7200AA19R00005.pdf

TABLE OF CONTENTS

SECTION B - SUPPLIES OR SERVICES AND PRICE/COSTS

B.1. SERVICES

B.2. CONTRACT TYPE AND CONTRACT SERVICES (FAR 52.216-1)

B.3. CEILING PRICES

B.4. LEVEL OF EFFORT AND PRICE SCHEDULE

B.5. BUDGETS

B.6. OTHER DIRECT COSTS

B.7. GRANTS UNDER CONTRACT (GUC)

B.8. TRAVEL, PER DIEM & TRANSPORTATION

B.9. AIDAR 752.7028 DIFFERENTIALS AND ALLOWANCES (JUL 1996)

B.10. INDIRECT COSTS

SECTION C - DESCRIPTION/SPECIFICATIONS/STATEMENT OF WORK

C.1. OBJECTIVES

C.2. BACKGROUND

C.2.1 Development Challenge C.2.2 Local Capacity Building and Greater Intra-Regional Linkages through Grants Under Contract (GUC) . 18 C.2.3 Linkages with USAID Economic Growth Strategies C.2.4 Past & Present Regional Economic Growth Projects C.2.5 Coordination with Bilateral Activities and Other Donors

C.3. SCOPE OF WORK

C.3.1 Core Component C.3.2 Buy-In Component: Mission and Bureau/Operating Unit Buy-Ins C.3.3 Reesults Framework C.3.4 Problem Statement, Goal and Desired Results C.3.5 Cross Cutting Theme: Corruption, Malign Economic Influences, And Violent Extremism Countered

Through Greater Economic Integration C.3.6 Gener Integration

C.4. ENVIRONMENT

C.5. MANAGEMENT PLAN

C.6. ACTIVITY MONITORING, EVALUATION AND LEARNING PLAN (AMELP)

C.7. DELIVERABLES

C.8. KEY PERSONNEL

C.9. QUALIFICATIONS FOR OTHER LONG TERM AND SHORT TERM PERSONNEL

SECTION D - PACKAGING AND MARKING

D.1. AIDAR 752.7009 MARKING (JAN 1993)

D.2. BRANDING STRATEGY

SECTION E - INSPECTION AND ACCEPTANCE

E.1. NOTICE LISTING CONTRACT CLAUSES INCORPORATED BY REFERENCE

E.2. INSPECTION AND ACCEPTANCE

SECTION F - DELIVERIES OR PERFORMANCE

F.1. NOTICE LISTING CONTRACT CLAUSES INCORPORATED BY REFERENCE

F.2. PERIOD OF PERFORMANCE

F.3. PERFORMANCE STANDARDS

F.4. PLACE OF PERFORMANCE

F.5. MISSION/BUREAU BUY-IN PROCEDURES

F.6. REPORTS AND DELIVERABLES OR OUTPUTS

F.7. REPORTS

F.8. AIDAR 752.7005 SUBMISSION REQUIREMENTS FOR DEVELOPMENT EXPERIENCE

DOCUMENTS (SEPTEMBER 2013) (Class Deviation OAA-DEV-13-01c)

F.9. OBSERVANCE OF LEGAL HOLIDAYS/FEDERAL NON-WORK DAYS

F.10. AUTHORIZED WORK DAY/WEEK

F.11. GRANTS UNDER CONTRACT REQUIREMENTS

SECTION G - CONTRACT ADMINISTRATION DATA

G.1. AIDAR 752.7003 DOCUMENTATION FOR PAYMENT (NOV 1998)

G.2. CONTRACTING OFFICER’S AUTHORITY

G.3. CONTRACTING OFFICER’S REPRESENTIVE (COR)

G.4. TECHNICAL DIRECTION/RELATIONSHIP WITH USAID

G.5. ACCEPTANCE AND APPROVAL

G.6. CONTRACTOR'S PAYMENT ADDRESS

G.7. PAYING OFFICE

G.8. ACCOUNTING AND APPROPRIATION DATA

G.9. SUMMARY ACCOUNTING AND APPROPRIATION DATA

G.10. KEY PERSONNEL

G.11. POST AWARD EVALUATION OF CONTRACTOR PERFORMANCE

SECTION H - SPECIAL CONTRACT REQUIREMENTS

H.1. NOTICE LISTING CONTRACT CLAUSES INCORPORATED BY REFERENCE

H.2. AIDAR 752.225-70 SOURCE AND NATIONALITY REQUIREMENTS (FEB 2012)

H.3. LANGUAGE REQUIREMENTS

H.4. AUTHORIZED GEOGRAPHIC CODE

H.5. CONTRACTOR’S STAFF SUPPORT, AND ADMINISTRATIVE AND LOGISTICS

ARRANGEMENTS

H.6. COMPLIANCE WITH U.S. LAWS AND REGULATIONS

H.7. ADS 302.3.5.5 REPORTING OF FOREIGN TAXES (JULY 2007)

H.8. NONDISCRIMINATION (JUN 2012)

H.9. CONFERENCE PLANNING AND REQUIRED APPROVALS (AUGUST 2013)

H.10. USAID IMPLEMENTING PARTNER NOTICES (IPN) PORTAL FOR ACQUISITION

(JULY 2014)

H.11. ADS 302.3.5.21 SUBMISSION OF DATASETS TO THE DEVELOPMENT DATA LIBRARY

(DDL) (OCTOBER 2014)

H.12. ADS 302.3.5.8 DEFENSE BASE ACT (DBA) INSURANCE

H.13. LOGISTIC SUPPORT

H.14. EXECUTIVE ORDER ON TERRORISM FINANCING (FEB 2002)

H.15. FOREIGN GOVERNMENT DELEGATIONS TO INTERNATIONAL CONFERENCES

(JAN 2002)

H.16. PROHIBITION OF ASSISTANCE TO DRUG TRAFFICKERS

H.17. ENVIRONMENTAL COMPLIANCE

H.18. GOVERNMENT FURNISHED FACILITIES OR PROPERTY

H.19. COMPLIANCE WITH SECTION 508 OF THE REHABILITATION ACT OF 1973, AS

AMENDED

H.20. CLOUD COMPUTING (MAY 2016)

H.21. AIDAR 752.7031 LEAVE AND HOLIDAYS (OCTOBER 1989)

H.22. CONSENT TO SUBCONTRACT

H.23. AIDAR 752.7013 CONTRACTOR-MISSION RELATIONSHIPS (OCT 1989)

H.24. ADS 302.3.5.19 USAID-FINANCED THIRD-PARTY WEB SITES (NOVEMBER 2017)

H.25. 302.3.5.10 ORGANIZATIONAL CONFLICTS OF INTEREST: PRECLUSION FROM

IMPLEMENTATION CONTRACT (SEPTEMBER 2018)

H.26. LIMITATION ON ACQUISITION OF INFORMATION TECHNOLOGY (DEVIATION NOs.

M/OAA-DEV-FAR-18-2c and M/OAA-DEV-AIDAR-18-2c) (APRIL 2018)

SECTION I - CONTRACT CLAUSES

I.1. NOTICE LISTING CONTRACT CLAUSES INCORPORATED BY REFERENCE

I.2 52.203-99 PROHIBITION ON CONTRACTING WITH ENTITIES THAT REQUIRE

CERTAIN INTERNAL CONFIDENTIALITY AGREEMENTS (DEVIATION 2015-05)

(APR 2015)

I.2. 52.217-9 OPTION TO EXTEND THE TERM OF THE CONTRACT (MAR 2000)

I.3. 52.222-36 EQUAL OPPORTUNITY FOR WORKERS WITH DISABILITIES (JUL 2014)

I.4. 52.252-2 CLAUSES INCORPORATED BY REFERENCE (FEB 1998)

I.5. 52.204-21 BASIC SAFEGUARDING OF COVERED CONTRACTOR INFORMATION

SYSTEMS (JUN 2016)

I.6. 52.215-19 NOTIFICATION OF OWNERSHIP CHANGES (OCT 1997)

I.7. 752.225-9 BUY AMERICAN ACT - TRADE AGREEMENTS ACT - BALANCE OF PAYMENTS

PROGRAM

I.8. 752.245-70 GOVERNMENT PROPERTY - USAID REPORTING REQUIREMENTS.

(OCT 2017)

I.9. 752.7032 INTERNATIONAL TRAVEL APPROVAL AND NOTIFICATION REQUIREMENTS

(APR 2014)

SECTION J - LIST OF ATTACHMENTS

ATTACHMENT 1 B.4.(b) CORE LABOR CATEGORIES AND LOADED DAILY RATES ATTACHMENT 2 B.4.(c) BUY-IN LABOR CATEGORIES AND LOADED DAILY RATES

ATTACHMENT 3 PAST PERFORMANCE MATRIX

ATTACHMENT 4 CONTRACTOR BIOGRAPHICAL DATA SHEET

ATTACHMENT 5 GENDER ANALYSIS FOR EDGE

SECTION K - REPRESENTATIONS, CERTIFICATIONS AND OTHER STATEMENTS

OF THE OFFEROR

K.1 NOTICE LISTING OF CONTRACT CLAUSES INCORPORATED BY REFERENCE

K.2 52.204-8 ANNUAL REPRESENTATIONS AND CERTIFICATIONS. (OCT 2018)

K.3 52.204-20 PREDECESSOR OF OFFEROR. (JUL 2016)

K.4 52.209-5 CERTIFICATION REGARDING RESPONSIBILITY MATTERS. (OCT 2015)

K.5 52.209-7 INFORMATION REGARDING RESPONSIBILITY MATTERS. (OCT 2018)

K.6 52.209-11 REPRESENTATION BY CORPORATIONS REGARDING DELINQUENT TAX

LIABILITY OR A FELONY CONVICTION UNDER ANY FEDERAL LAW. (FEB 2016)

K.7 52.209-12 CERTIFICATION REGARDING TAX MATTERS. (FEB 2016)

K.8 52.215-6 PLACE OF PERFORMANCE. (OCT 1997)

K.9 52.219-1 SMALL BUSINESS PROGRAM REPRESENTATIONS. (OCT 2014)

K.10 FAR 52.222-25 AFFIRMATIVE ACTION COMPLIANCE. (APR 1984)

K.11 FAR 52.225-20 PROHIBITION ON CONDUCTING RESTRICTED BUSINESS OPERATIONS

IN SUDAN--CERTIFICATION. (AUG 2009)

SECTION L – INSTRUCTIONS, CONDITIONS, AND NOTICES TO OFFERORS

L.1. FAR 52.252-1 SOLICITATION PROVISIONS INCORPORATED BY REFERENCE (FEB 1998)115

L.2. FAR 52.216-1 TYPE OF CONTRACT(APR 1984)

L.3. 52.216-29 - TIME-AND-MATERIALS/LABOR-HOUR PROPOSAL REQUIREMENTS—NON-

COMMERCIAL ITEM ACQUISITION WITH ADEQUATE PRICE COMPETITION

(FEB 2007)

L.4. PREPARATION AND DELIVERY INSTRUCTIONS

L.5. INSTRUCTIONS REGARDING THE TECHNICAL PROPOSAL

L.5.1 Technical Approach L.5.2 Activity Monitoring, Evaluation & Learning Plan (AMELP) L.5.3 Key Personnel and Management Plan

L.5.4 Institutional Capability L.5.5 Annexes

L.6. INSTRUCTIONS FOR THE PREPARATION OF THE COST PROPOSAL

L.7. FAR 52.233-2 SERVICE OF PROTEST (SEP 2006)

L.8. DELIVERY INSTRUCTIONS

SECTION M - EVALUATION FACTORS FOR AWARD

M.1. GENERAL INFORMATION

M.2. TECHNICAL EVALUATION CRITERIA

M.3. COST PROPOSAL EVALUATION CRITERIA

M.4. DETERMINATION OF COMPETITIVE RANGE AND CONTRACT AWARD

Solicitation No.: 7200AA19R00005

SECTION B - SUPPLIES OR SERVICES AND PRICE/COSTS

B.1. SERVICES

The contractor will provide technical services to carry out regional economic development activities in twelve USAID E&E countries which align to the following three Intermediate

Results and which are described in detail in the Statement of Work in Section C.

● IR 1: Improved Business Enabling Environment and Reduced Barriers to Trade. This

IR also includes an explicit anti-corruption element.

● IR 2: Improved Financial Sector Stability with Increased Access to Finance.

● IR 3: Improved Competitiveness through Value Chains and Trade Promotion.

B.2. CONTRACT TYPE AND CONTRACT SERVICES (FAR 52.216-1)

This is a Time and Materials type contract with reimbursable expenses. It consists of one three-year base period (36 months) and two (2) , one-year option years (12 months each) for a total of services not to exceed five years (60 months). For the consideration set forth hereunder, the

Contractor shall provide the services and deliverables described in Sections C and F.

B.3. CEILING PRICES

(a) The Ceiling Price for the performance of the Core Component work required hereunder for the E&E Bureau Core Base Period is _TBD____.

(b) The Ceiling Price for the performance of the Buy-In Component work required hereunder for the E&E Bureau Buy-In Base Period is _TBD____.

(c) The Ceiling Price for the performance of the Core Component work required hereunder for the E&E Bureau Core Option Year One is _TBD____.

(d) The Ceiling Price for the performance of the Buy-In Component work required hereunder for the E&E Bureau Buy-In Option Year One is _TBD____.

(e) The Ceiling Price for the performance of the Core Component work required hereunder for the E&E Bureau Core Option Year Two is _TBD____.

(f) The Ceiling Price for the performance of the Buy-In Component work required hereunder for the E&E Bureau Buy-In Option Year Two is _TBD____.

(g) Within the ceiling price specified in paragraph (a) above, the amount currently obligated and available for reimbursement of allowable costs incurred by the Contractor for performance hereunder is TBD. The Contractor shall not exceed the aforesaid obligated amount.

(h) Funds obligated hereunder are anticipated to be sufficient through TBD.

B.4. LEVEL OF EFFORT AND PRICE SCHEDULE

B.4. (a) GEOGRAPHIC CODES PER LABOR CATEGORIES

For the purpose of this contract, three geographic categories of labor are required:

# US Direct Labor – Citizens or permanent residents of the United States of America.

# Cooperating Country Nationals (CCN) – Citizens or permanent residents of any one of the twelve target countries.

# Third Country Nationals (TCN) – Citizens or permanent residents of any other country

(except the twelve target countries) of the world whose nationals are eligible to work on USAID projects. However, to transfer knowledge and leverage similar experience, there is a preference for individuals from post-presence USAID countries in the E&E region.

B.4.(b) CORE LABOR CATEGORIES AND LOADED DAILY RATES

See Attachment 1 in Section J

B.4.(c) BUY-IN LABOR CATEGORIES AND LOADED DAILY RATES

See Attachment 2 in Section J

B.4.(d) LEVEL OF EFFORT

The total LOE includes all contractor, subcontractor and consultant labor. A work day is no more than eight hours during any 24-hour period normally 12 AM to 12 PM). The minimum total number of Direct Burdened 8-hour work days for the Base Period and each Option

Period are as follows:

E&E CORE BUY-INS

3YEAR BASE PERIOD (Date TBD at time of award) 5528 3332

OPTION YEAR 1 (Date TBD at time of award) 1856 3428

OPTION YEAR 2 (Date TBD at time of award) 1696 1978

Subject to the prior written approval of the COR, the contractor may be authorized to adjust the number of days actually employed in the performance of the work by each functional position specified for E&E CORE LOE and for BUY-IN LOE in the contract. Adjustments between E&E CORE LOE and BUY-IN LOE are not authorized.

It is the contractor’s responsibility to ensure that the COR’s adjustment to the work days ordered for each functional position do not result in costs which exceed the ceiling price of the contract. Under no circumstances shall the COR’s adjustment authorize the contractor to be paid any sum in excess of the ceiling price of the contract.

The contractor must specify which personnel and labor categories are to be adjusted, and any such adjustments are subject to the clause of this contract entitled “Payments Under Time-and-Materials and Labor-Hour Contracts” [FAR 52.232-07], whereby only the Contracting

Officer may authorize the contractor to exceed the separate ceiling prices set forth in sections

B.3.(a) and B.3.(b) of the contract.

B.5. BUDGETS

B.5.(a) 3-YEAR BASE PERIOD (Date TBD at time of award)

E&E CORE COMPONENT

Fully Loaded Labor Costs – 5528 Days $______________

Travel, Per Diem & Transportation $ 444,000 (plug)

Local Support (Office Rent/Equipment)/ODCs $ 85,000 (plug)

Local Subcontractors $ 300,000 (plug)

Local Events & Activities $ 225,000 (plug)

Expat Allowances $ 190,590 (plug)

Grants Under Contract (GUC) $1,250,000 (plug)

Additional ODCs not specified* $______________

Allowable Indirect Costs on ODCs $______________

BUY-IN COMPONENT

Fully Loaded Labor Costs – 8834 Days $______________

Travel, Per Diem & Transportation $ 763,200 (plug)

Local Support (Office Rent/Equipment)/ODCs $ 231,000 (plug)

Local Subcontractors $ 550,000 (plug)

Local Events & Activities $ 600,000 (plug)

Grants Under Contract (GUC) $1,250,000 (plug)

B.5.(b) OPTION YEAR 1 PERIOD (Date TBD at time of award)

Fully Loaded Labor Costs – 1856 Days $______________

Travel, Per Diem & Transportation $ 177,600 (plug)

Local Support (Office Rent/Equipment)/ODCs $ 30,000 (plug)

Local Subcontractors $ 100,000 (plug)

Local Events & Activities $ 75,000 (plug)

Expat Allowances $ 63,130 (plug)

Grants Under Contract (GUC) $ 500,000 (plug)

Fully Loaded Labor Costs – 3428 Days $______________

Travel, Per Diem & Transportation $ 254,400 (plug)

Local Support (Office Rent/Equipment)/ODCs $ 77,000 (plug)

Local Subcontractors $ 200,000 (plug)

Local Events & Activities $ 200,000 (plug)

Grants Under Contract (GUC) $ 500,000 (plug)

B.5.(c) OPTION YEAR 2 PERIOD (Date TBD at time of award)

Fully Loaded Labor Costs – 1696 Days $______________

Travel, Per Diem & Transportation $ 88,800 (plug)

Local Support (Office Rent/Equipment)/ODCs $ 30,000 (plug)

Local Subcontractors $ 100,000 (plug)

Local Events & Activities $ 75,000 (plug)

Expat Allowances $ 61,030 (plug)

Grants Under Contract (GUC) $ 250,000 (plug)

Fully Loaded Labor Costs – 1978 Days $______________

Travel, Per Diem & Transportation $ 248,400 (plug)

Local Support (Office Rent/Equipment)/ODCs $ 77,000 (plug)

Local Subcontractors $ 150,000 (plug)

Local Events & Activities $ 200,000 (plug)

Grants Under Contract (GUC) $ 250,000 (plug)

B.5.(d) TOTAL CEILING PRICE SCHEDULE FOR BASE AND OPTION PERIODS

E&E CORE BUY-INS

3YEAR BASE PERIOD (Date TBD at time of award) $ $_______

OPTION YEAR 1 (Date TBD at time of award) $_______ $_______

OPTION YEAR 2 (Date TBD at time of award) $_______ $_______

B.6. OTHER DIRECT COSTS

a. Other direct costs necessary for the performance of the work under the contract, such as

DBA, physical examinations, immunizations, Medevac insurance expenses, may be authorized in the contract. The contracting officer determines which other direct costs are allowable, allocable, and fair and reasonable in accordance with the applicable federal cost principles (i.e. FAR 31.2 and AIDAR 731.2 for commercial (for profit) organizations or FAR 31.3 and AIDAR 731.3 for educational institutions, or FAR 31.7 and AIDAR

731.7 for other non-profit organizations).

b. For those other direct costs that the contracting officer authorizes, contractors are allowed to recover applicable indirect costs on these costs, if doing so is part of the contractor’s usual accounting procedures, consistent with the applicable cost principles and are included in the contractor’s Negotiated Indirect Cost Rate Agreement (NICRA).

c. No profit or fee will be applied to other direct costs, in accordance with FAR 16.601.

B.7. GRANTS UNDER CONTRACT (GUC)

a. Adjustments between the U.S. dollars earmarked for Grants Under Contract and all other budget line items are not authorized. The total amount for GUCs – $4,000,000.00 – must only be used for grants.

b. No profit or fee will be applied to the $4,000,000 for the Core and Buy-in Grants under

Contract.

c. No indirect costs will be applied to the $4,000,000 for the Core and Buy-in Grants under

Contract, unless doing so is part of the contractor’s usual accounting procedures, consistent with the applicable cost principles and are included in the contractor’s

Negotiated Indirect Cost Rate Agreement (NICRA).

B.8. TRAVEL, PER DIEM & TRANSPORTATION

a. For purposes of staffing the project, relocation costs are reimbursable for the Chief of

Party and other long term staff from their country of residence to the country location of the project.

b. Travel costs for long term field based contractor personnel to travel to Washington, D.C.

for consultations with USAID or for consultations with the contractor’s US-based office are allowed subject to approval in advance by the COR.

c. Travel costs for long term contractor personnel from their field based home to the field based project office are not allowed. These are considered normal commuting costs and are not reimbursable. Relocation costs for staffing purposes are not allowed for contractor personnel to staff the US-based project office. Thus, unallowable travel costs include relocation expenses within the U.S. for purposes of staffing the project and daily commuting costs.

d. Travel for technical personnel on approved STTA is reimbursable.

e. However, please note that the project is intended to maximize cost effectiveness and innovative methods of lowering project management costs are encouraged.

f. All travel shall be in compliance with the provisions of the Federal Travel Regulations

(FTR) 301.10.121, Federal Acquisition Regulation Subpart 31.205-46 and USAID Travel

Policy. The Federal Travel Regulations and current per diem rates can be accessed at:

www.gsa.gov/ftr.

g. No profit or fee will be applied to travel, in accordance with FAR 16.601.

B.9. AIDAR 752.7028 DIFFERENTIALS AND ALLOWANCES (JUL 1996)

a. This clause does not apply to TCN or CCN employees and CCN employees are not eligible for differentials and allowances, unless specifically authorized by the cognizant

Assistant Administrator or Mission Director. A copy of such authorization shall be retained and made available as part of the contractor's records which are required to be preserved and made available by the “Examination of Records by the Comptroller

General” and “Audit” clauses of this contract.

b. Danger pay allowance.

(1) The contractor will be reimbursed for payments made to its employees for danger pay not to exceed that paid USAID employees in the cooperating country, in accordance with the Standardized Regulations (Government Civilians, Foreign Areas), Chapter 650, as from time to time amended. The contractor’s employees may receive Dander Pay as a percentage of their unloaded basic compensation. Neither overtime or other premium pay nor other allowances are factored into the calculation of Danger Pay. Danger Pay is paid only for hours for which basic compensation is paid (DSR 655).

(2) Danger pay is an allowance that provides additional compensation above basic compensation to an employee in a foreign area where civil insurrection, civil war, terrorism or wartime conditions threaten physical harm or imminent danger to the health or well-being of the employee. The danger pay allowance is in lieu of that part of the post differential which is attributable to political violence. Consequently, the post differential may be reduced while danger pay is in effect to avoid dual crediting for political violence.

http://www.gsa.gov/ftr

B.10. INDIRECT COSTS

Pending establishment of revised provisional or final indirect cost rates, allowable indirect costs on ODCs shall be reimbursed on the basis of the following negotiated provisional or predetermined rates and the appropriate bases:

[To be completed at time of award.]

[END OF SECTION B]

[THIS SPACE IS LEFT BLANK INTENTIONALLY]

SECTION C - DESCRIPTION/SPECIFICATIONS/STATEMENT OF WORK

ECONOMIC DEVELOPMENT, GOVERNANCE AND ENTERPRISE GROWTH

(EDGE)

C.1. OBJECTIVES

The Development Objective (DO) of EDGE is: Inclusive, sustainable economic growth supporting intra-regional and Euro-Atlantic integration. In the Balkans, this presents itself as support for convergence with EU accession criteria. In Ukraine, Moldova, and Georgia this means support in approximating to the EU Association Agreement, and in Armenia, Azerbaijan, and Belarus support to the EU Eastern Partnership.

The current Regional Economic Growth Project (REG) is scheduled to end in July 2019. REG is a five-year, $13.9 million project to support inclusive and sustainable economic growth in the

Europe and Eurasia (E&E) region through greater integration and harmonization of regional markets. The project’s activities, involving all 12 countries, focus on improving competitiveness and increasing financial sector stability by promoting economic integration within the region and building economic linkages to the EU and other markets, including through digital connectivity.

Its contract allows for core regional activities in all 12 countries, as well as serving as a buy-in mechanism for E&E Missions or the Bureau to implement activities in a range of programmatic areas.

The purpose of this scope of work is to establish a mechanism to serve a similar role. EDGE will implement regional economic development activities for the same 12 country region through its

“Core Component” as well as serve as a flexible mechanism which entities can utilize using their own funds through the “Buy-In Component.”

The EDGE activity will seek out non-traditional partners in its implementation, with a focus on building the capacity and sustainability of local organizations.

Based on feedback from USAID Missions in the region and the findings of a recent evaluation of

REG, we anticipate that EDGE core activities in the region will focus on interventions deemed to have the greatest applicability to regionalization, such as working with SMEs Small and

Medium-sized Enterprises (SMEs) in key regional value chains, shared barriers to SME growth and development, and regional trade integration. It is also anticipated that participating SMEs, institutions and organizations will primarily be from the Western Balkan countries where there is greater commonality of issues that can be addressed on a regional basis. However, the evaluation also found that Missions are very supportive of REG’s flexible buy-in mechanism, The European Union has concluded or is negotiating free trade agreements with many of the E&E countries that are not likely to become candidates for EU membership. Consequently, for non-candidate countries, compliance with the trade agreement criteria will be the primary implementing objective. The EU’s Eastern Partnership is its assistance initiative that applies to all countries of Eastern Europe and former Soviet Union.

USAID has a bilateral presence in Albania, Armenia, Azerbaijan, Belarus, Bosnia & Herzegovina, Georgia, Kosovo, Macedonia, Moldova, Serbia, Ukraine, and regional programs are currently supporting Montenegro. In the context of this document, “E&E countries” or “E&E region” refers to these 12 countries.

which had allowed for specific interventions in Ukraine and Azerbaijan on a rapid basis. Thus, the Scope of Work for EDGE will include a broad range of technical areas for maximum flexibility and access for Missions in addressing specific Economic Growth and Development needs through the Buy-In Component.

C.2. BACKGROUND

The EDGE activity will have three primary Intermediate Results (IRs) based on the Bureau’s

Economic Growth Development Objective (DO). EDGE will also seek to address current regional policy priorities through a cross-cutting theme of countering malign influences, extremism and corruption. This cross-cutting theme is to provide a lens through which the activities implemented should be considered; all things being equal an activity that can advance the cross-cutting themes should take priority over others. All activities are to align to the three IR areas defined below:

● IR 1: Improved Business Enabling Environment and Reduced Barriers to Trade

● IR 2: Improved Financial Sector Stability with Increased Access to Finance

● IR 3: Improved Competitiveness through Value Chains and Trade Promotion

The Core Component of the EDGE contract will implement regional activities in the E&E region through a strategic and holistic approach to promote inclusive growth and integration with EU and Western markets, including as appropriate through strengthened cybersecurity and enhanced digital connectivity. Of the three IR areas, Core activities will focus on trade facilitation and competitiveness/value chain strengthening. As noted above, the USAID E&E countries include the Western Balkan countries of Albania, Bosnia and Herzegovina, Kosovo, Macedonia, Montenegro and Serbia; the Caucasus countries of Georgia, Armenia and Azerbaijan; and the

Western Newly Independent States (NIS) countries of Ukraine, Moldova and Belarus (UMB).

Previous regional economic growth activities have had greater demand from the Balkans due to a number of factors, including declining bilateral economic growth funding in the region, the commonality of constraints to growth, and the potential gains of economies of scale through regional implementation.

The Buy-In Component of EDGE is a programming mechanism for the 12 USAID (Montenegro is non-presence) countries. Buy-ins can be from individual Missions or from Operating Units, including the E&E Bureau, as well as other donors. While facilitating convergence with EU

Accession criteria is a clear priority for those Western Balkan countries that are candidates or potential candidates, convergence is an objective in all countries by virtue of possible trade and other integration objectives.

The Core Component will be implemented in three targeted technical areas aligned to specific sub-IRs and all Core activities should have the participation of beneficiaries/partners from at least two but preferably three or more countries in the region. The Buy-In Component is

For example, REG currently implements a large Financial Sector buy-in from USAID/Ukraine, and EDGE needs to be flexible and broad enough so that future activities of that type could be allowable.

This IR also includes an explicit anti-corruption element.

envisioned as largely a series of country specific, stand-alone activities to meet a broader range of possible technical needs. The Buy-In mechanism is intended to provide greater flexibility to the Missions and Bureau in light of budget cuts and the increasing economic and political uncertainty in the region. As previously noted, REG has a buy-in mechanism but its ceiling is insufficient to meet current demand. Thus, the EDGE buy-in mechanism will have a substantially higher ceiling in order to accommodate multiple needs throughout the region;

however, there is no dedicated funding for this Component. The purposes and management of the Buy-In Component are further addressed in Section C.3.2.

The Core Component of EDGE will have a flexible staffing structure. The EDGE COP must be based in one of the five presence countries in the Western Balkans (Albania, Bosnia, Kosovo, Macedonia, or Serbia) given that most regional activities are expected to focus on this sub-region. However, other part-time representatives can be proposed for other locations in the

Balkans, and one (1) Sub-Regional Representative (SRR) for the Ukraine/Moldova/Belarus

(UMB) sub-region and one (1) SRR for Armenia/Georgia/Azerbaijan (the Caucasus) sub-region should be identified. The COP will work with activity representatives to facilitate the design and implementation of regional activities under the Core Component and maintain ongoing communication with the USAID Missions and relevant bilateral programs in those countries where Core activities will be implemented. The COP will serve as the point of contact for inquiries regarding Buy-Ins, but is unlikely to lead implementation of country-specific Buy-Ins as additional staff would be hired for those. This physical staff in close proximity to E&E

Missions will allow Missions to better utilize this regional activity. If additional support is needed, the Buy-In Component may hire additional staff through the resources provided by those activities. Buy-in activities may or may not have dedicated full time staff, depending on the scale of the buy-in. The implementer must have the technical ability and organizational structure in place to manage activities under both the Core and Buy-In Components, and to be able to identify and field short and long term technical personnel as required across the full range of possible activities.

Section C.3.1 below provides greater detail on the desired results under each sub-IR. Section

C.3.7 describes the management and operational aspects of implementing the Buy-In

Component. However, all activities in both Components must fall under the three IRs and Sub-

IR areas noted above which link to the EDGE DO of Inclusive, sustainable economic growth supporting intra-regional and Euro-Atlantic integration.

C.2.1 Development Challenge

REG has two major bilateral buy-ins (in addition to small-scale, discrete buy-in activities): one from Ukraine and another from Azerbaijan. The two actions provide useful insight into how future EDGE buy-ins might work. The

Ukraine buy-in is $2.2 million and focuses entirely on financial sector activities. Because of the relatively large size, the budget can accommodate an in-country project manager (who also carries out certain technical functions).

Azerbaijan, funded in two increments, totals $700,000 and is split between Agriculture and Regional trade. The agricultural portion is implemented in partnership with both a bilateral agricultural project (ASAP) and REG’s core agricultural activities, but with no in-country project staff. The Regional Trade activities are implemented by a specialized subcontractor, also without full-time, in-country staff, but with substantial oversight by the

USAID/Azerbaijan mission.

Many of the countries in the E&E region are still struggling to achieve the economic growth required to address critical issues such as unemployment and convergence to EU requirements.

GDP growth over the past 3 decades has varied across region. Georgia, Moldova and Ukraine remain below 1989 levels in real terms, and exports as a percentage of GDP tend to be well below the 50% mark which is seen as a threshold for small countries to achieve in reaching higher income levels.

While it is often difficult to capture how certain regulatory and legislative reforms or macroeconomic improvements truly benefit real people, the region has failed to achieve sufficient growth levels to have a major impact in reducing unemployment. Unemployment remains above 20% and is even higher for countries like Kosovo, Bosnia & Herzegovina, Macedonia and Montenegro. Youth unemployment is often significantly higher, 2016 percentages among youth in the Balkans range from 36% in Albania to 68% in Bosnia

Herzegovina . The high prevalence of unemployed youth is also seen as contributing to increased extremism in the region. Yet this chronic situation in the region appears to be a long term cyclical problem rather than structural in nature, meaning that growth levels have not been strong enough to create sufficient employment opportunities even before the global financial crisis.

While structural approaches have helped to improve workforce skills and competitiveness, these efforts alone have not significantly reduced unemployment; inclusive economic growth is required throughout the region to have a lasting impact. Though economic disparities between women and men are less severe than in other regions, gaps remain in labor force participation, employment, wage equality, and overall economic participation and opportunities, which vary by country and subregion.

In addition, several macroeconomic performance indicators tracked through the Bureau’s

Monitoring Country Progress (MCP) analysis show backsliding in key areas. Macroeconomic reforms stagnated in the E&E region, and the outlook for renewed progress is mixed. Moldova and Ukraine made the greatest improvements in the ease of doing business, but both face other obvious economic challenges. The recent trend for Ukraine’s economy has been varied, with steep drops in 2014-2015, followed by some recovery but long term stability and growth remain uncertain. The three Caucasus countries have improved projections regarding implementation of reforms through 2018 in-spite of slow progress since the global financial crisis of 2008.

The Balkans show some promise, with moderate macroeconomic reform gains and GDP growth, though not at the pace prior to the global financial crisis. However, we note that none of the

Balkan countries are on a trajectory to achieve USAID graduation thresholds in the foreseeable future based on the MCP metrics. EDGE will seek to implement activities that support EU integration, including convergence to EU accession criteria in the Balkans and leveraging the EU

Association Agreement or EU Eastern Partnership in other countries.

Additionally, the new activity will integrate a cross-cutting theme of addressing key foreign policy priorities in the Europe and Eurasia region. This includes countering corruption, malign economic influences, and violent extremism. Activities should enhance economic integration with the EU and the West to provide greater economic opportunity and adherence to rules based

Economic Analysis and Data Services (EADS) July, 2017 economic systems, while also building the capacity, including as appropriate cybersecurity capacity, of local organizations, regulators, and the private sector to develop and advocate for policies that will advance growth and improve transparency. Improving policy formulation and implementation, supporting greater trade integration with the EU, and enabling SMEs to compete in European markets can contribute to greater economic engagement, thereby reducing opportunities for disinformation to take root. Improvements to the business enabling environment and trade facilitation (particularly movement of goods across borders) can help alleviate the opportunities for corrupt practices while contributing to economic growth. Greater accountability and reliability of institutions and organizations involved in the policy making process can also make citizens less susceptible to extremist messages.

C.2.2 Local Capacity Building and Greater Intra-Regional Linkages through Grants Under

Contract (GUC)

A primary objective of EDGE is to foster strategic partnerships with regional and local organizations to implement aspects of the program. A Grants Under Contract (GUC) mechanism will promote the capacity and sustainability of local associations and organizations through providing technical assistance. Grants can support a variety of partnerships that will leverage both public and private sector resources.

It is envisioned that $2 million of Core Component resources will be utilized through a (GUC) mechanism. The implementing partner and USAID will decide on the focus of the activities that would be funded by these GUC resources. Under the Buy-In Component, $2 million of the ceiling will be reserved for Missions and/or Operating Units to employ GUCs. For both the

Core and Buy-in Components, GUCs are expected to address local sustainability and capacity building when applicable, while contributing to the achievement of the IRs.

All grants within the Core Component must demonstrate a minimum of 1:1 leverage.

Participating partners can utilize cost share to meet this requirement however matching funds is preferred. Also, grants within the Core Component should include beneficiaries or implementers in a minimum of two or more countries in the region in order to build partnerships among local organizations to work regionally. For example, rather than a firm or association in one country seeking a grant to train SMEs in that country, a consortia of firms can apply together to work in several countries and perhaps broaden the base and learn from each other. While bilateral grants could still be awarded through the Buy-In Component, specific calls for multi-country grants would be issued through the Core Component.

Several USAID projects in the region and other donors have supported local entities in the past, both to provide direct services and to build their capacity and sustainability going forward.

However, often times their membership and clients provide limited revenue streams, and service provision in addressing some of the key constraints to economic growth is weak. These organizations commonly lack technical expertise and primarily work on a “project focused basis,” usually with donor support bilaterally. As a result, there is not continuous support from these organizations for networking, information-sharing, knowledge transfer and advocacy. This regional approach to grant awards is intended to overcome this weakness by building a regional client base and/or sharing best practices with others in the region to improve overall capabilities.

Under EDGE, the local organizations that will partner with the program will be strengthened so that their ability to provide strategic services to their end user, the private sector, will be more sustainable and effective.

C.2.3 Linkages with USAID Economic Growth Strategies

EDGE will be a Bureau managed contract, but will be closely coordinated with other regional, bilateral, and local implementing mechanisms in the economic growth area. As such, EDGE will in many cases support the CDCS Development Objectives of E&E Missions, but will most closely align to the Bureau’s EG Results Framework (RF) with the following DO: Inclusive, sustainable economic growth supporting intra-regional and Euro-Atlantic integration.

The Bureau’s Technical Services Office (TSO) EG Framework includes three Intermediate

Results (IRs) on which this program is based. These include: Improved Business Environment and Reduced Barriers to Trade; Improved Financial Sector Stability with Increased Access to

Finance; and Improved Competitiveness through Value Chains and Trade Promotion.

C.2.4 Past & Present Regional Economic Growth Projects

The E&E Bureau manages the Regional Economic Growth Project (REG) which implements activities on a regional basis and serves as a Buy-In mechanism for all 12 E&E countries in the region. The REG project began September 2013 and combined the technical areas addressed by two previous E&E projects, Regional Competitiveness Initiative (RCI) and Partners for Financial

Stability (PFS). The work of REG has informed the design of EDGE, including a reduction in the number or technical areas for Core Activities and a greater field-based presence. The REG activity is scheduled to end in July 2019.

C.2.5 Coordination with Bilateral Activities and Other Donors

EDGE will coordinate with bilateral, economic-growth related activities managed out of E&E

Missions to avoid duplication and to ensure activities are complementary to bilateral programs and objectives. Furthermore, there are many other donors in the E&E region with much larger budgets, particularly the EU, where there is already significant dialogue occurring between the

Bureau and EU colleagues to better coordinate efforts. The EDGE implementer will be expected to maintain active donor coordination and document this in its annual workplan and reports.

C.3. SCOPE OF WORK

The EDGE Scope of Work (SOW) is based on the three IRs described above and is separated into two Components:

● The Buy-In Component is structured for bilateral and regional activities throughout the

E&E region that could be funded by individual Missions or Operating Units, including the E&E Bureau. The Buy-In component can include any activities aligned to the three primary IR areas and is intended to be broad and allow for maximum flexibility.

● The Core Component will implement activities that have a regional focus and must include participation of beneficiaries or partners from at least two or more countries in the region. The Core Component will only focus on activities aligned to the following three sub-IR areas:

o Sub IR 1.1: Reduced barriers to movement of goods and capital o Sub IR 3.1: Improved Business Sophistication o Sub IR 3.2: Improved Market Integration and Expanded Market Linkages in

Targeted Sectors

C.3.1 Core Component

As stated above, Core Component activities will be focused on: Reducing Barriers to Trade, Improving Market Integration and Linkages, and Improving Business Sophistication. However, this scope is intended to guide the Contractor’s thinking on the range of areas that could be addressed within these Sub IRs. The problem statements below (C.3.4) are intended to provide more background on the rationale for these priority areas of the Results Framework.

Furthermore, the home office of the Contractor must have a skilled project management team able to respond on short notice to a range of requests in order to identify candidates, contribute to drafting SOWs and subcontracts, field teams and handle logistics, and provide financial management of buy-in activities. This includes the ability to provide rapid technical assistance to missions for the purposes of assessments, research and evaluations. The day-to-day management of buy-ins is not expected to be the direct responsibility of the EDGE COP, but rather the

Contractor should have systems and networks in place to allow for rapid response.

Technical oversight will come from the Mission or Bureau staff designing the activity. For mission buy-ins, a field-based Activity Manager will be designated to lead the effort and the

Washington TSO/EG office will serve as a liaison between the Contractor and EG Offices in the field. For regional buy-ins, the EDGE COR shall provide technical oversight or will designate an

Activity Manager in the Bureau or field as appropriate. It is anticipated that $2 million under the

Core Component will be set aside for Grants Under Contract.

C.3.2 Buy-In Component: Mission and Bureau/Operating Unit Buy-Ins

The Buy-In Component is structured as a mechanism to meet bilateral and/or regional needs of

E&E Missions, although it is possible that other offices and the Bureau itself could structure buy-ins through this Component. It is intended to provide a greater measure of flexibility to the

Missions and Bureau in light of increasing budgetary uncertainties and greater instability in the region. However, there is no dedicated funding for this Component through the EDGE contract;

rather it is limited to functioning as a mechanism to address priorities if funds become available.

Please note, activities under the Buy-In Component can address any of the 6 Sub-IRs, including cybersecurity and privatization, where related.

The management of the Buy-In Component will present certain challenges to the implementation of EDGE. First, there is no dedicated staff envisioned for this part of the program as it will be purely demand driven by E&E Missions. The proposed buy-in must be aligned to the EDGE

Results Framework, particularly the Intermediate Results, but not necessarily the Sub-IRs. Thus, there could be significant variation in the types of activities and countries that are supported through buy-ins.

Both regional and bilateral buy-ins will require a Scope of Work (SOW) and budget to be submitted to the COR of EDGE. The Missions or Bureau are expected to produce a draft SOW that explicitly defines the deliverables and requirements, and the Contractor will be asked to identify the appropriate technical assistance, provide a detailed budget, field teams, and provide administrative support. Home office support must also be funded through the buy-in and must be accounted for in the buy-in budget. Should the Missions or Bureaus require assistance in developing the SOW for an activity, these costs must also be accounted for in the buy-in budget.

C.3.3 Reesults Framework

The following Results Framework (RF) is reflective of both Components of EDGE.

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Sub IR 3.1: Improved business sophistication

Sub IR 3.2: Improved market integration and expanded market linkages

EDGE-EE Development Objective:

To promote inclusive economic growth in the E&E region with the specific objective of guiding the countries in the

Western Balkans towards convergence with European Union Accession Criteria

Contribution to DO:

Per capita GDP for countries in the E&E region Changes in unemployment rates in the region Growth of Income in the bottom 40% Reduce time and cost of moving goods across borders

IR 1: Improved Business Enabling

Environment (BEE) and Reduced Barriers to Trade

IR 3: Improved Competitiveness through Strengthening selected Value Chains and Trade

Promotion

IR 2: Improved Financial Sector Stability with

Increased Access to Finance

Sub IR 2.1: A more stable financial sector supported by the adoption of and compliance with key international standards

Sub IR 2.2: Expanded sources of capital, leading to improved access to finance

Sub IR 1.1: Building local capacity to advocate for improvements in BEE

Sub IR 1.2: Reduce time and cost of moving goods across borders

Crosscutting: Corruption, Malign Economic Influences, and Violent Extremism Countered through Greater Economic Integration

C.3.4 Problem Statement, Goal and Desired Results

IR 1: IMPROVED BUSINESS ENABLING ENVIRONMENT (BEE) AND REDUCED

BARRIERS TO TRADE (AND INVESTMENT)

Problem Statement:

An efficient and transparent business environment is essential for sustained private sector economic growth. The countries in the region historically have weak, even hostile environments for business growth. Laws, regulations, and institutions have not created a favorable environment, but rather restrict and control private enterprise. These types of business environments open the door for corruption by government officials who are in a position to extract bribes in return for regulatory relief. Most of the E&E countries score poorly on global comparative measures such as World Bank’s Ease of Doing Business (“Doing Business”) and

World Economic Forum’s Global Competitiveness Index (GCI).

Implementation also remains problematic. Laws and regulations are inconsistently and inefficiently applied, creating additional time and expense for businesses. The countries’ administrative structures are also inadequate, both in terms of procedural standards and the capacity of staff handling implementation. Although there has been progress in the region, and

USAID programs have made an important contribution in this regard, the E&E countries have considerable distances to go before they create an environment that supports sustainable and inclusive growth and meets EU requirements.

Research also shows that improvements in trade facilitation—reducing the time and cost of moving goods across borders—can yield huge economic benefits, and that the largest proportion of those benefits accrues to developing countries. There is great need for stronger regional trade capacity. The international community is increasingly focused on raising global performance and unlocking those benefits. The WTO’s December 2013 Trade Facilitation Agreement (TFA) represented a concerted international effort to strengthen the global economy by improving the transparency and simplifying the procedures associated with cross-border trade; the agreement entered into force in February of 2017, and its provisions have been integrated into the Central

European Free Trade Agreement (CEFTA) under Additional Protocol 5 (AP5), anticipated to enter into force in 2018.

Improvements in trade facilitation can address many of the barriers which serve as significant restrictions to the E&E region’s economic development. Despite growth in intra-regional trade among the Western Balkans, the scope of that trade remains limited and trade as a percent of

GDP remains comparatively small. This lack of intra-regional trade constitutes a significant barrier to growth in a number of ways. First, the countries of South East Europe are extremely small, making it hard to achieve economies of scale or to attract foreign investment.

Improvement in trade facilitation can encourage greater investment and contribute to the region being seen as a common market. Second, trade barriers carry an actual cost to business, both in terms of time and money thereby making cross-border value or supply chains prohibitively expensive and/or time consuming.

There are several different trading sub-regions that are relevant to EDGE, and while there are common issues and problems across the entire region, there are differences as well that will affect implementation approaches such as:

1) The Western Balkans – The countries that were originally part of Yugoslavia have a long tradition of trade (at one point they were the same country), but the break-up imposed new restrictions and barriers. These countries now have EU Stabilization and Association

Agreements (SAAs) in place, which include Free Trade Agreements (FTAs) that allow for increased market access for countries in the region. Intra-regional trade as well as trade between these countries and the EU is one of the highest priorities for EDGE, and presents significant opportunity for growth.

2) Caucasus – The three Caucasus countries were highly integrated trading partners within the Soviet Union, but since the collapse this trade has diminished considerably. Ongoing conflict between Armenia and Azerbaijan substantially reduces opportunities for intra-regional economic activity, and Armenia’s decision to join the Eurasian Customs Union

(with Russia, Belarus and Kazakhstan) further diminishes the potential for regional trade activity. Georgia has an Association Agreement with the EU and DCFTA, while

Azerbaijan and Armenia both have Partnership Agreements, DCFTAs are not envisioned.

While this structure complicates opportunities for intraregional trade, there is a high degree of interest to expand trade between all of the Caucasus countries and the EU.

3) Ukraine/Moldova/Belarus – Since the Russian invasion of Ukraine, expanding trade between Ukraine and the EU has become a much higher priority, both because of the urgency to cement a relationship with the EU, and also because the Russian markets have all but disappeared (except in the occupied territories). Expanding trade between

Moldova, as well as Belarus, and EU is essential as well as part of countering potential

Russian aggression.

There are also significant obstacles to the movement of capital within the region,…