institutional and organizational capacity
Organization and            Information sessions on        90%            New groups are being set up
structuring of groups and community mobilization;
associations involved in    support       for       the
honey and ndjassan          organization of statutory
production                  meetings; support for the
                            drafting of articles of
                            association and by-laws
Provision of                Support provided                 100%          NTR
organizational support
for the functioning of
management committees,
CIGs and associations
Development of action       Action plans developed in        100%          NTR
plans of all communities    five communities
Organization of at least    Not achieved                       0%         Activity planned for early 2011
two exchange visits to
enable target groups to
learn and share views
with others
Output 3: Communities have acquired technical and managerial capacity in the field of forestry, ndjassan development
and beekeeping
Organization of twelve      Ten training sessions held        85%         Groups were very busy during this first
(12) training sessions on   in the five communities                       semester such that their absorptive capacity
record-keeping              and the equipment bought                      was exceeded. The remaining courses will
                            distributed     to    these                   be phased over the next six months of the
                            communities                                   year

Organization of twenty-     Four training sessions held    Activity on-    70 persons, including 52 men and 18
four training sessions on   in six communities               going         women, were trained in nursery techniques
nursery establishment
and management
Training of the             Twelve (12) training              100%         56 persons in total, including 40 men and
population on the           sessions held in the six                       16 women, were trained
manufacture and             communities involved
installation of beehives
Organization of six         A training session on            100 %         The training was attended by 39 persons
training sessions on        ndjassan        collection                     including 25 men and 14 women. It was
ndjassan collection and     techniques was held in six                     rather theoretical because this year has
processing                  communities                                    been one of the worst in ndjassan
                                                                           production (ndjassan natural trees hardly
                                                                           produced this year).
Output 4: Illegal logging has dropped by nearly 50% in each village involved in the project
Awareness campaign on        Analysis of national and         40 %         Activities against illegal logging are
combating illegal            international laws and                        limited to awareness campaigns. The
logging                      regulations on forest                         project may not achieve the expected
                                                                                             Annex 4
                                                                                            Page 5/20

                             governance; a Practical                       outcomes.
                             Guide to popularize good
                             governance principles is
                             being prepared.
Output 5: Wood plant and ndjassan nurseries are developed in the villages concerned
Development of wood Acquisition of equipment                  85%
plant     and      ndjassan and establishment of ten
village     nurseries:     a nurseries     with    nearly
nursery with at least 10,300 forest and fruit tree
3500       seedlings      is seedlings; a timber yard of
established and well 50 forest tree and 25 fruit
monitored       in     each tree seedlings was set up
community
Organization of two Twelve                (12)   training    100%          NTR
training sessions on sessions were held in the
ndjassan domestication six communities.
in each community            Forty-seven (47) persons
                             in total (17 women and 30
                             men) were trained.
Collection of ndjassan About 1000 ndjassan                 Activity on-
wildlings                    seedlings are in nurseries,     going
                             of which half are ready to
                             be         grafted       and
                             approximately 1000 seeds
                             are in the germinator. This
                             number can already cover
                             over eight hectares of
                             planted area.
Output 6: Degraded areas of community forests are gradually reforested
Mapping of areas to be       Degraded areas of all           100%          NTR
reforested                   community forests have
                             been      delineated:     the
                             geographical coordinates
                             were taken in areas to be
                             reforested in the six
                             community forests.
                             The total area mapped is
                             about 3 442.917 ha,
                             representing 23.23% of the
                             total surface area of the
                             project area (i.e. of all
                             community forests)
770 trees were planted in 770 trees were planted in          100%          NTR
KOPONGO community, KOPONGO community,
representing an area of      representing an area of
nearly two hectares          nearly      two     hectares
reforested                   reforested
Plant monitoring and         Plant     monitoring     and  Activity on-
maintenance                  maintenance                     going
Output 7: Honey production and ndjassan collected have enabled the population to increase their income and
purchasing power
Support for the              96 beehives produced          Activity on-
manufacture and                                              going
installation of beehives
in the real environment
                                                                                           Annex 4
                                                                                          Page 6/20


Collection and              Unproductive year       Low       In most communities, there was no
processing of ndjassan                          achievement   production at all. Only two communities
grains from natural trees                           rates     collected a few ndjassan grains and even
                                                              lost most of their harvest while waiting for
                                                              the crushing machine which could not be
                                                              purchased at the expected time.

   3.         Nature Plus: Partnership for the Development of Community Forests (PDCF)

            This project is being implemented by Nature Plus, in partnership with Gembloux
   Agro-Bio Tech (University of Liège) and SNV. Specifically, the PDCF project seeks to
   develop community forests at the technical, institutional and organizational level by
   empowering three community forest (CF) groupings. In all, the project covers thirteen (13)
   CFs totalling approximately 55 591 ha and 23 000 inhabitants, through support provided to
   three groupings located in the East, Centre and South regions.

            Project activities took off in February 2010. There have been delays in signing
   agreements with partners and cooperation agreements with some local communities and
   NGOs. In view of the achievements detailed in Annex 4, it appears that project performance
   this year has been fairly satisfactory. The most important achievements include: assessment
   of project-supervised CFs (socio-economic analysis of project-supervised CF villages,
   improvement of logical framework indicators and proposal of new SMART indicators,
   development of an autonomy analysis chart (AAC) for monitoring; organization of three
   training sessions on the new Forest Allocation Procedures Manual and Management
   Standards validated in December 2008; two training sessions for Forestry Operations
   Managers (FOM) on basic inventory techniques, development and utilization of an
   operations card and a field book, and roles and responsibilities of a FOM; technical support
   for forestry work implementation and Simple Management Plan (SMP) renewal; support and
   monitoring for the development of CF operations records; and training to support the
   development of small-scale wood exploitation techniques.

            The following table shows 2010 achievements and achievement rates against annual
   projections.
                                                                                                    Annex 4
                                                                                                   Page 7/20

                   Nature Plus - Project Achievements as at 31 December 2010

                                                               Achievement
     2010 Projections             2010 Achievements                          Observations
                                                                  Rate
Continuing training of        Three training sessions on the       60%       The various training sessions
communities on the new        new Procedures Manual for                      should continue at village level
Procedures Manual             communities and two training
                              sessions for forest operations
                              managers

 Promote environmental        Primary     and     secondary       50%
education in three primary    schools contacted in the East
and three secondary
schools
Two training sessions for     Three training sessions on the      100%       Procedures Manual
the administration’s          new Procedures Manual and
employees                     one on forest inventory
                              techniques
Training of local NGOs        A training session on forest        100%       PDFC Project has recruited
                              inventory techniques and                       forestry technicians as project
                              three on the new Procedures                    staff and will integrate them into
                              Manual                                         the groupings.

Provide technical support                                         40%
for forestry work
implementation and
Simple Management Plan
(SMP) renewal
 Provide support and          Three CAEs available;               35%        Corrupt practices, lack of
monitoring for the            support for file compilation                   transparency, several actors
development of CF                                                            involved, including the
operations records                                                           administration
Training to support the                                           35%
development of small-
scale wood exploitation
techniques
Facilitate negotiations and                                       20%
execution of wood
exploitation and sales
contracts
 Promote CF wood and          A contract for the recovery of      15%        60 cubic metres were produced
by-products                   60 cubic metres in one FC                      but the community sold only 45
                                                                             cubic metres
Support NTFP                  Three awareness-raising and         30%
development and study         training meetings held
utilization outlets

4.        Achieving Conservation and Improving Livelihoods through the Sustainable
          Management of Community-Based Forest Operations in Cameroon

        This project is being implemented by Rainforest Alliance (RA), an international
NGO, in partnership with Cercle de la Promotion des Forêts et des Initiatives Locales de
Développement (Circle for the Promotion of Forestry and Local Development Initiatives)
(CEPFILD) and Organisation pour la Protection de la Forêt Camerounaise et de ses
Ressources (Organization for the Protection of Cameroon’s Forest and its Resources
(OPFCR). The project aims to maintain plant cover and improve the income of forest
                                                                                    Annex 4
                                                                                   Page 8/20

communities by supporting the implementation of sustainable forest management practices in
twelve communities, covering approximately 50 000 hectares in the Campo Ma'an and
Djoum-Mintom regions of Southern Cameroon.

         Project activities took off in May 2010. The implementation of the annual action
plan started with the development of a quarterly operational plan, raising awareness on the
ground to re-engage communities and launching workshops. The objective of these
workshops was to enhance project understanding by various partners, initiate discussions on
the current organizational and technical status of community forests and identify specific
areas to be strengthened in line with project objectives. A thorough diagnosis made it
possible to assess community forests and select project pilot community forests. Twelve (12)
community forests (CFs) were selected based on socio-economic and environmental or
ecological criteria. Deriving from this diagnosis, the project action focused more on
supporting the restructuring of management entities and preparation for production and
market access. Meetings were facilitated and allowed the establishment of offices, thus
rendering some management entities operational. A market survey was conducted and
identified actors involved in wood marketing activities and the various markets, including
second processing subsector opportunities and project target community forest challenges and
prospects. At the institutional level, meetings with partner organizations were organized,
particularly those implementing similar projects and others involved in community forestry,
FLEGT and REDD. However, coordination with other partners is not visible.

          Overall, project performance was average. There were difficulties in carrying out
activities on the ground because of field access problems (which were initially
underestimated by the project). Seven activities scheduled for 2010 were postponed to 2011
and two activities were in progress as at 31 December 2010. Special monitoring of the project
is needed in 2011.

         The following table shows 2010 achievements and achievement rates against annual
projections, as recorded in NGOs activity reports.
                                                                                         Annex 4
                                                                                        Page 9/20

                 Rainforest Alliance –Project Achievements as at 31 December 2010

  2010 Projections                        2010 Achievements         Achievement Rate   Observations
Organizing training workshops,        Activities carried out              100%         NTR
conducting studies and assessments,
organizing meetings on model forest
businesses, development of manuals,
guides and governance tools
 Raising awareness on FSCs,            A workshop was organized           30%
production and dissemination of       while manual production was
manuals                               postponed until 2011
Organizing meetings and training      Activities carried out              80%
technical teams to operationalize
community forest enterprises (CFE)
and support their production
Raising community awareness of the    Awareness campaigns were            10%
development of secondary species      postponed but a workshop
and unknown NTFPs                     between       buyers  and
                                      producers is underway




  5.        Promoting Community Land Tenure Rights in the Congo Basin

           This project is being implemented by The Rainforest Foundation UK (RFUK) in
  partnership with Centre pour l’Environnement et le Développement (Centre for Environment
  and Development) (CED), a Cameroon-based NGO. The project covers five Congo Basin
  countries: Cameroon, Gabon, Central African Republic, Democratic Republic of Congo and
  Republic of Congo. The overall project goal is to reduce deforestation and forest degradation
  in the Congo Basin, and poverty among forest communities in the region. Specifically, it
  aims to secure the rights of forest communities, especially their land tenure rights, as a means
  of avoiding deforestation and combating poverty.

           Project activities took off in January 2010. The most important achievements as at
  31 December 2010 relate to national studies on the legal context of land law (60%
  achievement rate) and local studies on forest community customary rights (50% achievement
  rate). National studies on the legal context of land law were actually conducted in Cameroon,
  Gabon and Congo, that is in three of the five countries provided for (Cameroon, Congo,
  Democratic Republic of Congo, Gabon and Central African Republic). In DRC, consultants
  were identified and preliminary discussions were started to launch work. Work has not started
  in CAR due to lack of funding (delay in the second disbursement). Local studies on forest
  community customary rights were conducted in Cameroon, Congo and Gabon. In DRC and
  CAR, studies were not launched for lack of funding (delay in disbursing the second tranche
  of funds). However, the project coordinator led a mission to CAR in September 2010 to begin
  discussions with local NGOs.

           The project operates in the land and forest law sector but does not sufficiently
  involve government institutions in charge of these issues. The project’s geographic coverage
  is ambitious; the implementation levels differ, depending on the country. Increased
  monitoring is required for this project, especially as the deadline for the last disbursement is
  31 December 2011 and the completion date 1 June 2012.
                                                                                                   Annex 4
                                                                                                 Page 10/20

          The following table shows 2010 achievements and achievement rates against annual
  projections.

                     Rainforest UK –Project Achievements as at 31 December 2010

                                                       Achievement
   2010 Projections          2010 Achievements                       Observations
                                                          Rate
Recruitment           of   Studies were conducted in       60%       Studies have not yet been conducted in DRC
consultants          for   Cameroon, Gabon and                       and CAR. In DRC, consultants have been
national studies on the    Congo.                                    identified and preliminary discussions have
legal context of land                                                been started to launch work. In CAR, work
law                                                                  has not commenced due to lack of funding.
Conduct     of     local   Local    studies were          50%        In DRC and CAR, studies were not launched
studies    on     forest   conducted in Cameroon,                    for lack of funding. However, the project
community customary        Congo and Gabon                           coordinator led a mission to CAR in
rights                                                               September 2010 to begin discussions with
                                                                     local NGOs.
Coordination   with        Meetings were held with        30%        Coordination meetings were held mainly with
other projects and         FERN, WRI and some                        international NGOs which are RFUK’s
programmes                 international NGOs.                       traditional partners. Consultations with a
                                                                     greater number and wider range of partners
                                                                     are expected from the project.

  6.         Stabilizing Carbon Emissions in the Sangha Tri-National Forest Complex
             through Sustainable Financing and Improved Livelihoods

           This project is being implemented by Fondation pour le Tri-national de la Sangha
  (Sangha Tri-National Foundation) (FTNS) and aims to sustainably stabilize carbon emissions
  by establishing long-term income mechanisms that directly improve the living standard of the
  rural population in the Sangha Tri-National (TNS) forest complex area. Its activities cover
  three COMIFAC countries: Cameroon, the Central African Republic and the Republic of
  Congo.

           Project activities started in November 2009. However, there was significant delay in
  effective project start-up. For that reason, the initial work plan had to be adjusted. There were
  delays in the first half of 2010 due to difficulties in fulfilling conditions precedent to
  disbursing grants to the three TNS parks and civil society organizations working in TNS,
  responsible for implementing project activities. The recruitment of key staff (programme
  manager and accounting firm) was considerably delayed. The project was also behind
  schedule in recruiting a FTNS project manager. This was however made up during the last
  months of 2010 with not only the signing of several grants that are project key elements, but
  also the preparation of several other grants that may be signed in early April 2011.
                                                                                                       Annex 4
                                                                                                     Page 11/20

           In view of achievements up to 31 December 2010, which are detailed in the table
  below, project performance is fairly satisfactory. For some targets, project progress is heavily
  dependent on the functioning of the Sangha Tri-National decision-making bodies such as the
  Tri-National Implementation Planning Committee (CTPE), which in principle meets twice a
  year. Moreover, the FTNS has co-financing that contributes to the same objectives as those
  funded by the CBFF, which may make it difficult to perceive or monitor CBFF contribution.
  This project requires closer monitoring.

                             TNS - Project Achievements as at 31 December 2010

                                                                 Achievement
    2010 Projections               2010 Achievements                          Observations
                                                                     Rate
Output 1: For 2012, the legal and institutional frameworks as well as technical capacity will be strengthened to
ensure effective implementation of the TNS land use vision
Organize       the     sub- The LUP (Land Use Planning)              100%     NTR
regional workshop to has been validated and
validate TNS Land Use adopted by the Tri-National
Planning (LUP).             Supervision and Arbitration
                            Committee (CTSA).
Support the organization CTPE meetings are now held                  100%     NTR
of TNS Planning and regularly, particularly with the
Implementation              support       of     the     TNS
Technical       Committee Foundation: three meetings
(CTPE) meetings.            were held during the last
                            twelve months.
Edit, print and distribute Finalized document available              25%      Steps are underway to recruit a
the TNS LUP document. Publishing and printing                                 consultant to publish, duplicate and
                            deferred.                                         distribute the document.
Support      the     PNNN Two grant agreements were                  75%      The contract with Nouabale Ndoki
Management             Plan signed with APDS Park in                          Park in Congo has been delayed due to
updating           process; CAR and Lobéké Park in                            unavailability of the players involved,
Support      the     APDS Cameroon,              respectively.                but this delay should offset by mid-
Development            Plan Discussions are underway                          April 2011.
finalization            and with PNNN.
validation         process;
Support the Lobéké Park
Management             Plan
revision process.
Conduct a study on An assessment and TNS                             100%     NTR
training and capacity player capacity analysis study
building needs of TNS was conducted and discussed
natural            resource with stakeholders at the
managers.                   January 2011 CTPE meeting.
Activity 2: Improve the quality of life of the rural population through community management
Make an assessment and A contract was signed with the                50%      The first progress report will be
conduct      a     baseline Sangha Group through IUCN                         available in March 2011.
socioeconomic study to for the study and socio-
define        development economic monitoring, and
indicators.                 work          is       underway.

Identify     beneficiaries    An analysis of potential actors     75%         The TNS Foundation will in early
eligible      for      the    that will benefit from TNS                      March launch a call for proposals for
implementation of forest      Foundation      grants     was                  local organizations. It is planned to
resource co-management        conducted as part of the above                  start awarding grants in April 2011.
pilot    initiatives    in    study.     Relevant       local
outlying areas of TNS         organizations and priority
parks.                        areas were identified and
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                                                                                                 Page 12/20

                             discussed during the CTPE
                             meeting held in Pokola in
                             January 2011.
Activity 3: Ensure that the TNS Foundation effectively performs its funding and conservation duties.
Update and complement The Operations Manual was                   50%         The revised Manual will be reviewed
the TNS Foundation’s revised            by    the    ARC                      during the TNS Foundation Board of
management tools.            accounting firm hired by the                     Directors’ meeting to be held in
                             TNS Foundation.                                  Bangui on 3 and 4 March 2011.

Organize visits to share   The      TNS       Foundation       50%         Contacts were made to organize a
experiences with other     (Executive Director and two                     training session for TNS Foundation
trust funds in Africa,     Directors) took part in a                       Directors extended to other African
Europe     and     Latin   training session organized by                   trust funds, with support from the
America.                   “Conservation         Finance                   Latin     American    Network    of
                           Alliance” (CFA) group in                        Environmental Funds. The training
                           Dakar in September 2010.                        session is scheduled for the second
                                                                           quarter of 2011.



  7.        Building Foundations for Success; Community Participation is Central to REDD

           This project is implemented by the NGO STICHTING FERN, in collaboration with
  a consortium comprising the following six NGOs: Brainforest, OCDH, FERN, OCEAN,
  CED and MEFP. Its overall goal is to support civil society in Congo Basin countries to get
  involved in national and international discussions on REDD, so that the land rights of forest
  communities are respected. Project activities will cover the following five COMIFAC
  countries: Cameroon, Democratic Republic of Congo, Republic of Congo, Gabon and Central
  African Republic. The total project budget is EUR 1 625 439 for three years, of which EUR 1
  462 895 representing CBFF contribution.

            Project activities began in May 2010 since the first disbursement was made in late
  April 2010. From July to December 2010, project activities focused on three areas: (1) project
  start-up, including the launching of activities in the Congo Basin; establishment of the
  consortium comprising the six members involved in the project (Brainforest, OCDH, FERN,
  CED, OCEAN and MEFP); and induction of the Project Coordinator (in collaboration with
  FERN since May 2010); (2) civil society participation in national and international
  discussions on REDD, especially in countries where the REDD process is underway (DRC,
  RC, CAR); and (3) strengthening of regional initiatives and networks, with the organization
  of two key workshops in Cameroon. Moreover, FERN conducted two missions in the Congo
  Basin region (in July/August and September/October 2010). Several working meetings with
  the consortium’s partners were also held in Brussels. In general, the project recorded some
  progress during the second half of 2010. Some activities recorded better outputs than
  expected and progress was made earlier than expected by others. Overall project performance
  is average. Considering that the REDD process is advancing at a rapid pace in DRC,
  Republic of Congo and Central African Republic, in particular, and access to and flow of
  information remains a problem, the role of civil society in monitoring what is happening and
  its level of contribution to discussions are essential.

           The following table shows 2010 achievements and achievement rates against annual
  projections.

                  FERN – Matrix of Project Achievements as at 31 December 2010
                                                                                                    Annex 4
                                                                                                  Page 13/20


                                                    Achievement
  2010 Projections         2010 Achievements                          Observations
                                                         Rate
Output 1: National NGO participation in national and international discussions
Facilitate and support   Continuing guidance:            100%
national NGOs’           regular training sessions;
understanding of         organization of two field
REDD                     trips to DRC and RC
 Output 2: Effective NGO coalitions in three COMIFAC counties participate in national and international
discussions on REDD
Assist local partners in Identification made in           75%         In RC and CAR, civil society advocacy
each country in          all countries but slow                       efforts were limited by difficulties
identifying a focal      implementation of                            relating to the establishment of
point organization       advocacy; organization                       independent NGO platforms
responsible for          of seminars and
coordinating the         publication of guidelines
national coalition       on REDD
Output 3: A REDD regional network of NGOs and CBOs is operational in the Congo Basin

Ensure that a network    Establish regional              25%         Activity postponed to 2011
is established and       collaboration networks
operational
Facilitate annual        FERN facilitated a              100%
network meetings         meeting with all
                         Consortium participants
                         in Douala, Cameroon.

Output 4: At least five REDD projects are developed with effective participation of local stakeholders
Monitor various          Information sharing in         40%          The REDD process in Gabon and
REDD project             DRC, RC and CAR                             Cameroon has not really started
consultation
processes; exert
pressure to ensure
effective participatory
consultation
processes; publish
guidelines on REDD
 Output 5: An effective mechanism for monitoring financial transfers from the central to the local level,
enabling stakeholders to monitor REDD funding, including a clear appeal process.
Identify a financial     Recruit a consultant            0%          The recruitment of a consultant was
expert to develop a                                                  deferred, given the uncertainty of funding
transparent financial                                                for this position
mechanism
Output 6: REDD national plans mention the importance of recognizing forest peoples’ rights.

Conduct research on      Analysis of available           75%         Analysis made in DRC and RC, since the
the REDD process and     RPP plans. Publication                      other countries do not yet have RPP
content of REDD          of a FERN critical report
plans focusing on the    on the World Bank
recognition of forest    REDD/FCPF process
peoples’ rights          ('smoke and mirrors')
                                                                                                   Annex 4
                                                                                                 Page 14/20

8.         Phasing out Slash-and-Burn Farming with Biochar

         This project is implemented by ADAPEL, a local environment and development
NGO in DRC. It seeks to slow deforestation in the Likenda Region located in Equateur
Province in DRC, by replacing slash-and-burn farming (putting pressure on the primary
forest) with sedentary farming. This transition would be realized through the introduction of
biochar to enrich soil fertility and thus increase agricultural yields.

          Project activities started in December 2009. By 31 December 2010, the project had
implemented key activities planned for the first year despite difficulties related mainly to the
remoteness of the project area and logistic conditions (bad roads, used vehicle, bureaucracy).
The most important achievements include: the selection and training of fifty farmers to be
introduced to biochar production; the identification of fifty hectares of land distributed among
the fifty farmers selected for the experimental phase of biochar production; creation of four
biochar production sites; construction of eight pyrolysis units for biochar production;
production of 160 tonnes of biochar to fertilize the first fifty hectares of fields; successful
introduction of biochar as an input in the fields of participants; creation of a scientific
database for analysis of the current system of slash-and-burn farming; and soil testing
"before” and “after” biochar use.

The following table shows 2010 achievements and achievement rates against annual
projections.

                        ADAPEL- Project Achievements as at 31 December 2010

                                                          Achievement
     2010 Projections         2010 Achievements                         Observations
                                                             Rate
Output 1: Biochar production and introduction
Activity 1.1 : Establishment of a group of participants
Introductory workshop A workshop was organized               100%       NTR
on biochar                and brought together 50
                          farmers from        the 20
                          villages involved in the
                          project
Shortlisting of 100       Selection of 50 farmers            50%        Gap caused by the late disbursement
participants                                                            of the second tranche because of non-
                                                                        compliant supporting documents.
                                                                        Fifty other participants will be
                                                                        selected in 2011
Individual briefing on    The briefing took place in        100%        NTR
biochar introduction      the 20 villages concerned
Activity 1.2: Selection of lands and distribution of inputs
Selection and             50 lands analysed; 27 lands       100%        NTR
characterization of       selected for soil and
different types of land biological analysis
(fallow, secondary and
primary forest)
Procurement and           Inputs procured and                           Fertilizer transportation was difficult
distribution of farm      distributed                                   because of the poor condition of the
inputs                                                                  vehicle
Activity 1.3: Biochar production
Identification        of Sources were identified            100%        NTR
biochar sources
                                                                                                      Annex 4
                                                                                                    Page 15/20

Construction of five      Eight furnaces constructed         160%         NTR
pyrolysis furnaces
Biochar production:       160 tonnes produced                 32%         Delays caused by lack of baked
500 tonnes envisaged                                                      bricks at the start of the project to
for year one                                                              build the pyrolysis units; problem of
                                                                          water supply and poor condition of
                                                                          the vehicle used to transport biochar.
                                                                          However, this delay will be made up
                                                                          in 2011 with a forecast of 500 tonnes
                                                                          of biochar, totalling 660 tonnes out of
                                                                          the 1500 tonnes initially planned by
                                                                          the end of the project (that is 44%
                                                                          achievement by end 2011). The
                                                                          project even intends to overshoot the
                                                                          target of 1500 tonnes at end of
                                                                          project (August 2012).

Manufacture         and   Programme postponed to               0%         The project would like to first test the
distribution of biochar   2011                                            mass production of biochar in
stoves                                                                    furnaces to convince participants
                                                                          before individual production in
                                                                          stoves.

Activity 1.4: Agricultural operation
Application of biochar Participants actually applied           100%        The process of applying biochar and
and mineral fertilizers   this substance in their fields                   fertilizers in the soil by the 50
to soils                                                                   farmers was successful.
Output 2: Transformation of fields into fertile soils and improvement of agricultural yields
Activity 2.1: Farm management
Planting, farm            Participants planted crops           100%        Preliminary results indicate that
management,               (either corn or rice) and                        biochar increases productivity. By
harvesting                managed their farms                              late 2011, productivity should
                          soundly; the harvest is                          increase from 50% to 100%
                          underway
Processing of crops       Product processing is in           Underway      Profits will go to the cooperative for
harvested into saleable progress (ginning, drying,                         redistribution among members
products                  storage)
Activity 2.2: Creation and management of an agricultural cooperative for bulk sales of agricultural
produce
Participatory             Two workshops held and               100%        Acceptance by participants of the
workshops, staff          community leaders selected                       idea of a cooperative
selection                 and trained
Creation and              Cooperative registered at            100%        NTR
registration of the       regional, territorial and
cooperative               national levels
Market prospecting        Prospecting is under way: a        Underway
                          major corn buyer has been
                          identified in Kinshasa, and
                          negotiations for corn sales
                          are on-going with the
                          brewery
Output 3: Scientific research (pedology, agronomy and land use)
Activity 3.1: Soil research
Preparation of a          Soil samples were taken (20        Underway      Sampling requires a lot of time, given
rudimentary map of        samples in 15 of the 20                          the difficult conditions related to
soils; soil testing on    village involved) and tests                      transportation which can be done
sites selected            are underway                                     only by air since the samples
                                                                           deteriorate rapidly
                                                                                               Annex 4
                                                                                             Page 16/20

Activity 3.2: Agronomic analysis
Analysis of current       Analyses conducted               100%     Initial research findings are ready for
biological productivity                                             publication
and agronomic
parameters before and
after biochar
application
Current biological        Analyses started               Underway   Analyses will be completed in 2011.
productivity,
agronomic parameters
after biochar
application
Activity 3.3: Land use analysis
Analysis of the current Analysis conducted: 18             100%     The initial findings of this analysis
system of slash-and-      lands were surveyed out of a              are ready for publication
burn farming              sample of 21.
Analysis of land use      Development of                 Underway   The analysis will help to determine
dynamics after biochar questionnaires to obtain data                whether or not the biochar system
is applied                from participants on the                  slows deforestation
                          change in their land use
                          method
Activity 3.4: Establishing a carbon accounting baseline rate
Baseline study to         The soil sample collection     Underway   Sample      analysis    requires   the
assess carbon             was made                                  utilization of specialized tools from
sequestration in soil                                               Europe. The study will be completed
                                                                    in                               2011.

Baseline study to        Questionnaires completed.      Underway    The project would like to introduce
assess deforestation     The study will be based on                 aerial photography to analyse forest
and its slowdown         satellite images to be taken               coverage
following the            in 2011
application of biochar



1.        Sustainable and Innovative Management of Forest Resources (GEDIRF)

          This project is implemented by AWF (African Wildlife Foundation), in partnership
with ICRAF (Agroforestry Partner), WorldFish (Fisheries Partner) REFADD (Gender and
Minorities Partner) and CIRAD (Biochar/Wood Energy Consultant Collaborator). The project
goal is to contribute to reducing deforestation and forest degradation and poverty, to improve
the quality of life for K7 population (now estimated at 25 000) through better management of
the Maringa-Wamba Lopori (MLW) landscape forests in Equateur Province in Northern
DRC.

         Project activities took off in March 2010. Project achievements as at 31 December
2010 can be summarized as follows: (i) production of study and analysis reports on wildlife
inventories and human activities for the former K7 concession; (ii) 200 local assistants
recruited and trained to collect data; (iii) a draft strategy paper prepared and accepted by
CARPE; (iv) a draft management plan indicating the community forest meso-area developed;
(v) socio-economic surveys conducted as part of the analysis of non-timber forest products
with high economic potential (NTFP); (vi) organization of five awareness-raising, training
and extension workshops on the Forestry Code, laws on village hunting and women’s
leadership and fifteen target groups in various groupings with the distribution of outreach
tools (Forest Code brochures translated into Lingala, posters, leaflets, etc.); and (vii)
                                                                                                     Annex 4
                                                                                                   Page 17/20

organization of a reflection and training/awareness-raising workshop on legislation
governing natural resource utilization and land rights according to groupings, pending the
recruitment of a legal consultant for more technical support.

           During this implementation phase, the project faced a problem of confusion about
the limits of the K7 concession (intervention area). This problem was caused by the slippage
of the K7 concession during the conversion of titles, giving rise to the creation of an
additional zone in Lingomo sector comprising about 15 villages. Before the conversion of
titles, the company "SIFORCO" was running the whole Bongandanga sector (15 groupings).
After conversion, SIFORCO received two titles for the K7 concession. This led to reluctance
about the number of groupings to actually take into account under this project. Consultation
meetings were held between AWF and SIFORCO to apportion roles and responsibilities in
planning land use in the K7 concession. This issue should be clarified and solutions adopted
during the next CBFF supervision mission. Moreover, the issue of remoteness of the project
intervention area, as well as travel from one village (camp) to another within the intervention
area by motorcycle and river have resulted in high travel costs. The project should submit a
proposal to revise the list of project goods and services to take these contingencies into
account.

         The following table shows 2010 achievements and achievement rates against annual
projections.
                   AWF- Project Achievements as at 31 December 2010
   2010 Projections            2010 Achievements           Achievement Observations
                                                              Rate
Output 1. Strategy Paper for a K7 PPUT established and accepted by stakeholders; utilization of this plan by
decision-making authorities; a pilot site for a community-managed forest identified; and a management plan
strategy for this forest developed
Produce reports and           Study reports and analyses      100%         NTR
conduct analysis on the       on wildlife inventories and
distribution over space       human activities produced
and time of wildlife,         for the former K7
human-induced                 concession
activities, and population
segments in K7
45 local assistants trained 200 local assistants trained      440%         More assistants were trained to
for data collection           for data collection                          collect data on gender and minority,
                                                                           biological,      socio-anthropological
                                                                           and economic issues as well as
                                                                           participatory mapping in order to
                                                                           speed up the study
A strategy paper for the      A draft strategy paper          70%          SIFORCO’s absence in the field is
PPUT was developed by developed and accepted by                            slowing the process of adoption and
the planning team and         CARPE; a draft                               validation of the strategy,
the pilot area identified     management plan                              development and even management
                              indicating the community                     proposals made by other
                              forest meso-area developed                   stakeholders in the K7 area
Output 2: Economic value of NTFPs and fishery resources improved and recognized through capacity building
and pilot activities
Produce analysis reports      Some outputs achieved           40%          More in-depth studies are underway
on NTFP promising             during socioeconomic                         and reports will be produced during
sectors                       surveys                                      the first quarter of 2011

Output 3: Knowledge, mastery and respect by the different communities involved and
local government institutions of legislation governing natural resource (NR) and land utilization by
strengthening the capacity of local stakeholders and facilitating the integration of GEDIRF outcomes in national
                                                                                                   Annex 4
                                                                                                 Page 18/20

legal processes
Six awareness-raising,       Five awareness-raising,           50%        REFADD and AWF collected basic
training and extension       training and extension                       elements. The organization of the
workshops on the             workshops on the Forestry                    workshop is on hold pending the
Forestry Code, laws          Code, laws governing                         recruitment of a legal consultant for
governing village            village hunting and                          more technical support
hunting and women’s          women’s leadership
leadership organized         organized; 15 focus groups
                             held in various groupings
                             and outreach tools
                             distributed
Participation in three       AWF attended the National        100%        NTR
thematic workshops and       Steering          Committee
working group organized meeting of 5 to 7 May
by the Government.           2010 to validate the
                             operational guide on forest
                             zoning standards in DRC;
                             the REDD mechanism
                             workshop organized by
                             UN-REDD           and     the
                             workshop on Bonobo
                             conservation in DRC
Output 4: Mastery of biochar energy development potential and conditions; strategy for disseminating
knowledge and lessons learned through pilot initiatives developed
Conduct five studies and No study conducted due to              0%        Activity postponed from the first
analyses and present a       delays in the consultant                     quarter of 2011 due to delays in
summary report               recruitment process                          concluding the contract with CIRAD
                             (CIRAD)
Output 5: Knowledge and lessons learned from phase one at the local, national and international level are
shared, collaboration with the Government is enhanced and the next phase is developed.
A communication              Project objectives and           100%        NTR
strategy is adopted for      activities are disseminated
the dissemination of         and feature in Congo Web,
GEDIRF’s progress at         RTCE, ACP, Info
national and international Environnement, Antenne A,
levels                       www.lomakordc.org,
                             Journal Infos
                             Environnement


2.        Quantifying Carbon Stock and Emissions in the Forests of Cameroon and the
          Republic of Congo

          This project is implemented by World Resources Institute (WRI), an international
NGO whose work involves measuring carbon stock and greenhouse gas emissions. The
project intends to develop carbon measurement techniques and address capacity building
challenges. Through this project, WRI quantifies carbon stock and greenhouse gas emissions
from forests of the Republic of Congo. WRI also aims to strengthen the capacity of local
institutions and government agencies to consistently carry out such control and monitoring
exercises. This project will help the Republic of Congo to improve its tools in order to enjoy
the benefits of carbon markets and payments for ecosystem services by providing data and
assistance in developing methodologies and strategies for measuring national forest carbon
and baseline forest carbon emission levels.

      Project activities started in March 2010. As at 31 December 2010, the project had
implemented the main activities planned for 2010. Key achievements include the recruitment
                                                                                                     Annex 4
                                                                                                   Page 19/20

of project staff, building the capacity of local stakeholders and tool dissemination. All
operations were implemented with very strong involvement of the Government of the
Republic of Congo and the REDD National Coordination Unit. The following table shows
2010 achievements and rates against annual projections.

                         WRI Project Achievements as at 31 December 2010
   2010 Projections          2010 Achievements             Achievement                    Observations
                                                               Rate
Output 1: Assessment of the national deforestation and forest degradation level, and development of carbon
level measuring tools
Collection of relevant      All activities relating to the     100%          NTR
existing biophysical,       collection of relevant
spatial and edaphic         existing biophysical, spatial
information                 and edaphic information
                            were carried out
Output 2A: The senior officers of the Ministry of Forest Economy of the Republic of Congo, NGOs and
research institutions are trained in monitoring, reporting and verification (MRV) of the
deforestation/degradation level and measurement of associated greenhouse gas emissions
Training of project         Project teams were trained         100%          NTR
teams
Output 2B: An MRV centre of excellence is established. OSFAC is established as a regional centre of
excellence for forestry monitoring and carbon measurement
OSFAC implements            OSFAC was established as           80%           The deficit will be offset by IMAZON
works with all new          a real centre for the pursuit                    in the field
techniques and experts of excellence in forestry
in degradation              monitoring and carbon
detection and emission measurement
measurement
Output 3A: Technical briefings for various actors. Workshops organized. Republic of Congo’s policy makers
are informed about the costs/benefits/risks/opportunities of sustainable forest management and poverty
alleviation resulting from reduction of deforestation/forest degradation and greenhouse gas emissions
Organize a technical        The technical workshop for         100%          NTR
workshop for policy         policy makers was
makers who will be          organized
responsible for project
monitoring
Inform civil society        Briefings were held for the        100%          NTR
leaders who will be         benefit of civil society
responsible for project leaders who will be
monitoring                  responsible for project
                            monitoring
Organize workshops          Workshops were held                80%           NTR
on UNFCCC, IPCC
guidelines and issues
of definition
Hold regular briefings Briefings were held and                 100%          NTR
and invite policy           policy makers participated
makers to fieldwork         in fieldwork and output
and output analysis         analysis sessions
sessions
Output 3B: Strategy and policy definition workshops are organized for key stakeholders. Stakeholders in the
Republic of Congo are informed of policy options to address the determinants of deforestation/forest
degradation and poverty reduction options.

Special workshops        Special workshops were             100%         NTR
organized for            organized for communities
communities
                                                                                             Annex 5

               Consultative Meetings Attended by the CBFF Secretariat in 2010

No.   Meeting Title                                                  Venue         Date
 1    International Conference on "Monitoring Carbon Stocks and      Brazzaville   2-4 February 2010
      Fluxes in the Congo Basin”
2     Paris International Conference on Tropical Forests             Paris         11 March 2010

3     UN/REDD Policy Board meeting, Nairobi, Kenya                   Nairobi       16-20 March 2010
4     Regional Workshop on Regional REDD Initiatives, organized by   Libreville    21-25 March 2010
      FCPF
5     COMIFAC Ministerial Conference                                 Brazzaville   19- 21 April 2010
6     African Development Bank 2010 Annual Meetings in Cote          Abidjan       20-31 May 2010
      d'Ivoire
7     Oslo Conference on Deforestation and Climate Change            Oslo          26-29 May 2010
8     COMIFAC-ONFI Regional Workshop on the Restitution of the       Douala        15-17 June 2010
      Study on Developing a Regional GHG Emissions Model (IIASA)
9     World Bank-COMIFAC Regional Workshop on Launching the          Douala        22-24 June 2010
      Regional Programme for REDD Institutional Capacity Building
      in the Congo Basin.
10    Workshop on Preparation of the World Bank-GEF REDD             Douala        18-22 October 2010
      Regional Project.
      MRV Regional Project Concept in Ten COMIFAC Member
      Countries
                                                                                   Annex 6

                         Bank Support Provided in 2010


SUPPORT PROVIDER                DESCRIPTION OF SUPPORT RECEIVED
OSVP                                  Assistance in reviewing appraisal reports
                                      Assistance in understanding ADB PAR review and
                                       approval procedures
                                      Coordination of the CBFF procedures review team
DIRECTOR, OSAN                        Supervision of activities
                                      Administrative and organizational assistance Lobbying
FRONT OFFICE OF OSAN DIRECTOR         Assistance in understanding Bank procedure Technical
                                       and operational advice
MANAGERS, OSAN                        Support for the technical review of appraisal reports
                                       produced by the Secretariat by appointing members of
                                       their respective Units as "peer reviewers" Operational
                                       advice
GECL                                  Support for the preparation of Grant Agreements between
                                       the Bank and beneficiaries
                                      Specific technical assistance
                                      Preparation of Grant AgreementsReview of consultants’
                                       contracts
FRTY                                  Support for the processing of CBFF missions by providing
                                       per diem on time
ORPF                                  Support for the design of procurement plans of grant
                                       beneficiaries in compliance with Bank procedures
FFCO                                        o Prreparation of documents required for
                                                 disbursement requests from grant
                                                 beneficiariesProcessing CBFF missions by
                                                 providing per diem on time
CGSP                                  Support processing CBFF missions by providing air
                                       tickets on time
                                      Providing work equipment
CMFO                                  Design of procurement plans of grant beneficiaries in
                                       compliance with Bank procedures
                                      preparation of documents required for disbursement
                                       requests from grant beneficiaries
                                      Support for the processing of CBFF missions by providing
                                       per diem on time
                                      Support for implementation of field activities
                                       Technical, administrative and financial assistance in
                                       workshop organization and management
CDFO                                  Design of procurement plans of grant beneficiaries in
                                       compliance with Bank procedures
                                      Preparation of documents required for disbursement
                                       requests from grant beneficiaries
                                      Processing of CBFF missions by providing per diem on
                                       time
                                      Implementation of field activities
                                      Technical, administrative and financial assistance in
                                       workshop organization and management
GAFO                                  Technical, administrative and financial assistance in
                                       workshop organization and management
         Annex 7: THE 2010 CBFF AUDIT REPORT




            CONGO BASIN FOREST FUND




Independent Auditors’ Report on the
Special Purpose Financial Statements
  of the Congo Basin Forest Fund




              Year ended December 31, 2010
                Congo Basin Forest Fund
               African Development Bank
              Temporary Relocation Agency
                   15 avenue du Ghana
                  1002 Tunis Belvedère
                         Tunisie
               This report contains 9 pages
KPMG
F.M.B.Z.    KPMG TUNISIE

Les Jardins du Lac                                  Téléphone : +216 71 19 43 44
Télécopie : +216 71 19 43 20                        Télécopie : +216 71 19 43 20
B.P. n° 317                                         Email : tn-fmbz@kpmg.com
Publiposte Rue Lac Echkel
Les Berges du Lac, 1053 Tunis


   Independent Auditors’ Report on the Special Purpose Financial Statements of the
                                Congo Basin Forest Fund

                                Year ended December 31, 2010.

We have audited the accompanying Special Purpose Financial Statements of the Congo Basin
Forest Fund, which comprise the statement of financial position and the statement of
commitment as at and for the year ended December 31, 2010 and notes, comprising a
summary of significant accounting policies and other explanatory information. The Special
Purpose Financial Statements have been prepared by Management of the African
Development Bank in compliance with the accounting and financial reporting matters as set
out in the accounting policies in Note 2 of the Special Purpose Financial Statements as at and
for the year ended December 31, 2010.

Management’s Responsibility for the Financial Statements

These Special Purpose Financial Statements referred to above present as at December 31,
2010 total funds available of EUR 57, 635, 263, a net funds balance of EUR 53, 593, 444
and Funds available for commitment of EUR 42, 340, 320.
Management of the African Development Bank is responsible for the preparation of these
Special Purpose Financial Statements and for determining the acceptability of the basis of
accounting policies as set out in Note 2 of the Special Purpose Financial Statements and for
such internal control as management determines is necessary to enable the preparation of
financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these Special Purpose Financial Statements
based on our audit. We conducted our audit in accordance with International Standards on
Auditing applicable to compliance auditing. Those standards require that we comply with
relevant ethical requirements and plan and perform the audit to obtain reasonable assurance
that the Special Purpose Financial Statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the Special Purpose Financial Statements. The procedures selected depend on
our judgment, including the assessment of the risks of material misstatement of the special
purpose financial statements, whether due to fraud or error. In making those risk assessments,
we consider internal control relevant to the entity’s preparation of the Special Purpose
Financial Statements in order to design audit procedures that are appropriate in the

                                                                                            1
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
entity’s internal control. An audit also includes evaluating the appropriateness of accounting
principles used and the reasonableness of accounting estimates made by management, as well
as evaluating the overall presentation of the Special Purpose Financial Statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.

Opinion

In our opinion, the Special Purpose Financial Statements of the Congo Basin Forest Fund are
prepared, in all material respects, in accordance with the accounting and financial reporting
matters as set out in the accounting policies in Note 2 of the Special Purpose Financial
Statements for the year ended December 31, 2010.

Basis of Accounting and Restriction on Distribution and Use

Without modifying our opinion, we draw attention to Note 2 to the special purpose financial
statements, which describe the basis of accounting.

These Special Purpose Financial Statements are prepared for the purposes of submitting
approved and audited Special Purpose Financial Statements to the Donors in accordance with
section 2.7 of the Instrument for the establishment of the Congo Basin Forest Fund, and are
not intended to be a presentation in conformity with a recognized accounting framework,
such as, International Financial Reporting Standards.

Our report is intended solely to the Donors. Our audit work has been undertaken so that we
might state to the Donors those matters we are required to state to them in an auditor’s report
and for no other purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Fund and the Donors, for our audit work, for this
report or for the opinion we have formed.




                                                           Tunis,le 27 Mai 2011



                                                           F.M.B.Z.    KPMG TUNISIE



                                                           Dhia Bouzayen

                                                            Partner




                                                                                             2
                                                  AFRICAN DEVELOPMENT BANK

                       CONGO BASIN FOREST FUND
       FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2010
                            (Expressed in EUR)




                                                                 TABLE OF CONTENTS




STATEMENT OF FINANCIAL POSITION AS AT DECEMBER 31, 2010 ...............................4


STATEMENT OF COMMITMENT AS AT DECEMBER 31, 2010 ..............................................5


NOTES TO THE FINANCIAL STATEMENTS....................................................................................6

STATEMENT OF ADMINISTRATIVE EXPENSES COMPONENT DISBURSEMENT AS
AT DECEMBER 31, 2010 (ANNEX 1) ................................................................................................... 8

 STATEMENT OF COMPLETED ACTIVITIES AS AT DECEMBER 31, 2010 (ANNEX 2)
................................................................................................................................................................................9




                                                                                                                                                                              3
                        AFRICAN DEVELOPMENT BANK

                       CONGO BASIN FOREST FUND
         STATEMENT OF FINANCIAL POSITION AS AT DECEMBER 31, 2010
                            (Expressed in EUR)




CONTRIBUTIONS                    Notes        2010           2009

Amount received                      3     57,460,235      37,142,774

Interest earned                      4      175,028         67, 598

Total funds available                      57,635,263     37, 210,372

Disbursements

Disbursements                        5     (4,041,819)    (1, 404,830)

Net Funds available                        53,593,444      35,805,542



 REPRESENTED BY :


Cash in bank                     6         53,764,123      35,842,476

Accounts payable                 7          (170,679        (36,934)

Net Funds balance                          53,593,444      35,805,542




                                                                         4
                       AFRICAN DEVELOPMENT BANK

                 CONGO BASIN FOREST FUND
   STATEMENT OF COMMITMENT AS AT DECEMBER 31, 2010
                     (Expressed in EUR)




                                                   2010           2009

Funds Available                                 57,635,263     37,210,372

Commitments

Administratives expenses component (Annexe 1)    2,544,451     1,228,600

Project support component (Annexe 2)            12,750,492     8,379,951

Total commitments                               (15,294,943)   (9,608,551)

Total funds available for commitment            42,340,320     27,601,821




                                                                             5
                     CONGO BASIN FOREST FUND
                   NOTES TO THE FINANCIAL STATEMENTS
                FOR THE YEAR ENDED DECEMBER 31, 2010




1. Purpose of the Fund

The Congo basin Forest Fund (CBF) is a Special Fund established in 2008. The Fund
intended to alleviate poverty and address climate change through reducing, slowing and
eventually reversing the rate of deforestation in the Congo Basin.

2. Accounting Policies

The accounts of the Fund are kept in Euros (EUR) and transactions are recorded on cash
basis. Disbursements in currencies other than the EUR are converted to the EUR using
the cross rates prevailing between the currencies, the Bank’s Unit of Account (UA) and
EUR on the date of the transaction.

For accounting purposes, the Bank’s UA is deemed to be equivalent in value to one
Special Drawing Right (SDR) of the International Monetary Fund (IMF).

3. Contributions

A total contribution of EUR 57,460,235 represents amount received from the
Governments of United Kingdom and Norway.

4. Interest Earned and Investment Income.

Interest earned on funds deposited in the Grant’s Bank account is credited to the Fund and
used for the same purpose as the Fund. This cumulative interest is shown net of bank
charges.

5. Disbursements

Disbursements are payments made for approved projects/activities. They are made up of
administrative expenditures and grants to various projects funded by CBF. The grants are
recognized as expenses in the year of their disbursement. The status of expenses is as
follows:

                                                                       2010

                                                               (Amounts in EUR)

Administrative expenses (Annex1)                               1,782,836

Projects support component (Annex 2)                           2,258,983

                                                               4,041,819

                                                                                         6
The detailed analysis of the administrative expenses and projects support components as
at 31 December 2010 are presented respectively in Annex 1 and Annex 2.

The administrative expenses include a total of EUR 199,343 to be recovered by AfDB in
accordance with section 2.3 of the Instrument for the establishment of the Congo Basin
Forest Fund which relate to the direct and indirect costs incurred by the Bank during the
financial year ending December 31, 2010.

6. Cash in Bank

This represents the balance held in Deutsche Bundesbank account as at December 31,
2010.

7. Net Amount Payable

The net amount payable is detailed as follows:

                                            Montant (EUR)
 Amount receivable                          75,045
 Amount payable                             (245,724)
 Total                                      (170,679)




                                                                                       7
                                         AFRICAN DEVELOPMENT BANK

                                             CONGO BASIN FOREST FUND

STATEMENT OF ADMINISTRATIVE EXPENSES COMPONENT DISBURSEMENT AS AT DECEMBER 31, 2010 (ANNEX 1)
                                   (Expressed in EUR)



     Code       Study                        Amount         Disbursements   Disbursements   Cumulative      Undisbursed
                                             approved       2009            2010            Disbursements   balance
                                                                                            12/31/10        12/31/10

     704431     Meetings                       30, 000                         23, 354         23, 354         6, 646

     704574     Governing         Council      168, 427        68, 427         36, 726        105, 153         63, 274
                Expenses

     704575     Salaries                       995, 962       226, 481         627, 080       853, 561        142, 401

     704576     Consultancy (fees)             556, 908       157, 644         135, 921       293, 565        263, 343

     704577     Equipement                     133, 500                           0              0            133, 500

     704578     Operating Costs                460, 311        62, 284         245, 576       307, 860        152, 451

     710989     AfDB Indirect        Costs     199, 343                        199, 343       199, 343
                Recovery

                Total                         2, 544, 451     514, 836        1, 268, 000    1, 782, 836      761, 615




                                                                                                                          8
                                                                    AFRICAN DEVELOPMENT BANK

                                                                      CONGO BASIN FOREST FUND

                               STATEMENT OF COMPLETED ACTIVITIES AS AT DECEMBER 31, 2010 (ANNEX 2)
                                                                              (Expressed in EUR)

Code                       Study           Title of the Project                          Amount       Disbursements   Disbursements   Cumulative     Undisbursed
                                                                                         Approved     2009            2010            Disbursement   balance


Sangha Tri-National        5650155000001   Stabilizing carbon emissions in the Sangha    661,000      132, 900                        132, 900       528, 100
Trust Fund Limited                         Tri-National forest complex through
                                           sustainable financing and improved
                                           livelihoods

Cam-Eco                    5650155000002   Reforestation of Degraded Areas and           283, 628     54, 463                         54, 463        229, 165
                                           Developing Non- Timber Forest Products in
                                           the Sanaga Maritime Region of Cameroon

Organization for           5650155000003   Alternatives to Mangrove Destruction for      274, 315     72, 256                         72, 256        202, 059
Environment and                            Women’s Livelihoods in Central Africa
Sustainable Development

Action pour le             5650155000051   Phasing out slash-and-burn farming with       338, 000     99, 157         41,823          140, 980       197, 020
Développement de                           biochar
l’Agriculture et de la
Pêche avec la Protection
Environnementale de
Likende (ADAPEL)

African Wildlife           5650155000052   Sustainable and Innovative Management of      1,101, 200   531, 218                        531,218        569, 982
Foundation (AWF)                           Forest Resources (GEDIRF)

Rainforest Foundation      5650155000151   Promoting Community Land Tenure Rights        519, 384                     128, 515        128, 515       390, 869
UK                                         in the Congo Basin




                                                                                                                                                                   9
Rainforest Allinace, Inc.    5650155000152   Achieving Conservation and Improving           1, 221, 271              200, 947     200, 947     1, 020, 324
                                             Livelihoods through the Sustainable
                                             Management of Community-Based Forest
                                             Operations in Cameroon.

Nature+ ASBL                 5650155000202   Partnership for the Development of             1, 275, 225              524, 930     524, 930     750, 295
                                             Community Forests (PDCF)

Stichting Fern               5650155000203   Building the foundations for success;          1,462, 895               256, 770     256, 770     1, 206,125
                                             ensuring community participation is at the
                                             heart of REDD

World Resources              5650155000251   Quantifying carbon stocks and emissions in     1,243,033                216, 004     216, 004     1, 027,029
Institute                                    the forests of Cameroon and the Republic of
                                             Congo

Bonobo Conservation          5650155000501   The Sankuru Community “Fair Trade”             1,322,401                                          1, 322, 401
Initiative                                   Carbon Initiative: Innovative Management of
                                             community protected areas

Réseau des ONG de            5650155000651   Involvement of indigenous peoples named        166,327                                            166, 327
Campo –Ma’an et                              Bagyéli in the sustainable management of the
environs (ROCAME)                            National Park of Campo-Ma'an.

Biodervisity International   5650155000601   Beyond timber: Reconciling the needs of the    1,530,588                                          1,530,588
                                             logging industry with those of forest-
                                             dependent people

Conservation                 5650155000602   Bonobo Conservation Concession in              1,351, 225                                         1, 351,225
International Foundation                     Equateur Province, DRC

Total                                                                                       12, 750,492   889, 994   1, 368,989   2, 258,983   10, 491,509




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