Annual Progress Report 2016

Transcription

1 Annual Progress Report 2016 UNDP UN Environment Poverty-Environment Initiative Poverty-Environment Initiative Empowered lives. Resilient nations.

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3 Annual Progress Report 2016 UNDP UN Environment Poverty-Environment Initiative

4 The Poverty-Environment Initiative (PEI) of the United Nations Development Programme (UNDP) and the UN Environment is a global UN effort that supports country-led efforts to mainstream poverty-environment linkages into national development planning. PEI provides financial and technical assistance to government partners to set up institutional and capacity-strengthening programmes and carry out activities to address the particular poverty-environment context. PEI Annual Progress Report 2016 is also available online at First edition. Published UNDP UN Environment Produced by the UNDP UN Environment Poverty-Environment Initiative The author would like to acknowledge all PEI colleagues at the country, regional and global levels for their contributions to this report. Writer and project coordinator: Victoria Luque Edited by: Lance W. Garner Designed by: Nita Congress Infographic by: Bonnie Stephens, bsimpledesign.com Cover photo: Lucian Coman/Shutterstock All dollars referred to in this publication are USD, unless otherwise specified. The term billion in this report means a thousand million. This publication may be reproduced in whole or in part and in any form for educational or nonprofit purposes without special permission from the copyright holder provided acknowledgement of the source is made. The UNDP UN Environment Poverty-Environment Facility would appreciate receiving a copy of any publication that uses this publication as a source. No use of this publication may be made for resale or for any other commercial purpose whatsoever without prior permission in writing from UNDP and UN Environment. The views expressed in this publication are those of the author and do not necessarily reflect the views of UNDP and UN Environment. The designation of geographical entities in this report, and the presentation of the material herein, does not imply the expression of any opinion whatsoever on the part of the publisher or the participating organizations concerning the legal status of any country, territory or area, or of its authorities, or concerning the delimitation of its frontiers or boundaries. While reasonable efforts have been made to ensure that the contents of this publication are factually correct and properly referenced, UNDP and UN Environment do not accept responsibility for the accuracy or completeness of the contents and shall not be liable for any loss or damage that may be occasioned directly or indirectly through the use of, or reliance on, the contents of this publication, including its translation into languages other than English.

5 Contents v vii x Foreword Executive summary Abbreviations and acronyms 1 Report overview 5 Outcome performance Outcome Indicator Outcome Indicator Outcome Indicator Key lessons: outcome level Output performance Output Output Indicator Output Indicator Output Indicator Output Indicator Output Output Indicator Output Indicator Output Indicator Output Output Indicator Output Indicator Output Indicator Output Indicator Key lessons: Output level iii

6 iv UNDP UN Environment Poverty-Environment Initiative Annual Progress Report Opportunities and challenges Increasing the focus on the structural causes of poverty and environmental degradation: contributing to gender equality. 40 Galvanizing institutional reform through South-South learning 45 Strengthening and expanding partnerships to catalyse and sustain poverty-environment mainstreaming Monitoring and evaluation Moving forward Paris Agreement in action contributing to climate resilience and promoting a just transition to a green economy Beyond 2017: universalizing Poverty-Environment Initiative experiences

7 Foreword 2016 marks the first year of implementation of a series of landmark international summits and conferences. The Sendai Framework for Disaster Risk Reduction , the Addis Ababa Action Agenda, the 2030 Agenda for Sustainable Development and the COP 21 Paris Agreement under the UN Framework Convention on Climate Change provide a collective framework to achieve sustainable development and poverty eradication. Developing countries are increasingly reaching out to the UN system to strengthen institutional mechanisms that can deliver on these historic agreements. The need to apply a coherent, integrated approach is greater than ever and the synergies underlying these agreements indicate that countries will not be able to deliver sustainable development without tackling climate change and environment challenges together with poverty eradication. Within the UN system, the United Nations Development Programme (UNDP) and United Nations Environment have been working collaboratively on the basis of their comparative advantages and their policy frameworks over the last 10 years as precursors of the 2030 Agenda Learning from initial joint efforts to integrate environmental sustainability into development planning and lessons on what an integrated approach should entail to effectively address the complex interlinkages among the social, economic and environment dimensions of sustainable development. This represents a decade of experience through our joint global programme, the Poverty-Environment Initiative, across 28 countries. The degree of trust placed in the continued assistance delivered to these countries is reflected in their commitment and ever-increasing demand to enhance their efforts to transform institutions and direct investments towards sustainable development and poverty eradication. The main recommendation of the independent Final Evaluation of the Poverty- Environment Initiative Scale-up phase completed in 2016 is to expand the Poverty-Environment Initiative geographically and thematically and upgrade the programme as a main but not exclusive UNDP UN Environment delivery mechanism of capacity development support and technical assistance to help countries meet the SDGs with a focus on inclusive, equitable, pro-poor, climate-proofed sustainable development, building on the Poverty-Environment Initiative s PEN [povertyenvironment nexus] mainstreaming agenda and modus operandi. In 2016, the Initiative actively engaged in the UN processes around the new development paradigm such as the United Nations Environment Assembly (Nairobi, v

8 vi UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 May 2016), High-Level Political Forum on Sustainable Development 2016 (New York USA, July 2016). Indeed, the Initiative s integrated approach has garnered respect within its host institutions through systemization of lessons learnt and good practices with the UN Programme on Reducing Emissions from Deforestation and Forest Degradation (UN-REDD), the UNDP Biodiversity Financing Initiative, the Partnership for Action on the Green Economy (PAGE) and, more widely within the UN community, the UN Food and Agriculture Organization (FAO), the UN Capital Development Fund and UN Women to jointly address government requests for support. Looking forward, it is within this global context and after consultation with our stakeholders that UNDP and UN Environment have prepared a Concept Note for a new joint programme beyond 2017: Poverty-Environment Action for Sustainable Development Goals ( ). This technical annual report highlights the work of the joint Global Programme in 23 countries to improve climate resilience of the poorest and to effectively implement pro-poor environment practices and a just transition to a green economy as our contribution to the achievement of the new development paradigm. Anne Juepner PEI UNDP Co-Director Isabell Kempf PEI UN Environment Co-Director

9 Executive summary The theme of last year s annual report was seeds of change, highlighting the Poverty-Environment Initiative s role in integration and mainstreaming of poverty eradication and sustainable development. This year, as the international community reflects on the first year of implementation of the 2030 Agenda for Sustainable Development noting the priorities and integrated approaches put forth by major global frameworks such as the Paris Agreement under the UN Framework Convention on Climate Change, the Addis Ababa Action Agenda on financing for development, the Sendai Framework for Disaster Risk Reduction and the United Nations Conference on Sustainable Development (Rio+ 20) we are proud to share details of a rich blossoming of our integrated approach, as it is serving to mainstream the poverty-environment nexus into countries national development strategies, local development plans and budget resource allocations as our contribution to the achievement of the Sustainable Development Goals (SDGs). The independent evaluation of the our scale-up phase ( ) completed in June 2016, found that the Poverty-Environment Initiative s operational structure as a UNDP UN Environment collaboration has proven to be one of the best examples of deploying the comparative advantages of two UN entities to deliver national sustainable development in a coordinated and effective manner. The evaluation found that our integrated approach effectively promotes transformation of institutions, informs the decision-making processes needed to break down sector silos and contributes to increasing investments in SDG implementation. It noted that no other existing programme is currently suited to perform this country support role as effectively as the Poverty-Environment Initiative. And it found that countrylevel outcomes are being achieved and the conditions for sustainability and impact are falling into place as programme implementation progresses. In line with the 2030 Agenda and the Paris Agreement, the Poverty-Environment Initiative works to break down the marginalization of environmental matters by stand-alone and generally less well-resourced environment departments, and to gain recognition of the importance of climate and environment to development by more influential departments of government (particularly finance and planning). To do so, we operate across a wide network of countries and foster greater country ownership and institutional reform. In 2016, the Poverty-Environment Initiative focused its technical and financial support in 23 countries: Bangladesh, Bhutan, Burkina Faso, Guatemala, Indonesia, Kyrgyzstan, Lao PDR, Malawi, Mali, Mauritania, Mongolia, Mozambique, Myanmar, Nepal, Paraguay, Peru, the Philippines, vii

10 viii UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 Rwanda, Tajikistan and Tanzania, including technical advisory services to Benin, Dominican Republic, Kenya, and a range of UN and non-un development partners. The Global Programme is also engaging with countries on the 2030 Agenda, the Paris Agreement and a just transition towards a green economy. Results have been achieved through the provision of an integrated approach to mainstreaming the poverty-environment nexus so far, in 47 national and 4,428 local development plans for 22 countries, in 108 sector strategies in 17 countries, in 33 associated monitoring and evaluation (M&E) systems of 17 countries and in 67 budget processes in 14 countries. Of these, 6 national and 19 local development plans, 24 sector strategies, 3 associated M&E systems and 6 budget processes integrated poverty-environment objectives in 2016 alone. The UNDP UN Environment collaboration is essential to delivering the long-term support required to achieve such meaningful and durable transformations. The Initiative s main progress to date has been to deepen and broaden the integration and operationalization of poverty-environment objectives in countrylevel development planning and increasingly budgeting and expenditure processes. In this context, total delivery in support of the Poverty-Environment Initiative in 2016 amounted to nearly USD 12 million, including about USD 6 million of Global Programme resources. Every dollar contributed by our donors has generated nearly an additional dollar at the country level. In 2016, annual targets focusing on the integration of poverty-environment objectives in national, subnational and sectoral policies and M&E frameworks as well as functioning cross-sector coordination mechanisms for poverty-environment related issues have been largely exceeded. The strengthened prioritization of povertyenvironment issues in the second generation of national development plans and the continued increase in numbers of plans across all levels of government demonstrate both growing awareness of the issues and trust in the Initiative s work. For example, our national coordinators have been invited to serve on the boards in charge of developing these strategic documents. Numerous strategic policy papers have been prepared based on studies supported by the Initiative and our key partners. This ensures that the poverty-environment nexus is the backbone of national and, increasingly, local plans and related monitoring frameworks. This report provides a wide range of examples showcasing the Poverty-Environment Initiative s comparative advantage in helping developing countries localize the 2030 Sustainable Development Agenda. Our support in integrating poverty-environment priorities in budgeting and expenditure processes continued to result in increased budget allocations in Malawi, Mali and Tanzania; and in changes to climate and environment expenditures and related systems in a range of countries in Indonesia and Tanzania reported increased expenditure. Poverty-environment tools and approaches in budgeting and expenditure processes including guidelines, financial accounting, expenditure reviews and other mechanisms have been institutionalized in Bhutan, Burkina Faso, Lao PDR, Mauritania, Malawi, Mali, Mozambique, Rwanda and Tajikistan under the leadership of ministries of finance.

11 Executive summary ix As the 2030 Agenda is implemented, there is increased recognition that current macroeconomic indicators do not cover national capital degradation or provide information on its impact on poverty. In fact, there are many different approaches to measuring overall progress towards sustainable development. In line with the European Union s Initiative, we have supported efforts to move beyond GDP measurements to develop or fine-tune indicators and methodologies that are more inclusive of environmental and social aspects of progress. As with our approaches to green growth (e.g. our work with OECD in Kyrgyzstan), the measurements aim to assess the relationship between economic activities and their impact on the environment and social inclusion. A highlight from this year s work has been support to the development of government guidelines and tools to manage private sector investment decisions, with 17 guidelines and tools implemented so far in three countries (Lao PDR, Myanmar and the Philippines). Participants in the 2016 Donor Steering Group Meeting in Vientiane experienced first hand the potential impact of improved capacity of national and local governments to enforce environmental legislation and ensure the sustainability of investments in e.g. hydropower or rubber plantations. Substantive progress is also observed in Lao PDR, where we are supporting application of environmental governance related to foreign direct investments; this is of particular relevance and is being extended to other countries mainly in Asia-Pacific. The Initiative has engaged in UN processes around the 2030 Agenda and preparation for implementation of the SDGs in partnership with a range of UN and non-un actors, including bilateral donors. UNDP and UN Environment programmes have incorporated poverty-environment mainstreaming tools into the structure of their operations, as reflected in the Partnership for Action on the Green Economy (PAGE), the UNDP Biodiversity Financing Initiative and the UN Programme on Reducing Emissions from Deforestation and Forest Degradation (UN-REDD), among others. The Poverty-Environment Initiative has sought to more systematically address gender and equity, promoting a focus on the structural causes of poverty and environmental degradation in our mainstreaming approach. Another key area of delivery in 2016 has been policy coherence through a holistic policy and institutional approach to addressing the needs of marginalized groups, increasing resilience of local communities and protecting livelihoods. We saw government dialogues with communities help introduce changes in sector policies, and civil society use information generated through our studies to advocate for appropriate investments in support of poverty-environment objectives. Engaging with parliaments and South-South learning also helped push the poverty-environment agenda forward. Demand to share lessons on poverty-environment mainstreaming and to learn from practical experiences on integrated approaches continued to grow. In the final years of the Poverty-Environment Initiative, countries and regions are looking at different approaches to address that demand. We have seen how strengthened and expanding partnerships are helping catalyse and sustain poverty-environment mainstreaming beyond 2017 and universalizing the Poverty-Environment Initiative s experiences in support of the 2030 Agenda and the Paris Agreement.

12 Abbreviations and acronyms CPD DFID EEA ENR FAO GDP GIZ LoCAL M&E OPHI PAGE PEF SDG SEEA UN UNDAF UNDP UNEP WAVES Country Programme Document Department for International Development experimental ecosystem accounting environmental and natural resource Food and Agriculture Organization of the United Nations gross domestic product Gesellschaft für internationale Zusammenarbeit (Society for International Cooperation) Local Climate Adaptive Living Facility monitoring and evaluation Oxford Poverty and Human Development Initiative Partnership for Action on Green Economy Poverty-Environment Facility Sustainable Development Goal system of environmental economic accounting United Nations United Nations Development Assistance Framework United Nations Development Programme United Nations Environment Programme Wealth Accounting and Valuation of Ecosystem Services x

13 Report overview Last year s annual progress report highlighted the achievements of the joint United Nations Development Programme United Nations Environment Poverty- Environment Initiative in each major area of its work: coordination across government institutions; cross-sector economic, social and environmental assessments to inform national, local and sectoral policy and planning; support to a just transition to a green economy; promotion of gender equality and social inclusion; South- South cooperation and partnerships; and putting in place building blocks for implementation of the 2030 Agenda for Sustainable Development and the Paris Agreement. Building on past efforts, this year s annual progress report highlights how the Poverty-Environment Initiative s collaborations with an ever-widening range of stakeholders across the country, regional and global levels including government partners, donors, United Nations (UN) partner agencies, private sector, civil society and research institutions catalyse support to integrate poverty-environment mainstreaming objectives and indicators into plans and budgets, and increasingly guidelines to influence private sector investments at the national and subnational levels. The content of this annual report is strictly aligned with the Poverty-Environment Initiative s results framework in order to clearly show progress and achievements. Thus, the next sections describe progress on outcome and output indicators, including a summary of lessons learned in their achievement. Opportunities and challenges are presented next, and the report concludes with a summary of how the Poverty- Environment Initiative s progress translates into lessons learned for achieving the 2030 Agenda and the Paris Agreement. The target audience for this report is the European Union and the Governments of Norway, Spain, Sweden and the United Kingdom. A separate report that puts a human face on the statistics and technical information shared here has been prepared for the wider public and is available on the Poverty- Environment Initiative website. The Poverty-Environment Initiative s three areas of focus during its second phase ( ) are to: strengthen outcomes from current country portfolio; deepen engagement on regional implementation strategies; inform the global sustainable development debate As the following sections demonstrate and delineate, sound progress was made in 2016 against most outcome and output indicators, and the Poverty-Environment Initiative is broadly on track to meet its targets. The table on the following pages provides an overview of progress towards achieving the Poverty-Environment Initiative s outcomes and outputs, per indicator, for Year 4 of implementation for the UNDP-UNEP PEI Joint Programme Document More details and highlights are provided in the respective outcome and output indicator sections. 1

14 2 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 OUTCOME AND OUTPUT INDICATORS AND RELATED ACHIEVEMENTS Indicator Cumulative level of achievement 2016 target Outcome Indicator 1: Level of application of poverty-environment approaches and tools for integrated development policies, plans and coordination mechanisms Output Indicator 1.1: Number of national and subnational policies and plans that integrate poverty-environment objectives in target countries Output Indicator 1.2: Number of key sectoral policies and plans that integrate poverty-environment objectives in target countries Output Indicator 1.3: Number of monitoring and evaluation (M&E) frameworks that integrate povertyenvironment indicators in national and subnational M&E systems Output Indicator 1.4: Level of functional government-led cross-sector coordination mechanisms Outcome Indicator 2: Increased public sector financial expenditure for poverty-environment results in target countries Output Indicator 2.1: Number of national budgeting and expenditure processes that integrate povertyenvironment objectives in target countries Output Indicator 2.2: Number of countries introducing beyond gross domestic product (GDP) measurements Bangladesh and Lao PDR moved from level 2 to level 3, Malawi moved from level 3 to 4 and Rwanda from level 4 to 5 4,475 development policies: 47 national and 4,428 local policies in 22 countries: Armenia, Bangladesh (4), Bhutan (239), Botswana, Burkina Faso (2), Dominican Republic, Guatemala (2), Kenya, Kyrgyzstan (9), Lao PDR (21), Malawi, Mali (3), Mauritania (2), Mozambique (2), Nepal (4,057), Philippines (2), Rwanda (33), Tajikistan (55), Tanzania (4), Thailand, Uganda (4) 108 policies in 17 countries: Bangladesh, Bhutan (18), Burkina Faso (3), Kenya (4), Lao PDR (4), Malawi (2), Mauritania (3), Mongolia (3), Mozambique (33), Nepal (3), Paraguay (3), Peru (2), Philippines (3), Rwanda (14), Tajikistan, Tanzania (3), Thailand 33 in 17 countries: Bangladesh (5), Bhutan (2), Burkina Faso, Dominican Republic, Guatemala, Kyrgyzstan, Lao PDR (3), Malawi (2), Mali, Mauritania (6), Mozambique, Nepal, Peru, Philippines, Rwanda, Tanzania (2), Tajikistan (2) 13 countries at Level 3 or above: Level 3: 10 countries (Bangladesh, Burkina, Lao PDR, Malawi, Mali, Mauritania, Mozambique, Peru, Philippines, Tanzania); Level 4: 2 countries: Kyrgyzstan, Rwanda); Level 5: 1 (Bhutan) 4 expenditure reviews demonstrate increased public expenditure in 2 countries: Indonesia (3) and Tanzania 67 processes in 14 countries: Armenia, Bangladesh (10), Bhutan (6), Burkina Faso, Indonesia (2), Malawi (12), Mali (5), Mauritania (2), Mozambique (2), Nepal (5), Philippines (3), Rwanda (3), Tanzania (5), Uganda 4: Bhutan, Dominican Republic, Kyrgyzstan and Tajikistan By 2016, at least 2 countries move up one level from baseline (2015) By 2016, 21 Poverty- Environment Initiative countries include povertyenvironment objectives in 4,400 development plans/ policies By 2016, at least 16 Poverty- Environment Initiative countries integrate povertyenvironment objectives into 80 sectoral policies and plans By 2016, at least 25 systems in 16 countries By 2016, 12 Poverty- Environment Initiative countries largely achieve level 3 or above By 2016 at least 4 Poverty- Environment Initiative countries report increased expenditure By 2016, 60 budgeting and expenditure frameworks in 12 countries By 2016, at least 2 Poverty- Environment Initiative countries have introduced beyond GDP measurements

15 Report overview 3 Indicator Cumulative level of achievement 2016 target Output Indicator 2.3: Number of (sub) national guidelines and tools to manage private sector investment decisions that integrate povertyenvironment objectives Outcome Indicator 3: Level of integration of pro-poor environmental mainstreaming approach and tools in UN (UNDP, UNEP) and partner strategies and programmes at country, regional and global levels 17 in 3 countries: Lao PDR (10), Myanmar, Philippines By 2016, at least 10 guidelines and tools to manage private sector investment decisions in 3 countries The Poverty-Environment Initiative remains anchored in a joint UNDP-UN Environment programme with core staff operating in four regional offices and at Headquarter offices of its host institutions. Poverty-environment mainstreaming approaches and tools were incorporated into the revised UNDG Environmental Sustainability guidelines and within UNDAFs in Poverty-Environment Initiative countries. UNDP and UN Environment programmes have incorporated to some extent poverty-environment mainstreaming tools into the structure of their operations By 2016, level 3 largely attained Output Indicator 3.1: Number of UNDAFs and Country Programme Documents (CPDs) that are poverty-environment mainstreamed 48: 25 UNDAFs in 20 countries: Bangladesh, Bhutan (2), Botswana, Burkina Faso, Honduras, Indonesia, Kyrgyzstan, Lao PDR, Malawi, Mali, Mauritania, Mozambique (2), Nepal (2), Peru, Philippines, Rwanda, Tajikistan (2), Tanzania (2), Thailand 24 CPDs in 20 countries: Bangladesh, Bhutan, Botswana, Burkina Faso, Colombia, Honduras, Indonesia (2), Kyrgyzstan, Lao PDR, Malawi, Mali, Mauritania, Mozambique (2), Nepal, Panama, Peru, Rwanda, Tajikistan (2), Tanzania (2), Thailand By 2016, the Poverty- Environment Initiative contributes to the formulation of 24 UNDAFs and 22 CPDs Output Indicator 3.2: Number of UN strategic documents such as United Nations Development Group guidelines and post-2015 debate that reflect Poverty-Environment Initiative inputs Output Indicator 3.3: Number of Poverty-Environment Initiative knowledge products shared with regional and global networks Output Indicator 3.4: Number of references to poverty-environment approaches and tools in UN and other development agency strategies/plans 59 strategic documents and contributions to the post-2015 debate shared globally or regionally (19 above 2015 totals) A 20-fold increase (1,967 %) against the 2013 baseline Exceeds 2016 target (10 additional contributions) by 1/₃ By 2016, the Poverty- Environment Initiative s inputs reflected in UN submissions on implementation of post development decisions 275 By 2016, 30 products are shared and feedback from users is positive 238 By 2016, 30% increase against baseline Legend: = partly achieved; = on track (achieved); = exceeded; = more than exceeded.

16 Budget codes & baselines linked to PE objectives/indicat ors Poverty-Environment Initiative blossoming forth Poverty levels of men and women reduced as measured by multidimensional indices Support for including PE objectives in development plans Improved natural resource access/control Partners support climate and environment management program mes for poverty reduction PE objectives implemented Government coordination mechanisms improved Institutional coherence Capacity building for PE and gender mainstreaming, including South-South learning Actions to break down sector silos Improved understanding of PEN Revised national budgeting and financial management processes and priorities Improved domestic resource mobilization for PE investments Strategic policy briefs Awareness-raising campaigns Cross-sector coordi n ation gaps identified PE objectives in national development plans Increased expenditure for PE and SDG implementation (private and public) PE objectives in sector and district development plans Investment programmes addressing PE objectives Legal frameworks Sustainable investment contracts Improved national M&E systems Proactive use of outputs & support to national and local processes to implement reforms Monitoring systems including PE indicators Compliance mechanisms Indicator data collected and used to improve actions to achieve P-E objectives Environmental and socially responsible private sector investments Community participation in decision making Environmental sustainability secured to sustain economic and social benefits for men, women, and vulnerable groups Improvements tracked & Beyond GDP measurements applied Economic, poverty and environmental assessments Strategic PE issues identified Use of planning guidelines Participatory processes established Lead role for planning/finance ministries; strengthen role of env. agency P E indicators integrated in planning & monitoring instruments International standard contract templates Private investment guidelines Public expenditure reviews and budget guidelines PE indicator baseline established PEI indicators identified Institutional and governance assessments Substantive ongoing engagement in development planning processes Engagement in budget processes Legal assessments Assumptions National political will for implementing national development plans Government support for improving environmental and natural resource sustainability Continued commitment to UNDP UN Environment joint programming Donor support sustained for UNDP UN Environment joint programming Government commitment to achieve SDGs and adopt necessary integrated approaches Source: Derived from UNDP-UNEP PEI, 3.2: Using a Theory of Change to Apply a Mainstreaming Programmatic Approach, Mainstreaming Environment and Climate for Poverty Reduction and Sustainable Development: A Handbook to Strengthen Planning and Budgeting Processes (PEI, 2015). 4

17 Outcome performance This section summarizes performance in 2016 against the three main Outcome Indicators of the Global Programme that follow. OUTCOME INDICATOR 1 Level of application of povertyenvironment approaches and tools for integrated development policies, plans and coordination mechanisms In line with its reformulation, the Poverty-Environment Initiative defined five levels of achievement for this indicator in Bangladesh and Lao PDR moved from level 2 to level 3, Malawi moved from level 3 to 4 and Rwanda from level 4 to 5. In this section, we provide short descriptions to showcase the progress made as countries make progress and generate results to institutionalize poverty-environment approaches and tools. For example, building on the previous Five-Year Plan (FYP), Bangladesh s 7th FYP integrated poverty, environment and climate change priorities not only as a separate chapter but also across key development sector strategies (e.g. agriculture, fisheries, forest, water, energy and infrastructure). The 7th FYP results framework that forms the foundation for the SDG monitoring process in the country also integrated poverty-environment indicators including specific indicators about climate resilience. The National Planning Commission and the Ministry of Finance harmonized sectors and improved reporting, monitoring of expenditures and coordination. The realignment of sectors is expected to improve the efficiency and resource allocation to the sector environment, climate change and disaster risk reduction. Furthermore, the National Academy for Planning and Development (NAPD) is ensuring institutionalization of capacity-building in povertyenvironment mainstreaming. TARGET: By 2016, at least 2 countries move up one level from baseline (2015) Malawi institutionalized the application of poverty-environment approaches and tools resulting in poverty-environment policy and budget coherence across several sectors and districts. This is reflected, for example, in the application of the annex on environmental sustainability and natural resource mainstreaming integrated last year (see Annual Report 2015) in Malawi s Guide to Executive Decision-Making (GEDM 2015) in conjunction with increased budget allocations (1 per cent in 2016) through application of the 2016/2017 budget guidelines that includes a sustainability chapter with links to poverty for the fourth consecutive year. In 2016, the wildlife, irrigation, mining and agriculture sectors also used the mainstreaming annex when 5

18 6 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 POVERTY-ENVIRONMENT CHECKLIST IN MALAWI S GUIDE TO EXECUTIVE DECISION-MAKING The guidelines include a practical checklist with 24 questions that can help policymakers to assess the environment and poverty impacts of various policy options. Questions include: What are the likely impacts (negative and positive) of the policy option on the environment and natural resource management? What are the costs and financial benefits on the natural resources and the environment? drafting their policies or sector strategies. The Office of the President has ensured compliance with the guidelines before approving other four new sector policies (agriculture, forestry, fisheries and climate policy). The application of the Guide has, for example, helped to ensure a balance between agriculture production (key for achievement of SDG2) and environmental conservation in the draft national agriculture policy. In the case of Rwanda, the Government has applied a checklist for the integration of environment and climate change priorities in annual sector and district plans and budgets for seven consecutive financial years. Every year, capacity has systematically been built on the application of the checklist and enhancements made, e.g. the checklist was first piloted by three sectors in 2010/11, with an additional 11 sectors following in 2013/2014 and 30 districts in 2015/2016. The sustained and strengthened achievements in mainstreaming poverty and environment into the national, local, sector, planning and budget processes led by Ministry of Finance and Economic Planning through the use of checklists, budget statements and assessments demonstrates the ongoing high-level political commitment of the Government of Rwanda. How will the financial benefits be used for improved livelihoods, environment conservation and management? Will the policy affect the gender balance in terms of access, ownership and control over natural resources and benefits realized from them? Does the option respect the provisions of the Environmental Management Act? Does the option unnecessarily expose the environment to abuse and therefore the need for more controls and enforcement? Substantive progress has also been made in 2016 to deepen the impact of mainstreaming approaches and tools across and beyond government institutions in all Poverty-Environment Initiative countries, although embedding environment and natural resource considerations continues to be challenging. Particular progress has been made in 2016 in Bangladesh, Bhutan, Kyrgyzstan, Mozambique, Nepal, Peru and Tajikistan. For example, seven sectors in Mozambique included povertyenvironment objectives in annual plans and 22 institutions use environment and climate budget codes resulting in increased budget allocations from 0.45 per cent in 2014 to a proposed 2.2 per cent of the 2017 state budget, making Mozambique very likely to move from level 3 to 4 in Peru also made important steps through well-coordinated efforts towards an inclusive solid waste management system. The Solid Waste Law and the National Solid Waste Plan integrated poverty-environmentgender objectives in a cross-government effort, making excellent progress on the institutionalization and sustainability front. For example, the Ministry of Environment included social aspects into its legislation to improve the economic standing of the recyclers (with special focus in women) while decreasing their exposure to health

19 Outcome performance 7 hazards, all while providing an environmental service. For its part, the Ministry of Economy and Finance also integrated an indicator on the formalization of recyclers at the municipal level, along with the amount of solid waste collected in their National Incentives Plan for the Improvement of Municipal Management. OUTCOME INDICATOR 2 Increased public sector financial expenditure for poverty-environment results in target countries The Poverty-Environment Initiative s support to integrate poverty-environment priorities into budgeting and expenditure processes has continued to result in budget allocations and changes to climate and environment expenditure frameworks in A total of four expenditure reviews demonstrated increased expenditure in two countries in 2016: at the national level in Tanzania and three local reviews in Indonesia. Furthermore, at least three countries (Malawi, Mali and Tanzania) have reported increased budget allocations in support of poverty-environment mainstreaming in TARGET: By 2016 at least 4 Poverty-Environment Initiative countries report increased expenditure The subnational reviews of public expenditures on climate conducted in Indonesia show an increasing trend of budget allocation and expenditure for climate change, with significant increases in in five provinces. In particular, three provinces Jambi, Yogyakarta and Central Java demonstrated significant increases in budget allocations for core climate change mitigation activities (see sidebar). It is important to highlight that this is the first time the government has been able to track subnational public investments in climate change. It is also the first time that local government in Bangladesh has been able to track this type of information, helping demonstrate its increased commitment to tackling climate change to address more effectively the Presidential Decree on the National Action Plan for Greenhouse Gas Emissions Reduction and its equivalent at the local level. Furthermore, the climate mitigation tagging system developed in 2014 was integrated in the state financial system and is being applied by all line ministries in the state budget formulation and expenditure review process. This increased capacity in tracking budget allocations and reviewing expenditure for climate change as well as a recent effort in integrating climate change into the performance-based budget system will lead to better prioritization and effective public investments in climate change at the national and subnational levels. Jambi % Yogyakarta +4.4 % Central Java % In Tanzania, the Poverty-Environment Initiative has contributed to increased expenditures through influencing policies (national development plan, public investment plan and environment management act) and policymakers. The Poverty-Environment Initiative successfully advocated for increased investments in environmental sustainability, as reflected in different studies between 2011 and 2015 such as economic reports, public expenditure reviews and district analysis (refer to previous the Poverty-Environment Initiative annual reports). The National Environment Management Council s expenditure on environment and climate

20 8 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 change has increased by 60 per cent between 2013/2014 and 2014/2015. Similarly, the Vice President s Office has increased its expenditure on the environment for development by 51.4 per cent. This trend is likely to continue. In the financial year 2016/2017, the government has substantially increased its budgetary allocation to environmental management compared to the previous two years. Of the total budget for the Vice President s Office for 2016/2017, 56 per cent (or 4.5 billion Tshs) is earmarked for environmental sustainability programmes a substantial increase over previous years. 1 Malawi, Mali and Mozambique also made considerable progress in increased budget allocations towards implementation of poverty-environment objectives in support for this indicator. For example, environment and climate budgeting is now an integral part of the budget process in Mozambique. Budget allocations have increased from 0.45 per cent of the state budget in to 2.2 per cent in 2016 (see Outcome Indicator 1). In Malawi, the national budget guidelines include a sustainability chapter for the fourth consecutive year. Despite challenges in economic growth and cuts to the national budget, the 2016 budget allocation to environmental sustainability is 1 per cent higher than the average expenditure in the past couple of years. In Mali, four key sectors (water, environment, urbanization and state land) have increased budgets for projects in support of poverty-environment objectives by 13.8 per cent (from USD 139 to USD 150 million) between the 2016 and TARGET: By 2016, level 3 largely attained OUTCOME INDICATOR 3 Level of integration of pro-poor environmental mainstreaming approach and tools in UN (UNDP, UNEP) and partner strategies and programmes at country, regional and global levels The target was met with evidence provided across this report, in particular under Output 3 and in the partnership section. The Final Evaluation of the Poverty- Environment Initiative Scale-up phase completed in 2016 found, There still is considerable room for the agencies to capitalize on the Poverty-Environment Initiative s work, experiences and platform, i.e. for realizing the Poverty-Environment Initiative s potential in the UN host agencies. Conscious of the need to address this relevant finding, the host agencies stepped up efforts in 2016 to ensure that the Initiative s integrated approach to poverty-environment mainstreaming and lessons learned garnered respect within its host institutions and, more widely, within the UN community. The Initiative has actively engaged in the UN processes around the 2030 Agenda for Sustainable Development and preparations for implementation of the SDGs in partnership with a range of UN and non-un actors, including bilateral donors. Through inputs via UNDP and UN Environment channels, these have been integrated into policy processes including the United Nations Environment Assembly (Nairobi, May 2016), High-Level Political Forum on Sustainable Development Source: Public Expenditure Estimates Development Vote (Part A, Vol. IV).

21 Outcome performance 9 (New York, July 2016) and Regional Conference Towards a Common Vision for Agenda 2030 in Central Asia (Almaty, October 2016). Relevant examples of Poverty- Environment Initiative contributions to post-2015 debates include Policy Guidance on Environment, Human Rights and Addressing Inequality (UNEP, June 2016). The Poverty-Environment Initiative remains anchored in a joint UNDP UN Environment programme with core staff operating in four regional offices and at Headquarter offices of its host institutions. Poverty-environment mainstreaming approaches and tools were incorporated to some extent into the revised UNDG Environmental Sustainability guidelines and within UN Development Assistance Frameworks (UNDAFs) in Poverty-Environment Initiative countries. UNDP and UN Environment programmes have incorporated poverty-environment mainstreaming tools into the structure of their operations (e.g. in UN Environment s Environmental, Social and Economic Sustainability Framework otherwise known as safeguards and Human Rights and Equality guidance). At the same time, the Initiative continues to benefit from global strategic programme direction and support offered by the Sustainability Team of the Bureau for Policy and Programme Support and the leadership and country-level knowledge and programming of the UNDP Country Offices under their respective Regional Bureaux. For example, the strong partnership between the two agencies enables the Initiative to effectively support the development of the SDG generation of UNDAFs for countries and UNDP Country Programme Documents. As a result, poverty-environment objectives have been included so far in 24 UNDAFs and 24 Country Programme Documents. The Poverty-Environment Initiative has also proven to be a useful platform for other UN and partner strategies and programmes. The Poverty-Environment Initiative has influenced UN partners including UN Women, FAO and other UNDP and UN Environment programmes and contributed to Getting to Zero: A Poverty, Environment and Climate Call to Action for the Sustainable Development Goals presented at the High-Level Political Forum on Sustainable Development (New York, 13 July 2016), which had been adopted by the Poverty Environment Partnership, the global network of Initiative partners and poverty-environment practitioners, at its 21st meeting (Dhaka, 1-3 June 2016). In 2016, the host agencies have stepped up efforts to systematize lessons learnt and good practices between the Poverty-Environment Initiative and other relevant programmes, such as the UN Programme on Reducing Emissions from Deforestation and Forest Degradation (UN-REDD) as they prepare the final evaluation and closure in Paraguay and such as the joint expenditure reviews in Bhutan and Kyrgyzstan with the UNDP Biodiversity Financing Initiative to jointly address government requests for support building on the Poverty-Environment Initiative s expertise in public environmental expenditure reviews. In Bhutan, the work focuses on climate change and biodiversity and on impacts of climate and biodiversity spending on poverty with the aim to supporting an integrated financing approach for the SDGs. In Kyrgyzstan, the aims of the public-private environmental expenditure review on biodiversity and climate change are to enhance budgeting through related SEEA work and to develop a financing strategy for biodiversity in the context of sustainable

22 10 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 development. Similar work is planned in Rwanda for 2017 and various country and regional UNDP projects continue to integrate tools and approaches pioneered by the Poverty-Environment Initiative. Details are available upon request. Looking beyond 2017, we are pleased to report multiple examples of how other UN and non-un partners are building on lessons from the Poverty-Environment Initiative to sustain and scale up the innovative work of the Initiative. For example, the Kyrgyz Republic has been selected as a new country in the Partnership for Action on the Green Economy (PAGE) and the Poverty-Environment Initiative will facilitate its launch together with the PAGE secretariat, providing an exit and sustainability strategy for our work. The European Union is scaling up the work of the Mainstreaming Reference Groups at the local level in Bhutan. In Malawi, the collaboration with the UN Food and Agriculture Organization (FAO) around soil loss and with UN Women on the gender gap in the agriculture sector is likely to be scaled up to a One UN Flagship programme joining the four agencies to tackle environmental, social and economic problems related to agriculture and food security. These and other examples in this report bear witness to the success of the Initiative in influencing the work of other development actors within and beyond the partner agencies. Key lessons: outcome level THE POVERTY-ENVIRONMENT INITIATIVE S GLOBAL TARGET ON INCREASED EXPENDITURE MAY NEED TO BE RECONSIDERED ISSUE: Increased expenditure is unlikely to be achieved in times of economic crisis such as shifts in GDP and revenue collection and in the face of general budget and reductions in official development assistance. Our work could still influence an increase in the proportion of the budget being spent on inclusive and sustainable environment and natural resource management. However, this might not necessarily result in increased expenditure as per our Outcome Indicator 2. This represents a lesson learned for development of future programming performance measurement metrics, e.g. accounting for a comprehensive approach including: institutionalization of budget codes (or similar tools), increased budget allocations (proportionately and in total) and expenditure tracking (and proportional and total increases). While acknowledging that the current programme M&E framework incorporates these three metrics, the performance monitoring currently measures only increased allocations and expenditures, not accounting consistently for all three metrics. ACTION: Where possible, Poverty-Environment Initiative countries will seek to collect data on the percentage of the budget allocated to implement poverty-environment objectives to provide qualitative context (i.e. proportion) to expenditure data reporting under the current programme. Monitoring performance in relationship to expenditures tracking in the new programme and programmes with similar

23 Outcome performance 11 objectives will require a more nuanced and consistent approach that balances quantitative and qualitative aspects. GOVERNMENT RESTRUCTURING PROCESSES ISSUE: The government restructuring process still under consolidation in Mozambique resulted in a vacuum of environmental units/focal points in some ministries for most of 2015; other ministries accumulated three or four focal points. Due to the reconfiguration of the Ministry of Environment, no environmental unit meeting was convened in 2015, and assessment of the integration of povertyenvironment objectives in provincial economic and social plans has not been possible thus far. ACTION: Together with PEI, the Ministry of Environment will in 2016 review the function of the environmental units/focal points within the new government structure in line with the terms of reference developed with PEI support in PEI continues to analyse the level of integration and need for capacity building. Where needed, PEI will build the capacity of new environmental units to support the integration of poverty-environment into the 2017 strategy and to support the Ministries of Economy and Finance to ensure integration of poverty-environment objectives in planning and budget processes delayed due to the government restructuring process. STRENGTHENED PARTNERSHIPS FOR IMPACT ISSUE: Looking at increasing sustainability in the year before the Initiative concludes, the Poverty-Environment Initiative strengthened collaboration, coordination and partnerships with a wide range of actors from community to international levels, from grassroots to global organizations across government, private sector, academia and civil society. This has been largely driven by the appreciation of mutual win-win gains from technical collaboration on key issues, e.g. poverty-environment-gender nexus, inclusive green economy, climate resilience, human rights, revenue-sharing, communications, capacity-building or institutional/policy reform as integral components of poverty-environment mainstreaming. ACTION: Detailed examples with regards to increased partnerships and collaborations for sustainability are found across the report and under Outcome Indicator 3 and opportunities and challenges. TESTING WHAT A FRUITFUL COLLABORATION WITH PRIVATE SECTOR LOOKS LIKE ISSUE: Outcome Indicator 1 focuses on the application of the tools that will enable the mainstreaming of the poverty-environment nexus policy and investment decision-making. As Poverty-Environment Initiative countries fully embrace the

24 12 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 development challenge, the need to influence not only public, but also private investments becomes more apparent. ACTION: The Poverty-Environment Initiative has worked closely with government agencies in charge of financial and public investment decisions and with key sectors such as mining and agriculture to tailor databases, investment model contracts, IT systems, technical guidelines, investment strategies and a wide array of tools and approaches to change decision-making and to make it more transparent. These tools and approaches have been commended by our partners, who are keen to make good use of them. The tools and approaches require dedicated training and advocacy to find their way through complex institutional structures and relations with very different interest groups. The Poverty-Environment Initiative has expanded the target groups to include chambers of industry and commerce, unions, foundations and funds to understand what it will take. A clear lesson from these relatively initial efforts is that time and resources are needed to ensure that the systems work and that the actors have the skills and knowledge to make the best use. INSTITUTIONALIZATION DOES NOT ALWAYS EQUAL SUSTAINABILITY ISSUE: The Poverty-Environment Initiative has used the example of the institutionalization through executive order by the prime minister of the Mainstreaming Reference Group in Bhutan (refer to previous annual reports) as best practice in terms of institutionalization of a coordination mechanism and indicator of ownership for mainstreaming. ACTION: The Poverty-Environment Initiative has successfully supported the rollout of the Mainstreaming Reference Group at the local level in the past years. Through application of lessons, in 2016, all 20 districts in Bhutan count with a local Mainstreaming Reference Group and action plans. This achievement has required the establishment of partnerships and capacity-building support. Looking at issues of sustainability beyond 2017, the Poverty-Environment Initiative has reached out to development partners such as the UN Capital Development Fund and the European Commission to complement the limited resources available from local governments to ensure adequate capacity of the local Mainstreaming Reference Groups and funding to implement their action plans. REFORMING REGULATIONS WHAT IT TAKES TO MAINSTREAM CLIMATE CHANGE INTO NATIONAL DEVELOPMENT PLANNING ISSUE: The Poverty-Environment Initiative in Indonesia is spearheading efforts to mainstream climate change and biodiversity through influencing the planning and budgeting processes at various levels of government. The climate tagging system has now been institutionalized into the existing programme-based budgeting system to help the government address climate change. In 2016, during the implementation

25 Outcome performance 13 of climate tagging, it became apparent that indicators in the programme-based budgeting system did not reflect adequately indicators for climate change activities. ACTION: The Poverty-Environment Initiative has been collaborating with partners to provide capacity-building and to improve collaboration between key government agencies to address this issue. An additional lesson from efforts this year is that further capacity-building and improved communication and coordination are necessary to accelerate data validation.

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27 Output performance Key information on progress against the three indicators is summarized, with detailed reporting provided subsequently for each indicator. OUTPUT 1 Poverty-environment approaches and tools for integrated development policies, plans and coordination mechanisms applied Progress towards Output 1 is measured through four different output indicators with respective annual targets, focusing on the integration of poverty-environment objectives in national, subnational and sectoral policies and monitoring and evaluation frameworks as well as functioning cross-sector coordination mechanisms for poverty-environment-related issues. Output 1 annual targets across those areas of work have been exceeded. Through this work, the Poverty-Environment Initiative is effectively facilitating government efforts to transition to sustainable development and to localize delivery of the SDGs. In total 4,459 national and local development plans, 102 sector plans and 33 M&E systems integrate poverty-environment objectives and indicators so far in 24 countries. Of these, 6 national and 19 local development plans, 24 sector plans and 3 M&E systems integrated poverty-environment objectives and indicators in 2016 alone. OUTPUT INDICATOR 1.1 Number of national and subnational policies and plans that integrate poverty-environment objectives in target countries IIn 2016, five National Development Plans and one national policy were approved in Burkina Faso, Lao PDR, Mali, Tajikistan and Tanzania. At the local level, Malawi, Mali, Nepal, Tajikistan and Tanzania approved a total of 13 subnational development plans that integrate poverty-environment objectives. This represents a cumulative total 4,459 plans, exceeding the annual target. TARGET: By 2016, 21 Poverty- Environment Initiative countries include povertyenvironment objectives in 4,400 development plans/ policies Building on the previous plan , Burkina Faso adopted a new National Plan for Economic and Social Development (PNDES ). The new plan integrates pro-poor environmental sustainability in its overall vision and in one of its objectives 15

28 16 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 The Government of Burkina Faso, having recognized the vicious circle linking environmental degradation, poverty, the persistence of social inequalities, and high population growth, has resolutely turned in the last two decades towards the quest for a sustainable development. This requires the advancement and strengthening of the three interrelated and mutually reinforcing pillars of economic development, environmental protection and social development. Seglaro Abel Some, former Executive Secretary of the Secretariat for the five-year development plan of the Ministry of Economy and Finance; now Permanent Secretary of the Ministry of Economy, Finance and Development (MINEFID) to reverse the trend of environmental degradation and ensure sustainable management of natural resources. The role of the Poverty-Environment Initiative is particularly highlighted in the plan, which states that the internalisation of the Poverty-Environment Initiative highlights the national authorities commitment to promote sustainable development. Lao PDR s new FYP (i.e. 8th National Socio- Economic Development Plan ) integrated for the first time key indicators moving away from quantity of investments towards quality of investments (e.g. percentage of public infrastructure investment projects, concessions and special economic zone projects that have been evaluated against social and environmental criteria). The same approach has been taken in the development of provincial plans thanks to the application of mainstreaming guidelines that prioritize poverty-environment objectives. Mali s Strategic Framework for the Economic Recovery and Sustainable Development includes poverty-environment objectives articulated across the various priority areas. In fact, the overall objective of the Strategic Framework is to promote inclusive and sustainable development for reducing poverty and inequality in a united and peaceful Mali [ ] to achieve the SDGs. Its first strategic axis is the promotion of inclusive and sustainable growth with a strong focus on environment and natural resource sectors including agriculture, livestock, fisheries and food security. In addition, climate change, gender and youth employment are considered as cross-cutting issues and objective 12 aims to promote a green economy through sustainable management of natural resources. Lao PDR s 8th National Social Economic Development paves the way towards the graduation from least-developed-country status and lays a strong foundation for the achievement of the Sustainable Development Goals. Addressing shortcomings in its roll-out and adequate emphasis on the integration of the poverty-environment nexus, the Poverty-Environment Initiative supported the development and application of a Socio-Economic Development Plan Manual that has guided the provincial and district authorities in developing their annual development plans. As a result, the manual aims at creating an enabling environment where social and environmental protection lies at the core of development. Its emphasis on lowcarbon green-growth principles will help inform the Green Growth Criteria/Selection Guidelines for the National Public Investment Programme. The Ministry of Planning and Investment approved the manual in 2016 as a guiding document for harmonizing the development planning process for each sector of government.

29 Output performance 17 Tajikistan s National Development Strategy , approved in 2016, addresses for the first time environmental sustainability and gender equality as cross-cutting objectives. Tanzania s second National Five-Year Development Plan 2016/ /2021 identifies sustainable natural resource management as a strategic intervention for economic growth. The plan highlights that Tanzania is endowed with rich and diverse natural resources from where it derives its economic and social livelihood. Managing such resources sustainably is therefore an imperative. The identified interventions to strengthen natural resource, environment and climate management have strong links to poverty reduction. They indicate government efforts to scale up demonstration projects supported by the Poverty-Environment Initiative and partners in previous years and include: enhancing community-based natural resource management systems; promotion of renewable green energy technologies (including biogas); and integrating, harmonizing and coordinating environmentally sustainable policies for growth across sectors. The Plan further articulates the importance of enforcing Strategic Environmental Impact Assessments to foster environmental sustainability. At the local level, highlights include: II Two District Development Plans in Malawi integrated poverty-environment objectives and two local governments in Mali integrated climate change into their economic, social and cultural development plans, budgeting and monitoring processes in partnership with the UN Capital Development Fund. A highly participatory approach enabled communities to prioritize the adoption of energyefficient cook stoves, reforestation measures and the promotion of the use of nontimber forest products by women for income generation. Another two pro-poor environmentally sustainable green recovery and rehabilitation plans in Nepal were approved in Thanks to the participation of marginalized groups, the plans address fundamental drivers and factors that interconnect environmental degradation, poverty and social inequity, following the April 2015 earthquake in Nepal (see gender section). In Tanzania, the Bukoba District Development and Investment Plan also integrated poverty-environment objectives. The Poverty-Environment Initiative facilitated the implementation of local economic development approaches to address findings from the 2014 Poverty-Environment Initiative study on sustainable fishing practices through this Plan. To sustain results, the Poverty-Environment Initiative is supporting the Poverty Eradication Division at the Ministry of Finance and Planning as the Division, using a comprehensive strategic framework and technical guidelines, implements the local economic development approach contained in the national plan; the purpose of this is to help local government authorities as they support sectors and districts to effectively mainstream poverty-environment objectives. I I The Poverty-Environment Initiative s support over the last years (see previous annual reports) has been critical to ensure that 93 per cent of all district development plans in Tajikistan (a total of 63, including six local plans in 2016) include poverty-environment priorities as cross-cutting issues and in specific

30 18 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 chapters. In recognition of the Ministry of Economy s leadership and ownership, the Poverty-Environment Initiative has joined forces with complementary UNDP Country Office projects to support the Ministry in its efforts to enhance the capacity of local experts, representatives of civil society and the private sector (including women entrepreneurs) in planning for sustainable local development. As a result, production of a documentary-educational film Manual on Planning, Monitoring and Budgeting of Sustainable Local Development is underway to sustain the results of the prioritization of poverty-environment in budgeting, resource mobilization, monitoring and evaluation of strategic documents and to promote wider participation of communities in local development planning. II Among other countries, Bhutan and Guatemala prepared an additional 29 subnational plans following methodological guidelines promoted by the Poverty- Environment Initiative that will be approved in TARGET: By 2016, at least 16 Poverty-Environment Initiative countries integrate poverty-environment objectives into 80 sectoral policies and plans OUTPUT INDICATOR 1.2 Number of key sectoral policies and plans that integrate poverty-environment objectives in target countries In 2016, the increasing trend in sector results continued with the approval of 14 new policies and 4 new laws integrating poverty-environment objectives in Lao PDR, Malawi, Mongolia, Mozambique, Nepal, Peru and Tajikistan, bringing the total of sector policies and plans to 108. The increasing trend in sector policymaking is not only reflects how the Poverty-Environment Initiative is addressing the implementation challenge in practice, but also evinces how the integrated approach underlying the poverty-environment mainstreaming approach can contribute to SDG achievement. Several examples complemented by testimonials below reflect this point well. Informed by the evidence from key The policy is also aligned to the Sustainable studies on the cost of soil erosion Development Goals, especially Goal Number 2, which (2011), soil loss (2016 in partnership with is end hunger; achieve food security and improve nutrition; FAO) and on the gender gap (2015 in and promote sustainable agriculture, including fisheries partnership with UN Women and the production. This is quite interesting to be aware of, as we draw World Bank), the Ministry of Agriculture various resources to address critical issues such as food and and Food Security invited the Povertynutrition insecurity and social development Environment Initiative to participate in the among the rural communities. George drafting team to develop the new national Chaponda, Malawai Minister of Agriculture, agricultural policy of Malawi. The policy Irrigation and Water Development, on the promotes investments in climate-smart launch of Malawi s fisheries and aquaculture agriculture and sustainable land and policy water management, including integrated soil fertility management, irrigation and sustainable use of agrobiodiversity. The policy has a strong focus on empowering the youth, women and vulnerable groups to close gender gaps. A similar approach has resulted in the

31 Output performance 19 approval of another three new sector policies: climate change, fisheries/aquaculture and forestry. The fisheries policy highlights decent work as well as an ecosystem approach to fisheries and aquaculture to ensure that the loss of biodiversity is minimized while ensuring that communities derive economic and nutritive benefits. For its part, the new forestry policy calls for better estimating the poverty reduction potential of the sector and includes an objective to promote various financing mechanisms in the sector. It particularly notes that the contribution of forestry to GDP is subsumed under agriculture and does not take into account the value of non-wood forest products, processed timber or the informal trade in fuel wood and charcoal. Our work in Peru aims to make the solid waste management sector more selfsustainable and decent. The Poverty-Environment Initiative has helped to create a robust policy framework so that recyclers can have decent jobs, which is critical for one of the most vulnerable and marginalized population groups. At the same time, the work aims at improving the efficiency of the solid waste collection system. In 2016, the work done in the last years on the National Plan for Solid Waste Management resulted in the integration of important poverty-environment objectives. In Arequipa, the Poverty-Environment Initiative is helping to update the local solid waste management plan so that it aligns with national plans and to make it the first plan of its nature to incorporate a social inclusion and economic empowerment approach, thus laying the basis for lesson learning to develop national guidelines for the remaining municipalities in Peru. OUTPUT INDICATOR 1.3 Number of M&E frameworks that integrate poverty-environment indicators into national and subnational M&E systems In 2016, Poverty-Environment Initiative countries have intensified efforts to redefine monitoring and evaluation frameworks that can better track the implementation of poverty-environment objectives for example, in Lao PDR and Peru bringing the total number of frameworks to 33. TARGET: By 2016, at least 25 systems in 16 countries In Lao PDR, the government integrated for the first time quality investment indicators in the M&E framework of the new Five-Year Plan (8th National Socio- Economic Development Plan); these include percentage of investment projects deemed to require EIA/IEE/ESIA by MoNRE/DESIA (Ministry of Environment and Natural Resources) that have been evaluated against social and environmental criteria: public infrastructure investment project, concessions, and special economic zones. Peru not only integrated poverty-environment indicators into the M&E framework of the National Plan for Solid Waste Management, but also updated it to transition to a National Integrated Information System for Solid Waste Management. The new system will consolidate strategies at the central and local levels and incorporate gender indicators. Furthermore, the Poverty-Environment Initiative is promoting synergies with the Nordic Environment Finance Corporation

32 20 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 ENABLING CHANGES IN LEGISLATION AND REGULATORY FRAMEWORKS Countries are increasingly amending existing or developing new legislation through national governance systems to achieve poverty-environment objectives and to promote policy coherence within and across sectors. This work is in line with the objectives of UN Environment s Environmental Governance Programme as it contributes to strengthen the capacity of institutions to address multilateral environmental agreements and the SDGs. Selected examples follow. Our long-term partnership with the Investment Promotion Department in Lao PDR resulted in the amendment of the Investment Promotion Law in 2016 to promote investments in pro-poor and environment-friendly areas. These include protection of the environment and biodiversity, education, advanced technology and research & development, organic farming, rural development and poverty reduction. Mongolia approved its first National Development Planning Law to ensure better horizontal and vertical coordination and integration across key sectors and provinces. The Poverty-Environment Initiative s work was instrumental in this achievement after participatory planning exercises showed that levels of coherence among national, sectoral and local plans were low. In-depth reviews of mining policy and mineral revenue management have helped officials of the newly established National Development Agency initiate review of the Local Development Index, which is used to allocate revenues from mineral and other resources for local development funds. In Myanmar, the Poverty-Environment Initiative teamed up with the International Senior Lawyers Project, a non-profit organization that fosters just and accountable sustainable development, including through focusing on the legal frameworks and legal agreements on investments. Findings of the Poverty-Environment Initiative-supported policy coherence analysis of Myanmar s mining and environmental laws and regulations are being used to advise Myanmar s Department of Mines on relevant international best practices and standards through participatory consultations. The recommendations were also presented to the Ministry of Natural Resource and Environment Conservation, which oversees policymaking for the mining sector, in order to improve coherence and implementation of relevant laws, policies and regulations. The improved coherence resulting from this work is expected to contribute to achievement of relevant SDGs and multilateral environmental agreements, including on chemicals and biodiversity. Looking towards to strengthen data security and to monitor greenhouse gases. It is also assisting selected subnational authorities to adapt to local needs and to spearhead efforts to ensure policy coherence. For example, the Municipality of Arequipa has already identified relevant indicators and targets such as: By 2018 all urban municipalities have solid waste management programmes with recyclers prioritizing gender equality and formal commercialization of inorganic waste and Build capacities for recyclers associations to establish an organizational system based on the principles of equality, transparency, solidarity, gender, poverty. Lessons from this work will inform replication in other municipalities.

33 Output performance 21 sustainability of these efforts, the Poverty-Environment Initiative is promoting collaboration with key stakeholders such as the Asia Development Bank. We are also coordinating the Minamata Initial Assessment and the National Action Plan for Artisanal and Small-Scale Gold Mining support from UN Environment in regards to the development and rollout of a strategic framework to improve policy coherence and to promote international standards of regulatory requirements. Bhutan also initiated a review of 34 policies and laws relevant to biodiversity and climate change in partnership with UNDP s Biodiversity Financing Initiative and the Poverty-Environment Initiative to assess coherence, effectiveness, efficiency and equity. Its recommendations could promote the implementation of biodiversity and climate objectives of relevant multilateral environmental agreements. Peru has approved an Integrated Solid Waste Management Law that, for the first time, specifies how to manage solid waste management in an environmentally safe way, with proper sanitary measures. The law includes several articles aligned with Poverty-Environment Initiative approaches and reflects the experience developed by the Programme in the sector in the past three years. For example, articles 7 and 15 make direct reference to the National Solid Waste Management Plan as a tool for an efficient use of materials and solid waste management, establishing it as the main regulation policy for solid waste management in the country. The law establishes the Ministry of Environment as the competent authority for the coordination, with other institutions, to apply what is included in the National Solid Waste Management Plan, including the formalization of recyclers by municipalities. Article 53 regulates how municipalities must use the level of formalization of recyclers associations as indicators to measure the results of their administration (see section on causes of poverty under opportunities and challenges). The Director of the Bureau of Local Government Finance in the Philippines highlighted how the Department of Finance s recently launched Environment and Natural Resource Data Management Tool is zeroing in on good fiscal governance (see indicator 1.3 for more details). Tajikistan s new law on environmental impact assessments will be approved in the first half of 2017 and is expected to improve national environmental legislation and to make the process of public participation more accessible and transparent. The Poverty-Environment Initiative played a central role in its development through a participatory approach. Progress has also been made in another six countries. Guatemala s National Development Agenda (being used as driver for the SDG implementation) does not have any associated M&E system. The government has therefore decided to give priority to its creation. The Poverty-Environment Initiative is assisting the Planning Ministry to develop an information technology platform (the territorial information system) as the basis from which all policies and programmes will be monitored and evaluated. The Poverty-Environment Initiative is helping to improve the capacity of the Planning Ministry, which is investing its own resources. So far, 10 people have been recruited, including land use management, environmental and IT experts to ensure institutionalization and sustainability of the platform. Tanzania s draft Monitoring

34 22 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 and Evaluation framework for the new National Development Plan includes forestpoverty indicators and Mali has started to review environmental indicators for its new national strategic framework. The Poverty-Environment Initiative in Tanzania and the Poverty-Environment Initiative in Burkina Faso have engaged in the design of national household budget surveys to include poverty-environment indicators. Meanwhile, Mauritania and Rwanda have taken important steps to enhance data collection on environmental sustainability linked to poverty eradication. Complementary and more ambitious efforts have been made across the four regions to assist different parts of government to introduce more innovative and integrated measuring frameworks. For example, in Bangladesh, the General Economics Division and the Bureau of Statistics signed a Memorandum of Understanding to develop Bangladesh s Environmental Statistics Framework The framework will reflect poverty, environment and climate change links through the application of a Poverty-Environment Accounting Framework, supported by the Poverty-Environment Initiative. This will directly inform Bangladesh s inter-sectoral monitoring framework of the SDGs and the monitoring of the 7th Five-Year Plan and successive plans. The Poverty-Environment Initiative is also promoting a link to poverty data with environment, climate and disaster data to better inform investments in poverty reduction policies and programmes. The Department of Finance of the Philippines is promoting transparency in the monitoring of natural resource revenues and launched in 2016 the Environment and Natural Resource Data Management Tool (see Indicator 2.1). For other examples on integrated measuring frameworks in Kyrgyzstan, Guatemala, Lao PDR and Tajikistan, see Indicators 2.2 and 2.3. TARGET: By 2016, 12 Poverty- Environment Initiative countries largely achieve level 3 or above OUTPUT INDICATOR 1.4 Level of functional government-led crosssector coordination mechanisms in target countries This key area of work for sustainability of the Poverty-Environment Initiative s efforts continues to bear much fruit. In 2016, Indonesia, Kyrgyzstan, Malawi, Myanmar, Peru, the Philippines and Rwanda moved up one level in line with the description of levels for this indicator, while coordination in Guatemala faced challenges and moved from level 3 to 2. Indonesia and Myanmar moved up from level 1 to 2, while Malawi and the Philippines moved from level 2 to 3, Peru from level 2 to 3 and Kyrgyzstan and Rwanda moved from level 3 to level 4. The move in Indonesia relates to the process for reporting financial expenditure on climate change (see Indicator 2.1), as the Ministry of Finance demonstrated leadership and improved capacity to assist all line ministries in the implementation of the budget tagging system and its integration into the national system. The coordination mechanism in Kyrgyzstan has been upgraded to the SDG Coordination Committee under the Prime Minister s Office and serves as a high-level multi-stakeholder coordination platform. This government coordination mechanism led at the highest level is critical to ensure the effective application of poverty-environment

35 Output performance 23 mainstreaming guidelines in regional development plans across the country. This work is now being done without Poverty-Environment Initiative support, evincing the move from level 3 to 4. As mentioned under Outcome Indicator 1 earlier, the move in Malawi is explained by the ownership and commitment demonstrated by the Government of Malawi in the successful application of poverty-environment guidelines incorporated in the Guide to Executive Decision-Making (GEDM 2015) and the District Environmental Management Guidelines (DEMG 2013) in sector and district planning processes. Barely existent, government-led cross-sector coordination on environment and development picked up in Myanmar after a successful first multi-stakeholder taskforce meeting on social and environmental sustainability of mining in the Mandalay region (which has the highest number of formal mining permits). The Myanmar Alliance for Transparency and Accountability, a national network of civil society organizations, has also joined the taskforce and similar work at the nationallevel demonstrates initial efforts to improve coordination in the country. In Peru, despite the change of government, the Ministry of Environment demonstrated strong ownership and a high level of leadership and coordination for the promotion of poverty-environment mainstreaming, which produced approval of the National Solid Waste Management Plan and the Solid Waste Law. Other examples of crosssectoral efforts to ensure policy coherence at the local level include the inclusion of indicators by the Ministry of Economy s National Incentives Plan for the Improvement of Municipal Management. From now on, municipalities must report the level of formalization of recyclers associations to access national financial support for their municipal strategies. The Philippines saw the launch of the Environment and Natural Resource Data Management Tool, thanks to close coordination and collaboration with the Bureau of Local Government Finance of the Department of Finance. The Tool (institutionalized at the local level) requires a joint government effort to monitor financial information relative to the extractive industries. In Rwanda, the sustained and deepened application of the environment and climate checklist for poverty eradication explains the move upward (see Outcome Indicator 1 and Indicators 1.1 and 1.2 for further detail). Other countries have continued to report progress concerning this indicator: I I Bhutan continues to make strides in this work despite having reached the toplevel ranking. In 2016, the national-level Mainstreaming Reference Group set up in 2011 with the Poverty-Environment Initiative support (see annual report 2012), has included representatives from the National Commission for Women and Children. The Group has benefited from their expertise in gender mainstreaming to sensitize the planning, budgeting and implementation processes at the central and local levels to ensure adequate implementation of the Ministry of Finance s budget call notification for the financial year on gender equality and women s empowerment. Drawing lessons from the national-level Mainstreaming Reference Group and building on the initial 10 local Mainstreaming Reference Groups reported last year, another 10 local Mainstreaming Reference Groups were established in 2016, covering all regions in the country. In 2016, the

36 24 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 Poverty-Environment Initiative assisted all 20 Dzongkhags to develop and officially submit action plans to guide the implementation of local-level activities, thanks to an allocation of Nu. 1 Million (USD 16,000) from each local government. The European Union has agreed to scale up complementary funding provided by UNDCF in six provinces between 2011 and 2016 to all 105 gewogs from 2016 until Some of the action plans developed for the local-level Mainstreaming Reference Groups include poverty-environment issues such as supporting local government to assess impacts of hydropower projects, review investment project proposals, address waste management issues and advocate for corporate social responsibility and advocacy around climate impacts and gender equality. II In Mozambique, the use of environment and climate budget codes and the integration of poverty-environment objectives into sector plans have been institutionalized across sectors. To deepen these efforts, a poverty-environment training package developed by the Ministry of Economy and Finance and the Poverty-Environment Initiative in collaboration with the International Institute for Environment and Development have been piloted in the sector and provincial annual planning processes of all 10 provinces. The Poverty-Environment Initiative in Mozambique is currently looking into the opportunity of adding a genderenvironment module to the training package. Feedback from the training was reported as excellent and a preliminary analysis of the 2017 draft sector annual socio-economic plans indicates that at least five sectors have included a total of 26 environmental actions, with a budget of USD 86,141 (6,037,470 Met). II Three coordination agreements were put in place in Paraguay to create synergies among the Ministries of Agriculture, Environment and Social Affairs to more effectively mainstream the environmental dimension with human rights approach across key government institutions. However, despite some initial work in the past years, political will remains insufficient to establish the expected cross-sectoral technical committee and related guidelines. We expect that the progress made in 2016 in the context of these agreements and continued advice will help make adequate progress in OUTPUT 2 Cross-sectoral budget and expenditure processes and environment-economic accounting systems institutionalized As countries geared up for the implementation of the 2030 Agenda and the Paris Declaration during the penultimate year of the Poverty-Environment Initiative, our countries showed good progress under this output, the most demanding part of our efforts to address the implementation challenge. The examples below highlight that we are indeed harvesting the bounty of experience of previous years in this challenging area. Poverty-Environment Initiative countries are slowly but surely changing the way institutions make budget and, more generally, investment decisions to ensure that they move towards more inclusive and environmentally

37 Output performance 25 sustainable development. We are pleased to report that the 2016 targets related to this output from influencing budgeting and expenditure processes to guidelines for private sector investment decisions have all been exceeded. OUTPUT INDICATOR 2.1 Number of budgeting and expenditure processes that integrate poverty-environment objectives in target countries In 2016, six budget and expenditure processes were implemented in Indonesia, Malawi, Rwanda and Tajikistan, bringing the total number of processes to 67. In Indonesia, the climate mitigation tagging system developed in 2014 was integrated into the state financial system. At the local level, Indonesia completed the Climate Public Expenditure Review of three provinces and a Climate Pubic Expenditure and Institutional Review of two provinces. The Reviews demonstrate increased expenditures in all provinces, in particular towards agriculture, forestry, energy and transport (see Outcome Indicator 2 for further details). TARGET: By 2016, 60 budgeting and expenditure frameworks in 12 countries For the fourth consecutive year, Malawi s 2016/2017 National Budget Guidelines include an environmental sustainability chapter with reference to poverty, livelihoods and climate and requires compliance with Environment Impact Assessment Guidelines. In the 2016/2017 government draft budget, the percentage of the budget for environmental sustainability, climate change and disaster risk management represented 4.15 per cent of the total national budget. Budget tracking for disaster risk management improved with the introduction of a specific budget code to address recommendations from the public environmental expenditure review supported by the Poverty-Environment Initiative in Tajikistan completed a water public environmental expenditure review and prepared a policy brief to communicate key findings and recommendations to better inform the ongoing Water Reform Programme for the years Tajikistan s Water Sector Public Environmental Economic Review revealed the extent to which this strategic sector has been neglected only 1 per cent of the central budget goes to the water sector despite increasing funding (from donors and revenue from user fees) and reforms in water supply and sanitation. What is more, around 40 per cent of the overall population has no access to safe water, with estimates indicating that more than 50 per cent of the rural population has no such access. Other findings highlight that ongoing institutional and policy reforms have led to some marginal performance improvements, but reaching universal access to water remains daunting without an improvement in expenditure efficiency. The Review recommended focusing on tariffs, cross-subsidization, revenue transparency and royalties, ownership and quality of service delivery within mid-term expenditure framework in the sector. In view of these findings, the review also provided a cost estimation for implementation of SDG 6. Tajikistan has also initiated expenditure reviews of the district development plans influenced by the Poverty-Environment Initiative since 2010.

38 26 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 For seven consecutive financial years, including 2017/2018, the Government of Rwanda has applied, through the annual budget call circular, a checklist for integrating environment and climate change into annual sector and district plans and budgets. Every year, capacity has systematically been built on the application of the checklist and enhancements have been made. The checklist was first If the Budget Call Circular does not consider environment and climate change, then most probably environment and climate change are not going to be taken into consideration by any sector or district. But now, since it is a requirement, it is therefore the role and responsibility of everyone. Jonathan Nzaikorera, Rwanda s Director-General for Budget of Ministry of Economy and Finance piloted by three sectors in 2010/2011, with an additional 11 sectors following in 2013/2014 and 30 districts in 2015/2016. Other Poverty-Environment Initiative countries also made good progress in For example, the Poverty-Environment Initiative in Mauritania has in the reporting period influenced the national draft budget circular and Burkina Faso and Peru strengthened poverty-environment objectives in relevant national and sectoral investment plans, respectively. Meanwhile, Mongolia and the Philippines continued to establish mechanisms to improve transparency in revenue-sharing from extractives (see section on structural causes of poverty under opportunities and challenges). Another positive development is that the Kenyan National Treasury s Draft Budget Policy Statement integrates climate change informed by a Poverty-Environment Initiative-supported public budget expenditure review of climate change. TARGET: By 2016, at least 2 Poverty-Environment Initiative countries have introduced beyond GDP measurements OUTPUT INDICATOR 2.2 Number of countries introducing beyond GDP measurements in target countries The Poverty-Environment Initiative is increasingly enabling institutions to adopt the integration of beyond GDP measurements such as natural wealth valuation and accounting or multidimensional poverty indexes into national monitoring and accounting systems has experienced an increase in the number and variety of efforts to adapt internationally recognized tools and approaches to introduce beyond GDP measurements addressing local needs in Bangladesh, Burkina Faso, the Dominican Republic, Guatemala, Kyrgyzstan, Paraguay, Tajikistan and Tanzania. In addition to the achievements reported on Bhutan and Dominican Republic in past years, the National Statistics Committee in Kyrgyzstan and the National Statistics Agency in Tajikistan have approved respective Systems of Environmental and Economic Accounting roadmaps. In 2016, the Poverty-Environment Initiative has therefore stepped up efforts to capture the value of natural wealth reported in previous years in Guatemala, Kyrgyzstan and Tajikistan. Guatemala completed the natural capital ecosystem valuation and the study of different public policy scenarios (Targeted Scenario Analysis) for the Chiquimulilla Channel. The Ministry of Planning used the findings

39 Output performance 27 and recommendations to inform ongoing trainings to align local land use plans with the national development plan. This work aims to jointly manage those natural resources in a more sustainable, inclusive and integrated way (see Indicator 2.3 for more detail). Kyrgyzstan is one of the first pioneers in the region to launch the international framework of the System of Environmental and Economic Accounting and Experimental Ecosystems Accounting (SEEA-EEA) as part of the system of the National Statistics Committee. In 2016, the government set up pilot forest accounts to develop robust evidence-based knowledge and policy advice to integrate poverty-environment priorities into regional development strategies and plans and into biodiversity financing schemes. This has been made possible thanks to strong political will in government, the leadership of the National Statistics Committee and excellent collaboration with the Global Change Research Institute of the Czech Academy of Sciences (CzechGlobe). This work is nevertheless challenging and requires a high degree of technical skills and a medium-term horizon. A unified methodology is not yet fully developed, and that is why pilot projects such as this one are so important, explained Kanykey Orozbaeva, Head of Department of Sustainable Development and Environmental Statistics. There are about 500,000 indicators in the system of state statistics. The system processes about 2.5 billion data by different sectors: economic, environmental, social and demographic in character. We need to develop key indicators for decision makers to identify critical situations in, let s say, environmental issues, to avoid any negative consequences for development in the future. So far, the methodology for experimental ecosystems accounting for the Kyzyl-Unkur forestry, the SEEA-EEA implementation guide and the accompanying SEEA-EEA training module are available as a strong base for the promotion of these efforts and will be complemented with ongoing work on valuation of ecosystem services and the private and the public environment expenditure review with a focus on biodiversity. The SEEA roadmap in Tajikistan is being used as baseline in current efforts to pilot the SEEA Central Framework in the forestry and water sectors. The introduction of SEEA-EEA will help the Kyrgyz Government with developing robust evidence-based knowledge and policy advice for implementation of its National Strategy for Sustainable Development and its National Biodiversity Strategy. For example, the National Biodiversity Strategy adheres to Aichi Biodiversity Target 2 of the Convention on Biological Diversity (CBD), which commits countries to evaluating biodiversity and ecosystem services and integrating these assessments into national accounts by 2020 (CBD 2010). More initial work was undertaken under the leadership of Tanzania s National Bureau of Statistics together with the Development Partners Group on Environment (DGPE) and the the Poverty-Environment Initiative through a discussion on practical options for the inclusion of natural capital into its system of national accounts. The recommendations are informing the development of a national strategy on the integration of natural capital into the system of national accounts. The

40 28 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 Poverty-Environment Initiative is assisting the Ministry of Finance and Planning to lead its development. Concerning multi-dimensional poverty, the collaboration with the Oxford Poverty and Human Development Initiative and the results achieved in the Dominican Republic (refer to previous annual reports and section on South-South cooperation) have inspired a varied range of work across the region that continues to respond to specific local needs. Tanzania s new national development plan contains targets for human development and poverty reduction with a focus on the multidimensional poverty index to monitor progress of government programmes and improved macroeconomic performance with a focus on poverty reduction and human development. Following up and preparing for the 2017 Household Budget Surveys (the most important tool at the country level to collect data on various parameters), the Poverty-Environment Initiative advocated including indicators on income and expenditure related to environment and natural resources so that their contribution to the national GDP will be documented and valued. Examples of proposed questions relate to the source and quantity of firewood and charcoal used by households, source and volume of water use by households, and income from sale of environment and natural resource products. This type of information will contribute to natural capital accounting and highlight the importance and contribution of environmental and natural resources to poverty reduction and economic growth. Similarly, and building on efforts in 2015, the Poverty-Environment Initiative in Burkina Faso continued to facilitate collaboration between the Sustainable Development Secretariat and the National Institute of Statistics and Demography to elaborate and integrate poverty environment linked indicators into the household survey modules as part of National Institute of Statistics and Demography-led Millennium Development Goals/Multidimensional Investigation Continues Initiative. The proposed 23 indicators related to household access and use of sanitation services, fuelwood, drinking water, air pollution and waste management. Paraguay s efforts to improve coordination (see Indicator 1.4) have resulted in agreed actions that include consideration of the inclusion of an environmental dimension in the poverty measures. TARGET: By 2016, at least 10 guidelines and tools to manage private sector investment decisions in 3 countries OUTPUT INDICATOR 2.3 Number of (sub)national guidelines and tools to manage private sector investment decisions that integrate povertyenvironment objectives Myanmar, the Philippines and particularly Lao PDR continue to exchange experiences and lead results concerning this indicator. This year, we are pleased to report that Lao PDR approved five new guidelines and tools to manage private sector investment decisions. Other countries are rapidly making progress inspired by the efforts made by the Government of Lao PDR, bringing the total number of guidelines to 17.

41 Output performance 29 Scaling up results from previous years, we joined efforts with the Government of Lao PDR to provide targeted training in support of three new provincial investment strategies and technical guidelines to more effectively manage private sector investment decisions. To complement these efforts, the Investment Promotion Department is testing a model contract template and a Corporate Social Responsibility reporting template developed in 2016 in collaboration with the International Institute for Sustainable Development. The aim of this work is to understand how social and environmental concerns and stakeholder engagement are being integrated into Lao PDR business operations and what businesses are doing to complement the successful implementation of the new five-year plan. Complementary efforts include linking the Investment Promotion Department system (monitoring investors compliance of environmental and social safeguards) and the Ministry of Energy and Mines system to streamline existing data to better assess investment processes in accordance with regulations and their social and environmental impacts. Learning from Lao PDR, Myanmar developed its first financial modelling tool to inform mining investments. The tool will enable the Department of Energy and Mines to assess the financial feasibility of mining proposals (foreign and domestic), including estimation of adequate costs for environmental management and social development. Stakeholders from private sector companies and state economic enterprises participating in a piloting exercise supported the application of the tool in project appraisal and shared practical recommendations to enhance transparency in revenue-sharing. Currently, mining contracts do not include requirements for setting aside revenues for environmental or social purposes, something that would also require institutional change, if the implications of the financial model are fully applied. A draft user guide has been developed in 2016 to facilitate its application and further consultation. Guatemala, Mali, Mozambique, Peru, Rwanda and Tajikistan also promoted integration of safeguards in existing regulations and monitoring systems. These countries increased efforts to promote the application of international standards and environmental impact assessments in key sectors such as mining and agriculture. Guatemala s Targeted Scenario Analysis provided very specific recommendations to the shrimp, tourism and fishing sectors to sustainably manage their investments. For example, the cost of a hectare of shrimp farming currently is USD 44,723, while the transition to the sustainable scenario would provide only an additional USD 1,400. However, the non-transition to the sustainable scenario could mean the extinction of the shrimp industry in the medium term. The private sector is engaged in ongoing consultations to use such findings in current local land use planning. Mozambique completed an impact assessment of Mozambique s Corporate Social Responsibility Policy for the Extractive Industries to inform the development of the implementation guidelines of the extractive policy and Tajikistan developed guidelines for the implementation of environmental policies in small and mediumsized enterprises. In Peru, recycling associations are developing inclusive and sustainable business plans to ensure their financial sustainability.

42 30 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 Tanzania also engaged with the private sector, following up on a series of policy, regulation and demonstration efforts supported over the past years by the Poverty- Environment Initiative and building on the lessons learned from the installation of fish ponds and cage fish farming in Bunda and Bukoba districts. Both district plans have been recently approved and integrate objectives related to sustainable fisheries. The National Service Cooperation has in 2016 replicated the fish ponds and cage fish farming in two other locations in support of the implementation of the District Plan objectives. To complement these efforts, the Ministry of Agriculture, Livestock and Fisheries licensed three private companies to undertake commercial fish cage farming in Bunda and Sengerema districts. The private companies are also undertaking environmental impact assessments in Sengerema district to ensure compliance to the environmental considerations as required by National Environment Management Council. OUTPUT 3 Poverty-environment approaches and experiences documented and shared to inform country, regional and global development programming by the UN and Member States Progress continues to be very positive under this output. Poverty-Environment Initiative activities, approaches and methods have been incorporated into a wide variety of settings within the UN system and among government policymakers and practitioners at all levels. Actions in this area have ranged from presenting a strategic paper, Getting to Zero: A Poverty-Environment-Climate Call to Action, at the UN Economic and Social Council High-Level Political Forum on Sustainable Development, to contributing to the Policy Guidance on Environment, Human Rights and Addressing Inequality adopted by UN Environment in The Policy Guidance, which expressly aims at integrating human rights into the UN Environment organizational culture and programmatic activities, highlights the Initiative s experience as an example of the linkages between human rights and environment in UN Environment s work and demonstrates how the lessons of the Initiative are increasingly being integrated into the fabric of UN institutions. At the Green Fiscal Policy Network regional workshop held in Bangkok, the Poverty- Environment Initiative presented its work on effective use of revenues from the extractives industries in Lao PDR and the Philippines, employing natural resource management tools, environmental and social safeguards and strategically designed fiscal frameworks and sovereign wealth funds/natural resource funds, to support delivery of the Sustainable Development Goals. This represents a strategic contribution to the growing work of the Initiative sustainable investment and social safeguards. In further recognition of the Initiative s role in promoting the sustainable management of natural capital for sustainable development and poverty eradication, the UN

43 Output performance 31 Environment Assembly at its second session called upon the Executive Director and Member States to continue to strengthen efforts led by the United Nations Environment Programme, including, among others, the Poverty-Environment Initiative in this strategic area of work. 1 OUTPUT INDICATOR 3.1 Number of UNDAFs and CPDs that integrate poverty-environment objectives A total of 25 UNDAFs and 24 CPDs integrated poverty objectives. In 2016, three UNDAFs and three CPDs for the period were approved in Poverty- Environment Initiative countries. The Poverty-Environment Initiative s engagement in the development of Tanzania s UNDAP II and the UNDP CPD 2016/ /2021 resulted in the integration of linkages among poverty reduction, inclusive sustainable growth and promotion of gender equality and women s empowerment in these two planning frameworks and in UNDP s Inclusive Growth Strategy Paper. The focus is on promoting sustainable livelihoods for poor women through the sustainable use of the environment and natural resources. The UNDP country office availed USD 400,000 TRAC (core funding) to the Poverty-Environment Initiative programme s annual work plan to deliver on this work and is interested in continuing this financial commitment. TARGET: By 2016, the Poverty-Environment Initiative contributes to the formulation of 24 UNDAFs and 22 CPDs Honduras and Peru approved the new UNDAF and CPD for the period The outcomes of the UNDAF in Peru are designed to address the needs of the most disadvantaged populations of Peru and the drivers of inequality/vulnerability. The relation between poverty and environmental sustainability is clearly present through two specific results: a) By 2021, every person in a state of vulnerability, poverty and discrimination improves his or her access to livelihood and productive employment and decent jobs, via sustainable development that strengthens social and natural capital, integrating an appropriate risk management; b) by 2021, every person in a state of vulnerability, poverty and discrimination improves his or her access to basic, essential and universal quality services and to an integrated and inclusive social protection system. Mozambique s CPD includes poverty-environment mainstreaming as a key focus area and Poverty-Environment Initiative-related activities. In the case of Kyrgyzstan, Malawi and Mauritania, the current UNDAFs were extended to align with the current national development strategy. The Poverty- Environment Initiative contributed to the preparation of the upcoming UNDAFs to ensure continued prioritization of the poverty-environment nexus upon adoption in early In 2017, Bangladesh, Mongolia and Lao PDR are expected to approve 1 United Nations Environment Assembly (2016). Resolution 2/13 Sustainable management of natural capital for sustainable development and poverty eradication (UNEP/EA.2/L.14, para. 4).

44 32 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 new UNDAFs. In fact, the Poverty-Environment Initiative s approach was identified as a good example of the integrated approach to support the 2030 Agenda. TARGET: By 2016, the Poverty-Environment Initiative s inputs reflected in UN submissions on implementation of post development decisions OUTPUT INDICATOR 3.2 Number of UN strategic documents such as United Nations Development Group guidelines and post-2016 debate that reflect Poverty-Environment Initiative inputs Poverty-Environment Initiative s experience and relevance to national and subnational implementation of the Sustainable Development Goals were prominently displayed in As of the end of 2016, the Poverty-Environment Initiative had recorded 59 inputs into strategic documents for the post-2015 debate since the 2013 baseline year, 25 of which were made during From the 2013 baseline year until December 2016, there had been a nearly 20-fold increase against the 2013 baseline in the number of UN strategic documents or post-2015 debates that reflect the Initiative s inputs. The Initiative achieved a 174-percent annualized increase for this indicator. Among the highlights were: II UN Environment Retreat on Integrated Approaches for the Implementation at Country and Regional Levels of the Environmental Dimension of the 2030 Agenda for Sustainable Development (February 2016), Agenda and Background document, UN Environment, Nairobi. II Presentation, together with IIED, of the Poverty Environment Partnership strategic paper, Getting to Zero: A Poverty-Environment-Climate Call to Action, at the High-Level Political Forum for the SDGs, on 13 July 2016, in New York. II Adoption by the UN Environment Assembly of the Resolution on Natural Capital (UNEP/EA.2/L.14), which Requests the Executive Director, in partnership with Member States, to continue to strengthen UNEP-led efforts, among others, including the Poverty-Environment Initiative. 2 II In follow-up to its advocacy work on gender and access to natural resources, the Poverty-Environment Initiative contributed to the Inter-Agency Learning Exchange on Land, Natural Resources and Environmental Management, organized by UN-Habitat through the Global Land Tool Network (GLTN) in June II In 2016, the Poverty-Environment Initiative in Africa programme contributed to the ECOSOC online discussion on implementing the 2030 Agenda for Sustainable Development. The Initiative s Africa team highlighted the experiences from Mozambique on applying tools and approaches for integrated policymaking. II The Poverty-Environment Initiative in Latin America and Caribbean programme contributed two working documents to the VIII Ministerial Forum on Development 2 UN Environment Assembly (2016), cit. supra.

45 Output performance 33 in Latin America and the Caribbean (Santo Domingo, October 2016). Existing Challenges to Optimize Social Protection Programs and Reduce Vulnerability in Latin America and the Caribbean reflects the different social protection systems linked to environmental risks in the region, such as Bolsa Verde in Brazil and Índice de Vulnerabilidad ante Choques Climáticos (IVACC) in the Dominican Republic. The second working paper, Guidelines for the Renovation of Social Policy in Latin America and the Caribbean for the implementation of the Sustainable Development Goals, analyses the different social policies in the region that point towards sustainable development, such as the green jobs in solid waste sector project in Peru. The IVACC also featured prominently in the joint Oxford Policy Management and World Food Programme Study on Shock-Responsive Social Protection in Latin America and the Caribbean (Beazley R., Solórzano, A. and Sossouvi, K., December 2016). II The Poverty-Environment Initiative in Europe and Commonwealth of Independent States programme collaborated on the International Conference on the Natural Capital for the Transition to a Green Economy, which was organized by the National Statistics Committee, in collaboration with the State Agency of Environment Protection and Forestry under the Government of the Kyrgyz Republic and with the support of the German Society for International Cooperation (GIZ). Included inter alia in the Initiative presentations were eight thematic posters on natural capital, green economy, biodiversity and ecosystems services. OUTPUT INDICATOR 3.3 Number of Poverty-Environment Initiative knowledge products shared with regional and global networks As of December 2016, a total of 275 knowledge products had been disseminated globally or regionally, an increase of 23 over the December 2015 total a 162 per cent increase against the 2013 baseline. Delivery has exceeded the 2016 target by 104 per cent. The Initiative s most popular publications in 2016 were Mainstreaming Environment and climate for Poverty Reduction and Sustainable Development: A Handbook to Strengthen Planning and Budgeting Processes, The Cost of the Gender Gap in Agricultural Productivity in Malawi, Uganda and Tanzania (2015), produced jointly with UN Women and the World Bank Group, and Annual Report 2015: Seeds of Change. TARGET: By 2016, 30 products are shared and feedback from users is positive In 2016, the Initiative added three new publications, including:. I I The Poverty-Environment initiative in the Context of the Sustainable Development Goals: Relevance and Experience for National and Subnational Implementation. Brochure, Poverty-Environment Initiative, I I Seeds of Change: The UNDP-UNEP Poverty-Environment Initiative 2015 Annual Report. Poverty-Environment Initiative, Nairobi, March 2016.

46 34 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 I I Getting to Zero: A Poverty, Environment and Climate Call to Action for the Sustainable Development Goals. IIED: London. II 11 technical reports or information notes, to its e-knowledge repository. A total of 221 studies, fact sheets, guidance and working documents prepared at the country and regional levels are now available to users around the world through the Poverty-Environment Initiative Knowledge Resources e-library. To expand and improve the Initiative s social media and online presence, the Poverty- Environment Initiative released four new videos on poverty-environment related activities and themes in These were uploaded to the website video gallery and the Poverty-Environment Initiative YouTube channel, attracting more than 1,124 views in 2016 and raising the cumulative total views for the entire video collection to more than 78,600 as of 31 December The website (unpei.org) continued to attract a steady following. During 2016, 28,568 sessions (visits) were logged by 21,085 users. Sixty-one per cent of these viewers were aged 18 34, reflecting the relative youthfulness of audience from the countries in which the Initiative operates. The Initiative s Community of lifetime fans on Facebook grew by 131, to reach 1,923 an annual increase of 9 per the Initiative s Twitter account, had attracted some 900 followers by end of TARGET: By 2016, 30% increase against baseline OUTPUT INDICATOR 3.4 Number of references to povertyenvironment approaches and tools in UN and other development agency strategies/plans The number of references to Poverty-Environment Initiative publications or citations to poverty-environment approaches and tools increased to 238 during 2016, a 236 per cent increase over the total number reported at end of Much of this increase is attributable to an improvement in the Poverty-Environment Facility s search strategies (notably in Google Scholar), which captured data that had been missed in previous counts conducted from 2013 to 2015 and in reporting by regional teams. Twenty new references and 21 new citations to the Initiative were documented in Notable among the 2016 references and citations were: II Beazley R., Solórzano, A. and Sossouvi, K. (December 2016). Study on Shock- Responsive Social Protection in Latin America and the Caribbean: Theoretical 3 72,723 downloads were reported by Poverty-Environment Initiative in Africa as of December Some 45,000 of these were of videos produced in Rwanda.

47 Output performance 35 framework and literature review, Oxford Policy Management and World Food Programme, Oxford UK. II Stewart, Howard Macdonald (2016). Integrating Environmental Sustainability in the UN Development Assistance Frameworks and UN Common Country Programming Processes. Terminal Evaluation of UNEP s UNDAF Projects Final Report. UNEP, Nairobi. II Uitto, Juha L. (2016). The Environment-poverty Nexus in Evaluation: Implications for the Sustainable Development, University of Durham and John Wiley & Sons, Ltd. II Watkiss, Paul, and Alistair Hunt (2016). Assessing climate-resilient development options in The Economics of Climate-Resilient Development. Edward Elgar Publishing, Cheltenham (UK). KEY LESSONS: OUTPUT LEVEL INTEGRATED APPROACH: TARGET EXISTING PROCESSES RATHER THAN CREATING PARALLEL SYSTEMS ISSUE: The most effective way to promote integrated approaches will usually be by targeting existing planning, budgeting and institutional coordination mechanisms and tools and enabling them to better respond to the three dimensions of sustainable development. Creating mechanisms outside routine national systems or parallel processes can be counterproductive to the desired institutional change or long-term impact. ACTION: The experience of the Poverty-Environment Initiative and its partners highlights several simple and practical tools that can be used to modify existing budget and planning processes in several countries. Institutionalizing the use of the tools in annual budget and planning processes, coupled with capacity-building in their application, helps to ensure their sustained application over time, policy coherence and the acceleration of change. NEED FOR SUSTAINED CAPACITY-BUILDING ISSUE: To illustrate the need to provide sustained capacity-building for mainstreaming in developing countries, we propose to look at concrete areas of work. For example, the inclusion of a poverty-environment objective or indicator in a monitoring framework does not automatically mean that data towards the indicator will be collected. Similarly, the introduction of poverty-environment guidelines in executive and sector planning manuals and/or in the budget call circulars requires follow-up capacity-building and fine-tuning for effective application.

48 36 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 ACTION: Programmes need to work together with government partners even after an indicator or objective has been introduced to ensure that sufficient capacity is there for application and implementation. It is increasingly clear that institutional capacitybuilding should be the priority, reflecting that successful poverty-environment mainstreaming is a long-term process of institutional change and that institutional weakness are a key barrier to effective change. Targeted country evaluations on institutional barriers have identified inadequate coordination mechanisms between sectors, between national plans and budget allocations and between the national and subnational levels as key challenges. EXPLORING NEW AVENUES TO FILL GAPS IN MONITORING SYSTEMS ISSUE: Last year s annual report included the persistent capacity issues faced in national M&E systems in (least-) developed countries. The Poverty-Environment Initiative has focused in the past in national monitoring systems from the perspective of the link to national development plans and strategies. Data collection and analysis to inform decision-making have proved challenging in most countries. ACTION: The national Household Budget Survey is the most important tool in many Poverty-Environment Initiative countries to collect data on various parameters. Traditionally, the Survey has a strong focus on collecting poverty-related data and few countries have until date combined this with the collection of environmental data or poverty-environment-linked information. One of the countries pioneering a different avenue through integration of poverty-environment and climate vulnerability variables in household surveys was the Dominican Republic. The current phase has seen an increase in the number of countries working with national statistic agencies to integrate a range of indicators on climate vulnerability, access and dependence on natural resources or incomes and expenditure related to the environment so that data are collected and that their contribution to the national GDP is well documented to effectively inform decision-making (see Indicators 1.3 and 2.2 for detail). ADAPTING TOOLS TO BETTER ACCOUNT FOR THE POVERTY-ENVIRONMENT NEXUS ISSUE: Most developing countries continue to experience challenges in empirically and systematically measuring and accounting for the nexus between poverty and environment. While quantifying the links between the environment and socioeconomic well-being, existing frameworks like the SEEA (System of Environmental- Economic Accounting) still contain gaps. ACTION: Poverty-Environment Initiative in Asia-Pacific has developed a discussion paper on developing and piloting the application of the Poverty-Environment Accounting Framework the PEAF. The PEAF is an adaptation of the SEEA that can generate information responding to specific poverty-environment-nexus indicators. Integrated data could demonstrate better the causal relationships

49 Output performance 37 between environment and poverty and further help in quantifying, monitoring and reporting on these relationships to inform policymaking and investment decisions. 4 Bangladesh is the first country in the region to discuss the potential adaptation of the SEEA to inform the intersectoral monitoring framework of the Sustainable Development Goals and Bangladesh s 7th Five-Year Plan. Speaking about the usefulness of the workshop and the accounting framework, Mr. Rafiq-ul-Islam from the Bangladesh Bureau of Statistics said, The Poverty Accounting Framework is very relevant to Bangladesh right now. In November 2016, we held an Expert Group Meeting that was attended by 65 participants from 28 different ministries. Thanks to the UNDP and UN Environment, the PEAF could help us develop the Environmental Statistics Framework for Bangladesh, to collect data for policy making for the SDGs and to meet the targets of the 7th Five-Year Plan. 4 See

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51 Opportunities and challenges 2016 brought to new heights sustainable and equitable development for countries struggling to secure their natural capital and overcome poverty. The previous sections demonstrate how, in the penultimate year of the Poverty-Environment Initiative, we are harvesting the bounty of experience produced under the Initiative while preparing the ground for new seasons of growth and change. The growth and change required to make the aspirations of the 2030 Agenda and the Paris Agreement a reality present tremendous opportunities and challenges not only for our partnership, but, most importantly, also for governments in the developing world. The work of this unique Initiative under the partnership between UNDP and UN Environment has become a leading example of how multiple social and environment objectives can be secured by breaking down the silos of decision-making within government. Demand for our services continues to increase as our work enriches environmental governance for the benefit of the poorest by providing a rich array of strategies, techniques and tools, which governments can use to reap the harvest of integrative policy and implementation. In this context, the main opportunities faced by our work include: II The alignment between our work and the new global development agenda II The proven experience in the development and application of an integrated approach to deliver on the three dimensions of sustainable development II Sufficient funding to complete the Programme as foreseen II The use of lessons and experiences to inform a future Programme II Our contributions to regional and global platforms and debates around the new development agenda Challenges are: 39

52 40 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 II Adequate level of integration of our integrated approach to mainstreaming in the core business of UNDP and UN Environment II Expanding partnerships for sustainability allowing others to capitalize on our achievements II Establishing solid partnerships to deliver on the future programme, expanding on participation of marginalized groups II Raising an adequate level of resources to fund the new programme This section of the report looks in more detail at these opportunities and challenges. It also highlights our work strengthening the voices of a wide spectrum of society, from smallholder farmers suffering from climate stress to marginalized communities of waste pickers and slums seeking solutions to today s environmental and natural resource management challenges. It also looks at partnerships and South-South cooperation as means to expand and sustain the harvest of our work. It concludes with specific examples of how the Initiative experience is already contributing to the implementation of the avalanche of landmark international summits and conferences held in Increasing the focus on the structural causes of poverty and environmental degradation: contributing to gender equality Much and varied progress was made in 2016 to effectively mainstream gender equality into our work to address the structural causes of poverty and environmental degradation. To that effect, the Poverty-Environment Initiative has stepped up efforts made in previous years to understand the level of awareness and existing capacity across Poverty-Environment Initiative countries in all regions. The results from a varied range of gender assessments and studies provide a clear picture of the challenge at hand. They usually point at low levels of awareness and inadequate structures and capacity. The scale of the challenge grows with the level of ambition, as in the case of the integration of gender equality in the context of the povertyenvironment nexus in development plans vs. budget work. Highlights across areas of work and countries follow. STEPPING UP THE POVERTY-ENVIRONMENT INITIATIVE S COMMITMENT TO GENDER EQUALITY In 2016, the Poverty-Environment Initiative supported Indonesia s Ministry of Finance to assess the responsiveness of climate related budgets to gender inequality and poverty. Public programs and activities identified as having high climate change relevance were assessed against the following criteria: access, participation,

53 Opportunities and challenges 41 control and benefits. The assessment showed that central government ministries lack awareness and technical capacity to effectively integrate poverty and gender issues into climate change related programmes and activities. This is despite the fact that the National Action Plan to Reduce GHG Emissions requires all line ministries to conduct a gender analysis before implementing climate change programme activities. The results have raised the awareness of the Ministry of Finance to this effect and efforts are underway to better use existing performance-based budget systems to accelerate gender and poverty responsiveness and to improve crosssectoral and multi-stakeholder collaboration In 2016, we made sure that the efforts made to produce the Cost of the Gender Gap in Agricultural Productivity report (see annual report 2015) had an impact at country level. To kick-start the follow-up, the Poverty-Environment Initiative, UN Women and the World Bank together with the Royal Norwegian Embassy organized a countrylevel launch of the report The Cost of the Gender Gap in Agricultural Productivity in Malawi, Tanzania and Uganda in Lilongwe, Malawi. Initial results materialized in 2016 when the findings in the report were reflected in the strong focus on women s empowerment and climate-smart agriculture in the new national agriculture policy (reported under Indicator 1.2). A series of follow-up empowerment dialogues provided an important platform for the Poverty-Environment Initiative and UN Women to engage with civil society and other UN agencies on the gender and environment nexus based on the analysis in the reports. Findings of the reports were also highlighted in the UN Environment Global Gender and Environment Outlook by UN Environment s Executive Director in a blog post on the cost of the gender gap report, in a YouTube video on international women s day, and in the One Planet Magazine. Since their launch, the reports have been quoted in at least 30 articles/ publications. The Poverty-Environment Initiative in Africa, together with UN Women, prepared a concept for follow-up work and successfully raised local resources for follow-up work so far in Rwanda, Ethiopia and Malawi, while a substantive proposal has caught the attention of the related SDG sub-fund. The regional programmes in Europe and CIS and in Latin America and the Caribbean shared similar communications and knowledge products in 2016, including the following: an article about the Poverty-Environment Initiative in Peru s gender work in a publication of success stories with UN Environment s Gender and Social Safeguards Unit; a Baseline Analysis on Gender-Environment Nexus Guidelines on Environmental Screening for SMEs; a report on gender mainstreaming in Poverty- Environment Initiative activities; the publication Women Empowerment in Tajikistan: Stories of Change ; and the two blogposts Women s role in Adapting to Climate Change and Kyrgyzstan, the Switzerland of Asia. Taking this work to the next level, Tajikistan integrated a strong gender component into the training module on SDGs that focuses on the linkages among women, the environment and poverty reduction (e.g. gender gaps in access to natural resources, climate change impacts on women, etc.). The Poverty-Environment Initiative in Tajikistan, in partnership with the Regional Environmental Centre for Central Asia, is planning to launch the module at the University of Public Administration, the Russian-Tajik Slavonic University, the Technological University of Tajikistan and possibly a few more state universities during

54 42 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 early/mid Learning from the work done in Africa, the regional team submitted a project proposal to Russia s Federal Agency for the Commonwealth of Independent States, Compatriots Living Abroad and International Humanitarian Cooperation. The project proposal, entitled Sustainable agribusiness in Eurasian rural communities through women s rights cases of Tajikistan and Kyrgyzstan, was presented during the environmental SDG conference in Almaty and is planned for 2017 to 2019 to help sustain and expand aspects of our work in the region beyond Inspired by these efforts, Mauritania has commissioned a study to assist the government in better integrating gender and social equity issues into environment and natural resources management in light of legal and customary practices limiting women s access to land and environmental assets despite women s high dependence on them. Myanmar has also included differential impacts by gender in the ongoing integrated assessment on mining in two townships. Rwanda initiated capacity-building activities on gender and poverty-environment mainstreaming in policy, planning and budgeting linkages to increase the knowledge of policymakers in finance, local government, natural resources, environment, the Office of the Prime Minister and the Gender Monitoring Office. The training was inspired by the UNDP Gender Economic Policy Management Initiative training modules and previous training given by the Poverty-Environment Initiative in Africa in Naivasha in Ensuring that planning processes integrate the needs of men and women alike, the national Mainstreaming Reference Group in Bhutan now includes representatives from the National Commission for Women and Children. The government is seeking their expertise to assist the implementation of the budget call notification for the financial year on gender equality and women s empowerment. Their integration into the group is helping to inform planning, budgeting and implementation processes at the central and local levels. In Nepal, the Poverty-Environment Initiative has been working closely with Ministry of Federal Affairs and Local Development to prepare pro-poor, environmentally sustainable green recovery and rehabilitation plans for target districts, ensuring that the needs and priorities of the most vulnerable were identified through consultative processes. Peru s Municipal Solid Waste Management Plan for Arequipa also included a socio-economic diagnosis and gender and poverty indicators and targets on solid waste management in the 29 districts thanks to improved collaboration with the Ministry of Women and Vulnerable Populations. Furthermore, the National Gender and Climate Change Plan approved in 2016 identifies solid waste management as a primary factor in controlling greenhouse gas emissions in the country. One focus of this priority area involves knocking on doors to save the planet, based on the experience of the women recyclers supported by the Poverty-Environment Initiative, which has been identified as a key initiative due it high potential for scalability.

55 Opportunities and challenges 43 ENSURING POLICY COHERENCE AND INCLUSION A HOLISTIC POLICY AND INSTITUTIONAL APPROACH TO ADDRESS THE NEEDS OF MARGINALIZED GROUPS ACTIVE IN WASTE MANAGEMENT In Peru, approximately 1 per cent of the population works in the recycling sector in precarious conditions as 70 per cent of collected waste is disposed in non-regulated dump sites. Poverty rates among this population group are high and 86 per cent of them are even in extreme poverty. The National Recyclers Law, however, recognizes the role of recyclers and promotes the protection and social development of these workers by integrating the recyclers into the formal system through the nationwide Programme of Source Segregation and Selective Collection of Solid Waste. A concerted effort in Arequipa is generating a replicable and sustainable municipal model to improve the livelihoods of recyclers by improving their working conditions, formalizing their jobs and strengthening recyclers associations. Actions to increase their capacities and generating added value to the products, while providing greater access to markets, have been advanced, with a special focus on women, who are the majority of the recyclers in this city. This initiative demonstrates a successful integrated approach for sustainable development, with poverty-environmentgender considerations mainstreamed. It not only improves waste collection and increases recycling amounts of waste, but the recyclers have improved their economic standing while providing an environmental service that has been recognized at the government level all while recyclers exposure to health hazards has decreased. The general outlook of the National Recyclers Law has a focus on gender and social inclusion. The approval of this law is an important step in ensuring the sustainability in Peru of the proposals developed in the framework of the Poverty-Environment Initiative, especially regarding the formal recognition of the role of the recyclers. GOVERNMENT DIALOGUES WITH MALAWI COMMUNITIES INTRODUCE CHANGES IN SECTOR POLICIES CIVIL SOCIETY USES INFORMATION TO ADVOCATE FOR THE RIGHT INVESTMENTS As mentioned under Indicator 1.2, Malawi s new forestry policy calls for better estimates of the poverty reduction potential of the sector, given that the contribution of forestry to GDP is subsumed under agriculture. This was the conclusion of the Poverty-Environment Initiative s facilitation of local communities and civil society dialogues with the government. The consultations have also ensured that the revised policies include mechanisms for community benefit-sharing and community-based natural resource management also saw the first budget allocation analysis undertaken by a civil society organization in Malawi. This experience provides an excellent example of how the Poverty-Environment Initiative can encourage investments in poverty-environment objectives by engaging with civil society to apply relevant findings from key Poverty-Environment Initiative studies. Similarly, Guatemala strengthened local stakeholders capacities for sustainable land use management. The Poverty-Environment Initiative improved their capacity to use

56 44 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 findings from the targeted scenario analysis in the development of participatory land schemes, using an ecosystems approach. INCREASING RESILIENCE OF LOCAL COMMUNITIES AND PROMOTING SUSTAINABLE LIVELIHOODS Scaling up our work in Rubaya, Rwanda, a green village (Muyebe), was established in 2015 in Muhanga district with funding and technical assistance from the Swedish International Development Cooperation Agency (Sida) and UNDP. Its District Panning Officer, Eric Bizimana, explained, There are a number of development challenges in Muhanga District. Some of them include soil erosion and landslides, poor management of mines that cause siltation to nearby rivers and continuous deforestation. The experience of the green village in Muhanga has been so successful that another green village (Muyebe II) with 100 houses is about to be completed. Indeed, Mr. Bizimana says, The benefits of the Muyebe green village are very many. Our first benefit was to know that it is possible to have the integrated development programme at Our people in this village came from a vulnerable and difficult environment. We lived on an island without education facilities, shops and little livelihood opportunities. Now we are comfortable and happy in our green village and we have the basic green infrastructure, decent houses, sustainable sources of energy, available water and can send our children to school, go to health centres and have better opportunities. At the same time, we also help the environment. Theogene Singiriyongana, Chairman, Gashaki Green Village Cooperative the community level addressing a number of developmental concerns: access to water, biogas, improved settlement and agriculture. The green village initiative driven by the Poverty-Environment Initiative s initial efforts has supported capacity-building on managing such concerted efforts. Muyebe II has benefited from a grant received from Rwanda s National Climate and Environment Fund (FONERWA) after the Poverty-Environment Initiative and Rwanda s Environment Management Authority helped the village to put together a funding proposal (see annual report 2015). In the case of the Philippines, the Environment and Natural Resources Data Management Tool is already providing greater transparency and accountability. For example, in Taganito Barangay (province), 98 per cent of revenues come from the development and use of natural wealth such as mining, hydropower, forestry and fishery. Mining revenues provide the largest percentage not only for employment, but also for overall development. The Local Government Code ( ) stipulates that host local governments are to receive a 40 per cent share from the revenues from natural resources for local development and livelihood projects. Local governments reported declining shares from national wealth in fiscal year 2014, but revenues picked up in In 2016 alone, at least an estimated PhP3.3 billion (USD 60 million) worth of revenues have been earmarked for local governments as their share from national wealth. In addition to economic development of the community that will ensure jobs and livelihoods for locals, these additional elements of social development will

57 Opportunities and challenges 45 have significant effects on indicators such as education, health and overall resilience of local communities. ENGAGING WITH PARLIAMENTS PUSHING THE POVERTY-ENVIRONMENT AGENDA FORWARD In 2016, the Poverty-Environment Initiative in Burkina Faso facilitated the establishment of a parliamentary network of 46 parliamentarians on environment, biodiversity and green-economy climate change. The network has led discussions and developed a roadmap to increase action and capacity on the povertyenvironment nexus in relation to SDGs. For example, they completed a parliamentary inquiry into mining titles and the social responsibility of mining companies. A monitoring committee followed up the work and proposed a new labour code in the mining sector to improve the working conditions and to combat fraud in the business. Similarly, efforts by the Poverty- Environment Initiative in Malawi to improve the capacity of the Parliamentary Committee on Environment and Climate Change Management to advocate for poverty-environment priorities were critical to speed up the approval of the four new sectoral policies, two (agriculture and forestry) of which had been stalled for over five years. QUANTIFYING POVERTY- ENVIRONMENT LINKAGES IN MALAWI While progress has been made toward closing the data gap on the poverty-environment nexus in Malawi, sufficient disaggregated data to inform policymaking are still lacking. To address this data gap, the Poverty- Environment Initiative in Malawi commissioned a detailed study to quantify poverty-environment linkages in the country. These findings are informing the drafting of the forthcoming national development plan and national SDG plans: Investments in ENR have positive impacts on economic growth and poverty reduction. A 1-percent increase in ENR expenditure (USD 300, 000) raises GDP by USD 17 million. ENR degradation results in national income loss. A 1 percent (317 sq km) increase in lost forest cover decreases income by nearly USD 24 million annually. Conversely, 18 per cent of rural and peri-urban households incomes come from ENR products such as charcoal, fuel wood, honey, mushrooms and agriculture. This demonstrates the economic importance of ENR products to household livelihoods across Malawi. Agriculture is central for Malawi s economy and poverty reduction efforts. Sustainable ENR use holds the key for agricultural productivity and food security. A 1 percent (USD 1 million) increase in agriculture value-added will likely increase GDP by USD 90 million. Access to land, level of education and the gender and age of the head of the household are key determining factors for household food security and agriculture productivity. The UN Resident Coordinator, Mia Seppo, is already using the study findings to promote poverty-environment mainstreaming. At the World Environment Day celebrations, she said, The economy of Malawi is built on its natural resources and ecosystems. A forthcoming Poverty-Environment Initiative study shows that environment and natural resources play an important role in the livelihoods of 95 per cent of rural and peri-urban households in Malawi, with 18 per cent of household s incomes being derived from environment and natural resource products. Galvanizing institutional reform through South-South learning In 2016, demand to share lessons on poverty-environment mainstreaming and to learn from practical experiences on integrated approaches continued to grow. In the final years of the Poverty-Environment Initiative, countries and regions are looking at different approaches to address that demand. Regional meetings and workshops across the four regions continued to provide a forum to learn about innovative

58 46 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 work and to explore collaboration and South-South learning. In preparation for the closure of the programme, the meetings also provided the opportunity to refine internal reviews and theories of change, to discuss options for the sustainability of Poverty-Environment Initiative results and to come closer to defining the Poverty- Environment Initiative s integrated approach towards the implementation of the SDGs, feeding into the design of an SDG toolkit through Furthermore, the European Commission invited the Poverty-Environment Initiative in Malawi to participate in its training on Greening National Development in Leshoto to share tools and approaches to inform the development of the country s second national development strategy. The Poverty-Environment Initiative in Malawi made a presentation focused on its programmatic approach to inform Malawi s national development strategy, but also drew on experiences from the Poverty-Environment Initiative in Rwanda. The Initiative s Handbook on Mainstreaming Environment and Climate for Poverty Reduction and Sustainable Development (2015) was the key source of material for the training. Relevant indicators across this report provide other examples of South-South learning; Myanmar continued to apply tools and approaches to improve social and environmental sustainability of public and private investment projects, learning from Lao PDR and the Philippines. Interestingly, new avenues for cooperation were provided by the Czech Republic (see Indicators 1.3 and 2.2), Russia (see gender section) and South Korea. Bhutan s policymakers also learnt about best practices in strategic environmental assessments from South Korean counterparts, while, in Lao PDR, key government/technical officials responsible for formulating the long-term and medium-term development strategies and plans learnt from South Korea s experience in developing the institutional, legal and financial mechanisms around the National Green Growth Strategy. This experience contributed to the integration of green growth, equity and sustainable development as objectives of the 8th National Socio-economic Development Plan, while the finalization of the green growth criteria/indicators for public investment programmes is expected in mid Strengthening and expanding partnerships to catalyse and sustain poverty-environment mainstreaming In preparation to sustain our work, 2016 has been a very fruitful year for partnerships from local to international levels. We continued to inform the work of the Poverty Environment Partnership (PEP) and facilitated the participation of government representatives, and regional and global experts on poverty-environment mainstreaming in the 21st PEP meeting in Bangladesh. The Poverty-Environment Initiative Technical Advisory Group meeting and the Asia-Pacific regional meeting were organized back to back to the PEP meeting, which benefited from bringing together the experiences of a wide range of policy makers, development practitioners and development agencies.

59 Opportunities and challenges 47 INTERNATIONAL DEVELOPMENT PARTNERS: EUROPEAN UNION, UK S DFID, GERMANY S GIZ, NORWAY In 2016, Mauritania s Ministry of Environment and Sustainable Development requested support to develop climate vulnerability maps on the basis of the two environmental profiles developed in 2015 with Poverty-Environment Initiative support (see annual report 2015). These have been developed with the support of the Poverty-Environment Initiative together with the Global Alliance against Climate Change (a jointly funded project by Germany s GIZ and the European Union). The vulnerability maps assess the climate vulnerability of agriculture, livestock, water and inland fisheries in the two regions to inform concrete projects to increase the climate resilience of the local population. The maps will also inform the forthcoming Global Alliance against Climate Change project on capacity-building for local planners with a budget of 1.6 million from the European Union. The European Union is also scaling up the work of the Mainstreaming Reference Groups at the local level in Bhutan (see Indicator 1.4). The Poverty-Environment Initiative is also working together with Germany s GIZ to assist the Government of Mauritania to assess the current National Strategy on Sustainable Development and Environment National Action Plan and to develop the new National Strategy on Sustainable Development and Environment National Action Plan In Malawi, GIZ has financed the review of the wildlife act inspired by the review of the national wildlife policy that the Poverty- Environment Initiative assisted with. Furthermore, the Initiative is collaborating with the GIZ programme in the Kyrgyz Republic regarding data- and informationsharing. In Malawi, the national launch of the report on the cost of the gender gap was co-hosted by the Government of Norway. In Nepal, the United Kingdom s DFID collaborates with the Poverty-Environment Initiative through the Environment Friendly Local Governance Framework; this, along with the UN Capital Development Fund LoCAL, counts as a key programme to mitigate climate change and help communities adapt to climate change. UNITED NATIONS CAPITAL DEVELOPMENT FUND Lo C AL INITIATIVE Based on meetings and discussions in 2015, the Poverty-Environment Initiative in Mali and the UN Capital Development Fund LoCAL jointly provided trainings in 2016 to local government decision makers on poverty-environment and climate mainstreaming in two communes where LoCAL is engaged. The Poverty-Environment Initiative in Mali drafted and shared with UNCDL LocCAL/Mali an agreement on long-term collaboration between the two projects. The joint programme would be centred on strengthening capacity of local administrations to integrate pro-poor environmental sustainability and climate change adaptation into local development plans and to implement priority local actions and their monitoring. In Bhutan and Nepal, the collaboration continues through joint missions, joint review and joint work-planning. This partnership has led to more efficient use of resources from the

60 48 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 Poverty-Environment Initiative and LoCAL; it has also amplified the effects of the Poverty-Environment Initiative and of LoCAL s work by creating stronger alignment between the Poverty-Environment Initiative s local planning and budgeting support and LoCAL s performance-based climate adaptation grant mechanism. FOOD AND AGRICULTURE ORGANIZATION OF THE UNITED NATIONS (FAO) In 2016, the Poverty-Environment Initiative in Africa and FAO completed a soil loss assessment in Malawi that updates the 1992 Malawi soil loss baseline from 22 to 29 tonnes/ha/year. The assessment has further contributed to an improved methodology for developing soil erosion factors, an updated soil loss map and recommendations for systems enhancements for periodic update of the soil loss map. Based on the work on the soil loss assessment, FAO produced 10 district soil loss maps using its own funding. On the request of the Ministry of Agriculture, the Poverty-Environment Initiative and FAO will in 2017 undertake an economic evaluation of soil and nutrient loss. The collaboration with FAO has proven to be very successful to the extent that the UN Resident Co-ordinator and FAO Resident Representative in Malawi wish to see the collaboration deepen and be a feature of any successor programme to the Poverty-Environment Initiative in Malawi. GLOBAL ENVIRONMENT FACILITY In Guatemala, the GEF project Conservation and Sustainable Use of Biodiversity in Coastal and Marine Protected Areas is using the result of the targeted scenario analysis to support the elaboration of land use plans in the coastal area and to review some environmental management plans in the area. The expected output of this project is to strengthen last and forest management processes and biodiversity conservation in order to secure the flow of multiple ecosystem services while ensuring ecosystem resilience to climate change. By supporting land planning in the same area as the Poverty-Environment Initiative but in additional municipalities not covered by our project, complementarities are being ensured in order to allow having a greater area with land management planning, including an ecosystems approach. OXFORD POVERTY AND HUMAN DEVELOPMENT INITIATIVES The Poverty-Environment Initiative and the Oxford Poverty and Human Development Initiative have collaborated on the multidimensional poverty index, building on past work by the UNDP Human Development Report Office in New York. As a result, the Poverty-Environment Initiative has signed an agreement with the Oxford Poverty and Human Development Initiative in 2016 to investigate whether the existing MPI methodology can be adapted to include environmental and natural resource sustainability variables that impact on poverty. The analytical work to assess options for adapting the MPI methodology is expected to be piloted at country level in one or two countries in Engagement on the multidimensional poverty index builds on

61 Opportunities and challenges 49 RWANDA S RUBAYA GREEN VILLAGE The Rubaya green village was completed in 2011, through the collaboration of key government agencies in Rwanda to demonstrate how to address poverty-environment challenges in an integrated approach. The Rubaya project included construction of 43 houses with rainwater harvesting and an associated water storage and supply system plus ventilation-improved latrines. A biogas system provides clean fuel to the households and manure for farming fuelled by human and cow waste, with each household receiving a cow. Additionally, terracing was constructed to reduce erosion and improve agricultural productivity. Terracing also reduces the vulnerability of villages to the impact natural disasters a common threat on the steep terrain. A school was also constructed. A strongly participatory approach was taken to the construction and management of the project, with the community choosing the beneficiaries, who helped to construct it and manage it through a co-operative. The success of the Rubaya village led to the government deciding to require all districts in Rwanda to have at least one green village and to Sweden supporting the construction of another village. Currently, there are seven green villages with many more needed. Thus, the Poverty-Environment Initiative in Rwanda and the Poverty-Environment Initiative in Africa completed an ex post costbenefit analysis on the project and the benefits of scaling it up to use to support the government to mobilize additional funds to construct more villages. The results of the study are clear: The village cost about USD 636,000 to construct and costs about USD 22,000 per year to run, using central estimates. Using conservative figures, the project demonstrates an internal rate of return (IRR) of 5.8 per cent, 7.7 per cent and 8.9 per cent over 15, 20 and 30 years, respectively. It improves food security and monetary incomes, decreases deforestation and saves each household an average of 175 minutes per day through by alleviating the need to collect water; it also saves two hours per day by eliminating the need to collect firewood. This time is now available for farming, attending school and other activities. Women and children have particularly benefited from the supply of water and clean energy, including in terms of school attendance. Additional benefits that are difficult to quantify and thus not incorporated in the analysis include increased social cohesion and security plus reduced downstream water pollution. The study also estimated the benefits of investing in an additional 30 villages of 100 households each a total of 3,000 beneficiaries, which would cost about USD 48 million. This would generate estimated net benefits of about USD 21 million at a 6-percent discount rate over 30 years, generate further indirect economic benefits equivalent to 0.8 per cent of GDP and lead to a 0.71-percent decrease in the extreme poverty rate of 16.3 per cent (in 2015). In conclusion, the study gives strong support for increasing investments to address povertyenvironment challenges through such cross-government, integrated socio-economicenvironmental approaches. While the project is in Rwanda, similar investments in other African countries would likely also generate a positive rate of return.

62 50 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 global interest and includes significant interest from Poverty-Environment Initiative countries, including Dominican Republic, Paraguay, Rwanda and Mozambique. Monitoring and evaluation The revision of the Poverty-Environment Initiative s M&E system undertaken in 2015 was captured in an annual report of the M&E Working Group and concluded in May 2016 with approval of the Joint Management Board. The revision has contributed considerably to improved monitoring and reporting through 2015 and The 8th Poverty-Environment Initiative Donor Steering Group met in Vientiane from April 2016 to discuss progress. The European Commission, Norway, Spain and Sweden expressed their continued support to the Poverty-Environment Initiative s work and agreed to the development of a concept for a new poverty-environment mainstreaming programme beyond 2017 (see box under Lessons for the 2030 Agenda). Two important evaluations will be useful to analyse when preparing for the Poverty- Environment Initiative s successor programme beyond Completion of the independent Final Evaluation of the Poverty-Environment Initiative Scale-up phase suffered considerable delays and was finally completed in June 2016 and shared on the Poverty-Environment Initiative website. Its main recommendation is, Expand the Poverty-Environment Initiative geographically and thematically and upgrade the programme as a main but not exclusive UNDP-UNEP delivery mechanism of capacity development support and technical assistance to help countries meet the SDGs with a focus on inclusive, equitable, pro-poor, climate-proofed sustainable development, building on the Poverty-Environment Initiative s poverty-environment nexus (PEN) mainstreaming agenda and modus operandi. The main conclusions from the recent independent evaluation of the Poverty-Environment Initiative Scale-up phase are: II Mainstreaming the poverty-environment nexus in development planning, budgeting and monitoring is as relevant as ever, more so in the context of the recently agreed Sustainable Development Goals; PEN mainstreaming is relevant to all four regions. II There is unmet global demand for PEN mainstreaming support. II The UNDP and UN Environment collaboration for PEN mainstreaming brings value-added, ensuring integrated and cost-effective support to countries. II No other existing programme is currently fit to perform this country support role as effectively as the Poverty-Environment Initiative. I I Country-level outcomes are being achieved and the conditions for sustainability and impact are falling into place as programme implementation progresses.

63 Opportunities and challenges 51 II The Poverty-Environment Initiative s operational structure has proven to be one of the best-used examples of how to deploy comparative advantages of two UN entities in support of national sustainable development in a coordinated and effective manner. A joint management response was completed within two months and both documents were widely shared with Poverty-Environment Initiative stakeholders after being presented during the 8th Poverty-Environment Initiative Annual Donor Steering Group meeting. An internal review of the current phase 2 was completed in September to inform 1) the legacy of the Poverty-Environment Initiative through exit and sustainability strategies of Poverty-Environment Initiative countries, 2) knowledge management actions to be completed by end 2017 (e.g. the Poverty- Environment Initiative toolkit for SDG implementation) and 3) consideration of the interventions needed to achieve the 2030 Agenda for sustainable development. Another strategic document prepared in 2016 is the cost-benefit analysis of the Rubaya green village demonstration project. The analysis clearly highlights the economic, social and environmental benefits of addressing poverty-environment challenges. Moreover, it demonstrates the value of taking an integrated, cross-government approach to addressing interlinked poverty and environment challenges. MAIN POVERTY-ENVIRONMENT MAINSTREAMING RISKS/ ISSUES IDENTIFIED IN 2016 AND MITIGATION STRATEGIES Risk ratings attached to progress against Outputs, along with the overall risk rating, have remained minor to moderate under DFID s risk framework in its 2016 annual review. At the fiduciary level, as a joint UN programme delivered by UNDP and UN Environment, Poverty-Environment Initiative delivery is governed by the UN s risk management processes and fiduciary risks are therefore considered low. Based on this, the overall risk level for the programme is judged to be minor. Below, we provide some examples of risks and mitigation strategies undertaken in 2016.

64 52 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 Risk/issue Description Mitigation The Poverty- Environment Initiative s technical skills on integrated budgeting, financing, measurement Ability to track expenditure on environmental sustainability and climate change moving to impact monitoring Long-term impact and sustainability of the programme The Poverty-Environment Initiative through its broad development policy support mandate is requested to provide quality technical support in innovative areas of integrated budgeting, financing and beyond GDP measurements. However, these are all emerging areas with no defined global definition and lack of established expertise. A variety of tailor-made public expenditure reviews have been the main tool applied in the context of Poverty-Environment Initiative support to track expenditure on poverty-environment objectives in development plans. Despite its being a rather successful tool in the context of poverty-environment mainstreaming, there have been differentiated levels of institutionalization. While Asia has seen a more successful uptake by government and this information is relatively easily accessible, Africa is increasingly facing challenges, which is a risk to measuring the level of mainstreaming attained in a given country. Poverty-environment mainstreaming requires a sustained support for individual and institutional capacity development over the long term. The Poverty-Environment Initiative tailors training programmes to government staff and increasingly to nongovernment actors. It is, however, critical to have high-level political commitment from senior managers of the trained officials so that training produces sustainable impacts at the institutional level. It is difficult to measure capacity development for policy work. Establishing baselines before the intervention and monitoring and evaluating its contribution to institutional capacity require innovative approaches and considerable resources. The Poverty-Environment Initiative needs to invest more resources to develop high-level and credible technical services through partnerships with relevant key experts and institutions to deliver effective support over the long term. The Poverty-Environment Initiative is engaging with the World Bank, IIED and ODI on public and private financial management, with the UN Statistics Division, Oxford Poverty and Human Development Initiative and World Bank on beyond-gdp measurements in line with the SDGs. The different efforts will provide useful lessons that will inform the legacy of the Poverty-Environment Initiative and the new programme. The Poverty-Environment Initiative regional teams are providing more targeted support to country programmes, where relevant, to strengthen integrated budgeting and financing and are developing a guidance note on impact monitoring. Lessons from partnerships and cross-regional exchanges will inform the legacy of the Poverty-Environment Initiative and will be captured in a toolkit under development in partnership with IIED, PAGE, UN Environment WCMC and UNDESA, with a focus on poverty-environment mainstreaming through institution-building. The learning-by-doing approach characteristic of the Poverty-Environment Initiative provides a practical solution, given the daily challenges for the application of poverty-environment mainstreaming tools and knowledge gained, and helps develop specific technical skills by addressing those challenges. After the introduction of conceptual training, additional, more foundational training may be necessary. An example of this is the training curriculum on economic evaluation techniques to include environmental and social considerations. While this type of training is important to introduce concepts, additional foundational concepts are also necessary to make the lessons learned in the first training course more applicable. Lessons from the Poverty-Environment Initiative will inform the development of a considerable capacity-building component of the new programme.

65 Moving forward Achieving the SDGs is a very complex policy challenge, including due to the interlinkages between SDGs and among the social, environmental and economic pillars of sustainable development. A comprehensive, cross-government, mutually reinforcing integrated approach to bring pro-poor, sustainable environment and natural resource management into the heart of government and private sector investment decisions (i.e. poverty-environment mainstreaming) is therefore essential to SDG achievement. This will require, inter alia, substantive changes to government institutions and the way they operate. Not only the 2030 Agenda, but also the Paris Agreement require a radical acceleration of the integration of environment and climate change in national policies, plans and programmes as a critical dimension of true sustainable development. The various papers, joint events and strategic documents mentioned under Outcome Indicator 3 and related Output 3 testify to the overwhelming expectations raised and the increasing contribution made by a relatively small initiative. In fact, the Poverty- Environment Initiative remains the only development programme that can deliver country-level results through dedicated support for sustained poverty-environment mainstreaming. This is why some consider the Poverty-Environment Initiative to be one of the precursors of the integrated approach required to deliver the 2030 Sustainable Development Agenda. For example, Mongolia s draft UNDAF explicitly includes the Poverty-Environment Initiative as a flagship programme to be scaled up to support SDG implementation. The UNDAF specifically refers to the Poverty- Environment Initiative as an example of One UN support to contribute to achieving SDGs 1, 8, 10 and 17. Under this new UNDAF, the Poverty-Environment Initiative will support the development of integrated financing frameworks at the subnational level in line with the 2030 Agenda and with the Addis Ababa Action Agenda. Other UNDAF processes where the Poverty-Environment Initiative was referred to, include Lao PDR, Thailand and Cambodia. Marking the launch of the 2030 Agenda last year, we introduced some of the lessons from the Poverty-Environment Initiative that can contribute to its delivery. The examples that follow demonstrate our counterparts commitment and the trust placed in our capacity to deliver practical integrated approaches. Poverty- Environment Initiative countries across all regions have initiated concrete actions to adapt and localize the SDGs in the way they make decisions about their development paths. For example, Burkina Faso assigned relevant SDG targets to the new national development plan priority areas, while the M&E systems in Mali, Mauritania and 53

66 54 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 TRANSITIONING FROM SECTOR TO AN INTEGRATED APPROACH THE CASE OF WASTE MANAGEMENT IN PERU In Peru, the per capita generation of waste has increased by 40 per cent over the last 10 years. Approximately 1 per cent of the Peruvian population generates its income from precarious waste collection practices. Eighty-six per cent of them are living in extreme poverty, their valuable environmental and social contribution unaccounted for. On the basis of our integrated approach to sustainable development, our work strives, on the one hand, to make the solid waste management sector more self-sustainable in line with the National Development Plan. Target 10 of the Plan states that, by 2021, 100 per cent of municipal solid waste generated will be disposed adequately. On the other hand, we support the government s efforts to create a robust framework so that recyclers can generate more stable income and decent jobs. In this context, the Poverty-Environment Initiative identified the need to demonstrate how this work can make a difference beyond the work at the national level. Peru s second largest city, Arequipa, is leading this work to generate a sustainable model that can be replicated in the rest of the municipalities and provinces of the country. The Poverty-Environment Initiative has been assisting the local government to improve the capacities of recyclers associations to optimize the efficiency of collection routes thanks to their engagement with the private sector. By formalizing job conditions and designing business plans to become key actors in the recycling chain, these vulnerable groups are already achieving greater social and economic inclusion. Furthermore, we are assisting in the update of the Municipal Solid Waste Management Plan to be the first such plan to incorporate a social inclusion and economic empowerment approach, thus laying the basis for the municipal model mentioned earlier. The Poverty-Environment Initiative has been instrumental in improving the coordination among and beyond government actors, i.e. the Ministries of Labour, Economy and Finances, Social Development or Women and Vulnerable Populations, private sector (hotels, universities) and civil society. These actors joint efforts will ensure institutionalization and sustainability of a more coherent and sustainable legal framework and have been recognized in the recently approved National Solid Waste Management Plan. This Plan binds together the different strategies, policies and plans through indicators that combine waste management goals with social inclusion. Complementary work is on track to link targets to a nationwide investment programme for municipal solid waste management and to improve the capacity of national monitoring systems that effectively facilitate public access to monitor progress. Moving on to implementation efforts, the Poverty-Environment Initiative assisted in the revision of the Solid Waste Law for policy coherence with the National Solid Waste Management Plan.,Article 53 defines how to access national financial support for municipal strategies and how to measure the level of formalization of recyclers associations to measure the results of the municipal administrations. The general outlook of the law has a gender and social inclusion focus: The solid waste plans designed and implemented by the municipalities, must consider the process of waste characterization, contain concrete segregation and valuation objectives and have a gender and social inclusion focus while promoting local employment. The approval of this law is an important step in ensuring sustainability of our efforts. These considerations provide a legal framework for the implantation of the Municipal Solid Waste Management Plan at the local level.

67 Moving forward 55 Rwanda began identifying environmental and climate change indicators for the SDG prioritization process. The Government of Mozambique is undertaking an SDG assessment to inform the mid-term review of its current (see annual report 2015) and the development of its next national development plan. It focuses on how national development plan priority area number 3 (promote jobs creation, productivity and competitiveness SDG 8) can be achieved in an environmentally sustainable manner (in line with priority area 5 and SDGs 14-15) and to eradicate poverty (SDG 1). Selected provincial consultations underlined the need to address issues related to informal mining, fisheries and forestry if economic growth is to be environmentally sustainable and inclusive. They also highlighted how awareness of global development agendas among provincial and district planners varies and hence the importance of embedding the Sustainable Development Goals and targets within the context of the national development plan, i.e. of localizing the 2030 Agenda. Recognizing that this issue is common to all countries (and their specificities), the Poverty-Environment Initiative supported a range of activities in 2016 to help land the 2030 Agenda across regions. For example, we partnered with UNDP s Aid for Trade programme to hold the conference Exploring Opportunities to Accelerate SDGs Implementation in Tajikistan. Over 100 participants including deputy chairpersons from the Committee of Environmental Protection, Strategic Research Centre, Committee for Women and Family Affairs, top officials from Oxfam, OSCE, Japan International Cooperation Agency, governmental officials from other relevant state institutions, and representatives from the private sector, environmental and gender NGOs, CSOs and academia learned about available tools and approaches to improve institutional capacity to accelerate the integration of environmental and natural resource management into development planning. Taking this work to the regional level, the conference Towards a Common Vision for the Agenda 2030 in Central Asia, co-organized with CAREC and UN Women, discussed practical approaches to prioritize the environmental dimension of the SDGs in Central Asia (see #GreeningCentralAsia, Facebook and Twitter). Its Outcome Document, agreed with international organizations such as UN Women, UNECE, GIZ and UNESCO, is being used as foundation to strengthen the poverty-environment nexus in ongoing efforts to localize the 2030 Agenda with the following priority actions: (i) integrating the SDGs into national development planning; (ii) enhancing data and statistical capacities of government counterparts; (iii) leveraging science, technology and innovation in support of SDG implementation at the country level; and (iv) mobilizing partnerships and resources. This work has been complemented with a training of trainers event Capacity-building for Sustainable Development in Central Asia: I would like to underline the vital role and contribution of the Poverty-Environment Initiative in promoting sustainable socio-economic development not only in the Central Asian countries where it operates, but in the entire region. Moreover, I believe that the Poverty-Environment Initiative CAREC partnership will be an additional benefit for Central Asian countries in fostering neighbourhood dialogue on the development goals of region importance. Lubov Ten, Advisor to the Ministry of Economics of the Republic of Kyrgyzstan

68 56 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 Looking beyond 2015 to enhance the capacity of stakeholders to implement the SDGs and to harmonize efforts with regional and national strategies in the region. The Poverty-Environment Initiative also supported the integration of SDGs into Mauritania s new 15-year strategy and a cost estimation for implementation of SDG 6 in the context of Tajikistan s water sector reform (see Outcome Indicator 2). Other countries such as Bhutan, Guatemala, Kyrgyzstan and Myanmar analysed policy and legal frameworks and carried out institutional reviews. This represents an important contribution to the achievement of SDG target (policy coherence for sustainable development) from the perspective of the poverty-environment nexus. It is also an opportunity for the countries to identify other gaps in SDG implementation readiness and in their capacity to implement multilateral environmental agreements. Paris Agreement in action contributing to climate resilience and promoting a just transition to a green economy The Poverty-Environment Initiative Scale-up Final Evaluation highlighted that the Poverty-Environment Initiative s undisputed niche is rural poverty and natural resources management. Increasingly, the Poverty-Environment Initiative has been addressing climate change adaptation as a strategy to manage the risks posed by climate change to sustainable development, and in particular to vulnerable populations. This is why, during 2016, the Poverty-Environment Initiative stepped up such efforts to promote learning from experiences across countries and to scale them up. For example, learning from the green villages integrated approach in Rwanda, Kyrgyzstan improved the capacity of two districts to promote green villages by using renewable sources of energy and energy-efficient solutions. The Government of Tanzania also scaled up initial work on green energy and sustainable agriculture practices in three districts with support from the private sector. Preliminary assessments from an ongoing cost-benefit analysis indicate that the use of biogas systems have been particularly beneficial for users, as, for example, it has reduced their dependency on firewood. In turn, this has reduced unpaid work and drudgery for women and girls and lowered their exposure to smoke, which has resulted in fewer eye infections and less smoking-induced coughing. Furthermore, the application of bio-slurry, which is the by-product of the biogas production, is expected to improve soil fertility, increase agricultural output and reduce the use of chemical fertilizers. This benefit has informed the prioritization of renewable green energy technologies in the new National Five-Year Development Plan II and similar local economic development initiatives. This information is trickling down to local communities through local radio programmes and is promoting discussion in support of sustainable development. Different studies and assessments such as these are critical to raise the awareness about the magnitude of the task at hand. For example, national and local climate public expenditure and institutional reviews, such as those referred to under Indicators 2 and 2.1, are helping governments direct

69 Moving forward 57 resources to climate activities to improve their lives and livelihoods of the extremely vulnerable. Sector policies also provide an excellent entry point to promote action to simultaneously tackle climate change and poverty issues. For example, Peru in 2016 approved the National Gender and Climate Change Plan the first such plan ever in South America. In view of the contribution of waste to greenhouse gas emissions in the country, solid waste management is one of the priority areas of the plan. Based on the experience of the women recyclers supported by the Poverty-Environment Initiative, the plan includes the action knocking on doors to save the planet as a key initiative with high potential for scalability; this makes our work sustainable. In Malawi, the new fisheries policy demonstrated climate-resilient practices for sustainable development and poverty eradication thanks to Chinese technology that applies to deep fishponds; this technology improves water capacity and thus increases fish production from 0.8 to 1.2 to 4-8 tonnes per hectare. Benin is studying the economic impacts of climate change on key sectors to inform sector strategies and the national development plan Recognizing the benefits of effective partnerships for sustainability and the overwhelming needs in capacity development, the Poverty-Environment Initiative partnered with the World Bank to support the development of the green growth strategy in Lao PDR, including through South-South learning in South Korea. As a result, the National Green Growth Strategy includes clear institutional, legal and financing mechanisms that integrate green growth, equity and sustainable development. The Poverty-Environment Initiative also shared lessons on our work at different global and regional venues such as the 2nd Global Academy on the Green Economy, where the Delegation from Kyrgyzstan discussed building on the lessons and sustaining the work of the Poverty-Environment Initiative to launch the Partnership for Action on the Green Economy in the country in PEI then also provided capacity building in the national Green Economy academy held in Burkina Faso in December The Initiative also participated in an collaboration workshop in Berlin in May 2016 convened by the Green Economy Coalition and hosted by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ). This workshop brought together the main international actors working to support green growth/inclusive green economy in developing countries to explore more effective ways to collaborate, particularly at country level. A workshop organized by the Office of the United Nations High Commissioner for Human Rights (OHCHR) on climate change and human rights in October also provided a good opportunity to share our experience. Our intervention, providing concrete examples of using an integrated approach in support of SDG implementation was very much appreciated by Member States. In November, the Initiative participated in training of UN staff on land and natural resources organized by UN-HABITAT as part of the UN Regional Support to the Great Lakes Region. Our participation in the Green Fiscal Policy Network regional workshop held in Bangkok allowed us to share our experience in Lao PDR and the Philippines in promoting a more transparent and effective use of revenues from the extractives industries; this

70 58 UNDP UN Environment Poverty-Environment Initiative Annual Progress Report 2016 employed natural resource management tools, environmental and social safeguards, strategically designed fiscal frameworks and sovereign wealth funds/natural resource funds to support the Sustainable Development Goals. Beyond 2017: universalizing Poverty- Environment Initiative experiences The 8th Poverty-Environment Initiative Donor Steering Group agreed to the development of a concept for a new poverty-environment mainstreaming programme beyond Recognizing the need for policy coherence and to direct investment flows (public and private) in sustainable use of environment and natural resources (SDG 17), the objective of the new programme will be to assist developing countries to deliver coherent policies and increased investments in poverty eradication that improve environmental sustainability and address climate change. The focus will be on contributing to the achievement of those SDGs at the nexus between poverty and environment namely, SDGs 1, 2, 12, 13 and 15 and to the Paris Agreement through multi-stakeholder partnerships that bring together governments, civil society, the private sector, the United Nations system and other actors to mobilize investments in sustainable development and climate resilience. Looking forward, the new UNDP United Environment joint programme will build on the Poverty-Environment Initiative s mainstreaming tools and approaches to effectively influence policy and budget coherence. In this context, the Mainstreaming, Acceleration and Policy Support for the 2030 Agenda led by UN Development Group has developed a Mainstreaming Reference Guide for UN Country Teams as part of the toolkit for implementing SDGs. The Guide draws on Poverty-Environment Initiative tools developed and applied in the context of the Poverty-Environment Initiative s integrated socio-economic-environmental approach to environmental mainstreaming. In 2016, the Poverty-Environment Initiative reached out to a range of actors in sustainable development (CBD, SwedBio, WCMC, WAVES, IISD, UN Women, IPBES, UNDESA, IIED, WRI, UNITAR, PWC s Climate and Development Knowledge Network) to develop a knowledge product that will summarize and analyse experiences in poverty-environment mainstreaming. The will inform implementation of the 2030 Agenda and the Paris Agreement in developing countries. This knowledge product will build on the Handbook and will be developed on the basis of a compendium of practical country-level experiences that link tools and approaches to mainstreaming results in support of specific SDG targets. It will be published by the end of 2017.

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72 European Union Norwegian Ministry of Foreign Affairs Spanish Ministry of Foreign Affairs and Cooperation Swedish International Development Cooperation Agency UK Department for International Development Poverty-Environment Initiative Empowered lives. Resilient nations. Poverty-Environment Facility P.O. Box Nairobi, Kenya Fax: Website: