The Mesoamerican Biological Corridor as a Vector for Sustainable Development in the Region:

The Role of International Financing

Seminar: Sustainable Natural Resource Management at the Regional Level

Madrid March, 2001

The Mesoamerican Biological Corridor as a Vector for Sustainable Development in the Region:

The Role of International Financing

Preliminary Considerations[1]

Objective

1.This document demonstrates that significant internationally financed investment flows for sustainable development are directed individually to each of the countries in the Mesoamerican Region, and that these resources could have a greater impact at the regional level if they were applied in an integrated programmatic context such as that offered by the Mesoamerican Biological Corridor (MBC) initiative.

The Concept of the Mesoamerican Biological Corridor

  1. The MBC is a programmatic concept which links natural ecosystems, indigenous communities, towns and cultivated lands throughout eight countries, from southeast Mexico to Panama, integrating environmental and economic objectives which contribute to the well-being of the entire population. The MBC is also an organizing principle around which to promote investment, create employment, generate income and combat poverty, demonstrating that the potential for development and economic competitiveness of Mesoamerica is inextricably linked to the condition of its natural resource base and the services which they provide, the continuum of which is represented in the MBC.
  1. This initiative is being financed through a series of national projects which focus specifically on the conservation and sustainable use of biodiversity within the Corridor, as implemented by the GEF and the World Bank. Initiatives also exist at the regional level, through a GEF project implemented by UNDP and the UNEP, as well as other activities financed by a range of international donors. These initiatives provide fundamental support to the concept of the Corridor as an effort to link the protected areas of Mesoamerica.

International financing of the MBC as a vehicle for sustainable development

  1. In examining the IDB and World Bank portfolios, it is possible to distinguish those investments which are directly related to the core concept of the Corridor as an anchor of sustainable development, particularly in relation to the conservation and management of forest resources biodiversity, watershed management, land administration, and eco-tourism. There are also those investments which are more indirectly related to the MBC concept, including projects in the agricultural, transportation, sanitation, social investment, infrastructure and energy sectors. The investments financed by the IDB and World Bank which are directly related to the Corridor concept surpass 888 million dollars, and those which are indirectly associated total more than 4.54 billion; that is, more than $US5.43 billion in IDB and World Bank funds that are being invested in operations related to the Mesoamerican Biological Corridor in total. [2]

Table 1

(US$ millions)

  1. An initial study recently prepared by the Regional Unit for Technical Assistance (RUTA), indicates that in addition to IDB and World Bank financed investments, environmental and technical assistance projects related to the Corridor, amounting to approximately US$ 361 million, were being planned or executed in Central America during the second half of 2000 by other multilateral and bilateral agencies and international NGOs (see Annex 2). Total financing for MBC directly related projects by all sources thus exceeds US $1.249 billion.
  1. Individually, these projects promote, among other objectives, the sustainable use of agricultural land, the conservation and management of forest resources, watershed management, conservation of biogenetic resources, the development of tourism (including eco-tourism) and energy resources, and the reduction of vulnerability to natural disasters. Except for a few regional initiatives, these projects are implemented in isolation, preventing the realization of potential synergies from regional integration. Even the projects and programs which focus upon the protection of biodiversity and natural areas within the Corridor lack coordination among themselves and with related regional activities.

The need for a programmatic context

  1. Hurricane Mitch powerfully demonstrated the need to coordinate investment projects and programs in infrastructure, urban development, watershed management and forest conservation. Similarly, if the development investments financed in each of the countries in the region were linked within a programmatic context such as the MBC, the development of the Mesoamerican Region would take an unprecedented leap forward, both in qualitative and quantitative terms, as the political support and active participation of civil society which the MBC has achieved offers a unique opportunity to link the various programs and projects in a coordinated effort for regionally integrated sustainable development.

Indicative analysis of investments financed by the IDB and World Bank

  1. The graphics presented in the this document demonstrate, by way of example, the financing of IDB and World Bank investment programs and technical assistance operations which are directly or indirectly related to the concept and principles of the MBC (including projects under preparation and execution). Clearly there are significant financial resource flows being applied to the stewardship of natural resources in Central America, and the MBC specifically, which are not included in this document. Some bilateral and multilateral cooperation organizations and NGOs that support MBC projects are listed in Annex 2.

A. Projects Directly Related to the MBC concept

  1. In this document projects in Panama, Costa Rica, Nicaragua, El Salvador, Honduras, Guatemala and Belize which directly impact upon the management of natural resources and environmental services-- such as forest conservation and development, watershed management, sustainable use of biodiversity, protected areas, indigenous community development, eco-tourism and environmental and natural resource management projects—were considered for inclusion in the analysis (see project list in Annex1). In the case of Mexico, only those projects located in the four states included in the MBC (Chiapas, Campeche, Yucatan and Quintana Roo) were considered for inclusion as either directly or indirectly related to the MBC.

B. Projects indirectly associated with the MBC concept

  1. Included under the category of projects indirectly related to the MBC are those which are not necessarily focused upon environmental or natural resource management, but which critically impact or facilitate sustainable development in the region. These projects include rural development, energy, institutional strengthening, infrastructure, land administration, micro-finance and micro-enterprise development, sanitation, social investment, tourism and transportation. Projects in science and technology, commerce, gender, banking and financial sector reform, decentralization, education, health, public finance, mining, housing, nutrition and privatization have been excluded from the analysis for the sake of simplification, though it is recognized that these types of projects can contribute to the sustainable development objectives embodied in the MBC concept.

C. Technical Assistance directly and indirectly related to the MBC concept


  1. Technical assistance operations related to the MBC in the land administration, infrastructure, tourism, transportation, sanitation, social investment, energy, agriculture, micro-enterprise and environment sectors total 114 million dollars.

General Conclusions

  1. One conclusion which can be drawn from this preliminary analysis is the necessity to formalize the development framework embodied in the MBC initiative, creating a communications platform from which information can be exchanged and coordination achieved between projects of similar characteristics being prepared and executed within the Corridor, such as watershed management, conservation and development of biodiversity resources (including the GEF projects implemented by the World Bank). This communications platform, incorporated into the System for Central American Integration (SICA), could facilitate the coordination between national and regional initiatives with overlapping or similar objectives. At the same time, there is a need to coordinate projects of land management, agricultural technology, rural finance and protected areas and biodiversity conservation within a coherent national policy framework if the development objectives of each initiative are to be fully realized.
  1. The IDB and the World Bank are committed to fostering a regional approach to development with their respective projects and programs and are prepared to facilitate, with the participation of governments in the region, the process of coordinating their project portfolios to advance the MBC concept as a platform for sustainable development in Mesoamerica. This joint undertaking to identify the projects and technical assistance activities which each institution is supporting in relation to the Corridor marks a step in the direction of regional coordination. In order to develop a programmatic context for the MBC as an instrument to promote sustainable development in Mesoamerica, the following points are put forward for consideration:
  • The goal is not necessarily to increase or promote new investments, but rather to achieve improved coordination and integration of existing projects and programs, as well those which are already in the design and preparation phases.
  • A framework of incentives and rules must be devised to assure that these investments are considered in a regional framework for development, for example by creating a formal consultation mechanism for governments and international organizations which support projects directly related to the MBC.
  • It is crucial to strengthen the capacity of regional coordination institutions grouped under the SICA umbrella, to manage the process of coordinating investments related to the MBC, as has been previously concluded by the governments of Mesoamerica and the donor community.
  • The Puebla-Panama Program (PPP), a development initiative proposal based on regional integration approach under study by the new government of Mexico, presents Donor community members and Mesoamerican governments with a unique opportunity to insert the MBC as a platform for sustainable development and vehicle for strengthening integration efforts. Developing mechanisms to coordinate investments and partnering with initiatives like the one conceived of in the PPP is fundamental to realizing the potential benefits of greater and more sustainable economic development in the region.
  • It is necessary to establish a financial instrument to cover the minimum recurrent costs of coordination activities (This fund could be financed through different mechanisms, including, for example, the assignment of a small percentage of each national project related to the Corridor).

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Annex 1

Projects Directly Related to the MBC

Country/Region / Project Name /

Amount

US$ millions /

Status

/ Sector / Institution
Belize / Community Managed Sarstoon Temash Conservation / 0.7 / Execution / Environment / WB
Belize / Environmental and Social Technical Assistance / 2.6 / Execution / Environment / IDB
Belize / Loan TC: Land Administration / 0.9 / Execution / Land Administration / IDB
Belize / Tourism Development / 11.0 / Execution / Tourism / IDB
Costa Rica / Biodiversity / 7.0 / Execution / Environment / WB
Costa Rica / Ecomarkets / 40.6 / Execution / Environment / WB
El Salvador / Biodiversity Coffee / 6.9 / Execution / Environment / WB
El Salvador / National Environmental Protection Program / 30.0 / Execution / Environment / IDB
Guatemala / Management & Protection of Laguna El Tigre / 0.75 / Execution / Environment / WB
Guatemala / Sustainable Development of Peten / 19.8 / Execution / Environment / IDB
Guatemala / Chixoy River Basin Conservation / 14.4 / Execution / Forestry / IDB
Honduras / Environmental Development / 10.8 / Execution / Environment / WB
Honduras / Biodiversity / 7.0 / Execution / Environment / WB
Honduras / Bay Islands Environmental Management / 19.1 / Execution / Environment / IDB
Honduras / Environmental Management Cajon Watershed / 20.4 / Execution / Environment / IDB
Mexico / Mesoamerican Biological Corridor / 13.25 / Execution / Environment / WB
Mexico / Indigenous and Community Biodiversity / 10.1 / Execution / Environment / WB
Mexico / Biodiversity Conservation in El Triunfo Biosphere Reserve / 0.75 / Execution / Environment / WB
Mexico / Community Forestry / 15.0 / Execution / Forestry / WB
Nicaragua / Atlantic Biodiversity Corridor / 7.1 / Execution / Environment / WB
Nicaragua / Lake and City of Managua Environmental Improvement / 15.0 / Execution / Environment / IDB
Nicaragua / Forestry Resources Management/Conservation Program / 15.3 / Execution / Environment / IDB
Nicaragua / Forestry / 9.0 / Execution / Forestry / WB
Nicaragua / Implementation Sanitation Measures Managua Lake / 15.0 / Execution / Sanitation / IDB
Nicaragua / Atlantic Region Development Program / 8.0 / Execution / Social Investment / IDB
Panama / Mesoamerican Biological Corridor / 8.4 / Execution / Environment / WB
Panama / San Lorenzo / 0.73 / Execution / Environment / WB
Panama / National Environmental Program / 15.8 / Execution / Environment / IDB
Panama / Darien Sustainable Development / 70.4 / Execution / Environment / IDB
Panama / Loan TC Tourism Support Program / 2.5 / Execution / Tourism / IDB
Belize / Northern Belize Biological Corridor Conservation & Maintenance / 0.7 / Preparation / Environment / WB
Belize / Land Administration II / 9.0 / Preparation / Land Administration / IDB
Centro America / Mesoamerican Barrier Reef / 35.0 / Preparation / Environment / WB
Costa Rica / Sustainable Cacao / 0.7 / Preparation / Environment / WB
El Salvador / National Environmental Mgt. / 20.0 / Preparation / Environment / WB
El Salvador / Basin Management Lempa River / 19.0 / Preparation / Social Investment / IDB
Guatemala / Western Altiplano Natural Resources Mgt. / 38.0 / Preparation / Environment / WB
Guatemala / Bio-Itza Community Protected Areas / 0.3 / Preparation / Environment / WB
Guatemala / Priority Basin Natural Resources / 40.0 / Preparation / Environment / IDB
Guatemala / Basin Management Lempa River / 6.3 / Preparation / Environment / IDB
Guatemala / Sanitation and Sustainable Mgmt. Amatitlan Basin / 20.0 / Preparation / Sanitation / IDB
Honduras / Natural Resources Management Priority Basins / 80.0 / Preparation / Environment / IDB
Honduras / Basin Management Lempa River / 1.3 / Preparation / Environment / IDB
Honduras / Sustainable Coastal Tourism / 5.0 / Preparation / Tourism / WB
Mexico / National Protected Areas / 20.0 / Preparation / Environment / WB
Nicaragua / All Spice/Solar Drying / 7.0 / Preparation / Environment / WB
Nicaragua / Social Environment for Forestry Development II / 25.0 / Preparation / Forestry / IDB
Panama / Canal Watershed / 20.0 / Preparation / Environment / WB
Panama / Sanitation of Panama City / 100.0 / Preparation / Sanitation / IDB

Note:This is not an exhaustive list of projects under preparation or programs under study and discussion with governments.

Annex 2

Partial list of MBC supporters

Bilateral Donors

  • Canada
  • Denmark
  • England
  • European Union
  • Finland
  • France
  • Germany
  • Holland
  • Japan
  • Spain
  • Switzerland
  • Sweden
  • United States of America

International agencies

Central American Bank of Economic Integration - BCIE

  • Global Environment Fund - GEF
  • Inter-American Development Bank – IDB
  • International Fund for Agricultural Development - FIDA
  • International Union for the Conservation of Nature - IUCN
  • United Nations Development Program - UNDP
  • United Nations Environment Program - UNEP
  • World Bank - WB

Non governmental organizations (NGOs)

  • Conservation International - CI
  • Flora and Fauna International - FFI
  • Ford Foundation
  • International Tropical Timber Organization (ITTO)
  • Mac Arthur Foundation
  • The Nature Conservancy - TNC
  • World Conservation Society - WCS
  • World Resource Institute - WRI
  • World Wildlife Fund - WWF

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[1]This preliminary analysis was conducted by staff of the IDB (Gustavo Minc, Diego Rodriguez, Shigeo Sakai and Ricardo Quiroga) and World Bank (Lisa Taber, Arsenio Rodríguez and Armando Guzmán). This document does not necessarily reflect the official policies of the IDB or the World Bank, rather it aims to identify common themes of internationally financed support for the development of the MBC concept, using relevant projects as examples.

[2]Of this total, approximately 3.762 billion are included in the IDB’s portfolio of investment (3.670 billion) and technical assistance (92 million) operations; 1.667 billion comes from the World Bank’s portfolio of investments and technical assistance operations (1.645 and 22 million, respectively).