Montenegro - Forest for Shared Prosperity Project

Overview & Synopsis

Montenegro Forests for Shared Prosperity Project for Montenegro has the development objectives of improving the sustainable management of forest resources and enhancing the economic viability of the forest industry in targeted areas. Component 1. Strengthening Sector Governance and System Modernization supports sector reforms and capacity through three Sub-components: Sub-component 1.1 strengthens the policy framework and institutional capacity by developing bylaws and operational guidelines for the new Forest Law, aligning practices with the European Union deforestation and timber regulations, updating forest fire management policies and emergency response plans, conducting market studies to improve timber market transparency, and reinforcing law enforcement coordination to deter illegal logging; Sub-component 1.2 modernizes forest resources measurement and traceability by upgrading the Forest Management Information System (FMIS) with geographic information integration, updating the National Forest Inventory (NFI), improving a timber valuation decision support system, establishing an Electronic Timber Tracking System (ETTS) interoperable with FMIS, updating measuring, reporting, and verification (MRV) for emissions and carbon sequestration, enhancing official forestry statistics with the Statistical Office of Montenegro (MONSTAT), and launching a one-stop web portal for public access to data; Sub-component 1.3 supports the operationalization of the Montenegro Forests Company through a phased business plan, corporate governance and financing arrangements, staff recruitment and training, and transparent timber sales mechanisms including an online auction platform. Component 2. Forest Resilience and Wildfire Risk Reduction reduces wildfire risk and restores forest health through two Sub-components: Sub-component 2.1 Shield and Sense strengthens prevention and preparedness by engaging communities, managing fuels and creating buffer zones with fire-resistant species, maintaining fire protection areas and mineralized strips, improving firebreaks and boundary lines, constructing water reservoirs and upgrading equipment storage, preparing local integrated forest fire management plans and digital fire protection maps, enhancing local detection systems via towers, community spotters and remote sensing, procuring vehicles and specialized equipment, and ensuring inclusive participation and properly fitted protective equipment for women; Sub-component 2.2 Recover and Revitalize improves suppression readiness by assessing surveillance and detection approaches, prepares and implements restoration plans for burned areas using climate-resilient and biodiversity-enhancing techniques, strengthens analysis of fire causes, and assesses and pilots rehabilitation of prioritized forest road segments to improve emergency access and operational forestry. Component 3. Empowering Growth and Enhancing Wood Sector Performance builds firm capabilities and market access through two Sub-components: Sub-component 3.1 establishes and operationalizes the SmartWood Capacity Program housed at the University of Montenegro’s Institute for Interdisciplinary and Multidisciplinary Studies to conduct a needs assessment, deliver targeted training on modern production, digitalization, sustainability and quality management, support launch of a forestry bachelor’s program contingent on formal establishment, provide advisory and extension services for technology adoption and buyer readiness, and develop market intelligence and industry dialogues, with dedicated outreach and participation measures for women-owned and women-led small and medium enterprises (SMEs); Sub-component 3.2 advances certification, grading and standardization in partnership with the Institute for Standardization of Montenegro by providing technical assistance for product and process standards, piloting certifiable chains of custody aligned with Forest Stewardship Council (FSC) and Program for Endorsement of Forest Certification (PEFC) requirements, reducing fixed compliance costs for eligible SMEs including women-led firms, and training and accrediting local certification assessors. Component 4. Project Management finances a Project Implementation Unit within the Ministry of Agriculture, Forestry and Water Management for coordination, environmental and social risk management, monitoring and evaluation, stakeholder engagement and communications, while fiduciary functions are provided by the Ministry of Finance’s Technical Support Unit, including transparent financial reporting and use of government-wide procurement and financial management systems.