proposals – Addendum

RISK ASSESSMENT AND MANAGEMENT
GREEN CLIMATE FUND FUNDING PROPOSAL | PAGE 57 OF 101
G
Selected Risk Factor 6
Description
Risk
category
Level of risk
Probability of risk
occurring
Political shifts could reduce the national government’s
interest in channelling resources to the project area
and potentially change incentives to promote palm oil
development. Because Peru is facing a new election
cycle, it is clear that support for one of the country’s
poorest provinces, with a very sparse population and
even lower political leverage, is highly dependent on
the elected officials and their preferences. An adverse
result could bring sharp reductions in government
investment and support for Datem del Marañón. From
the project’s perspective, this could imply a reduction
in cooperation and protracted bureaucratic processes
that might delay the adoption of decisions.
Other
High (>20% of
project value)
Medium
Mitigation Measure(s)
The project is well established in the region and the province. It has gained the support of all levels of government.
Building this relationship has required time and perseverance, as well as trust-building activities. The two main
mitigation options to be implemented are: (a) “early engagement” (i.e. provision of information and data to
disseminate expected outcomes); and (b) “awareness creation” through well-orchestrated events to disseminate the
project and its achievements.
It is also important to note that the project will coordinate with the relevant governmental organizations at the
national level to mitigate these risks, including the Forestry Service (SERFOR), the Ministry of Agriculture
(MINAGRI), and the National Program of Forest Conservation (PNCB) at the Ministry of Environment (MINAM),
more specifically in regard to the agricultural development and palm oil Nationally Appropriate Mitigation Action
(NAMA) currently under preparation.
Selected Risk Factor 7
Description
Risk
category
Level of risk
Probability of risk
occurring
Political risk arising from the indigenous communities’
registration and land titling, including potential conflict
between different groups, and the inability of the
independent Redress Mechanism to solve conflicts
and to solve them in a timely manner. If these risks
were to materialize, they would affect not only the
project, but through legal and reputational risks, both
the accredited entity and the GCF.
Other
Medium (5.1-
20% of project
value)
Medium