J.1_Statement_of_Objectives.pdf

RFP 72011518R00001

Tajikistan Agribusiness Competitiveness Activity (TACA)

Attachment J.1

STATEMENT OF OBJECTIVES

Title: Tajikistan Agribusiness Competitiveness Activity

C.1 PURPOSE

The Tajikistan Agribusiness Competitiveness Activity seeks to strengthen Tajikistan’s economic growth through interventions aimed at improved competitiveness of Tajikistan’s agribusiness enterprises, leading to increased economic development, employment, and livelihoods.

Improving the economic viability of the agriculture sector will create both on and off-farm employment and encourage investment in supportive infrastructure and services in rural areas.

This will also improve Tajikistan’s ability to effectively participate in regional trade, improving connectivity of countries in the region and supporting overall regional stability.

Furthermore, recent terror attacks in the U.S., Sweden, Russia, and Istanbul, carried out by Central Asians, highlight the growing concern of migrant laborers from Tajikistan traveling abroad for economic opportunities where they are potential targets for recruitment by extremist organizations. The lack of economic opportunities in Tajikistan has become a critical threat to stability and security that extends far beyond its borders. For this reason, national security is seen as a secondary outcome of the direct economic and employment outcomes resulting from USAID’s Tajikistan Agribusiness Competitiveness Activity.

C.2 PERIOD AND PLACE OF PERFORMANCE

The expected period of performance for the Tajikistan Agribusiness Competitiveness Activity is five years and will be implemented in Tajikistan, leveraging investments within the U.S.

government’s Feed the Future Zone of Influence in Khatlon province.

C.3 BACKGROUND

Tajikistan Challenges and Opportunities

Tajikistan is a small, landlocked, low-income country located in Central Asia. It is the poorest of the Commonwealth of Independent States, with 19.5 percent of the population living on less than USD 1.90 a day and 56.6 percent subsisting on less than USD 3.10 a day.1 Only seven percent of Tajikistan’s land is arable; however, agriculture is a cornerstone of the economy and accounts for 25 percent of gross domestic product and employs 53 percent of the labor force in Tajikistan.2 The agriculture sector in Tajikistan offers a solid foundation for economic development. Of approximately 8 million Tajiks, over 70 percent live in rural, agricultural

1 World Bank World Development Indicators, http://databank.worldbank.org/data/reports.aspx?source=world-development-indicators

2 World Bank World Development Indicators, http://databank.worldbank.org/data/reports.aspx?source=world-development-indicators areas.3 Focusing on agriculture growth is one of the most effective ways to reduce rural poverty.

Agriculture work is largely feminized in Tajikistan, with an estimated 75 percent of working women employed in it. However, women’s agricultural work is characterized by low pay and job insecurity, harsh physical conditions, lack of access to and control over productive resources, limited presence as managers and low technical and specialized knowledge. While women headed 21.4 percent of dehkan farms in 2016, the average size of women-headed farms is smaller than those headed by men. Furthermore, women managed only 7.5 percent of all planted crop lands on dehkan farms.4 Tajikistan’s major agricultural products include cotton, wheat, dried and fresh fruits, vegetables, cattle, sheep, and goats. Factors limiting land use for agriculture include the country’s mountainous topography, water, electricity, soil salinization, and lack of mechanization. These geographical and infrastructural limitations, along with constraints within the enabling environment for agriculture, prevent the sector from reaching its full potential.

Tajikistan faces a number of serious economic development challenges. Despite consistently high economic growth rates since the end of the civil war in 1997, the economy remains heavily agrarian and rural with minimal development in the industrial and service sectors. Tajikistan’s two main exports that account for approximately two thirds of total exports is raw cotton and unwrought aluminum, and its economy remains reliant on inflows of remittances from Tajik migrant workers.5 The country remains highly susceptible to external economic shocks and suffered from recent regional economic downturns, triggered by the Russian economic crisis, with resulting reductions in remittances from migrants working abroad, which fell by 54 percent, from US$ 4.2 billion to $1.9 billion between 2013 and 2016. According to the World Bank, 60 percent of remittances are used for household food purchases and only 62 percent of households reported in a May 2016 survey that they were able to afford adequate food for the household.

Investment rates, and in particular private investment rates, have consistently been lower in Tajikistan than other Central Asian and lower-middle income countries, which has further dampened growth and employment prospects.

Despite the many challenges facing Tajikistan’s economy, recent research studies conducted independently by the ADB, the World Bank, and USAID have all made efforts to prioritize the constraints to economic growth and job creation, with many common findings that support the work of the Tajikistan Agribusiness Competitiveness Activity. The ADB identified the following as the major constraints of economic growth: lack of access and the high cost of finance; access to reliable electricity; poor quality of transport and logistics infrastructure;

corruption and weak rule of law; and market failures. In its 2017 jobs diagnostic, the World Bank identified similar constraints stating that “a prerequisite for Tajikistan to increase job creation is to create conditions for private sector growth, which implies much higher private sector investments. This requires increasing expected rates of return on investments, ensuring that entrepreneurs and firms can finance these investments, and eliminating barriers to entry and

3 Ibid.

4 Gender Statistic Report, Agency of Statistics Under President of the Republic of Tajikistan (TajStat), 2017. http://www.stat.tj/en/Gender6/Genderbaz/.

5 Asian Development Bank Country Partnership Strategy, August 2016.

https://www.adb.org/documents/tajikistan-country-partnership-strategy-2016-2020 distortions that might preclude private investments in particular sectors. Some of the most urgent reforms to achieve these objectives involve improving macroeconomic management and governance to reduce risks and uncertainty; upgrading business regulations and facilitating trade and logistics, in order to reduce transaction costs; reforming institutions that govern capital markets to improve access to finance; and rethinking investment incentives.” USAID, in its 2016 jobs diagnostic, reached similar conclusions and found the primary constraints holding back job creation to be high business tax rates, burdensome tax administration, access to reliable electricity, access to finance, crowding out from low-productivity State Owned Enterprises, and a high cost of export.

Together, these many constraints have hindered business activity and entrepreneurship, particularly in the formal sector. The evidence for a poor business environment is made evident by the characteristics of Tajik firms, which tend to be small and informal and therefore less productive. Tajikistan ranks 128th in the world in the 2017 Doing Business rankings, and is only 85th in the “Starting a Business” ranking, which is a drop of 33 places from just a year before.

Much work remains to improve the business climate, foster firm expansion, and encourage entrepreneurs to start and grow businesses in new industries and sectors where Tajikistan can best capitalize on its comparative advantages.

Continued private growth must continue to accelerate not only for growth purposes but also to absorb an increasing number of working-age people as well as diminishing employment opportunities for migrant workers. Today Tajikistan has the highest population growth rate in Central Asia, and job growth will have to increase at an even faster rate in the coming years as a youth bulge enters the already struggling labor market and opportunities for migrant labor decline.

Despite the employment growth challenges identified above, Tajikistan has many opportunities to improve competitiveness in the business environment, expand trade, diversify its economy, and improve employment opportunities. The agriculture sector has already shown relatively strong productivity and growth in real output. In fact, growth in agriculture value-added products has often exceeded overall economic growth rates in recent years, and agriculture employs the most workers of any sector. Within the Government of Tajikistan’s National Development Strategy 2016-2030, the development of the agriculture sector is seen as a priority for driving economic growth. It states as a priority, “Raising the productivity of agricultural operations, to include strengthening the private sector in rural areas by developing entrepreneurial activity in agriculture and ensuring equal rights and guarantees for land use.”

The World Bank recommended in its 2017 Job Diagnostic study “strengthening selected value chains, connecting small producers and firms, and improving incentives for formal jobs.

Developing and integrating value chains offers the potential to create and improve the quality of jobs in rural regions and in urban areas alike, both to wage earners and the self-employed (small producers and microenterprises.)” USAID’s Job Diagnostic in 2016 also found, “Agriculture represents Tajikistan’s largest employment sector and improvements to productivity can reduce poverty, increase food security, and transform the structure of the economy and the labor force.”

The agriculture sector offers the lowest wages of all, which presents an opportunity to promote the creation of better jobs and improve livelihoods through the development of agricultural value chains . New jobs are created when businesses grow, but new firm creation is very low by international standards. This finding suggests an opportunity to help new firms start and grow from micro to small, from small to medium, and from medium to large. Access to finance in particular is necessary to reach this objective. Other recommendations from the ADB, the World Bank, and USAID include value chain development to link small producers with lead firms;

creating new firms throughout agricultural value chains (i.e. from inputs to outputs); better access to technology, information, and networks; and diversifying exports.

Although the labor market challenges are overwhelmingly ones of low labor demand, we see evidence of some unmet demand in the labor market due primarily to a lack of work experience, practical skills, and professional education. In other words, skills required for real world application are lacking. If done at all, supply side interventions need to focus developing skills with specific business demand, and not general skills. In addition, limited access to education and employment opportunities for women and girls points to the importance of gender considerations in disseminating new knowledge and skills. There is also a matching component:

young people are not aware of the skills and experiences they need in order to land good jobs after the completion of their schooling. Connecting employers with job seekers will improve employment outcomes and contribute to the job growth needed in the coming decades.

In 2012, USAID Tajikistan enhanced its investments in economic growth and food security through Feed the Future (FTF), America’s global hunger and poverty initiative. To date FTF activities are creating jobs and enhancing economic opportunities in Khatlon province through introducing and scaling of new agricultural technologies, building the capacity of agricultural input suppliers and extension agents, and some support for local entrepreneurs to create new enterprises focusing on the post-harvest handling and processing of agricultural products. For example, the Feed the Future Tajikistan Agriculture and Water Activity (TAWA) will work with at least 50,000 producers (35,000 of which are women) over the course of the activity to introduce and scale new technologies that enhance productivity of in fruit, vegetables, and dairy value chains. Technologies include new crops and improved seed and tree varieties, integrated pest management, greenhouses, pruning and grafting, fruit drying technology, and improved feed and silage production among others. In addition, USAID’s Women’s Entrepreneurship for Empowerment (WEE) Project is developing strawberry, a crop traditionally grown by women, with new imported varieties and modern growing technologies like drip irrigation. Through increased harvests, greater crop diversity, and higher quality products, FTF activities are expanding economic potential through increasing incomes and creating jobs.

By partnering with local entrepreneurs, FTF has also done some work to improve agricultural value chains by establishing cold storage and food and feed processing facilities. However, given the greater emphasis of FTF on smallholder farmers and crop production, more work is needed to develop downstream components of agricultural value chains including transport and logistics of agricultural products and trade linkages to domestic and international markets. Within this space there is considerable potential for the creation and expansion of businesses which will create new, high skilled jobs while at the same time continuing to improve livelihoods of smallholder farmers.

In 2016, USAID Central Asia launched a regional project called Competitiveness, Trade, and Jobs (CTJ) which is working to improve the competitiveness of economies in Central Asia by, among other things, improving the export potential of horticultural products and services in the transport/logistics sectors. In Tajikistan, CTJ works with the government of Tajikistan on World Trade Organization Post-Accession Action Plan reforms and promotes regional cooperation and trade connectivity. Given the high level regional focus, CTJ does not implement competitiveness activities on the ground in Tajikistan beyond short training sessions that focus on business competitiveness that are well tailored to the Tajikistan development context. The focus of the Tajikistan Agribusiness Competitiveness Activity will be to complement, bridge, and enhance the gains made by FTF activities in Tajikistan and regional gains made by CTJ.

This should be done through a suite of activities that includes technical assistance along with direct investments in partnerships with businesses and entrepreneurs to improve overall competitiveness and demand for Tajik products in domestic and international markets. The assessments conducted by CTJ in 2017, the End Market Analysis for Selected Markets for Central Asian Fresh and Dried Fruit Products, Transport and Logistics Analysis Horticultural Exports in Central Asia, and Value Chain Analysis are attached to the solicitation.

C.4 RELATED USAID ACTIVITIES

The following is a brief description of related activities implemented in Tajikistan by USAID/Central Asia (CA):

Competitiveness, Trade, and Jobs (CTJ) September 2016- September 2021:

The activity works with governments in Central Asia and private sector actors to improve the competitiveness of these economies as measured by an increase of exports in the horticulture and improved services in the transport/logistics sectors. The activity conducts assessments in the horticulture and transport sectors to identify opportunities and challenges in increasing regional trade and competitiveness within those sectors. Short term training is conducted through CTJ throughout the region on regional trade and competitiveness topics. The activity also partners with relevant government authorities when there is political will to address the trade facilitation constraints that fall within the mandate of the host country authorities. Additionally, CTJ plans to pursue partnerships with firms within Central Asia of up to $2 million worth of activity funds in private sector partnerships to increase regional trade and create or maintain jobs.

Feed the Future:

Tajikistan is an aligned country within the U.S. government’s Feed the Future (FTF) Initiative.

Feed the Future in Tajikistan is focused in 12 districts in Khatlon province known as the “Zone of Influence (ZOI)”: Bokhtar, Jomi, Balkhi, Khuroson, Nosiri Khisrav, Qubodiyon, Jayhun, Dusti, Sarband, Shahritus, Vakhsh, and Yovon comprise the lower Kofarnighon and Vakhsh river basins. Under FTF, USAID Tajikistan programs include programming in maternal child health and nutrition, as well as agriculture. This program will be expected to capitalize on the FTF investments within the agricultural sector that forward and link farmers and products to markets for increased trade opportunities. More information can be found at https://www.feedthefuture.gov/country/tajikistan. The primary FTF programs that focus on agriculture in Tajikistan are included below:

Feed the Future Tajikistan Agriculture and Water Project September 2015- March 2020:

The Feed the Future Tajikistan Agriculture and Water Activity (TAWA) assists farmers residing in the zone of influence (ZOI) in southern Tajikistan to increase, diversify, and add value to their agricultural production in order to address dietary deficiencies and market surplus production.

TAWA introduces and build on modern technologies and practices to support the growth and sustainable development of the agriculture extension, vegetable, fruit, dairy, and irrigation sectors within the ZOI.

Women’s Entrepreneurship for Empowerment Project September 2014- September 2018:

The main goal of this activity is to mitigate poverty by building women’s business capacities and improving inclusivity, equality, access and control. The project empowers women who are currently economically inactive to start microenterprises; facilitates greater access for women to value chains, new markets, customers, and to business services; and works to positively influence societal attitudes toward women’s entrepreneurship. The program is implemented in seven districts of Khatlon Province in Tajikistan. As this program comes to a conclusion in September 2018, USAID will look to this new activity to continue activities focused on women’s economic empowerment.

Feed the Future Tajikistan Land Market Development Activity November 2016- August 2020: The Feed the Future Tajikistan Land Market Development Activity promotes market-based principles for land tenure and works to establish a functioning agricultural land market that allows the transferability of land use rights (buying, selling, leasing), and a simple and transparent land registration process, while ensuring gender equality in rights and processes. The activity focuses on land policy and legal development, private sector capacity development to support land market, simplification of land registration procedures and expansion of knowledge of land use rights among rural government and citizens, especially female landholders.

Feed the Future Tajikistan Health and Nutrition Activity- September 2015- September 2020: The Feed the Future Tajikistan Health and Nutrition Activity (THNA)’s goal is to contribute to improvement of nutritional and health status of children and mothers through integration of quality health and nutrition interventions from household and community to regional and national levels. Furthermore, THNA promotes the use of globally approved multi-sectoral practices to address the drivers of malnutrition. This is being addressed through nutrition-specific and sensitive interventions on health, agriculture, education and governance sectors. In collaboration with other FTF activities THNA addresses a range of nutrition challenges, including food security, dietary diversity, infant and young child feeding, and sanitation amongst others, ensuring that gender-equitable and culturally sensitive approaches are incorporated, and leveraging public and private partnerships.

https://www.feedthefuture.gov/country/tajikistan

C.5 RELATIONSHIP TO REGIONAL DEVELOPMENT COOPERATION STRATEGY

(RDCS)

The Tajikistan Agribusiness Competitiveness Activity supports USAID/Central Asia’s Regional Development Cooperation Strategy through Development Objective 1: “Expanded diverse and competitive trade and markets.” Activities contribute directly to Intermediate Result (IR) 1.1, “More diverse and competitive private sector” and IR 1.2, “Enhanced agricultural competitiveness and food security.” The Regional Development Cooperation Strategy can be found at https://www.usaid.gov/central-asia-regional/rdcs.

C.6 OTHER DONOR ASSISTANCE

Most major international development organizations, including both donor agencies and multilateral development banks with a presence in Asia, have ongoing activities in Tajikistan. In 2015, the OECD reported total official development assistance (ODA) disbursements of $473 million from 54 donors. Total ODA is equivalent of 4.5 percent of Gross National Income (GNI), although this percentage has fallen steadily from a peak of 16.1 percent of GNI in 2001.

Of the $473 million in ODA, 40 percent came from the ADB and an additional 32 percent from the six largest country donors: Switzerland, Germany, U.S., Russia, United Kingdom (UK), and Japan. The largest sectors were transport and storage ($78million), government and civil society ($66 million), energy distribution ($55 million), water supply and sanitation ($36 million), agriculture ($29 million), banking and financial services ($24 million), and basic health ($24m).

Outside of the Asian Development Bank (ADB), Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH (GIZ), the UK’s Department for International Development (DFID), and USAID have been the most active donors in promoting private sector development in Tajikistan.

In 2015, GIZ disbursed approximately $19.2 million for activities broadly related to those covered under the scope of this activity while DFID contributed $10.4 million and USAID $8.6 million.

Despite donor interest in private sector development, a number of notable activities have recently ended or will soon end. These include a DFID/GIZ co-funded project titled Growth in Rural Economy and Agriculture in Tajikistan (GREAT), which was a five-year, £18.9 million project focused primarily on the agriculture sector with special emphasis on agro-processing, marketing, transport, finance, and cross-border trade. Another DFID activity, the £5m Central Asia Investment Climate Programme, is scheduled to end in December 2017. This activity targets the business enabling environment, including regulation and tax administration, and the development of public-private partnerships. The Tajikistan Agribusiness Competitiveness Activity will help fill the gap left by these activities.

Much of the current private sector enabling activity focuses on regional trade facilitation.

USAID (through its CTJ project), EU, GIZ, International Finance Corporation (IFC), ADB, and United Nations Development Programme (UNDP) all currently fund regional trade programs through at least 2018. Donor focus on trade issues is well-placed to increase economic growth rates and create new jobs in Tajikistan through export promotion. However, the fact that so many donors are involved in this space does necessitate the need for close coordination to ensure leveraging and not duplication of efforts in regional trade facilitation.

https://www.usaid.gov/central-asia-regional/rdcs

Agribusiness projects include the $50M EU-funded Enhanced Competitiveness of Tajik Agribusiness Programme (ECTAP), which promotes the development of value chains, agro-enterprises, and marketing, and is ending in May 2019. The International Development Association (IDA) is funding the $26 million Tajikistan Agriculture Commercialization Project through June 2021. This project targets three areas: technical farm-level assistance, improved access to finance for both large and small businesses, and institutional capacity building and project management. GIZ implements a 4 year, approximately $10 million “Towards Rural Inclusive Growth and Economic Resilience” program, which includes work on value chains which is ending in December 2018.

Donors have also been involved in expanding access to finance, particularly for small and medium enterprises. Indeed, access to finance is a critical issue in Tajikistan, and like trade, has been identified by USAID, the World Bank, and the ADB as a top constraint to economic growth and job creation. In fact, the ADB identified access to finance as its top constraint to growth in its recent country diagnostic. Despite this constraint, donor activities in the finance space have been more limited than those targeting trade facilitation. Switzerland is currently the largest donor of finance activities. These include the Azerbaijan-Central Asia Financial Market Infrastructure Project (ACAFI) implemented by the IFC, and the EBRD Small Business Initiative, which has a strong financing component. The EBRD also recently announced the expansion of its Women in Business program to Tajikistan, with US$10 million that will support access to finance and capacity building for women to develop businesses. The EBRD is also working with Tajikistan to reduce foreign exchange risk through the local currency loan program. The IDA Tajikistan Agriculture Commercialization Project works to improve access to finance for large agri-businesses as well as access to start-up capital for small businesses.

Donors have also promoted economic growth through advancements in the transport sector.

Japan recently funded a project to improve air transportation and capacity at Dushanbe International Airport, an effort that includes the construction of a new cargo terminal and the installation of modern aeronautical systems that will increase airport capacity.

C 7. ACTIVITY DESCRIPTION

A. Goal

The goal of Tajikistan Agribusiness Competitiveness Activity is sustainable economic growth through interventions aimed at improved competitiveness of Tajikistan’s agribusiness enterprises, leading to increased economic development, employment, and livelihoods.

Improving the economic viability of the agriculture sector will create both on and off-farm employment and encourage investment in supportive infrastructure and services in rural areas.

This activity will have a particular focus on building agribusiness competitiveness within targeted value chains6, especially in the Feed the Future Zone of Influence in the Southern

6 Value chain: One way in which actors organize themselves within market systems. Value chains refer to the actors and functions connected by a series of value-addition transactions from production to consumption of particular goods and services. A value chain for dairy, for instance, may include input suppliers, farmers, processors, traders, wholesalers and national retailers selling into end markets. Value

Khatlon region bordering Afghanistan, and improving product quality, services, and logistics to increase links to domestic, regional and international markets.

The activity will build off investments USAID has made in increasing quality and quantity of crop production within the horticulture and dairy value chains through Feed the Future programming, by supporting all/any actors along these agricultural value chains. The activity will provide targeted demand-driven assistance to agricultural associations, cooperatives, market integrators, and/or small and medium enterprises (SMEs) in targeted sub-sectors to take advantage of domestic, regional and international market opportunities.

The contractor will have the flexibility to recommend to USAID for approval a set of demand-driven interventions in its Performance Work Statement (PWS) aimed at generating rapid, broad-based and sustainable economic growth within measured by increased of sales, exports, and employment.

B. Performance Objectives and Results

Objective 1: Diversify the agricultural sector to include higher-value commodities and value-added products.

Result 1.1: Leverage innovation and technology to diversify production to higher-value commodities and value-added products.

Result 1.2: Increased technical skills and knowledge necessary to diversify fresh and processed goods ready for trade.

Result 1.3: Improve product development, design, and marketing of agricultural products.

Objective 2: Strengthen linkages between aggregators, wholesalers, exporters, and international and domestic end-markets.

Result 2.1: Increased agribusiness linkages between Khatlon and industrial centers in

Tajikistan, and elsewhere in South, Central and East Asia, to increase trade of value-added products.

Result 2.2: Leverage innovative technologies to deliver higher-value commodities and products to end markets.

Objective 3: Partnering and leveraging of resources to catalyze systemic change in the agribusiness sector and increase productivity of value chain actors.

Result 3.1: Leverage private sector investment across market systems7 to facilitate firms and chains depend, in turn, on support services, such as veterinary, cold chain, and financial services. They are also shaped by the broader enabling environment in which they operate, such as policies regulating safety standards and social and cultural norms that affect access to resources.

7 Market Systems: A market systems orientation implies that all interventions should be designed with market demand in mind but also that such systems accommodate multiple input and output value chains that complement each other. Thus a market systems approach, like a production systems approach, goes beyond a single commodity or value chain and seeks to harness and foster complementarity and farmers to take better advantage of growth and trade opportunities.

Result 3.2: Support entrepreneurs through technical, business and financial capacity building and capital support.

C. Illustrative Performance Indicators

The contractor’s performance will be evaluated based on progress in accomplishing the activities specified in their Performance Work Statement, annual work plans and Activity Monitoring, Evaluation, and Learning Plan (MEL Plan), and achievement of the contract targets for each performance measure set in connection with the indicators provided in this section. USAID and the successful offeror will use objectively verifiable indicators with periodic data collection to measure performance and adjust approaches as necessary. Below is an illustrative list of performance indicators for the Tajikistan Agribusiness Competitiveness Activity. The Offerors are expected to recommend to USAID a summary AMEP with the proposal that captures the high-level results of proposed activities conducted to achieve the above stated objectives.

Illustrative U.S. Government Standard Indicators:

● EG.3.2-21 Number of firms (excluding farms) or civil society organizations (CSOs) engaged in agricultural and food security-related manufacturing and services that have increased profits or become financially self-sufficient with USG assistance

● EG.5.2-1 Number of firms receiving USG-funded technical assistance for improving business performance

● EG.5.2-2 Number of private sector firms that have improved management practices or technologies as a result of USG assistance

● EG.3.2-5 Number of public-private partnerships formed as a result of USG assistance

● EG.2.2-1 Number of firms receiving USG-funded technical assistance to export

Illustrative Custom Indicators:

● Number of firms/products meeting regional and international trade standards and certification requirements.

● Quantity of products meeting regional and international trade standards and certification requirements.

momentum that more efficiently link producers to market actors (service providers, aggregators, transporters, and processors) to consumers. In aggregate, profit incentive and improved policy help improve predictability and transparency, attracting additional investment and strengthened market systems.

● Percentage improvement of the trade balance in the targeted value chains during life of activity.

● Number of participating firms adopting Quality Management Systems and International Standards.

● Percentage of participating firms improving their sales/profitability over of the life of the project.

● Percentage increase of participating firms’ employment over of the life of the project.

● Number of services available in targeted value chains.

C 8. GUIDING PRINCIPLES

A. Sustainability

Tajikistan Agribusiness Competitiveness Activity will follow a Facilitation and Market Systems Approach to catalyze systemic changes through partnerships with the private sector and local actors.

Market systems approach is the guiding framework for scaling technologies, practices and business models, with the objective of developing market systems that are:

Competitive—system actors are able to effectively innovate, upgrade and add value to their products and services to match market demand and maintain or grow market share;

Inclusive - delivering a sustainable flow of benefits to a range of actors, including the poor and otherwise marginalized, as well as to society as a whole; and

Resilient - system actors are able to address, absorb and overcome shocks in the market, policy environment, resource base or other aspect of the system.

Facilitation is an approach to implementing value chain development that is fundamental to achieving the sustainability of these outcomes. Facilitation aims to stimulate systemic change without taking a direct role in the market system. It involves working through market participants and ensuring that they are drivers of the change process.

USAID encourages innovation within mechanisms/competitions for private sector engagement proposed in the Program Work Statement (PWS). Grants Under Contracts, deliverables-based sub-contracts, and other result-based financing mechanisms will be considered in the PWS.

B. Collaboration and Coordination

Stakeholders and counterparts include private sector entities, the Government of Tajikistan, non-governmental organizations, business associations, farmers, and other development partners (donors). The Contractor should leverage other development partners (donors) and other United States Agency for International Development (USAID) implementing partners working in relevant areas to identify means of coordination and collaboration to achieve sustainable results and leverage resources.

C. Gender Considerations

Pervasive and persistent structural inequalities in Tajikistan limit the ability of the poor to improve their lives. Women and girls are affected by inequalities through two main channels.

One is composed of limits on their access to education and employment opportunities, which curtails their economic autonomy and weakens their bargaining position within the family. The other way inequalities affect women is through discrimination they face that leads to their material and resource deprivation, making it more difficult for them to fulfill their vital roles in food production, preparation, processing, distribution, and marketing activities. Challenging and overcoming the constraints women face must therefore be integrated throughout this activity.

Gender is a social construct that refers to relations between and among the sexes, based on their relative roles. USAID’s Automated Directive System (ADS) states: “Gender issues are central to the achievement of strategic plans and Development Objectives (DO), and USAID strives to promote gender equality, in which both men and women have equal opportunity to benefit from and contribute to economic, social, cultural, and political development; enjoy socially valued resources and rewards; and realize their human rights”. (ADS 201.3.9.3)

Further, USAID requires that gender integration be incorporated into new project designs.

Specifically, gender integration entails the identification and subsequent treatment of gender differences and inequalities during program/project design, implementation, monitoring, and evaluation. As part of the design of any proposed activity, the contractor should assess and identify gender issues that affect the participation of men and women equally in the participation of this project.

The following actions are required:

1. The Contractor must assure that gender issues are analyzed and program activities within the Performance Work Statement are designed to maximize women’s empowerment and decision-making.

2. The contractor shall make special efforts to ensure that woman-managed associations, businesses and other value chain actors are beneficiaries of project-funded assistance.

These efforts will include, but are not be limited to targeted outreach and activity opportunity publicity.

3. The Contractor must take gender into consideration in terms of how services are promoted, accessed, and provided so as to maximize participation by both male and female entrepreneurs. Accordingly, the Contractor should consult with experts, solicit input from potential program beneficiaries, and use available USAID and other publicly available resources.