FAO FISHERIES TECHNICAL PAPER 316
Aquaculture project formulation
Senior Fishery Planning Officer
FAO Fishery Policy and Planning Division
Colin E. Nash
UNDP/FAO Aquaculture Development
and Coordination Programme
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying or otherwise, without the prior permission of the copyright owner. Applications for such permission, with a statement of the purpose and extent of the reproduction, should be addressed to the Director, Publications Division, Food and Agriculture Organization of the United Nations, Via delle Terme di Caracalla, 00100 Rome, Italy.
FOOD AND AGRICULTURE ORGANIZATION OF THE UNITED NATIONS Rome, 1990
This document was prepared as part of a series of Technical Papers dealing with planning concepts and methodologies in the fisheries sector. Intended mainly as didactic materials for use in training courses, it provides an introduction to procedures and problems involved in the formulation of projects within the context of the special characteristics of the aquaculture sub-sector.
Please note the present address of Dr C.E. Nash is: P.O. Box 4606, Rolling Bay, WA. 98061, USA.
FAO Fisheries Department
FAO Regional Officers
Directors of Fisheries
|Insull, D.; Nash, C.E.|
Aquaculture project formulation.
FAO Fisheries Technical Paper. No. 316. Rome, FAO. 1990. 129p.
|This document is intended primarily as didactic material for use in training courses in aquaculture project formulation. It can also be read as a text in its own right by government administrators and planners, particularly in developing countries, and by commercial investors in aquaculture.|
|The first part of the document contains a broad introduction to project formulation, describing the integration of aquaculture projects within development plans, the organization and management of project formulation projects, and the stages of the project cycle. It is not only important for projects to be satisfactorily integrated into the economy of the sub-sector, but also that those responsible for project formulation should be aware of the practical problems which may arise in project implementation. Project formulation and implementation, therefore, are described briefly here as a single entity, consisting of twelve phases, and the more frequently occurring problems encountered in project implementation are described. Illustrations of three actual aquaculture projects are given to show the diversity which may be encountered by planners.|
|The second part of the document is concerned only with the six phases of project formulation, encompasing project identification, preparation, and appraisal. The sequence of activities carried out within each phase are described within 17 steps, each including further activities or tasks. Drawing on the characteristics of these illustrative models particular attention is given to differences of approach between the public and private sectors.|
Aquaculture projects are similar in many respects to agricultural projects. They require similar formulation, the same standards of design and analysis, and experienced and trained personnel to carry out the formulation. As in agriculture, aquaculture projects are linked directly to specific sites, either on land or water, and are a form, directly or indirectly depending on the type of project, of rural development; they may similarly be adversely affected by pollution or by local economic or social changes which inhibit economic activity at their fixed location.
Nevertheless, aquaculture has many characteristics and criteria for development which are special to it. Moreover, those persons in developing countries who have responsibility for aquaculture development generally have a professional background in capture fisheries and an academic training in biology or another natural science; where officials have had training in aquaculture it has usually been in aspects of production rather than planning. They are thus unlikely to have contact with, let alone be familiar with, the procedures of aquaculture project formulation.
The purpose of this publication is to introduce those charged with aquaculture development to the underlying rationale of the project approach to overcoming development problems within the context of the aquaculture sub-sector. It provides step-by-step guidance to the process of project formulation, focussing on the relationships of the steps to each other, rather than explaining in detail the many techniques required in project formulation. For those wishing to study the subject more deeply, a list of publications for further reading will be found at the end of the text. A limited number of publications are cited here. Taken together, however, they describe most of the techniques used in aquaculture project formulation and appraisal.
A major purpose of this publication is to provide documentation for use in training courses dealing with capture fisheries and aquaculture project formulation and in courses concerned with aquaculture sub-sector planning and management. Its treatment of project formulation is therefore extended, in one direction to discuss the relationship between sector planning and projects, and in the other to describe briefly the function of project implementation and its relationship to project formulation. The latter is only a part of the project approach to development. If the project is not well integrated into the sectoral economy, a disappointing outcome is likely regardless of how competently the techniques of the formulation process have been applied. It is also essential that project planning takes the full account of practical realities of project implementation. The project formulation team, therefore, must be aware of the requirements of project implementation and potential areas of project weakness.
While a major concern of officials charged with aquaculture development will be with projects which are at least partially funded by official external assistance, the major part of investment in aquaculture is made by the private sector. Such investment is frequently dependent on previous government investment in infrastructure and almost certainly on institutional measures in support of the sub-sector. The linkage between private sector investment and government intervention and support means that officials should be aware of the key differences between public and private sector procedures in project formulation.
The publication is in two parts. In Part I, “An Introduction to Projects”, provides an overview of the project approach. Its first chapter describes some aspects of projects within the development process and the ways different types of organizations might undertake project formulation and implementation. Chapters 2 and 3 describe the project formulation process and project implementation. The final chapter of Part I illustrates through case studies different types of projects within the aquaculture sub-sector.
Part II is divided into chapters which deal with the three main stages of the project cycle, i.e., Identification, Preparation, and Appraisal. Within these stages six phases are defined, each phase containing one or more steps. In all, 17 steps are described in the form of a series of tasks typical of that part of project formulation. The differences between the procedures in the public and private sectors are described at each step. The practical application of each phase is illustrated by reference to three imaginary projects, one dealing with a “green field” private-sector project, one with a large brackishwater-development project funded through external assistance, and one with a regional project providing assistance in institution building, improved production and enhanced product quality.
The advantage of such a step-by-step structure is that it provides a comprehensive view of the formulation process coupled with an insight into the use of the process in the rational and systematic collection of information, its analysis and the types of judgement which are required of the formulation team. A possible weakness is that it may suggest a mechanical process where there is no need or opportunity for creativity. Equally, the step-by-step explanation of the formulation process may convey the impression that a rigid sequence must be adhered to, work on each step chronologically following the previous one. In practice, neither of these conditions exist in project formulation. It is hoped, therefore, that the text contains sufficient emphasis on the need for an open-minded, innovative approach, particularly in the identification of projects, and that adequate attention is adequately drawn to occasions where certain steps may well be undertaken concurrently.
The basis of this publication is the FAO “Guide for Training in the Formulation of Agricultural and Rural Investment Projects”, published in 1986, from which the methodological framework has been taken with some slight adaptation. The “Guide” has also been borrowed from closely where its treatment of a topic is particularly applicable to aquaculture project formulation. It is listed in the “Further Reading”, at the end of this document; it is especially useful in its incorporation within one publication of descriptions of most of the techniques used in project formulation.
The need for good resource allocation and scheduling are emphasized in two documents which, together, have been the source of the chapter which deals with project implementation. These are “Health Project Management: a manual of procedures for formulating and implementing health projects”, published in 1974 by the World Health Organization (WHO) which describes aspects of project implementation in different contexts, and a document published in 1979 by the US Agency for International Development (USAID), “Agricultural Project Implementation”. This publication combines well documented examples and imaginary project situations, and presents a choice of options, an analysis of approaches, and the consequences of decisions. The importance of good design and, in particular, proper scheduling is also emphasized by another publication of which extensive use has been made. This is “The Design of Agricultural Projects: lessons from experience”, produced by the FAO Investment Centre in 1989 as Technical Paper No. 6.
In describing some of the technical issues in aquaculture project design, much reliance has been placed on a document produced by the UNDP/FAO Aquaculture Development and Coordination Programme (ADCP), “Planning An Aquaculture Facility: Guidelines for bioprogramming and design”, published in 1988.
A document produced by the Economic Development Institute (EDI) of the World Bank in 1984, “Aspects of Project Appraisal”, was used as the basis of the chapter dealing with this subject.
Dr Michel Girin of France Aquaculture, the aquaculture development project arm of the Institut Français de Recherche pour l'Exploitation de la Mer (IFREMER), was responsible for preparing a working document which elaborated the structure adapted here, and also much of the textual materials, including a number of the project illustrations.
The authors also wish to thank those FAO staff members who have read and commented on drafts for parts of the publication.
Hyperlinks to non-FAO Internet sites do not imply any official endorsement of or responsibility for the opinions, ideas, data or products presented at these locations, or guarantee the validity of the information provided. The sole purpose of links to non-FAO sites is to indicate further information available on related topics.
|PART I - AN INTRODUCTION TO PROJECTS|
|1.||PROJECTS WITHIN THE DEVELOPMENT PROCESS|
|The Relationship Between Projects and Development Plans|
|Organization for Project Formulation and Management|
|Stages of the Project Cycle|
|2.||AN OVERVIEW OF PROJECT FORMULATION|
|The Project Idea|
|The Six Phases of Project Formulation|
|3.||AN OVERVIEW OF PROJECT IMPLEMENTATION|
|Potential Problem Areas|
|4.||ILLUSTRATIONS OF THE DIFFERENCES IN THE FORMULATION OF AQUACULTURE PROJECTS|
|A Shrimp Farming Pilot Project in Senegal|
|A Shrimp Culture Project in Bangladesh|
|The ASEAN Aquaculture Development and Coordinating Project|
|PART II - PROJECT IDENTIFICATION, PREPARATION, AND APPRAISAL|
|1.||AQUACULTURE PROJECTS COMPARED WITH THOSE FOR AGRICULTURE|
|PHASE I:||Preparation for Project Formulation|
|Step 1 -||Project Inception|
|Step 2 -||Preparation of the Formulation Workplan|
|Illustrations of Phase I (Steps 1–2)|
|PHASE II:||Reconnaissance and Preliminary Project Design|
|Step 3 -||Overall Analysis and Diagnosis of the Project Situation|
|Step 4 -||Analysis of the Project Having Regard to the People Involved|
|Step 5 -||Assessment of the Future “Without the Project”|
|Step 6 -||Outline Specification of a Possible Project|
|Illustrations of Phase II (Steps 3–6)|
|PHASE III:||Project Design|
|Step 7 -||etailed Technical and Socio-economic Investigations|
|Step 8 -||Definition of Project Objectives, Targets, and Design Criteria|
|Step 9 -||Step 9 Design of Individual Project Components|
|Step 10 -||Project Organization and Management|
|Step 11 -||Project Cost and Revenues Estimation, and First Financing Proposals|
|Illustrations of Phase III (Steps 7–11)|
|PHASE IV:||Analysis of Expected Results|
|steps 12 -||Financial Analysis|
|steps 13 -||Economic Analysis|
|steps 14 -||Social Analysis|
|step 15 -||Environmental Impact,|
|Illustrations of Phase IV: (Steps 12–15)|
|PHASE V:||Project Documentation and Submission|
|Step 16 -||Preparation and Submission of the Project Report|
|Illustrations of Phase V (Step 16)|
|PHASE VI:||Project Negotiation|
|Step 17 - Project Negotiation|
|Illustrations of Phase VI (Step 17)|
|APPENDIX||A - Task Analysis|
|B - Project Profitability Criteria|
|Table 1||-||A logical framework at project inception stage, of a proosed project for a municipality, fish farm in China|
|Table 2||-||Project decision matrix|
|Table 3||-||Phased investment costs of a prawn breeding sub-project in China|
|Table 4||-||Investment and operating costs of a project in China for new shrimp ponds|
|Table 5||-||Financing requirements of a new fish-pond sub-project in China|
|Table 6||-||Net incremental income per l-ha modified pond with pig (contract household) in China|
|Table 7||-||Financial analysis of a project in China for new shrimp ponds|
|Table 8||-||Economic analysis of a project in China for new shrimp ponds|
|Figure 1||-||Schematic diagram of the project cycle|
|Figure 2||-||The phases of project formulation and project stages|
|Figure 3||-||Phases, steps and outputs of the project formulation|
|Figure 4||-||Phase I. Preparation for project formulation|
|Figure 5||-||Phase II. Reconnaissance and preliminary project design|
|Figure 6||-||Flow diagram of marine shrimp farming and marketing system|
|Figure 7||-||Phase III. Project design|
|Figure 8||-||Project management organogram for a project to enhance inland fisheries|
|Figure 9||-||Phase IV. Analysis of expected results|
|Figure 10||-||Phase V. Project documentation and submission|
|Figure 11||-||Phase VI. Project negotiation|