An incomplete understanding during project design of existing land rights, land use behaviors and land quality in the specific program areas can result in implementation delays, as well as changes in focus and outcomes. Although a detailed picture of land is often unavailable without in-depth field work, key assumptions should be verified during compact due diligence. PURP was prefaced on the assumption that 1) land was overgrazed due to common use pastureland and lack of private land use rights; and 2) herders had customary grazing areas around their winter shelters that did not overlap with other grazing rights, which could be leased to individual herder groups to spur investment. In reality, land was largely overgrazed in the peri-urban areas around the three main cities; however, it was not as overgrazed in one of the two peri-urban Phase 2 areas (Choibalsan). Unlike the other four peri-urban areas, Choibalsan households had relatively high levels of perception of tenure security. Rangeland management behaviors did not change there, which could have been since households there were not as driven by concerns of overgrazing.
In Phase 1 peri-urban areas, which surrounded Mongolia’s three main cities, there was also a misunderstanding of the amount of land available for leasing, which affected the ability of qualified herder applicants to participate in the Peri-Urban Rangeland Project (PURP). The aim was to supply 300 leases via a lottery from those herder groups whose applications were shortlisted by local-government selection committees. However, only 284 herder group parcels out of the 467 shortlisted herder groups qualified following a social assessment around resettlement concerns, which also caused significant project delays. Before granting a lease, many parcels had to be resized to avoid impeding on neighbors’ grazing areas or falling into buffer zones around water areas. In the end, some herder groups did not have sufficient land area to participate in PURP. A better picture of existing land availability and land degradation would have lessened this issue, but it would have required more time and money during due diligence. Phase 2, for example, revised its herder selection process to avoid facing similar issues. At the time, MCC was interested in quickly getting Compacts signed. Now, MCC engages in more detailed due diligence, but it does take much longer to design the Compact. There are tradeoffs and MCC should consider its risk tolerance in each case.