Study on the Mechanism of Transboundary Horizontal Eco-compensation (ADB-58305-001)

Countries
  • China
Geographic location where the impacts of the investment may be experienced.
Specific Location
Gansu and Fujian provinces
Whenever identified, the area within countries where the impacts of the investment may be experienced. Exact locations of projects may not be identified fully or at all in project documents. Please review updated project documents and community-led assessments.
Financial Institutions
  • Asian Development Bank (ADB)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Approved
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
U
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
Nov 28, 2024
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
Borrower
Government of China - National Development and Reform Commission
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Finance
  • Technical Cooperation
  • Water and Sanitation
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Grant
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 0.30 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Project Cost (USD)
$ 0.30 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Bank Documents
Primary Source

Original disclosure @ ADB website

Updated in EWS Apr 2, 2025

Disclosed by Bank Dec 4, 2024

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

According to the Bank’s website, the TA is designed to support the long-term integrity of ecosystems and water resources in the designated provinces (Technical Assistance Report - para. 7). Accordingly, the TA will focus on distilling lessons from existing eco-compensation mechanisms for application in the designated provinces. In addition, the TA will focus on the management and design of the proposed water fund. The optimal design of the fund will ensure the alignment of incentives to support the long-term sustainability of clean drinking water resources. This would also include ensuring optimal investment in compensation payments to conserve and improve water resources and examine opportunities for income generation.

*Technical Assistance Report - para 7: Although most provinces in the PRC have established horizontal compensation mechanisms, this is not the case at the city level. In addition, there is a need to focus on drinking water quality and the efficient use of compensation, once provided, to negatively impacted parties. Accordingly, the National Development and Reform Commission (NDRC) is considering studying the eco-compensation modality for implementation in Gansu and Fujian provinces, especially in cities. While these provinces are highly developed, they suffer from poor water quality.

 

Early Warning System Project Analysis
For a project with severe or irreversible impacts to local community and natural resources, the Early Warning System Team may conduct a thorough analysis regarding its potential impacts to human and environmental rights.

According to the Technical Assistance Report, the Risk Categories are:

Environment: Not Applicable
Involuntary Resettlement: Not Applicable
Indigenous Peoples: Not Applicable

Investment Description
Here you can find a list of individual development financial institutions that finance the project.

The TA financing amount is $300,000, which will be financed on a grant basis by ADB's Technical Assistance Special Fund (TASF-other sources). The government will provide counterpart support in the form of counterpart staff and other in-kind contributions. 


Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

Project Officer: Vivek Rao
Designation: Principal Financial Sector Specialist - Asian Development Bank
Email: vrao@adb.org

ACCESS TO INFORMATION

You can submit an information request for project information at: https://www.adb.org/forms/request-information-form

ADB has a two-stage appeals process for requesters who believe that ADB has denied their request for information in violation of its Access to Information Policy. You can learn more about filing an appeal at: https://www.adb.org/site/disclosure/appeals

ACCOUNTABILITY MECHANISM OF ADB

The Accountability Mechanism is an independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an Asian Development Bank-financed project. If you submit a complaint to the Accountability Mechanism, they may investigate to assess whether the Asian Development Bank is following its own policies and procedures for preventing harm to people or the environment. You can learn more about the Accountability Mechanism and how to file a complaint at: http://www.adb.org/site/accountability-mechanism/main.

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