SUMMARY OF THE ABBREVIATED RESETTLEMENT ACTION PLAN (ARAP)

Language: English Original: English AFRICAN DEVELOPMENT BANK GROUP SUMMARY OF THE ABBREVIATED RESETTLEMENT ACTION PLAN (ARAP) FOR THE ORGANIC SUGAR PROJECT OF PURE DIETS MOZAMBIQUE S.A. IN MOZAMBIQUE 0CTOBER 2015 E&S Team: Sector Director: Regional Director: Erika Auer, Senior Social Development Specialist, ONEC3 Kelello NTOAMPE, Environmental Scientist, ONEC3 K. DIALLO K. MBEKEANI Resident Representative: Division Manager: J. RIBEIRO M. CISSE 1

Pure Life Abbreviated Resettlement Action Plan (A-RAP) Summary Project Title: Pure Life Organic Sugar Project Country: Mozambique SAP Code: P-MZ-AAG-005 Department: OPSD Division: OPSD2 Date of Submission: 11/09/2015 Project Task Manager/ Alternate Task Managers: O. Afun-Ogidan / N. Vij / A. Valko- Celestino 1. Description of the project, project area and area of influence This is a summary of the abbreviated RAP developed for Pure Diets Mozambique SA by Protiviti Global consultancy firm in 2015. Pure Diets Mozambique SA (PDMSA) has proposed to set up organic sugarcane plantations, a sugar mill of 3500 tonnes of cane per day (TCD) expandable to a 5000 TCD capacity along with a 12 megawatts (MW) capacity co-generation power project for captive consumption (herein referred as project ). PDMSA has also proposes to bring initially 4311 hectares (ha) of land under organic sugarcane cultivation in a phased manner. An additional 650 ha of land shall be used for setting up necessary infrastructure like factory, roads, housing, and reservoirs. Out of this 650 ha, 200 ha is reserved for the factory. The power generated by the cogeneration plant will be utilized for its own captive consumption and irrigation facilities. The site is located at Malengane, Moamba District, Maputo Province in Mozambique. The project area is located in Mozambique in the continent of Africa. Mozambique is surrounded by Malawi and Tanzania in the North, Zambia and Zimbabwe in the West, Pretoria in South. The eastern border is Indian Ocean. Mozambique is divided in to 11 provinces. The Maputo province is the southernmost. The project is located at Moamba district in Maputo province on the South of Incomati River bank, in Sabie Administrative Post, in the locality of Malengane. Moamba is well connected by road and rail. 2. Potential impacts There will be a significant impact of loss of structures that will be caused by the proposed project mainly the construction of the organic sugar mill.types of houses to be affected are largely the made from mud, straw and locally available wood and bushes. Project Affected Persons (PAPs) loosing residential structures are entitled to the compensation in form of housing structure to be constructed in accordance with national standards (more details provided in Sections 9 and 11.1). Demolition of outer structures and services such as fences, stores, toilets and kitchens will result in loss of PAPs basic services that individuals, family or enterprises depend upon for sanitation, security and general well-being, however, this will not necessitate physical relocation of PAPs or 2

loss of business. The proposed project will result in loss of land mainly for used by the PAPs for cattle grazing. A total of 64 cattle (cows and goats) are available with PAPs. The project area that was considered was inspected and recommended by government officials (land department) as it would impact a limited number of families (5). The area would also be advantageous from logistic perspective for the factory. The project has decided to consider the area based on the recommendations and considering limited number of families to be displaced. 3. Organizational responsibility The community relationship department at PDMSA is mainly responsible for implementation, monitoring and evaluation of resettlement action plan. As per article 6, 7 and 8 of Regulations for the Resettlement Process Resulting from Economic Activities Decree 31/2012 of 8 August, a technical committee shall also be formed. Internal monitoring for A-RAP implementation will be carried out throughout the resettlement process. PDMSA should agree on the maximum time of vacating and this should be done once all PAPs have received their compensation. It is recommended that maximum time of vacating could be six months. The community relationship department will keep a record of all progress and prepare regular monitoring resettlement implementation reports that outline the successes and challenges encountered and submit to Director. To ensure the efficiency, the community relationship department will facilitate monitoring and reporting activities, provide regular reviews and quality control in addressing provisions of the A-RAP. Data from field surveys will be used as the benchmark for monitoring the progress of RAP implementation. PDMSA will submit quarterly monitoring report to the lenders, it will be go along with the environmental and social management plan reporting. 4. Land Lease As per article 3 and 4 of the Land Law 19/97 Government of Mozambique the entire land is owned by state.pdmsa had involved all the community leaders and Government officials in the conception stage of the project and signed the Memorandum of Understanding (MOU) with community leaders for processing the DUAT (land lease documents issued by Government of Mozambique- Annexure 1 of the ESIA report) with the Director of Provincial Agriculture. Based on the declaration, a model map is being prepared by the Government surveyors and it was referred to the community leaders for their attestation for making the final map. The Temporary land title (TEMPORARY DUAT) was issued to PDMSA by the Director of Provincial Agriculture. The Temporary DUAT is issued by the Director of Provincial Agriculture directly if the size of land is up to 1000 ha. If the land size is 1001 to 5000 ha and above 5000 ha, the temporary DUAT will be issued by the Director Provincial Agriculture after getting approval from the Minister of Agriculture and Land and the President respectively. 3

5. Community participation The households affected by the project were duly consulted in the presence of government representatives and district administrator. They declared their willingness to relocate if they are compensated as per Mozambican law. The households indicated their preference of relocating to a site close to their current homesteads (houses made with mud and straw). Their concerns are addressed in a Memorandum of Understanding which is signed by the heads of 5 families, government officials and PDMSA. PDMSA has committed to fulfil the following: Permanent Housing at Better Place Houses to be constructed as per national standards Arrangement of temporary housing Graveyard Relocation and ceremonial assistance will be provided by PDMSA Employment for families sugarcane fields, sugar mill etc. Other general social benefits from the project such access to education, water, sanitation facilities and healthcare facilities, Access to pasture land that is proposed to be developed by PDMSA for cattle grazing. 6. Integration with host communities The site selection is done considering the requirements of article 17 and 18 of Mozambique Regulations for the Resettlement Process Resulting from Economic Activities Decree 31/2012 of 8 August. Soil test shall be conducted prior to start of the construction. The site is well located with sufficient natural drainage and hence there are no chances of flooding. The households will be relocated within the same community (1 km away from the existing location) and the community was consulted for their consent on relocation of these families. 4

7. Socio-economic studies The following table demonstrates the result of the census survey undertaken by PDMSA. Sl# Parameters Manjate Family Chewane Family Nkuna Family Xivite Family Chauke Family 1 Number of Men 3 2 3 2 1 2 Number of women 4 2 1 2 2 3 Number of children 1 4 3 1 2 4 Source of water River Inkomati River Inkomati River Inkomati River Inkomati River Inkomati 5 Number of structures 2 3 2 1 1 6 Source of food Vegetable and Poultry Vegetable and Poultry Vegetable and Poultry Vegetable and Poultry Vegetable and Poultry 7 Medical facility Sabie Hospital and Traditional Medicine 8 Number of people employed 9 General educational level of family 10 Diseases in Last 5 years Malaria & Diarrhoea 11 Any physical disability/disable family members 12 Availability of communication facilities like mobile phones Sabie Hospital and Traditional Medicine Sabie Hospital and Traditional Medicine Sabie Hospital and Traditional Medicine 1 1 None None None Sabie Hospital and Traditional Medicine Uneducated Uneducated Uneducated Uneducated Uneducated Malaria & Malaria & Malaria & Malaria & Diarrhoea Diarrhoea Diarrhoea Diarrhoea None None None None None Mobile Phones Mobile Phones Mobile Phones Not Available Not Available 13 Availability of Radio Available Available Available Not Available Not Available 5

14 Availability of Banking Not Available Not Available Not Available Not Available Not Available Facilities/ Financial Inclusion 15 Language Spoken Tsonga & Portuguese Tsonga & Portuguese Tsonga & Portuguese Tsonga & Portuguese Tsonga & Portuguese 16 Number of cattle 9 48 5 Not Available Not Available 17 Source of Income Employment in nearby companies Seasonal Employment and some vegetable farming Self-Employment Self-Employment Self-Employment 18 Education Facilities Primary School is available now by PDMSA 19 Transportation Facilities Local Bus or Common Tractors Primary School is available now by PDMSA Local Bus or Common Tractors 6 Primary School is available now by PDMSA Local Bus or Common Tractors Primary School is available now by PDMSA Local Bus or Common Tractors Primary School is available now by PDMSA Local Bus or Common Tractors 20 Owned Vehicles Bicycle None None Bicycle Bicycle 21 Permanent Cropping/ None None None None None Agriculture/Standing Crop 22 Type of Housing Made from Straw, Mud and locally available material Made from Straw, Mud and locally available material Made from Straw, Mud and locally available material Made from Straw, Mud and locally available material Made from Straw, Mud and locally available material 23 Sanitation Facilities Toilets made from locally available material/ Open Sanitation Toilets made from locally available material/ Open Sanitation Toilets made from locally available material/ Open Sanitation Toilets made from locally available material/ Open Sanitation Toilets made from locally available material/ Open Sanitation

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8. Legal framework, including mechanisms for conflict resolution and appeal This A-RAP has been prepared in consistent with the applicable policy provisions of the Government of Mozambique and those of the African Development Bank- Integrated Safeguard Systems (ISS), NedBank- IFC Performance Standards (PS) and Equator Principles and Deutsche Bank Africa Agriculture and Trade Investment Fund (AATIF)- social and environmental (S&E), and labour requirements in collaboration with the International Labour Organization (ILO) and United Nations Environmental Programme (UNEP). The requirements are outlined below: 8.1. Government Legislation All articles of the Land Law 19/97 Government of Mozambique Regulations for the Resettlement Process Resulting from Economic Activities Decree 31/2012 of 8 August Article 1-28 8.2. International Requirements Africa Development Bank Integrated Safeguard System OS2 - Involuntary Resettlement: Land Acquisition, Population Displacement and Compensation Ned Bank- IFC Performance Standards PS5 - Land Acquisition and Involuntary Resettlement AATIF- S&E Requirements on resettlement 9. Institutional framework The community relationship department at PDMSA is mainly responsible for implementation, monitoring and evaluation of resettlement action plan. As per article 6, 7 and 8 of Regulations for the Resettlement Process Resulting from Economic Activities Decree 31/2012 of 8 August, a technical committee shall be formed with the following objectives: To monitor, supervise and make methodological recommendations for the entire resettlement process To issue technical opinions about the resettlement plans To prepare monitoring and evaluation reports of the resettlement process, taking into account the previously approved plans To propose the notification of the proponent of an activity to provide information about the progress of the resettlement process To prepare the draft Internal Regulations of the Committee To propose complementary rules for the implementation of these Regulations The following members will form the part of technical committee: Member from PDMSA Member of the Local Administration sector Member of the Public Works and Housing sector 8

Member of the Agricultural sector Member of the Provincial Government Member of the District Government Other possible stakeholders who will be involved in the committee are: Representatives of the affected population Representative of Civil Society Community leaders As per article 16 of the aforementioned legislation, the resettlement process will adhere to the following model: 1. Type of Housing -a) Organised housing plot with infrastructures; b) Housing with at least type III characteristics (three bedrooms), with an area of 70 m2. 2. Construction Material- The houses defined in the previous paragraph are built with conventional material (stonework) and according to an approved design. 3. Local Characteristics-The housing projects shall follow the social and cultural characteristics of the resettlement place. 4. Vegetation Conservation- During house building the preservation of the vegetation shall be guaranteed. 5. Economic Security-The continuation of the performance of subsistence activities shall be guaranteed in the resettlement places, according to the cases, or income generation programmes shall be defined. 6. Supporting Facilities-The resettlement process is accompanied by the establishment of access roads, a water supply system, sanitation, electrification, health post, school, day-care centre, market, shops, police station, leisure and recreation sites, sports facilities, worship and meeting places. 7. Type of Area for Economic Activities-In resettlement places there shall be areas reserved for the practice of agriculture, cattle breeding and other activities. 10. Eligibility Project Affected Person (PAP) is defined as Any person who, as a result of the implementation of the project, loses the right to own, use, or otherwise benefit from a built structure, land (residential, agricultural, pasture or undeveloped/unused land), annual or perennial crops and trees, or any other fixed or moveable asset, either in full or in part, permanently or temporarily. Affected people might be displaced either physically ( Physically Displaced People ) or economically ( Economically Displaced People ). 11. Valuation of, and compensation for losses The calculation of compensation and other resettlement allowances for displaced property owners based on the national legislation was done. The value of housing structure or asset (direct 9

comparison method) and any crops (earnings approach) as determined by the valuation assessments. The valuation has been done to include: Relocation or loss of shelter- Housing to be arranged for PAP as per Government of Mozambique; Relocation of graves and associate ceremonial alliance- as per Government of Mozambique; Relocation to temporary housing arrangement till the time permanent housing is under construction; Loss of assets or access to assets (for example grazing area for cattle); Loss of income sources or means of livelihood, whether or not the affected persons must move to another location and/or provided with residential housing, or housing sites, or as required, agricultural sites for which a combination of productive potential, location advantages, and other factors is at least equivalent to the advantages of the old site. For all affected properties a survey was conducted to determine current replacement costs such as cost of construction materials, transportation costs, and labour costs at the date of valuation as well as rates of compensating permanent crops. Spot valuation was conducted at the site. Spot valuation was based on visual inspection and physical counting technique. Physical verification of structures, assets, etc. was done. 11.1. Loss of Structures (residential structures) There will be a significant impact of loss of structures that will be caused by the proposed project mainly the construction of the organic sugar mill. Types of houses to be affected are largely the made from mud, straw and locally available wood and bushes. PAPs loosing residential structures are entitled to the compensation in form of housing structure to be constructed in accordance with national standards. As per the article 18 of Regulations for the Resettlement Process Resulting from Economic Activities Decree 31/2012 of 8 August, the following housing standards shall be strictly adhered to: The following criteria are considered for the definition of the size of the housing plot: - Suitability for construction, with an inclination not higher than 10%, areas without a high water table; - In rural areas the area of the plot shall not be less than 5,000 m2 ; - Front access to the road; - Natural ventilation; - Access to water and other infrastructures; - Access to social facilities. - In rural areas physical spaces for vegetable production and the breeding of poultry and other animals shall be guaranteed. 10

Also as per article 17 of the aforementioned legislation, PDMSA shall conduct the following environmental test before starting the construction of residential structure. This will ensue suitability of the proposed site: - Soil permeability - Water table level - Inclination of the terrain - Storm water drainage - Soil fertility 11.2. Loss of Annexed structures Demolition of outer structures and services such as fences, stores, toilets and kitchens will result in loss of PAPs basic services that individuals, family or enterprises depend upon for sanitation, security and general well-being, however, this will not necessitate physical relocation of PAPs or loss of business. Annexed structures in this RAP are counted separately and a total of 6 annex structures will be affected. For this A- RAP Annexed structures will be entitled to the following compensation: Compensation of the annex structure according to the type of structure; for example better sanitation facilities, permanent toilets, kitchen area, fencing etc. 11.3. Loss of Land (Grazing Land for Cattles) The proposed project will result in loss of land mainly for used by the PAPs for cattle grazing. A total of 64 cattle (cows and goats) are available with PAPs. All PAPs that will lose land will receive the following compensation: Project promoters have committed to develop pasture land to be used for grazing the cattle owned by the PAPs and community in general. 11.4. Loss of Permanent Crops/Trees (Individual PAP) Permanent crops include those that take more than a year to reach full maturity and can be harvested over a long period of time. In this case PAPs do not have any permanent crops that may get affected and creates negative economic impact. PAPs have grown trees for various purposes that include shelter, fruits and subsistence. Each tree is counted and compensated according to its market value and age of maturity; for instance a mango tree that is fully matured and producing is compensated 100% of the compensation rate of the tree. A total of 11 trees are identified that are likely to be affected due to the project. PAPs losing trees are entitled to the following compensation: Compensation of value of each tree according to the market value and level of maturity; 11

11.5. Loss of Cultural and Archaeological Property The proposed project will have an impact on graves. A total of 11 graves will be affected by the project and will have to be relocated prior to implementation. It should be noted that the rates to be compensated for graves will vary depending on developments done on the grave. Compensation will be paid for expenses related to the relocation of graves such as expenses for ceremonies and labour in connection with exhumation and reburial, and any other development. The processes of relocating the graves will be participatory and take into account PAPs cultures and values. Where graves that would be adversely affected by the Project need to be exhumed and reburied at alternative locations, rituals and ceremonies will need to be conducted and must consult respective relatives. For this project, PAPs will be compensated ceremonial cost and cost of relocation; while other costs related to relocation of the grave as per national legislation. 12. Shelter, infrastructure and social services The PAPs will also receive following benefits: PAP will get employment for families sugarcane fields, sugar mill etc. PAP will get access to better education facility PAP will get access to medical facility PAP will get access to safe drinking water PAP will get access to better housing, sanitation facility PAP will get access to public infrastructure PAP will get financial inclusion through ATMs and Bank Branch 13. Implementation schedules No. Parameters Start Date Timelines/Frequency 1 Formation of RAP Team and March 2013 April 2013 Socio Economic Survey 2 Notice and MoU with PAP April 2013 Nov 2013 3 Formation of Technical Nov 2015 Dec 2015 Committee 4 Communication of Grievance Dec 2015 Dec 2015 Management System 5 Providing Temporary April 2015 Oct 2015 Accommodation to the PAP 6 Providing Employment to PAP Jan 2014 Completed 8 Communication to PAP about the Jan 2016 Jan 2016 permanent relocation structure 7 Construction of Permanent Mar 2016 July 2016 Housing Arrangements for PAPs 8 Construction of annex structure Mar 2016 July 2016 for PAPs 9 Relocation of Graves Mar 2016 May 2016 12

10 Monitoring, Evaluation and Submission of Completion Report, 11 Independent Audit- RAP Implementation Nov 2015 July 2016 Quarterly Annually 14. Costs and budget No. Parameters Budget (MZN) 1 Providing Permanent Houses for 5 Families 3,000,000.00 2 Providing Temporary Housing for Families 350,000.00 3 Grave Relocation including Ceremonial Expenses 120,000.00 4 Compensation for Trees 88,000.00 5 Contingences 200,000.00 Total Budget (MZN) 3,758,000.00 15. Monitoring and evaluation The monitoring process will involve the following: Administrative monitoring to ensure that implementation is on schedule and problems are dealt with on a timely basis. Socio-economic monitoring during and after the relocation process to ensure that persons have been able to recover successfully and as anticipated from the relocation program. Administrative monitoring to ensure that relocation of graves has been adequately performed and all PAPs have been well involved in the relocation process. Data from baseline socio-economic surveys undertaken during consultation will provide the benchmark for monitoring to assess the progress and success of A-RAP implementation. Monitoring will also include communication with PAPs and documentation of reactions from PAPs and physical monitoring of progress of the A- RAP s implementation, including the relocation of PAPs and the affected community assets. It is important that monitoring be guided by verifiable indicators. Ensuring compliance through indicators to be monitored will be important in the RAP implementation process. Monitoring will be undertaken at regular intervals, at least once a month. Following up of those who will have been relocated will be necessary in the initial months to ensure that they are coping with the new situation. The following is a list of the key indicators which will have to be incorporated in the reports to be prepared by the entity implementing and reporting on the A-RAP: Number of households and individuals affected by project activities Number of households and individuals economically displaced (crop, shops and activities affected, etc.) as a result of project activities Number of households and individuals resettled by the project 13

Number of resettlement houses built Number of graves relocated Number of resettlement houses taken possession of by resettles Number of grievances received per month Total of Grievances received (which are still open, and those closed) Amounts of compensation paid for each category of lost assets (structures, land, crops others) and other benefits obtained by households and individuals Affected PAPs and resettled households economic and livelihood situation Community structures affected Community structures rebuilt and used by community It is also important to engage external monitoring personnel who will review all compensation tallies and ascertain whether compensation was provided correctly. The external monitor will also assess whether PAPs have regained their prior living standards in terms of income, housing, access to basic amenities, and ownership of land and material assets. The impact monitoring will first be carried out approximately 3 months after the PAPs have been relocated and a report will be submitted to Director and the lender group giving details of the evaluation and its findings. PDMSA will conduct an independent third party audit to evaluate the effectiveness of the resettlement plan. PDMSA will submit the audit reports to lenders for review. 16. References and Contacts References Abbreviated Resettlement Action Plan (09/2015). Organic sugar production and cogeneration power plant. Prepared by: Protiviti Global Contacts Kelello Ntoampe, Principal Environmentalist. Email: k.ntoampe@afdb.org. Erika Auer, Senior Social Development Specialist. Email: e.auer@afdb.org Tel.: +225 2026 2269. 14