The World Bank
Community Livelihood Enhancement And Resilience (P178545)

Project Information Document (PID)

Appraisal Stage | Date Prepared/Updated: 02-May-2023 | Report No: PIDA34216

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The World Bank
Community Livelihood Enhancement And Resilience (P178545)

BASIC INFORMATION

OPS_TABLE_BASIC_DATA
A. Basic Project Data

Country Project ID Project Name Parent Project ID (if any)
Lao People's Democratic Republic P178545 Community Livelihood
Enhancement And
Resilience
Region Estimated Appraisal Date Estimated Board Date Practice Area (Lead)
EAST ASIA AND PACIFIC 05-May-2023 15-Jun-2023 Social Sustainability and
Inclusion
Financing Instrument Borrower(s) Implementing Agency
Investment Project Financing Lao People’s Democratic Poverty Reduction Fund -
Republic Ministry of Agriculture
and Forestry

Proposed Development Objective(s)

To improve rural livelihoods and consumption of diverse foods for targeted vulnerable communities, and to respond
promptly and effectively in case of Eligible Crisis or Emergency.

Components
Local Economic Development and Community Capacity Strengthening
Community Livelihoods Enhancement
Community Nutrition Interventions
Project Management, Capacity Building and Monitoring and Evaluation
Contingent Emergency Response Component

PROJECT FINANCING DATA (US$, Millions)

SUMMARY -NewFin1

Total Project Cost 45.00
Total Financing 45.00
of which IBRD/IDA 45.00
Financing Gap 0.00

DETAILS -NewFinEnh1

World Bank Group Financing

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Community Livelihood Enhancement And Resilience (P178545)

International Development Association (IDA) 45.00

IDA Credit 45.00

Environmental and Social Risk Classification
Moderate

Decision
The review did authorize the team to appraise and negotiate

Other Decision (as needed)

B. Introduction and Context

Country Context
The Lao People’s Democratic Republic (PDR) is a landlocked country of 7.3 million people,1 endowed
with enviable natural resources. Lao PDR has been one of the fastest-growing economies in the world
between 2003 and 2019. Economic growth has been driven by capital accumulation in the natural
resource sectors and other large infrastructure developments, such as mining, hydropower, and
transport-related projects. GDP growth slowed down from 8.0 percent in 2013 to 2.5 percent in 2021 as
COVID-19 hit. The pandemic led to employment disruptions that caused severe income losses for
households. In May 2022, 43 percent of households still reported having experienced a decline in income
compared to pre-pandemic levels.2
A deterioration in the domestic and external environment has negatively impacted the population
since 2022.3 Earnings have not kept pace with inflation, which reached 40.3 percent (year on year) in
January 2023. Food price inflation is creating an additional burden in a context of existing malnutrition
challenges. Most households responded to food inflation by reducing food consumption, switching to
cheaper food, hunting and gathering, or resorting to self-production.4 In December 2022, 13 percent of
households were food insecure, with heightened risk among rural households (16 percent) and
households headed by people with no education (23 percent).5 Climate change impacts, notably flooding
and drought, are projected to exacerbate food insecurity across the country.6
These new economic challenges compound underlying weaknesses. Economic growth had been
largely natural-resource-driven, debt-fueled and unequal. It was not accompanied by significant job
creation, especially off-farm. Labor force participation declined from 84 percent in 2012 to 72 percent in
2018, with youth unemployment quadrupling to 21.8 percent during that period. Overall, growth had

1 Lao Statistics Bureau (as of 2021).
2 World Bank. 2022. Monitoring Household Welfare in Lao PDR: Round 5 Brief. Data is from the latest available survey round.
3 World Bank. 2022. Lao PDR Economic Monitor: Tackling Macroeconomic Vulnerabilities.
4 World Bank. 2022. Monitoring Household Welfare in Lao PDR: Round 5 Brief.
5 WFP 2022. Lao PDR: Food Security Monitoring, December 2022.

6https://unfccc.int/sites/default/files/NDC/202206/NDC%202020%20of%20Lao%20PDR%20%28English%29%2C%2009%20April
%202021%20%281%29.pdf

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been more favorable to the non-poor, with a rise in inequality between geographic areas of the country.7
Before the Covid pandemic struck, the national poverty rate had declined from 24.6 percent in 2012 to
18.3 percent in 2018. However, living standards remain unequal across geographic areas and ethnic
groups, with widening gaps. Poverty declined primarily in the south and north, while in the central
region—previously the wealthiest—it declined only slightly. Mountainous areas in the north and hilly
areas bordering Vietnam in the south encompass most districts with high poverty rates; they are home to
large ethno-linguistic minority populations and display evidence of poor nutrition.8 In 2018, 32.7 percent
of Mon-Khmer people and 38.4 percent of Hmong-Lu-Mien were poor. The gap had been widening since
2012 for the Hmong-Lu-Mien, who are 10 percent of the population but 19 percent of the poor.
Communities across Lao PDR face persistently high levels of vulnerability that hinder sustainable
welfare progress, linked to lack of livelihood diversification. Agriculture-only households are more likely
to have lower consumption and be poor. While poverty decreased, the share of poor households who
depend only on farming increased from 71 percent in 2012 to 79 percent in 2018.9 Nonfarm job creation
has been limited, hindering opportunities for diversification of incomes and thus increasing risks of
impoverishing income shocks.10 Diversification of agricultural production, further movement towards
market-oriented agriculture, and the enhancement of farm productivity where feasible will continue to
be crucial for livelihood improvement and to offer buffers against shocks in the sector.
High levels of childhood chronic under-nutrition continue to hamper long-term human and
economic development. Low nutrient intake and nutritional deficiencies among pregnant mothers and
infants under two years have long-term consequences for cognitive development. About 33 percent of
children under five years old were stunted in 2017,11 among the highest levels in the East Asia and Pacific
(EAP) region. Stunting did not improve as rapidly as monetary poverty in the four northern provinces
covered by the World Bank’s nutrition convergence approach since 2020,12 which have some of the
highest stunting rates in the country. Underconsumption of protein-rich food is a significant driver. In
addition, persistently high rates of adolescent pregnancy, especially among less educated and rural girls,
increase the risk of child stunting, reinforcing an intergenerational cycle of chronic malnutrition.
Lao PDR is highly exposed to disasters and risks arising from climate change. Its population faces
significant climate-related hazards that are exacerbated by poverty and malnourishment, especially
among marginalized communities.13 Annual expected losses from floods alone range between 2.8 and 3.6
percent of GDP.14 Climate models show a trend of consistent warming and an increase in the intensity of

7 World Bank 2022. Where are the Poor in Lao PDR Small Area Estimation: Province and District Level Results.
8 World Bank 2020: Where Are the Poor in Lao PDR? Small Area Estimation: Province and District Level Results.
9 World Bank. 2020. Lao People’s Democratic Republic Poverty Assessment 2020: Catching Up and Falling Behind. World Bank,

Washington, DC.
10 Ibid.
11 Stunting reflects chronic malnutrition as a result of failure to receive adequate nutrition over a long period and recurrent or

chronic illness. It is measured is by height-for-age. Children whose height-for-age is more than two standard deviations below the
median of the reference population are considered short for their age and are classified as moderately or severely stunted. Those
whose height-for-age is more than three standard deviations below the median are classified as severely stunted. (Lao Statistics
Bureau and UNICEF. 2018. Lao Social Indicator Survey II 2017, Survey Findings Report. Vientiane, Lao PDR).
12 National aggregates of childhood undernutrition in 2017 mask wide inequalities, with stunting rates significantly higher in

provinces such as Phongsaly (54 percent), Sekong (49.9 percent), Xiengkhuang (48.3 percent), and Huaphanh (40.7 percent).
13 The World Bank Group and the Asian Development Bank. 2021. Climate Risk Country Profile: Lao PDR (2021).
14 GFDRR, 2019. Post-Disaster Needs Assessment: 2018 Floods, Lao PDR

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heavy rains, altering the Mekong hydrological system, with floods increasing in frequency.15 Such events
are projected to have significant impacts on the region’s ecosystems, community infrastructure,
population health, productivity of labor, and agricultural livelihoods. These in turn will adversely impact
food and nutrition security. In addition, key economic activities, including mining, hydropower, and
agriculture, have also resulted in high rates of deforestation, natural resource depletion, and
environmental degradation, further exacerbating vulnerability to natural disasters and climate shocks.
The effects of such shocks typically will affect the poor disproportionately and exacerbate existing
inequalities, given their greater reliance on agricultural livelihoods and more limited coping mechanisms.16
Against this backdrop, strengthening the resilience of poor rural communities through improved
livelihoods and access to nutritious food is more critical than ever. A lack of diversity in livelihoods within
villages is a root issue leading to low resilience, along with lower formal education levels, language gaps,
weak village institutions, and limited access to basic infrastructure. Building resilience will mean
empowering communities to diversify their sources of self-consumed foods and income whenever there
is limited potential to improve the physical and economic productivity of existing agricultural activities. In
bad economic times, diversified income sources can help buffer negative impacts and limit the need to
resort to negative coping mechanisms. In good economic times, they will sustain improvements in
productive assets and enhance well-being.

Sectoral and Institutional Context
Improving rural and agricultural livelihoods will continue to hold the key for sustainable poverty
and vulnerability reduction in the upland areas of Lao PDR. While two thirds of the population live in rural
areas, they represent 88 percent of the poor. Almost all of these are agricultural households. About half
of these households can be characterized as living in remote areas, mostly in upland villages; only 64
percent of them live in villages with all-weather road access.17 Livelihoods in upland villages combine self-
consumption, sales, and uneven levels of remittances from seasonal or permanent migration. While none
of the villages is fully practicing subsistence agriculture, most are at risk of food and/or nutrition deficits,
in quantity and/or quality, should households’ own production decline.
Agricultural production is in transition, which climate and market shocks might accelerate. Upland
land use generally combines small patches of paddy land, rainfed or with gravity irrigation, with rotational
agriculture on typically one hectare of sloped land annually. Crop rotations have become very short,
around three years, due to land shortages.18 Village communities are already transitioning, with
Government support, to fencing part of the communal fallows for livestock use, although this will require
reliable water sources. In the rotation, the predominant hybrid maize crop, a cash crop for 90 percent of
producers (nationwide), implies the annual use of external inputs,19 while higher input and transportation
costs have started to substantially reduce margins. Cassava cultivation has been steadily increasing since
2020, with potential significant implications for upland smallholders. Rubber and banana plantations are
partly village-based but their presence in project villages is reportedly limited and has stabilized. Extreme
weather and more intense droughts impact households’ self-consumed foods.

15 Prime Minister’s Office. 2021, July. National Strategy on Disaster Risk Reduction (NSDRR), 2021 – 2030.
16 The World Bank Group and the Asian Development Bank. 2021. Climate Risk Country Profile: Lao PDR (2021).
17 World Bank. 2019. Lao People’s Democratic Republic Poverty Assessment 2020: Catching Up and Falling Behind. World Bank,

Washington, DC.
18 Cramb, Rob Editor 2020. White Gold: The Commercialization of Rice Farming in the Lower Mekong Basin. Palgrave

MacMillan.
19 UNCTAD 2020. Analyzing the Maize Value Chain for Export in Lao People’s Democratic Republic.

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Connectivity has improved, at least in the northern part of the country, but upland villages with a
lack of roads for reliable physical market access remain at risk of structural food deficits. Smartphones are
ubiquitous among the young generation, even when the signal does not reach the village itself. Province-
wide, 72 percent of villages in the north, 74 percent in the south, had road access in 2019. Satellite images
show that a significant proportion of villages in poorer districts do not have road access, which hinders
access to markets and basic services. According to the 2020 agricultural census, households in villages
without road access were twice as likely to report being anxious about not having enough to eat. Another
important feature of local governments’ action is the on-going relocation of isolated, small settlements
into larger villages with road access under the Government’s rural development policy.
Despite these common features, villages differ markedly on the way forward, requiring adapted
models for resilience. Geographical remoteness, connectivity to markets and services, ethnicity,
dependence on forest resources, remaining unexploded ordnance (UXO) presence, and past and recent
migration history are among the factors that contribute to this diversity. Close to 3,000 villages
countrywide (35 percent of all villages) are listed as upland villages.20 These are typically a mix of small
communities of around 30 to 100 households, and larger consolidated villages comprising several
hamlets.21 Villages along the northern corridor, linked to China by train since mid-2022, and those close
to the border with Vietnam in the northeast have substantial new opportunities for income generation.22
The “Sam Sang�? (three drive) devolution policy defines the formal functions of local administrative
levels, enhancing the decision-making capacity at the district level and identifying the village as the basic
development unit. The Ministry of Planning and Investment promotes participatory planning guidelines
for the integration of villages’ priorities into the five-year socioeconomic development plans. Village
institutions are seen by the Government as an effective mechanism to deliver inclusive local investments.
However, this village-level process is not fully institutionalized, and elements of participation can be
strengthened. Village administration is led by a locally elected village chief, who is assisted by deputy
chiefs, and heads of village hamlets. Participation in local institutions tends to be dominated by older men,
with limited voice for youth and women. Ethno-linguistic minority groups face barriers in engaging with
the local administration and are at significant risk of being excluded from development initiatives, largely
due to language and capacity constraints.
Women’s active and effective participation in local decision-making is limited.23 Ingrained social
norms discourage women from voicing their needs.24 Language barriers and illiteracy pose an additional
disadvantage for women, especially non-Lao-Tai women.25 Gender inequalities persist also in economic
opportunities, despite women’s significant role in the rural economy. Women tend to be in low-quality
jobs. Around 86 percent of working women in Lao PDR are self-employed, compared with the Association
of Southeast Asian Nations (ASEAN) average of 46 percent. Most of them are employed in agriculture or
unpaid care work: in 2018, rural women spent over four times as much as men on household chores,
limiting their ability to engage in both formal and informal work.26 Female-headed households have less
household labor and productive assets than male-headed households and less diversified crop

20 2020 Third Agricultural Census.
21 Laos Statistics Bureau, 2021 population on-line data, by province.
22 World Bank Group 2022. Developing the Agribusiness Potential in the Laos-China Railway Corridor.
23 FAO. 2018. Country Gender Assessment of Agriculture and the Rural Sector in Lao People’s Democratic Republic. Vientiane.
24 Lao PDR PFR, Impact Evaluation, 2016.
25 LECS 2018 data.
26 LECS 2018

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production,27 rendering them less resilient to economic shocks and the adverse effects of climate change
and disasters. For women in poor rural areas, structural transformation and commercialization have
opened relatively fewer opportunities for employment off-farm than for men, increasing their economic
vulnerability.
The Poverty Reduction Fund (PRF), under the Ministry of Agriculture and Forestry (MAF), has
established itself as one of the main Government institutions working to reduce poverty in rural areas,
implementing a series of three World Bank-financed projects by the same name, starting from 2003. The
third project (PRF III - P157963) is currently under implementation. The PRF series improved access to
infrastructure for well over a million rural people through construction of over 6,000 small infrastructure
works. Close to 10,000 households had pursued new livelihood investments through PRF III as of 2020.
The PRF project series has gradually evolved, expanding the scope of interventions from rural
infrastructure to community livelihoods interventions and introduced community nutrition activities. In
parallel, it deepened its participatory approach to community investment decisions, strengthened its
focus on district level capacity, sharpened its targeting approach to reach poorer areas. Changes have
been incremental, based on piloted and rigorously evaluated new interventions. Geographic coverage has
also shifted over time. PRF III contributes to the nutrition convergence agenda in four high-stunting
provinces in the north (Oudomxay, Phongsaly, Huaphanh, Xiengkhuang).28
Two main strategy frameworks define the policy context of the project: MAF’s 2021-2025 Strategy
and the Government’s Decree 348 (2017), implemented under MAF’s oversight. MAF’s Strategy defines
agricultural production for domestic food security and nutrition as its first priority, seeking to balance the
development of agricultural commodities for domestic and international markets. Under this strategy,
MAF’s 2021-2025 plan promotes learning through household groups and networks, as well as the
establishment of registered producer groups, a first step towards the creation of farmer cooperatives,
and access of these producer groups to formal credit. MAF considers adaptation to climate change a
priority. Decree 348/GOL (2017) reflects a geographical expansion of the country’s poverty reduction
efforts. Under the decree’s definition for the graduation of villages and districts from poverty, 93 districts
were poor in 2022. These criteria include road access, availability of clean water and market access.

C. Proposed Development Objective(s)

Development Objective(s) (From PAD)
To improve rural livelihoods and consumption of diverse foods for targeted vulnerable communities, and to respond
promptly and effectively in case of Eligible Crisis or Emergency.

Key Results
Indicator 1: Percentage of Income-Generating Activities29 (IGAs) implemented that are viable 1 year after having
benefitted from financing under the project (total; women-owned IGAs; non-Lao-Tai-owned IGAs)

27 FAO, 2019. Country Gender Assessment of Agriculture and the Rural Sector in the Lao PDR.
28 Since 2020, the World Bank has been working with the Lao government and development partners to help ensure nutrition
and food security through coordinated interventions across sectors (livelihoods, social assistance, improved childcare practices,
access to health services, and water, sanitation, and hygiene).
29 An IGA is defined as viable when it generates a gross operating profit ((gross operating profit = total revenue – total

expenses).

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Indicator 2: Number of project beneficiary households that have at least one additional source of income from
project activities (total; female-headed households)
Indicator 3: Percentage change in travel time to drinking water, agricultural areas, markets, agricultural
storages, drying platforms and processing site areas
Indicator 4: Percentage of children aged 6 to 23 months from community nutrition groups (CNGs) households
consuming foods from five out of eight recommended food groups
Indicator 5: Number of direct beneficiaries (total; female; non-Lao-Tai).

D. Project Description

CLEAR is a community and local development (CLD) project that builds off the PRF series while
taking advantage of Lao PDR’s changing rural sector and evolving policy framework. Proven
implementation mechanisms and multisectoral approaches of the PRF series are maintained. Activities
will be successively implemented in two batches of clustered districts and villages, with a two-year project
cycle in each village. The amount of the block grant is the same in each village.
The project targets some of the most vulnerable communities in Lao PDR, continuing to support
four nutrition convergence provinces in the north (Huaphanh, Oudomxay, Phongsaly, Xiengkhuang) and
expanding to three provinces in the south (Saravan, Savannakhet and Sekong). It will be implemented in
14 districts (two per province). PRF III beneficiary villages will be avoided. The geographic targeting is
based on a data-driven exercise. Provinces were ranked based on a simple index including
multidimensional poverty,30 stunting prevalence,31 vulnerability to climate-induced shocks and natural
hazards,32 and dimensions of deprivation directly relevant to the project (low connectivity, high reliance
on agricultural incomes).33 Two districts are selected in each province, based on poverty status34 and
operational feasibility (e.g., proximity, complementarity with other programs, etc.).
CLEAR tailors activities to three types of villages, defined according to their current vulnerability
levels and market access potential. All project components will be implemented across all-villages. See
Table 1. Approximately 32 villages will be selected within each district, prioritizing those considered poor
based on PMT/Decree 348 data and graduation criteria, complemented with other available indicators
such as distance from markets and absence of other programs. CLEAR will cover about 450 villages. It
reflects synergies and complementarities with the main development projects in the same districts.
Table 1: Village Typology Matrix and Overview of Activities by Village Type

Type I Type II Type III
Food security level Intermediate level Transition level
Current status Remote village Village with improving connectivity Less remote village with improved
Limited connectivity to market to market connectivity to market, exposed to
Exposed to food security shocks Exposed to income shocks and market risks and unemployment risks
and climate change impacts climate change impacts and climate change impacts

30 Multidimensional poverty, based on LECS 2018 in World Bank. 2020. “Lao People’s Democratic Republic Poverty Assessment
2020: Catching Up and Falling Behind.�? World Bank, Washington, DC.
31 Lao Social Indicator Survey II, 2017.
32 Data from the Global Facility for Disaster Reduction and Recovery (GFDRR) database, available on thinkhazard.org.
33 Share of households with agriculture-only incomes; share of villages without road access in the rainy season (Lao Expenditure

and Consumption Survey 6, 2018/2019).
34 Based on Decree 348 data and monetary poverty estimates at district level from World Bank 2022. Where are the Poor in Lao

PDR Small Area Estimation: Province and District Level Results.

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Activities by village type
Community Basic access (e.g., access road Production oriented (e.g., drying Groups’ infrastructure needs (e.g.
infrastructure spot improvement, bridges, platform, field access roads) drying platform, processing site area,
drinking water) storage)
Livelihood groups Self-help groups (without Self-help groups (with savings and Self-help groups (with savings and
savings and credit) credit) credit); producer groups
Nutrition A – Social and behavior change communication (SBCC) activities
interventions B – Promotion of nutritious foods, adapted to village resources
CLEAR community Voluntary village application process after orientation training
capacity building Community capacity strengthening program for selected villagers and local staff
Hamlet and village participatory process

Component 1: Local Economic Development and Community Capacity Strengthening (US$25.6 million)

This component supports activities taking place at the level of the whole village community.
Activities will strengthen community capacity to prioritize climate resilient village-level initiatives and
related small infrastructure investments and organize their operation and maintenance. This will be done
in a way that promotes participation of community members and attention to the needs of women, all
ethno-linguistic groups and vulnerable groups.
Subcomponent 1.1: Participatory Village Development Planning (VDP). The VDP process will allow
villagers to vote for a short list of small infrastructure investments, comparing proposals from the groups
set up under Components 2 and 3 with other basic infrastructure needs, and reach an agreement on how
to operate and maintain this infrastructure. Updated village development planning guidelines,
incorporating recent best practice in the country and a clear process for incorporating climate and risk
considerations, will be adopted. The institutionalization of this process will support district governments
in incorporating village priorities into their sector plans. Villages will develop village profiles with
information relevant to tailor activities to the village context.
Subcomponent 1.2: Community Capacity Strengthening. This subcomponent, taking place in
parallel with Subcomponent 1.1, will equip key community representatives, including women and newly
selected village facilitators, with the knowledge and skills to lead the community in developing a forward-
looking, inclusive vision of local development and resilience. They will participate in training to acquire
soft skills as well as practical project implementation skills, such as early warning to reduce disaster risks.
Additional sessions, for women only, will focus on building self-confidence, resilience, and the ability to
identify priority needs. Peer learning among training participants and the use of multimedia will be
encouraged during and after the sessions.
Subcomponent 1.3: Climate-resilient Community Infrastructure. This subcomponent allocates block
grants to beneficiary villages for the climate-resilient construction or renovation of the small
infrastructure works selected through the VDP process. Climate-resilient small infrastructure will be
implemented through a process of participatory design, procurement, construction, supervision and
formal hand-over to the community. The range of eligible infrastructure includes: (a) agricultural and rural
access roads, outside the district’s rural road network, (b) drinking water and irrigation, (c) village facilities
for climate-smart crop production or livestock and fish raising, (d) drying platforms and storage facilities,
(e) small processing facilities, and (f) tree preservation (e.g., fencing) or tree planting. The Project

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Implementation Manual (PIM) will include details on non-eligible infrastructure.35 Prior to the
construction, two villagers already with basic construction skills will attend training at a local vocation
school and receive a kit of small tools for the community. Villages will be encouraged to use cash-for-work
schemes for construction and maintenance as feasible.

Component 2: Community Livelihoods Enhancement (US$7.2 million)

This component supports group-level activities that promote income generation. Groups will be
adapted to the socioeconomic situation of villages. In type II and type III villages, CLEAR will follow the
PRF’s process of supporting savings and credit groups, mostly composed of women, building financial
literacy and diversified income-generation activities. In select type III villages with confirmed market
opportunities, the project will support the emergence and capacity building of registered producer groups
(PGs) and of producers of agricultural inputs. In type I villages, where capacity to develop self-sustainable
savings and credit activities is inadequate as most group members, both men and women, are relatively
poorer, the groups will engage in food production.
Sub-Component 2.1: Development and Management of Self-Help Groups (SHGs). This sub-
component provides training and facilitation for step-by-step self-organization of members of different
households into groups. SHGs will be engaged in saving and thrift activities and will be encouraged to
pursue at least two income-generation and/or food production activities. They will draw from a list of on-
farm and off-farm livelihood options. Elected group representatives (three per group) will form the village
self-help group management committee (VSMC). The committee members will be trained in group
management, record keeping, and fund rotation, with a simplified process in type I villages. Individual
members will retain the option to use their small loans for income-generating activities if different from
the group’s priorities. Members with higher technical and financial capacity will be encouraged to develop
individual or group enterprises, focusing on the production and sales of local agricultural inputs and/or on
establishing a PG. Group principles including regular meetings will be key to promote peer learning.
Sub-component 2.2: Income Generation and Food Security Capacity Building. This subcomponent
builds capacity among district staff and the project’s young graduates, who will then deliver training to
SHG members on diversification of income generation and food self-production sources. The project will
develop a new series of technical training modules and training methods adapted to these beneficiaries,
complementing existing training materials by MAF with new modules prepared with support from the
university teams. The training modules will highlight climate-smart agriculture36 such as the use of
climate-resilient seed varieties, animal feed and fodder production from locally available sources, erosion
control measures, the use of animal manure, non-timber forest products, sustainable harvesting or
cultivation and the reduction of post-harvest losses. Specific modules would cover integrated pest
management, improved marketability, prevention of animal diseases and mortality reduction. Capacity
building will take the form of hands-on learning through in-village demonstrations by selected group

35 Non-eligible infrastructure includes, for example, the rural road network that is under the responsibility of the Ministry of
Public Works and Transportation; schools and health centers; river embankments, since these are complex projects to be
designed jointly for several villages; irrigation canal lining since these are generally exposed to landslides; etc. Village
infrastructure specifically serving the expansion of previous village facilities due to the arrival of households relocated less than
2 years prior or planned for relocation is another non-eligible activity. A full list of non-eligible infrastructure is included in the
PIM.
36 Climate-smart agriculture (CSA) is an integrated approach to managing landscapes (cropland livestock forests and fisheries)

that address the interlinked challenges of food security and climate change. CSA aims to simultaneously achieve three
outcomes: Increased productivity enhanced resilience reduced emissions.

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members. Multimedia peer learning methods will be used.
Sub-Component 2.3: Delivery of Project Grants and Management of Productive assets. SHGs and
local input suppliers are eligible for project seed grants. The SHGs’ seed grant will be provided through
the bank account of the VSMC, against submission of a microplan, while input suppliers and PGs will be
required to submit a market-oriented business plan. In addition to encouraging individual activities, the
SHG will engage in the maintenance of group productive assets such as drying platforms or storage and
processing space. When these facilities are built through the Component 1 subgrants, formal handover to
a relevant SHG will take place upon completion of the construction works, with clear definition of
ownership, operation, and maintenance responsibilities, and a fee recovery system, outlined in the PIM.
Component 3: Community Nutrition Interventions (US$4 million)

This component will support improvements in the dietary intake (both in quality and quantity) of
mothers and children in the 1,000-day window through the promotion of innovative nutrition practices.
The component is based on five principles: (a) the introduction of proven timesaving in-village processed
foods, (b) community contributions, (c) a results-based incentive for well-performing villagers, (d)
harnessing the power of youth and social media, and (e) maximizing food sources in increasingly resource-
constrained local food systems. Community resilience will be strengthened through maintaining a
combination of foods from households’ own production, food purchases and collection of forest food
products. The food sources promoted will reflect the community’s agro-ecological and cultural context.
Subcomponent 3.1 Promotion of demand for enhanced nutrition practices. The project will adopt
an integrated social and behavioral change communication (SBCC) approach to deliver activities targeting
individuals, family and peer networks, and the whole community. Women-led community nutrition
groups (CNGs) will be established and trained in each community, consisting of pregnant women and
mothers of children under two years, their children and other caretakers. These groups will meet once a
month for practical group-based learning, food processing, cooking, discussions on SBCC modules in
MAF’s mandate (food production, food processing, food expenditure, wild food collection), and sharing
messages on basic nutrition as well as gender equality. Each CNG will be equipped with a basic cooking
and a food processing kit (including a small mill and drying nets).37 Food subsidies to CNG members will
cover the purchase of foods for two years, matching a community contribution. CNG members will also
distribute rations to the poorest households in their community. Home visits by a young graduate and
accompanying village facilitator will deepen delivery of messages to CNG members. Multi-media peer
learning (MMPL) will complement other group activities. Young village women, after training, will capture
and disseminate the group’s success stories, starring local villagers, and using culturally appropriate ways
of storytelling and local languages. Videos (or photos, in some very poor villages) will be shared during
group meetings and on social media. Finally, an integrated community nutrition platform for coordination
and regular meetings to influence village authorities, husbands, and SHG members will be supported. In
nutrition convergence areas, community meetings will include use of child nutrition scorecards.38
Subcomponent 3.2 Promotion of community-sourced nutritious food. First, the subcomponent will
support home nutrition gardening. Nutrient-dense crops suitable for cultivation in areas with limited
water and land access will be promoted for home consumption and group cooking. The Lao Farmer

37 The kit is expected to include a mill for the production of roasted rice-mung bean flours called “pre-mix for child feeding�?,
powders of dried fish and frogs as well as leaf powders.
38 It is expected the Reducing Rural Poverty and Malnutrition Project Phase II (P178883) will develop child scorecards with

nutrition and health monitoring information, with inputs from other nutrition convergence projects.

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Community Livelihood Enhancement And Resilience (P178545)

Network (LFN) will train CLEAR and district agriculture and forestry office (DAFO) staff. They in turn will
train three lead farmers from each CNG in setting up pesticide-free gardens and composting and provide
them with initial seed and seedlings. Only organic production methods will be promoted, which will
reduce the project’s contribution to greenhouse gas (GHG) emissions. Agricultural fact sheets will be
translated into audio clips and local languages. Second, goat dairy production and use will be supported
to provide a key ingredient in child feed recipes, expanding the PRF III pilot. The project will train existing
goat farmers in 100 villages in raising, feeding and milking indigenous goats. Both sets of activities will use
a training-of-trainers approach for CLEAR staff, select CNG members or model goat farmers and DAFO
officers, followed by training CNGs and SHGs, reliant on face-to-face and online/multimedia tools. Farmers
raising goats will be provided with a simple milking set and milking record books to record daily milk yields.
Component 4: Project Management, Capacity Building and Monitoring and Evaluation (US$8.2 million)

This component provides technical and operational assistance for the day-to-day management of
the proposed project and its Monitoring and Evaluation (M&E) system. It covers hiring, training and
remunerating national and district PRF staff as well as the costs of village facilitators; associated
equipment and operating costs; accounting, procurement, financial management, internal controls,
auditing, environmental and social safeguards, M&E, and other specialized support.
The component also supports activities geared towards further improving the sustainability of
CLEAR approaches and principles by MAF, including through a review of how community-based poverty
reduction interventions can be further embedded in MAF core programs, particularly using core MAF
human resources in CLEAR implementation at provincial and district levels; a communication strategy on
the role and results of PRF, and tools for outreach and fundraising; and preparation for additional phases
of CLEAR or similar projects, should they be pursued.

Component 5: Contingency Emergency Response Component (CERC) (US$ 0)

This component has an initial zero value but may be financed during the project to respond to an
. eligible crisis or emergency.
.
Legal Operational Policies
Triggered?

Projects on International Waterways OP 7.50 No

Projects in Disputed Areas OP 7.60 No

Summary of Assessment of Environmental and Social Risks and Impacts
.

Overall, the project is expected to have positive environmental and social impacts by improving the
livelihood opportunities and nutritional outcomes for poor communities in selected Provinces to enhance
their resilience to shocks. The activities would build on the current ongoing PRFIII-AF and focus the poorest
areas in the northern and central regions of Lao PDR based on the recent poverty assessment and
migration including those most impacted by COVID-19, and those most likely to be affected by climate

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change. The project would channel its block grants in a subproject approach to targeted villages to
improve access to productive infrastructure and income generating opportunities. The project will
support construction or rehabilitation of basic and climate resilient infrastructure and support to
livelihood activities. Implementation of the CLEAR subprojects will be directly managed at the village level
and the project will therefore build the capacity of local communities to plan, implement, and sustain
these sub-projects.
Experience from similar set of activities and implementation arrangement financed under PRFIII
suggested that these type of small-scale infrastructure works, and livelihood support activities can induce
negative environmental and social risks and impacts. The project recognizes that 8 out of 10 ESSs (ESS 1,
ESS 2, ESS 3, ESS 4, ESS 5, ESS 6, ESS 7 and ESS 1039) are assessed to be relevant to the project.
The social risk is classified as Moderate. Whilst the project aims to deliver a range of benefits,
project activities have the potential to generate moderate, predictable, mitigatable social risks and
impacts, that are low in magnitude. Social risks and impacts anticipated for this project include: (a) lack of
stakeholder engagement; (b) risk of exclusion and discrimination particularly of ethnic minorities and
vulnerable groups if not adequately represented in project activities; (c) risk of elite capture, (d) risks
related to the labor and working conditions of project workers; (e) small scale land acquisition and/or
access restriction, (f) risk of Sexual Exploitation and Abuse and Sexual Harassment (SEA/SH) and (g) child
labor. These risks and impacts are for the most part predicable and possible to mitigate during the lifetime
of the project.
Environmental risk is classified as Moderate. The direct environmental risk and impact are expected
from (1) physical construction and renovation civil works (noise, vibration, dust, generation and
management of construction wastes); (2) occupational health and safety issue of project personnel who
are implementing projects activities (injured from falling subject and other construction activities, road
safety, and transmitted and infected with COVID-19); (3) potential involvement of project staff in
consuming and trading wildlife and other NTFP while working and staying in remote village areas; (4)
Community Health and Safety (CHS) of those involve in project activities and accident caused by project
vehicle; (5) exposure to an unexploded ordinance (UXO) risk. In addition, indirect risk and impact are
expected from (1) generation and management of solid waste during the operation of office facilities
(including minor electronic waste from the used IT equipment procured by the project), (2) access to and
extraction of natural resources by road users while using tertiary road supported by the project (including
expansion of forestland, involving with illegal hunting and logging), (3) improper/unsafe use of pesticides,
fertilizers for agricultural intensification and irrigation related subproject, (4) no protection of water
sources for future water supply, (5) unsafe used of water tap built by the project which may lead the bad
environment and illness in the village, and (6) potential fire at storage or processing facilities built for
horticultural products and animal husbandry, solar driers supported by the project and other nearby
facilities. However, these potential environmental impacts will be minor, localized, temporary and can be
mitigated through the design and implementation of subprojects and environmental and social mitigation
measures in compliance with ESF requirements.
Prior to appraisal, the client with the support from consultants, will develop, consult, and disclose

39ESS 1: Assessment and Management of Environmental and Social Risks and Impacts; ESS 2: Labor and Working Conditions;
ESS 3: Resource Efficiency and Pollution Prevention and Management; ESS 4: Community Health and Safety; ESS 5: Land
Acquisition, Restrictions on Land Use and Involuntary Resettlement; ESS 6: Biodiversity Conservation and Sustainable
Management of Living Natural Resources; ESS 7: Indigenous Peoples/Sub-Saharan African Historically Underserved Traditional
Local Communities; ESS 10: Stakeholder Engagement and Information Disclosure

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Community Livelihood Enhancement And Resilience (P178545)

an Environmental and Social Commitment Plan (ESCP), ESMF which will include guideline and principle for
development and implementation of E&S mitigation measures to ensure that project activities are
compliance with ESF requirements. This will include (a) Resettlement Policy Framework (RPF), (b) Labor
Management Procedures (LMP) and (c) a negative list of activities not eligible for financing, The project
will have to ensure adequate budget and staff for project E&S risk management, monitoring and reporting
include a training which will be informed by the capacity needs assessment. All ESF related activities to be
funded by the Client as part of the project budget.
The project is expected to involve different groups of stakeholders from national to village levels,
including local communities, government line agencies, mass organizations and the private sector. The
project’s stakeholders and the level of their engagement will be identified and analyzed by the PRF during
project preparation and a Stakeholder Engagement Plan (SEP), including a Grievance Redress Mechanism
(GRM) will be prepared. Requirements of ESS7 on meaningfully involving ethnic groups in project activities
will be included in the SEP and not in a standalone document
An Environmental and Social Commitment Plan (ESCP), drawn and agreed between the Bank and
the Borrower, will set out the important measures and actions that will be required for the project to
meet environmental and social requirements over the project’s lifetime. These measures will be
implemented within a specified timeframe and the status of implementation will be reviewed as part of
project monitoring and reporting.
During the implementation stage, site specific E&S screening will be conducted following the
screening procedure outlined which will be developed in the ESMF to identify environmental and social
risk and impact, and mitigation measures for each proposed sub-project.
For the preparation of the ESF instruments, the client will engage external consultants to support the PRF
with the preparation of the required ESF instruments during project preparation. These will be financed
from the Project Preparation Advance which is being prepared.

E. Implementation

Institutional and Implementation Arrangements
The Poverty Reduction Fund (PRF) agency will be responsible for implementation of the CLEAR
project.40 PRF has a mandate to implement MAF strategy, while allowing it to retain flexibility in terms of
planning and budgeting. The PRF Board, chaired by the Minister of Agriculture and Forestry, has formally
approved the design of CLEAR on February 27, 2023. The Board includes MAF departments (Planning and
Finance, Rural Development and Cooperatives), other relevant ministries and the governors of
participating provinces. It will provide oversight for both the on-going PRF III and CLEAR.
A project management unit (PMU) for CLEAR will be established at the central level under the PRF
agency in MAF. The PRF Executive Director and the Deputy Executive Director will manage and provide
oversight for both PRF III and CLEAR. Senior financial management and procurement officers, as well as
support staff such as IT officers, will also work on both projects. Other technical specialists, such as those
in charge of Components 1, 2 and 3 and M&E, are expected to be partly senior staff with experience
gained through the PRF project, partly newly recruited staff. A communications and training specialist is

40The PRF is a legally established semi-autonomous entity, established and operated in accordance with the Decree of the
Prime Minister (10/PM, 2012) with the status of a level two technical organization within MAF, as per Prime Minister’s Decree
No.99/PM, March 2017 on the Organization and Functionalities of the Ministry of Agriculture and Forestry.

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Community Livelihood Enhancement And Resilience (P178545)

added. A full-time E&S and Gender specialist will be recruited for the first two years of the project and
intermittently in the following years. The PRF agency will implement CLEAR based on a Project
Implementation Manual (PIM) and relevant technical guidelines. The PIM will include a detailed
description of the project cycle, processes, and guidelines for activities under each component.
CLEAR will be implemented through district teams and several activities will be delivered by young
graduates (YGs). The PMU will establish district teams in each project district and directly hire their staff.
District teams will comprise a team leader, an M&E officer, an engineer, an agriculture and livelihoods
officer, a nutrition officer, a financial management assistant, and procurement officer, and young
graduates. One of the district team leaders for each province will be tasked with coordination at the
provincial level. An E&S and gender specialist will be included to cover all districts in one province. Around
one graduate per five villages will be employed. Half of the YGs will be responsible primarily for nutrition
activities, the other half for agriculture and livelihoods (including support to SHGs with savings and credit).
Recruitment will prioritize candidates fluent in at least one local language other than Lao. YGs, both men
and women, are equipped with a motorbike each, and covered by travel and health insurance. To optimize
logistics, reduce travel risks and allow longer village visits, it is foreseen that the young graduates travel
to villages monthly.
The communities will take an active role in project decisions and implementation. The village
implementation team (VIT), i.e., the village committee enlarged to include relevant community members
such as elders, will lead the project’s participatory process, with support from at least one village
facilitator in each village. The village facilitator will be a local community member with a relatively higher
education level and higher fluency in Lao. He or she will work as liaison with the PRF team for the three
components. The PIM will reconfirm how consultations and communications are consistent with the
stakeholder engagement plan, paying special attention to marginalized groups. Among mass
organizations, the LWU and LYU at village level will be directly involved, starting with Component 3. The
village self-help group management committee (VSMC) will manage the savings and uses of the project’s
seed grant through a commercial bank account. It will support the village committee in the management
of Operation and Management (O&M) fees for community infrastructure and be directly in charge of O&M
decisions in group activities. The village mediation committee will ensure downward accountability
towards small infrastructure preparation, implementation, operation and maintenance.
CLEAR will actively mobilize district-level stakeholders, MAF colleges and agricultural faculties in
universities and service providers as relevant. The district bureaus, including district agriculture and
forestry office (DAFO), planning, health (overseeing drinking water schemes), and public works and
transportation, will form the district’s CLEAR Steering Committee (SC), in charge of reviewing VDPs,
integrating village priorities into their sector plans, and supervising activities on the ground. The district
vocational schools will be mobilized for the training of selected villagers in construction work. Technical
level coordination with other on-going projects will also take place at district level. It may take the form
of mutual contributions to capacity-building activities and/or exchanges of working tools. PRF will engage
the country’s five agricultural universities and civil engineering colleges. Experts and students from these
organizations will contribute to activities that include the village profiles, the update of training modules,
and village technical monitoring. Service providers will bring in additional expertise and capacity to launch
activities.
Project implementation is organized in the form of two batches of around 225 villages each, since
covering all villages at the same time would be logistically challenging. CLEAR will first be implemented in
districts not covered by PRF III to avoid staff uncertainties about differences between the two projects.

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Community Livelihood Enhancement And Resilience (P178545)

Each village will undertake a two-year project cycle structured into a set of implementation steps. The
timing of each step takes into account uneven availability of village participants during the slack and peak
agricultural seasons, and the rainy season constraints for travel and construction works. The PIM will
describe the project cycle. Managing implementation as a clear series of steps will also help each village
strengthen ownership of the CLD approach in the community.
Digital tools will be leveraged. CLEAR will take full advantage of the country’s high phone and
internet network coverage, and the young generation’s capacity to engage through digital tools. It will
expand a capacity-building approach successfully introduced for local PRF staff in PRF III, combining face-
to-face sessions with distance learning via a YouTube channel. The project provides weatherproof tablets
to the young graduates, with software allowing off-line sessions, and smartphone credit to the village
facilitators. Digital tools will also enhance peer-to-peer learning, within and across project villages, as well
as with successful groups in similar environments elsewhere in the country.
.

CONTACT POINT

World Bank

Benjamin Burckhart
Senior Social Development Specialist

Giorgia Demarchi
Senior Social Development Specialist

Borrower/Client/Recipient
Lao People’s Democratic Republic

Implementing Agencies

Poverty Reduction Fund - Ministry of Agriculture and Forestry
Phatnakhone Khanthamixay
Executive Director
phatnakhone@prflaos.org

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Community Livelihood Enhancement And Resilience (P178545)

FOR MORE INFORMATION CONTACT

The World Bank
1818 H Street, NW
Washington, D.C. 20433
Telephone: (202) 473-1000
Web: http://www.worldbank.org/projects

APPROVAL

Benjamin Burckhart
Task Team Leader(s):
Giorgia Demarchi
Approved By

Practice Manager/Manager:

Country Director: Alexander Kremer 02-May-2023

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