Resettlement Policy Framework

China State Council Leading Group for Poverty Alleviation and Development

Foreign Capital Project Management Center

November 2014

Table of Contents

Executive Summary

A. Project Overview, Principles and Rationale for a Resettlement Policy Framework

B. Framework for Land Acquisition

B1. Objectives and Relevant Terms of the Policy Framework

B2. Preparation and Approval of Resettlement Action Plans

B3. Institutional and Legal Framework

B4. Implementation Process

B6. Budget Arrangements

B6. Public Participation and Information Publication

C. 4.Land Transfers and Use of Land as Shares

D. Complaint Mechanism

E. Monitoring and Evaluation

Appendix I Laws and Policies Related on Land Acquisition

Appendix II Compensation Principles for the Project Areas

Appendix III Laws and Policies on Social Security

Appendix IV Entitlement Matrix

Appendix V Summary of Land Occupied for Market Construction

Executive Summary

  1. Process

This Resettlement Policy Framework (RPF) is based on the findings of a full social assessment that bas been undertaken during project preparation by an independent and qualified consulting firm, with extensive community consultation. The draft document was made available to the public locally and the final document has been publicly disclosed.

  1. Purpose

The World-Bank financed Poverty Alleviation and Agriculture Development Demonstration in Poor Areas Project aims todevelop and demonstrate rural value chain models in selected destitute areas that promote equitable organizational arrangements, participation, and the sustainable increase of income of poor households in 547 administrative villages in Gansu, Sichuan and Guizhou provinces.This RPF is established for the following purposes:

Under Component I, the project will finance agricultural cooperative investment funds. Cooperatives are likely to use part of this investment to expand their farming operations in the form of plantations or breeding farms (production bases). The RPFconfirms the participatory process and cooperative formalization process, which have been instituted in the project implementation manual and will serve to ensure fair and transparent land arrangements. It also provides additional detail to guide implementation of these processes.

Under Component 2 (public infrastructure and services), the project will finance the construction of public markets and access roads to production areas. At the time of appraisal, no instance of civil works requiring land acquisition had been identified.However, as most locations for markets have not been confirmed at the time of appraisal (Appendix V), and none of the locations for access roads have been confirmed, it cannot be ruled out that some of this infrastructure would require land acquisition. The World Bank Policy on Involuntary Resettlement OP 4.12 is therefore applicable. This RPF is produced to ensure full compensation at replacement cost of all affected households.

When access roads are built on land currently used as farmland, most landis likely to be obtained through voluntary adjustments within the project villages. TheRPF requests coordination and agreement by the villagers, and documentation of these cases. It will also guide the implementation of voluntary exchanges.

The project will take place in an environment where the government is implementing ecological resettlement operations. Successful cooperative development can only take place in stable communities. The RPF confirms that the project villages will neither be departure locations nor arrival locations for households in on-going ecological resettlement programs.

  1. Compensation for the Construction of Rural Infrastructure and Other Civil Works

In accordance with OP 4.12, instances requiring land acquisition have been avoided during project preparation and will continue to be avoided where feasible, or minimized, exploring all viable alternative project designs.

In instances where land acquisition is unavoidable, affected personswould be diverse. Although most of them will be farmer households affected on farmland, it may not be precluded that some households might be urban households, or some land might be residential land, or the construction of some markets might affect occasionally houses and lead to house demolition. As a result, the RPF is a generic document covering all these instances.

July 2011 (project identification) is the cut-off date established to determine whether land for future project-funded infrastructure or facilities are covered under the present RPF. Counties that have acquired land after July 2011 have produced a due diligence report prior to appraisal to confirm absence of land acquisition. Information included in these reports will be monitored during project implementation.

  1. Land Transfers and Use of Land as Shares for Agricultural Production

In accordance with OP 4.12, any instance of land transfer or use of land as share in a joint cooperative investment must be fully voluntary. Households will therefore retain the possibility not to join or to opt out after the end of a contract period. In cooperatives, since the project provides an investment fund to cooperatives in a grant form, there should be no requirement that households are requested to pool their land into the cooperative’s capital stock (“land shares”) as a condition to become a cooperative member. Should the use of land as shares be the preferred option for local members, related rights to dividends would be open in a transparent manner. Land transfers are now requested by the national legal framework to take the form of a contract with a clear time limit, and with payments based on the local land market. This process is starting in the project areas, and this RPF guides full use of this legal framework.

In order to ensure that the project is implemented in accordance with these principles, project supported cooperatives are required to go through a participatory process of formalization of new or existing cooperatives that includes a mandatory step on land arrangements. Participants will receive prior information and training on land management in cooperatives, and they will receive individual land transfer contracts in the event of land transfer.

Land transfers and land share schemes for a production base undertaken by a project-supported company or organization other than a cooperative will be subject to the same requirement.

  1. Complaint Mechanism

A complaint mechanism covering all situations listed in this Resettlement PolicyFramework is set up. This mechanism will start at the administrative village or township level. The government offices in charge will be resettlement offices, or another relevant office that has been designated for the project.

  1. Responsibilities and Budget

County PMOs assume overall responsibility for the implementation of this RPF. They ensure that township project implementation units and village committees undertake the consultations and negotiations that are needed to prevent any unnecessary land acquisition under the project. They will assume all expenses to cover planning in relation to this framework and any potential need for compensation.

The Provincial Project Management Offices, under the guidance of the national Project Coordination Office, take overall responsibility for preparation and appraisal of abbreviated Resettlement Action Plans, and of full Resettlement Action Plans in the event that such plans are needed, in close cooperation with county PMOs, and for their submission to the World Bank.

  1. Monitoring and Evaluation

International monitoring is undertaken, with quarterly reports, to cover all aspects of this RPF including the complaints mechanism. An independent external evaluation of this framework will be undertaken twice during project implementation. In the event a full Resettlement Action Plan is needed, specific external and evaluation of this plan will take place.

A.Project Overview, Principles and Rationale for a Resettlement Policy Framework

  1. The World-Bank financed Poverty Alleviation and Agriculture Development Demonstration in Poor Areas Project aims to develop and demonstrate rural value chain models in selected destitute areas that promote equitable organizational arrangements, participation, and the sustainable increase of income of poor households. The project covers Sichuan Province, Guizhou Province and Gansu Province in the nationally designated contiguous poverty-stricken areasof Wumeng Mountain and Liupan Mountain, including 10 cities (autonomous prefectures), 27 counties, 547administrative villages, 3940 natural villages in total, totally covering 243,800households. It will benefit 929,200 rural people,of which 357,000 are registered as poor and 243,000 belong to ethnic minorities. Average poverty incidence in the project areas is assessed to reach 44%, and average rural per capita net income is CNY 3,510 per year.

Table 1. Project Areas

Area / Province / City (Autonomous Prefecture) / County (District)
Wumeng Mountains / Guizhou / Bijie City / Dafang, Zhijin
Zunyi City / Chishui City, Xishui, Tongzi
Sichuan / Luzhou City / Gulin, Xuyong
Liangshan Yi Autonomous Prefecture / Zhaojue, Meigu, Jinyang, Butuo
Liupan Mountains / Gansu / Tianshui City / Zhangjiachuan
Wuwei City / Gulang
Dingxi City / Tongwei, Longxi, Min County, Weiyuan, Lintao, Anding District
Qingyang City / Huan County, Huachi, Zhengning, Heshui
Linxia Hui Autonomous Prefecture / Dongxiang, Yongjing
Pingliang City / Zhuanglang, Jingning
Total / 3 / 10 / 27
  1. The Project includes four components:

Component 1: Integrated Value Chain Development. The objective of this component is to support the improvement of value chains for selected agricultural products with local competitive advantage (key commodities), establish new farmer cooperatives or strengthen existing cooperatives or other producer/ community cooperation arrangements to become effective business entities, and strengthen forward and backward marketing linkages. Specific activities include: (a) Cooperative Establishment and Development, (b) Establishment of Cooperative Development Funds, (c) Public Private Partnerships for training and technical services for cooperatives, communities, and farmer households groups that will be delivered through qualified agricultural enterprises.

Component 2: Public Infrastructure and Services including (a) the construction of production road infrastructure, irrigation infrastructure and land leveling, information infrastructure and equipment, and public market facilities, (b) public services, such as food safety testing and control, and public extension and training, and (c) advisory services for cooperatives through cooperative facilitators.

Component 3: Poverty Reduction in Adjacent Destitute Areas - Training and Learning analytical studies and development of guidelines.

Component 4: Project Management, Monitoring and Evaluation.

  1. The construction period of this Project is five years, and total investment is CNY1.8 billion, withUSD 150 million from a World Bank loan, equivalent to CNY 915 million,and CNY885 million of domestic funds. Project components account respectively for 65.2% (component 1), 22.3% (component 2), 0.2% (component 3) and 3.4% (component 4) of the total planned investment. Sichuan, Guizhou and Guangxi would respectively access USD 50 million, USD 40 million and USD 60 million of the World Bank loan.
  2. The principles of this Project in relation to land are as follows:

avoiding direct occupation of cultivated lands;

avoiding the use of project investments on lands with undocumented land transfers by cooperatives or enterprises;

avoiding departure and arrival areas in ecological resettlement programs for poverty alleviation;

regular monitoring of whether land acquisition of cultivated lands or investments on lands with undocumented land transfers have been avoided or not.

  1. There are no large-area concentrated and contiguous lands in land use in this project. Most of the civil works would take place on rural collective lands, and most of the lands would be set up through voluntaryland donation and in-village land exchanges, through full negotiation among the villagers. Some land transfers from farmer households to cooperatives and enterprises might also take place for the purpose of project-funded activities, and these would also be done through full negotiation with the villagers.
  2. In spite of this, cases of land acquisition may arise in this Project in relation to the construction of public/farmers markets and village trading facilities, cooperative buildings, feed storage facilities, epidemic prevention facilities, access roads for agricultural production, and irrigation and drainage facilities. In addition, since trading markets/farmer’s markets constructed in most project counties do not have a well-defined location and area at present, their impact cannot be determined. The Borrower has therefore, in accordance withthe Involuntary Resettlement OP4.12 of the World Bank, formulated this Resettlement Policy Framework (RPF) to guide land acquisition, in-village land donations and land transferscaused by the project.

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B.Framework for Land Acquisition

This framework applies to instances where land reallocation within villages is made without voluntary adjustments within a village for the construction of rural infrastructure and other civil works. It also provides guidance for voluntary land adjustments within a village.

B1. Objectives and Relevant Terms of the Policy Framework

  1. This RPF is prepared in accordinace with the World Bank’s Involuntary Resettlement OP4.12, dated December 2001. It’s overall objectives are as follows:

discussing all feasible project design plans to avoid or reduce involuntary resettlement as far as possible;

if the resettlement is unavoidable, the resettlement activities shall be designed and implemented as sustainable development plans; providing sufficient funds, and making the affected households share the benefits of the project; seriously negotiating with the affected households, and making them have the opportunity to participate in the planning and implementation of the resettlement plans;

helping affected households to endeavor to improve livelihood and living standards, and at least making them practically recover to higher standards before removal or before the commencement of the project.

  1. ThisRPF has stipulated the principles and objectives of the resettlement, applicable criteria, rights, legal and institutional framework, compensation and restoration modes, participation features and complaint procedures of resettlement to specifically guide the compensation, relocation and restoration of the resettlement.
  2. Each resettlement plan must be based on the identifiable basic information collected, and the following persons shall be defined asaffected persons, whether they are affected in a permanent or temporary manner:

Rural residents whose farmland or houses and homesteads are partly or fully affected by the project;

Urban residents whose houses are partly or fully affected by the project;

Enterprises and public institutions whose businesses or facilities are partly or fully affected by the project;

Those whose young crops or attachments are partly or fully affected by the project.

  1. The specific principles of the RPF are as follows:

minimizing the acquisition of lands and other properties and corresponding resettlement as far as possible;

up to the baseline survey date, all affected households shall be qualified for requesting restoration measures to help them improve or at least maintain their living standards, incomeacquisition ability and production level before the project. The lack of lawful rights to loss of assets shall not impede the affected households’ rights to the resettlement measures;

the resettlement measures provided include: (1) reimbursing houses and other buildings with replacement costs without depreciation or salvage value recovery; (2) replacement with farmlands with equal production capacity acceptable by the affected households; (3) replacement with equivalent houses and homesteads acceptable by the affected households; (4) resettlement and living allowances; (5) livelihood recovery, including skill training, employment assistance, social security and other aspects;

if the affected households accept the replacement of the houses and homesteads, farmlands, which shall be adjacent to the lost lands as far as possible;

the transitional period of resettlement shall be minimized, and the restoration measures shall be provided to the affected households at each project area in advance before the prospective commencement date;

the acquisition plan for lands and other assets and the restoration measures provided shall be repeatedly negotiated with the affected households to guarantee the minimized interference. The affected households will be empowered before the prospective commencement date;

maintaining or improving original service and resource level;

the availability of financial and material resources for resettlement and restoration must be guaranteed whenever and wherever necessary. The budget for the Resettlement Action Plan shall include unexpected expenses;

system and institutional arrangements shall guarantee the effective and timely design, plan, consultation and implementation of the properties and resettlement;

effectively and timely supervising, monitoring and assessing the implementation of the Resettlement Action Plan.

B2.Preparation and Approval of Resettlement Action Plans

  1. July 2011 (project identification) is the cut-off date established to determine whether land for future project-funded infrastructure or facilities are covered under the present resettlement policy framework. Counties that have acquired land after July 2011 have produced a due diligence report prior to appraisal to confirm absence of land acquisition. Information included in these reports will be monitored during project implementation.
  2. When some involuntary land acquisition is taking place under a subproject, population affected by the sub-project, but the number of affected persons is not more than 200 in one specific instance, the provincial Project Coordination Offices will closely cooperate with the county Project Management Offices (PMOs) to prepare an Abbreviated Resettlement Action Plan for the selected sub-project. This Plan shall be submitted by the provincial Project Coordination Offices to the World Bank; meanwhile, sufficiently consultation of affected households will take place, so that and they have the opportunity to participate in the design and implementation of the Resettlement Action Plan.
  3. The Abbreviated Resettlement Action Plan will at least contain the following contents:

detailed survey on affected households’ situation and asset evaluation;

description of compensations prepared to provide and other resettlement assistance;

communication with the affected households of the acceptable alternative solutions;

institutional duties and complaint procedures for the implementation;

monitoring and implementation arrangements;

progress chart and budgets.

  1. The Abbreviated Resettlement Action Plan shall be completed at the latest 4 months before the estimated resettlement commencement working day. Each Abbreviated Resettlement Action Plan shall be submitted to the World Bank for review and approval at least 3 months in advance before the actual implementation. Only upon the acceptance of the Resettlement Action Plan by the World Bank shall the compensation, resettlement and restoration activities be actually started. Compensation, resettlement and restoration activities shall be completed before the performance of the building project contract.
  2. In casethe population affected by the project exceeds 200, the provincial Project Coordination Officeswill closely cooperate with the county PMO to prepare afull Resettlement Action Plan.
  3. The preparation and implementation of a Resettlement Action Plan (including paying various expenses related to the resettlement) shall be assumed by the Borrower. The provincial PCOsshall be fully responsible for this Project.
  4. Such a Plan shall be submitted by the provincial PCOs to the World Bank; meanwhile, affected households will be consulted, and will be given the opportunity to participate in the design and implementation of the Resettlement Action Plan.
  5. In accordance with OP 4.12, the Resettlement Action Plan will contain the following contents (if relevant), and the contents irrelevant to the project shall be indicated in the Resettlement Action Plan:

overall description of the project;