ENSURE project has delivered the first tangible results in 2020

It was commonly acknowledged that the enormously increased herd size and resulting overgrazing is the major problem lying behind not only declining livestock productivity and persisting rural poverty but also increasing environmental degradation and biodiversity loss in Mongolia.

Controlling animal numbers proved to be a hard task as traditionally herders see their livestock as a walking bank, a measure of social status and security. The government’s policy target to reduce the herd size from 43 m in 2008 to 35 m in 2015 under the Mongol Livestock national program has failed and Mongolia counted the highest ever livestock number in 2019 – 70.9 m.

In 2018, UNDP ENSURE project has set bold targets to protect habitat of unique local biodiversity by reducing the herd size on not less than 300 thousand ha of pastureland in 13 rural districts of 4 central and south-western provinces of Mongolia.

To address the long-standing and difficult problem the project has employed an innovative and holistic model to change the herders’ behavior through a package of awareness building and incentive mechanisms. The model used (i) a training package showing benefits and ways to improve livestock incomes through increased livestock productivity and commercialization of animal sales; (ii) pastureland use agreements (PUA) between herder groups and district governors to build herders’ formal commitment to reduce the herd size to optimum levels; (iii) livestock risk management fund (LRMF) to stimulate animal sales and finance herders activities on pastureland, risk and livestock management; (iv) assistance to organize animal sales in a cooperative manner to a processor.

To pilot the model, the project team visited all herder households in selected districts to educate herders on the project objectives, benefits and ways to access them. As a result, around 15% of herders in project districts have voluntarily joined the project with clear understanding of benefits as well as responsibilities including the herd size reduction and voluntary contributions to LRMF. 

Herder groups with project-selected herders as members have signed 5 to 15-year PUAs to reduce the herd size gradually around 5% annual rate to avoid damaging livestock incomes. 227 herder groups decided their memberships composed of 6 households on average and identified their pastureland use boundaries through consultations with neighboring herder households to avoid any involuntary resettlement problems. The total area under PUAs reached more than 600 thousand ha doubling the project target.

Depending on availability of project matching fund, LRMF was established in one district, the Ulziit of Arkhangai province. Herders voluntarily paid their contributions to the fund in the amount of MNT 500 per sheep unit and the project matching fund contributed MNT 300 per sheep unit. The fund totaling around MNT 60 m was used as designed to stimulate animal sales -around MNT 750 was paid to every sheep unit sold to the market with proper origin and quality certification and MNT 365 was used to finance herders proposals on pastureland, risk and livestock management. The project team also assisted linking to a meat processor willing to cooperate with the project and establishing herders’ organization with legal body status to sale animals to the processor through a formal agreement.

In December 2020, the annual livestock census in Mongolia has produced its results in the Ulziit district.    

2020 livestock census data, non-project herders

2020 livestock census data, project herders

As shown in above tables the livestock number has decreased by 21.4% among project herders against 5.6% among non-project herders. The project herders reside all over the district territory suggesting that project and non-project herders experienced the same weather and socio-economic conditions in 2020. So, the huge 3.8-fold difference of 15.8 percentage points can be safely attributed to the project. In total, the district herd size dropped by 8%.

Thus, the ENSURE-promoted model pilot has produced tangible results that have wide policy implications such as:

  1. The herders’ non-sustainable livestock number maximization behavior can be changed through a proper intervention with right incentive mechanisms
  2. The model provides a replicable solution to the long-lasting overgrazing problem that makes livestock productivity declining due to severe malnutrition and greater exposure to natural risks as availability of reserve pastures has much shrunk
  3. The herd size reduction marks a milestone in protecting the unique biodiversity in Mongolia as its habitat faced a major threat from expanding livestock herding
  4. Pastureland use agreements with herder groups provides more secure land tenure for herders, an important protection for especially poor herders against mining companies and rich herders who virtually ‘grab’ pastures taking advantage of the existing common-use regime
  5. Cooperation in livestock marketing provides a promising solution to address problems accumulated in the livestock value chain such as weak bargaining power and resulting low prices, lack of proper origin and quality certification, an absence of economic  incentives for greater commercialization and quality, the dominance of informal changers separating producers and processors     
  6. Herders’ voluntary contributions to LRMF in expectation to benefit back have shown their willingness to pay grazing fees or livestock taxes if revenues are spent on addressing the problems herders face in running their businesses
  7. The herd size reduction makes Mongolia’s targets to reduce greenhouse gas emissions achievable. The enormous herd size growth has made the livestock sector the second largest polluter after the energy sector, accounting for more than 40% of the national gas emissions

The project results are harmonized well with the recent policy changes providing much opportune lessons to learn from.

In November 2020, the parliament has approved the new law on taxing livestock. The law has authorized soum and district governments to establish and enforce taxes within the limits MNT 0-2000 per animal. The policy objective now is to guide local governments in right direction so that they could establish tax rates in line with common taxation principles and best respond to addressing the accumulated problems. In this regard, the project-tested model of raising funds of MNT 800 per sheep unit and spending back on pasture, risk and livestock management in direct herders’ participation provides a good example to learn from. Based on tested best practices, the project team has provided recommendations during the on-line consultations in late December 2020 with participation of relevant representatives from the Ministry of Food, Agriculture and Light Industry (MOFALI) and the Ministry of Finance (MOF). The recommendations were accepted by the MOF unit in charge of updating the local development fund rules that will regulate the revenues and spending of newly introduced livestock head taxes.    

On 6 January 2021, the cabinet meeting has approved MOFALI’s updated rules for awarding champion herders. The updated rules shift more from quantity to quality focusing on indicators such as efforts to reconcile animal numbers with pasture carrying capacity and investments in animal productivity.