Shanxi province is situated in the middle reaches of the Yellow River and the eastern part of the Loess Plateau in northern People’s Republic of China (PRC). At project appraisal, it had only about 3.8 million hectares of dependable arable land, of modest quality and productivity, for its 23 million rural population. Most farmers continued traditional agricultural practices—growing mainly wheat and corn—that generated low incomes and required the extensive use of water and agrochemicals that resulted in soil and water pollution. Free–range livestock grazing, and disposal of untreated animal waste worsened the pollution problem. In addition to being unsustainable and environmentally damaging, the old agricultural system kept most farmers in poverty.
To help prevent the situation from worsening, the Asian Development Bank approved a $100 million loan for the Shanxi Integrated Agriculture Development Project in December 2009. Two grants from ADB-administered facilities—$500,000 from the Multi-Donor Trust Fund under the Water Financing Partnership Facility and $195,000 from the Gender and Development Cooperation Fund—supported groundwater management and women economic empowerment activities. The project had 4 outputs: (i) transition to high-value production, (ii) strengthening farmer–market linkages, (iii) capacity-building, and (iv) project management.
Perennial, annual, and livestock production bases were established by 39,829 households: perennial cultivation covered 6,968.01 hectares and engaged 21,106 households; annual crops covered 756.27 hectares and engaged 9,282 households; and livestock breeding involved 9,218 households. Farmers, markets, and enterprises were linked to increase production and add value to agricultural products. Onsite processing and storage facilities were established and/or upgraded, including 223 date-drying units and a 2,000-ton thermostatic storehouse that boosted local capacity to provide the market with higher-quality produce. 14,861 farmer households signed product buyback contracts with various enterprises; 9,161 households signed loan guarantees and technical service contracts with local enterprises.
39,829 farmer households participated in technical training or agricultural demonstrations. 328 households received drip-irrigation subsidies, and 6,500 farmers were trained in water-saving techniques. 20 women’s groups and 3 cooperatives were organized. Microcredit worth $86,000 were dispensed to 4 villages, benefiting 117 households and enabling 294 women to be trained. Provincial, municipal, and county level project management offices (PMOs) were established and provided with adequate staff, training, and equipment.
No major change in scope occurred; minor changes were inevitable, mainly due to prolonged project processing, a lower exchange rate, and unforeseen changes in local government programs.
Delivery of the outputs generally as targeted allowed the project to achieve its intended outcome to increase farm productivity and household incomes through high-value agricultural production. Specifically, increase in incomes of at least 25% increase for about 39,829 project households was realized. Overall, the project helped reduce rural poverty and develop a sustainable agriculture sector in 26 counties in Shanxi. Self-evaluation by ADB’s East Asia Department rated the project highly successful.
The Shanxi provincial government was the executing agency. A provincial PMO under the Shanxi Poverty Alleviation and Development Office supervised the day-to-day implementation activities undertaken by the municipal and county project implementation units and the project leading groups.
