Statement_of_Objective_(Attach_J.1).pdf

SECTION J - ATTACHMENTS

ATTACHMENT J.1 - STATEMENT OF OBJECTIVES

Note: This Statement of Objectives (SOO) identifies the top-level goals and objectives of the Activity and is used as a focusing tool for both the U.S. Government (USG) and the Contractor.

This SOO is provided in lieu of a USG written statement of work (SOW). The SOO does not state how the work is to be accomplished, but allows Offerors to develop and propose innovative approaches and cost-effective solutions to meet the Activity goal and objectives.

Throughout the SOO, the terms “Offeror” and “Contractor” are used purposefully to signify the status of an entity prior to and after award of the resulting contract. Therefore, all content related to an “Offeror” should be considered by an entity in their proposal preparation; while content related to a “Contractor” are informational and refer to activities or responsibilities performed by the winning Offeror after award.

J.1 Purpose

This Activity seeks to advance Indonesia’s own development goals of balancing biodiversity conservation and sustainable land use with inclusive economic and livelihoods development.

This Activity contributes to the 2014-2020 USAID Indonesia Country Development Cooperation Strategy. Specifically, this Activity contributes to Development Objective 3: Development priorities for mutual prosperity advanced, and the following intermediate results: 3.2 - Environmental security and resilience enhanced, 3.3 - Constraints to economic opportunity decreased.

J.2 Development Context

Indonesia is the largest tropical archipelago in the world, straddled between two continents, Asia and Australia, and between two oceans, the Pacific and the Indian. This strategic location provides Indonesia with exceptional environmental values, including diverse habitats, species, and environmental services. As such, Indonesia is the country with the highest level of terrestrial biodiversity and endemism in Asia and the third highest in the world.

Two-thirds of the nation’s entire land area is designated as Forest Estate, under the management of the Ministry of Environment and Forestry (MOEF). Second, outside the Forest Estate remaining land area is made up of non-forest public lands, known as Areas for Other Purposes. These areas are reserved for agriculture, industry, transportation, urban and rural population centers, and all other non-forest land uses.

The Forest Estate was designated by the Government of Indonesia (GOI) in the early 1980’s under the New Order regime. MOEF is responsible for establishing policy and regulations governing the Forest Estate in accordance with three basic functions. First, Conservation Areas encompass national parks, wildlife reserves, and nature reserves, covering a total area of 22.1 million hectares or 18 percent of the Forest Estate. The GOI designated these areas explicitly for the protection of biodiversity. Second, Protection Forests are designated to provide watershed functions, covering 29.7 million hectares or 25 percent. Third, Production Forests are generally targeted to produce timber and pulp, covering a total area of 56.0 million hectares, or 47 percent of the Forest Estate. MOEF estimates that Production Forests contribute to roughly five percent of the national economy. Production Forests can be reclassified to Conversion Forest for excision from the Forest Estate and recognized as Area for Other Purposes. In general, the intent of reclassifying Production Forest to Conversion Forest is to establish large-scale agricultural plantations. Approximately 13 million hectares, or ten percent of the Forest Estate, have been designated by subnational and national authorities as Conversion Forest.

The area of land under these Forest Estate designations does not align with the distribution of forest cover across the country (Table 1). As of 2018, MOEF estimates that at least 28 million hectares of land without forest cover are within the Forest Estate, while at least eight million hectares with forest cover are on Areas for Other Purposes.

Table 1. Forest cover and non-forest cover across the Forest Estate and Area for Other Purposes in Indonesia (in million hectares)1.

Land Cover Forest Estate Area for Other

Purposes

Grand Total

Grand Total

Percent Conservation Forest

Protection Forest

Production Forest

Conversion Forest

Total

Forest Cover 17.3 23.9 38.3 6.3 85.8 8.1 93.9 50.0

Primary forest 12.5 15.2 14.4 2.5 44.6 1.5 46.1 24.6

Secondary forest 4.7 8.4 21.0 3.8 37.9 5.4 43.1 23.0

Plantation forest 0.1 0.3 3.0 0.0 3.4 1.3 4.7 2.5

Non-forest Cover 4.8 5.8 17.7 6.5 34.8 59.3 94.0 50.0

Total terrestrial area 22.1 29.7 56.0 12.8 120.6 67.5 187.9

Forest Area Percent 78.3 80.5 68.4 49.2 71.1 12.0 50.0

Within the Forest Estate, MOEF directly manages Conservation Areas whereas provincial government agencies and officials have substantial authority over natural resource use and management of Production Forests and Protection Forests. On Areas for Other Purposes, 1 Ministry of Environment and Forestry. The State of Indonesia’s Forests 2018.

district governments generally have authority over land use, including the right to issue commercial licenses and permits for clearing forest to develop agriculture, natural resource extraction, and infrastructure, among others, even where the forest may have high biodiversity value.

Across this land base is the fourth most populous country in the world with an estimated 264 million people. Indonesia is considered the largest economy in Southeast Asia and the GOI seeks to maintain this status through a projected 5.4 - 6.0 percent economic growth per year.

However, approximately more than 10 percent of Indonesians still live below the poverty line.

Many of these people live in or adjacent to the Forest Estate. Of the country’s approximately 75,000 villages, almost 26,000 villages, with over 32 million people are located in or adjacent to the Forest Estate. Over 6,000 villages are located specifically adjacent to Conservation Areas, with a significant proportion of the population of these villages dependent on ecosystem services and forest resources for their livelihoods. In one form or another, all Indonesian citizens depend on healthy ecosystems for a range of goods and services, including water, soil, and the range of biodiversity values that underpin sustainable development.

J.3 Problem Statement

In its most recent global assessment, the U.S. National Intelligence Council predicts that unsustainable use of natural resources, and the ensuing degradation of the environment, will likely increase competition, economic distress, and social discontent in the short and long term.

The Council further predicts that permanent damage to the natural environment will threaten the economic benefits that ecosystem services provide. Conservation of biodiversity is critical for maintaining ecosystem service function and sustaining long-term economic growth.

At a national level, the GOI demonstrates capacity and commitment towards improved biodiversity conservation and natural resource management through international and domestic pledges. For example, the GOI is a signatory to the Convention on Biological Diversity and the United Nations Forum Convention on Climate Change, with commitments to reach the Aichi Biodiversity Targets and reduce greenhouse gas emissions, respectively. Along with these commitments, Indonesia strives towards a “self-reliant” vision of long-term development. This vision is embodied in the current GOI national biodiversity strategic action plan which seeks to achieve “Indonesian biodiversity preservation and development that contributes to national competitiveness and a fair and sustainable use of resources to improve the welfare of current and future generations”.

Indonesian civil society and private sector entities support the GOI’s efforts in biodiversity protection and reduction of greenhouse gas emissions from land use through the development and use of the high conservation value (HCV) and high carbon stock (HCS) standards. Civil society organizations and private sector entities use the HCV and HCS standards on a voluntary basis to meet international sustainability commitments, such as the New York Declaration on Forests or the Consumer Goods Forum. Implementation of these standards is one way to operationalize sustainability commitments within specific management units, with the aim to reduce threats to biodiversity and land based greenhouse gas emissions.

The high conservation value global standard includes six principal criteria, the first three criteria provide specific guidance to identify areas with high biodiversity values and design measures for protection of these values. Critically endangered species and areas that contain habitat for endangered, restricted range, or protected species are clearly noted as specific biodiversity focal interests under the first criterion. The second and third criteria focus on high biodiversity values at the landscape and ecosystem levels, respectively.

The HCS standard provides a clear method to identify forest land with high carbon values that should be protected from forest or other land with low carbon values suitable for non forest land use. The standard includes three phases with seven modules with cross-cutting quality assurance and participatory planning requirements. Private sector entities generally use the HCS standard to meet international no deforestation commitments. However, private sector entities could also implement the HCS standard in support of Indonesia’s Nationally Determined Contribution to reduce greenhouse gas emissions from land use change.

Despite the array of voluntary efforts to implement HCV and HCS standards at the management unit level in Indonesia, the GOI, academia, and civil society acknowledge that widespread threats to biodiversity and forest loss continue at the landscape and jurisdictional scale.

Deforestation in Indonesia currently averages approximately 500,000 hectares per year;

however, from 1985 - 1997 the average rate of deforestation was approximately 1.7 million hectares per year. Direct threats to biodiversity and forests are tied to expansion and production of agriculture, tree plantations, mining, and logging that does not align with laws, policies, or regulations. Unmanaged wildfire, used for clearing land on both peat and mineral soils, is another direct threat to biodiversity. All of these direct threats can cause significant greenhouse gas emissions from land use. These direct threats occur at both large- and small-scale.

Direct threats to biodiversity and forests, along with greenhouse gas emissions from land use, can be attributed to three main underlying drivers: weak governance, lack of private sector commitment, and smallholder capacity. First, weak governance is caused by lack of leadership and political will, lack of environmental law enforcement, low human resource capacity, among others. Decision making processes often prioritize conversion of high conservation value natural forests and peatlands to agriculture, mining, and infrastructure development over conservation.

Decisions to convert forests and peatlands are most often made without transparent and participatory processes, and with insufficient evidence to account for the benefits that natural capital in healthy ecosystems provide in rural and urban development. Further, these processes involve an array of overlapping and/or conflicting laws, policies, and regulations for use of lands with unclear tenure which may be considered open access. Government authorities, particularly at the subnational level, often lack capacity and political will to enforce environmental laws. The ability of subnational jurisdictions to plan, finance, and implement programs that sustain and enhance biodiversity and ecosystem services is generally weak.

Second, a lack of private sector commitment is caused by a disregard for legal and regulatory planning requirements, disregard for operational implementation of legal and regulatory requirements, challenges to reach profitability given current regulatory environments, and a lack of positive incentives, among others. Private sector entities often capitalize on weak governance by exploiting complex and opaque legal frameworks to their advantage. Private sector entities often disregard planning and operational requirements mandated through legal and regulatory processes. Where private sector entities have made pledges towards biodiversity conservation and sustainable management of natural resources, they often lack the capital, knowledge, incentives and/or business acumen to navigate these issues and reach profitability. Even though private sector entities may make strong commitments to natural resource supply chains free from deforestation, these entities may also exploit loopholes in corporate or local governance structures to continue business as usual practices.

Third, lack of smallholder capacity is caused by a lack of viable alternatives for sustainable livelihoods, lack of tenure, limited co-management rights, and a lack of stewardship, among others. Unregulated expansion of agriculture and mining into high biodiversity areas by smallholders is intricately linked with both weak governance and lack of private sector commitment, since smallholders operate under unclear governance arrangements while serving as producers in national and international private sector commodity supply chains.

Previous USAID initiatives sought to address these issues through land use planning activities with subnational governments, with Forest Estate managers (Conservation Areas and Forest Management Units in particular), and with private sector entities mainly in natural forest timber production. These activities generally focused on building capacity of subnational partners to incorporate environmental standards into local policies and development programs, often targeting increased area under improved management and/or co-management schemes between government officials and local communities.

USAID has seen some recent success in working with subnational partners at village and district levels in reducing threats to biodiversity and greenhouse gas emissions from land use change. For example, one district established a regulation requiring all villages to use a minimum amount of their Village Fund for environmental remediation. In another example, a private sector entity entered into an agreement with a local co-operative to provide financial and technical support for sustainable commodity production that meets international No Deforestation commitments and third-party certification standards. However, implementing similar initiatives at a large scale remains elusive. Capacity of government officials and private sector entities at all levels to plan, finance, and implement sustainable development that measurably reduces threats to biodiversity and greenhouse gas emissions from land use change is generally limited.

While needs remain for targeted technical support to improve natural resource management in Indonesia, purely technical approaches to reduce threats to biodiversity and greenhouse gas emissions from land use change will not address the underlying drivers of biodiversity and forest loss which are needed to achieve the broader goal of sustained, improved natural resource management. Likewise, approaches that focus primarily on smaller-scale activities such as patrols in National Parks will be insufficient, because such activities do not address larger-scale, interlinked socio-economic challenges, nor promote integrated approaches to landscape management. Integrated approaches are needed to achieve genuine results across complex and fragmented landscapes, and stand as models for institutionalizing systemic change.

J.4 Development Hypothesis

If Indonesia implements inclusive economic and policy incentives within an evidence-based regulatory framework that emphasizes and strengthens protection of high conservation value and high carbon stock areas at subnational levels, and land managers implement activities to reduce threats to biodiversity and reduce greenhouse gas emissions from land use in an inclusive and participatory manner, and stakeholders adopt natural resource commodity production methods that advance sustainable management of ecosystem services that reduces threats to biodiversity, then, we expect to see measurable improvements in biodiversity conservation and measurable reductions in deforestation and land degradation, along with an increase in inclusive, sustainable investment that enhances rural livelihoods.

J.5.1 Goal

This Activity will implement the development hypothesis through the following goal:

By the end of five years, Indonesia advances its own development objectives in balancing biodiversity conservation and sustainable land use with inclusive economic and livelihoods development.

This Activity contributes to the 2014-2020 USAID Indonesia Country Development Cooperation Strategy. Specifically, this Activity contributes to Development Objective 3: Development priorities for mutual prosperity advanced, and the following intermediate results: 3.2 - Environmental security and resilience enhanced, 3.3 - Constraints to economic opportunity decreased.

To achieve the overall goal, this Activity will achieve the following two objectives.

1. Strengthened inclusive environmental governance in targeted subnational jurisdictions that advances biodiversity conservation, sustainable forest management, and sustainable land use.

2. Increased implementation of environmental and social sustainability goals within private sector natural resource commodity production supply chains that reduces threats to biodiversity and greenhouse gas emissions from land use.

The anticipated overall outcome of this Activity is that targeted subnational jurisdictions with high conservation values and high carbon stock will be under improved management of natural resources that measurably conserves biodiversity, decreases greenhouse gas emissions from unsustainable land use, and promotes sustainable and inclusive economic growth. The Activity will strengthen implementation of environmental governance systems and private sector engagement through inclusive, multi-stakeholder participation, especially with marginalized populations. The Activity will use a range of evidence-based strategies to strengthen natural resource policies, regulations, standards, and criteria so that sustainable natural resource management actively contributes to a measurable reduction of threats to biodiversity and greenhouse gas emissions from land use.

J.5.2 Objectives

The Activity will develop and implement tailored interventions to be closely interlinked across the two objectives. Interlinking interventions will improve the sustainability of initiatives that reduce threats to biodiversity and greenhouse gas emissions from land use, facilitate investment in sustainable land management, and increase inclusive economic and social co-benefits from conservation and natural resource management. USAID recognizes that the ability of external actors, including development partners, to influence change requires a deep, nuanced understanding of power, societal norms, economy, and drivers.

1. Strengthened inclusive environmental governance in targeted subnational jurisdictions that advances biodiversity conservation, sustainable forest management, and sustainable land use.

In broad terms, environmental governance can be defined as the process by which groups of rights holders decide and define, through an inclusive and transparent process, what is and what is not acceptable behavior in terms of natural resource use in a given area, and how the group ensures that people comply with the policies, rules, and regulations for acceptable behavior. Natural resource management can be defined as the implementation of rules and regulations defined by a governance body or group. Effective environmental governance occurs when a governance group makes decisions and enforces rules that ensure the sustainability (i.e., long-term ecological and economic productivity) of the natural resources under their control in an inclusive manner. As such, sustainable natural resource management is an integral part of effective environmental governance.

a. Current Status

At the national level, the GOI has implemented several policy measures to improve the larger framework for environmental governance. For example, there are Presidential Instructions to halt issuance of licenses and permits that would cause the loss of primary forest in the Forest Estate or that would develop peatlands. The GOI is also currently in process to operationalize an environment fund (Government Regulation 46 of 2017) to facilitate ecosystem service compensation schemes. However, according to Indonesia’s

National Planning Agency2, weak environmental governance is still widespread across the country at the subnational level. Weak governance is characterized by: corruption;

uncertainty over rights to forest areas; weak forestry institutions (including Forest Management Units); non-harmonized laws and institutions; and, lack of recognition for valuation of ecosystem services.

In a limited number of subnational jurisdictions, there has been a slow, yet steady, rise in interest among subnational government officials in improving environmental governance.

This interest targets sustainable development that addresses economic, environmental, and social issues, through integrated land management across policy-relevant boundaries. Key characteristics of these initiatives combines multi-stakeholder involvement, locally owned vision, and commitment to outcomes for development that conserves existing biodiversity and forests. For long-term success, national and subnational leadership needs to embrace these characteristics by ensuring their integration into public policies and regulations. Financing strategic and operational activities that support such long-term reforms, through domestic resource mobilization, is a known constraint to improvements in sustainable natural resource management that reduce threats to biodiversity.

b. Outcome

The anticipated outcome of this objective is strengthened and inclusive environmental governance that advances biodiversity conservation, sustainable forest management, and sustainable land use in targeted subnational jurisdictions. By the end of the period of performance for this Activity, strengthened and inclusive environmental governance will be exhibited by the following factors. First, subnational jurisdictions exhibit commitment and capacity to transparently plan, finance, and implement measurable inclusive development goals that prioritize biodiversity conservation and sustainable land management that reduces greenhouse gas emissions from land use change, balanced with sustainable and inclusive economic development. Second, natural resource managers exhibit commitment and capacity to protect and conserve biodiversity and forest resources that provide critical ecosystem functions which underpin sustainable development. Third, environmental governance bodies and natural resource managers equitably enforce natural resource laws, policies, and regulations across the range of actors and stakeholders that influence biodiversity conservation and greenhouse gas emissions from land use. Fourth, environmental governance bodies and natural resource managers develop and implement inclusive incentive mechanisms for private sector entities and smallholders who demonstrate land management practices that measurably and transparently reduce threats to biodiversity and greenhouse gas emissions from land use.

2 National Planning Agency (Bappenas). 2019. Low Carbon Development: A Paradigm Shift Towards a Green Economy. Jakarta.

Progress towards the outcome and factors will be measured against a baseline of environmental governance at the start of the Activity, measurable and scientifically credible reductions in deforestation from an historical baseline that aligns with the GOI’s relevant commitments, and by the degree to which interventions address the suite of factors that contribute to weak governance. This Activity will also contribute to and report on progress towards relevant Sustainable Development Goals and National Mid-term Development goals of the GOI.

c. Interventions

To achieve this activity-level outcome, interventions will be interlinked with the other activity-level outcome.

This section will be replaced by the portion of the Performance Work Statement (PWS) addressing this Objective from the winning proposal. The PWS will explain how the outcome above (section b) will be achieved.

2. Increased implementation of environmental and social sustainability goals within private sector natural resource commodity production supply chains that reduces threats to biodiversity and greenhouse gas emissions from land use.

a. Current Status

The political economy of natural resources and natural resource commodity production in Indonesia has traditionally emphasized extraction by large-scale private sector entities over sustainable use. Historically, half of all forest loss in Indonesia has been driven by conversion of forest to plantations. Though this has declined in recent years, 25 percent of forest loss is still driven by the development of large scale plantations. Private sector entities engaging in natural resource commodity production in Indonesia includes, but is not necessarily limited to: agricultural commodities such as oil palm; forest commodities such as pulp and timber; and, mineral commodities such as coal, gold, tin, and others.

Threats to biodiversity and extensive greenhouse gas emissions from land use arise from the extractive nature of natural resource commodity production that disregards the value of ecosystem services which underpin long-term sustainable production.

Donor engagement with private sector entities in natural resource use has historically been limited to building capacity in technical aspects of land management. The current status of land use and natural resource commodity production in Indonesia indicates that this capacity building is not enough to shift the lens of the natural resource political economy to sustainable management. Private sector entities are increasingly being required to implement environmentally and socially responsible sustainability measures into their supply chains, i.e., “green supply chains” in order to maintain their market shares. Where these supply chains rely on natural resource commodities, private sector commitments to zero deforestation, sustainable natural resource management, and equitable social benefits are becoming more common.

Natural resource commodity supply chains in Indonesia rely on large proportions of production from smallholders, much of which enters into global supply chains.

Smallholders who engage in natural resource commodity production for their livelihoods are a unique subset of the private sector. Individually, smallholders can act as entrepreneurs engaged in micro- or small enterprise. Collectively, smallholders can act small- to medium-enterprises. In either case, smallholders act as producers in commodity supply chains which link to larger private sector entities in national and international markets. For example, Indonesia ranks first in terms of global oil palm production, second for rubber production, third for cocoa, and fourth for coffee production, whereby smallholders account for 40, 80, 90, and 90 percent of production for each of these commodities, respectively. The diversity of smallholders across Indonesia is vast, though smallholders generally engage in production on less than two hectares of land. Due to rising population, GOI economic development goals, and global demand for commodities, in recent years smallholders contribute to approximately 25 percent of the annual deforestation across Indonesia. Contributing factors to smallholder driven deforestation include limited management or co-management rights, lack of stewardship and inefficient use of existing agricultural lands, and a lack of viable alternatives for sustainable livelihoods.

Natural resource commodity production from both private sector entities with large scale plantations and smallholders poses significant threats to biodiversity through conversion of forest to agriculture, forest degradation, and increasing conflict with wildlife, especially critically endangered species such as orangutan, Sumatran tiger, and Sumatran elephant, as their habitats become degraded or converted to other land uses. At a national level, the GOI has set ambitious planning goals to implement low carbon development, or, in other words, sustainable economic growth that incentivizes investment in natural capital and protection of ecosystem services. However, financing and implementing these goals at subnational levels will require substantial inputs in capital investment along with targeted technical assistance to support mainstreaming of these commitments into operations that measurably reduce threats to biodiversity and greenhouse gas emissions from land use.

b. Outcome

The anticipated outcome of this objective is increased implementation of environmental and social sustainability goals within private sector natural resource commodity production supply chains that reduces threats to biodiversity and greenhouse gas emissions from land use. By the end of the period of performance for this Activity increased implementation of environmental and social sustainability goals within private sector natural resource commodity production supply chains will be exhibited by the following factors. First, private sector entities implement mandatory and voluntary environmental and social standards and requirements. Second, private sector entities and subnational jurisdictions establish and implement successful, mutually beneficial partnerships with positive incentives that provide replicable business models for profitable commodity production that reduces threats to biodiversity and conserves forests within the existing regulatory environment. Third, smallholders who rely on natural resource commodity production for their livelihoods demonstrate stewardship and efficient use of land through sustainable and replicable business models, such as conservation enterprises, that reduce threats to biodiversity and reduce rates of deforestation and forest degradation. Fourth, private sector entities and subnational jurisdictions increase economic development opportunities for smallholders in sustainable natural resource management, with a special emphasis on supporting inclusive investments in environmentally friendly business models for women, youth, indigenous people and other marginalized groups.

Progress towards the outcome and factors will be measured by increases in inclusive investment in sustainable natural resource management, commitment to international sustainability standards and results of monitoring high conservation values and high carbon stock from the implementation of those commitments within natural resource commodity supply chains, measurable and scientifically credible reductions in deforestation from an historical baseline that aligns with the GOI’s relevant commitments, and by the degree to which interventions address the suite of factors that contribute to reducing the threats to biodiversity and greenhouse gas emissions from land use that arise from private sector and smallholder natural resource commodity production. This Activity will also contribute to and report on progress towards relevant Sustainable Development Goals and National Mid-term Development goals of the GOI.

c. Interventions

To achieve this activity-level outcome, interventions will be interlinked with the other activity-level outcome.

This section will be replaced by the portion of the Performance Work Statement (PWS) addressing this Objective from the winning proposal. The PWS will explain how the outcome above (section b) will be achieved.

J.5.3 Outcome Indicators

Achievement of the Activity's two objectives will be measured using outcome indicators, consisting of standard and custom indicators, that demonstrate the impact of the Activity's performance. Mandatory standard indicators include:

● EG.10.2-2 Number of hectares of biologically significant areas under improved natural resource management as a result of USG assistance.

● EG.13-6 Greenhouse gas emissions, estimated in metric tons of CO2 equivalent, reduced, sequestered, or avoided through sustainable landscapes activities supported by USG assistance.

● EG.10.2-3 Number of people with improved economic benefits derived from sustainable natural resource management and/or biodiversity conservation as a result of USG assistance (sex disaggregate).

● EG. 13-4 Amount of investment mobilized (in USD) for sustainable landscapes as supported by USG assistance.

● EG.13-2 Number of institutions with improved capacity to address sustainable landscapes issues as supported by USG assistance.

● EG.13-5 Number of people receiving livelihood co-benefits (monetary or nonmonetary) associated with the implementation of USG sustainable landscapes activities (sex disaggregate).

Some or all of the following standard indicators may also be selected, as appropriate.

● EG.10.2-4 Number of people trained in sustainable natural resources management and/or biodiversity conservation as a result of USG assistance (sex disaggregate).

● EG.10.2-5 Number of laws, policies, or regulations that address biodiversity conservation and/or other environmental themes officially proposed, adopted or implemented as a result of USG assistance.

● EG.13-1 Number of people trained in sustainable landscapes supported by USG assistance (sex disaggregate).

● EG.13-3 Number of laws, policies, regulations, or standards addressing sustainable landscapes formally proposed, adopted, or implemented as supported by USG assistance.

● EG.10.4-3 Number of disputed land and property rights cases resolved by local authorities, contractors, mediators, or courts as a result of USG assistance.

● EG.5-1 USD sales of firms receiving USG-funded assistance.

The Contractor must propose custom indicators necessary to adequately track progress and outcomes of interventions, with reference to and in support of standard indicators. At a minimum, the following two custom indicators are required. First, the Contractor must propose at least one environmental governance indicator. For example, USAID’s 2015 Guidelines for Learning and Applying the Natural Resource Governance Tool in Landscapes and Seascapes (https://pdf.usaid.gov/pdf_docs/PBAAE424.pdf) is one possibility. Relevant governance indicators of the Government of Indonesia should also be considered.

Second, the Contractor must report the historical deforestation rate and projected deforestation during the life of this Activity, in the target jurisdictions. The Contractor must use third party, independently generated data and analysis for reporting these changes in forest cover. After award, the Contractor must annually report changes in forest cover (forest loss, forest gain), differentiated between natural forest and planted forest. Further, the Contractor should strive to https://pdf.usaid.gov/pdf_docs/PBAAE424.pdf estimate the baseline historical rate of forest degradation and reduce current/future rate of forest degradation relative to the historical baseline.

All outcome indicators, standard and custom, must be consistent with: 1) USAID’s Indo-Pacific Vision (https://www.usaid.gov/indo-pacific-vision); and, 2) USAID/Indonesia’s Mission-wide Performance Management Plan. In annual reports, the Contractor must report progress and achievements for both standard and custom indicators in reference to the GOI’s relevant goals and objectives within the 2020-2024 National Mid-term Development Plan, the Sustainable Development Goals, and sectoral goals/objectives as relevant.

The Contractor will monitor the outcome indicators to measure achievement of the two objectives through an Activity Monitoring, Evaluation and Learning (MEL) Plan (discussed in detail in Section F of this solicitation and highlighted in the following section, Guiding Principles).

J.6 Guiding Principles

Offerors must fully integrate the following guiding principles in the Technical Approach and

PWS.

1. Geographic Site Selection

Indonesia is a high global priority for biodiversity conservation. USAID considers Indonesia as a Tier One Operating Unit based on rankings from the Global Environment Facility’s Global Benefits Index for Biodiversity and World Wildlife Fund’s Global 200 list. In support of the GOI and USG goals for biodiversity conservation, this Activity must follow the criteria of USAID’s Biodiversity Code. These criteria are:

● The program must have an explicit biodiversity objective; it is insufficient to have biodiversity conservation result as a positive externality from another program;

● Activities must be identified based on an analysis of drivers and threats to biodiversity and a corresponding theory of change;

● Site-based programs must have the intent to positively impact biodiversity in biologically significant areas; and,

● The program must monitor indicators associated with a stated theory of change for biodiversity conservation results.

The explicit biodiversity objective for this Activity is to reduce the key direct threats to high conservation values in targeted jurisdictions. Simultaneously, this Activity will reduce threats to high carbon stock areas in targeted jurisdictions.

Biodiversity objectives for this Activity include one or more of the following area-based high conservation values:

● Areas that contain significant concentrations of rare, threatened, endangered or endemic species, including species on GOI’s national protection list;

https://www.usaid.gov/indo-pacific-vision

● Areas that contain critical habitats for the survival of rare, threatened, endangered or endemic species;

● Large landscape-level ecosystems, ecosystem mosaics, and intact forest landscapes that contain viable populations of the majority of naturally occurring species in natural patterns of distribution and abundance; and,

● Rare, threatened, or endangered ecosystems, habitats or refugia.

Offerors must develop criteria for geographic site selection that address the following factors:

● subnational jurisdictions with sites that contain area-based high conservation values under direct threat;

● subnational jurisdictions with sites that contain high carbon stocks under direct threat;

● subnational jurisdictions that exhibit a likelihood of success to achieve strengthened and inclusive environmental governance that advances biodiversity conservation, sustainable forest management, and sustainable land use; and,

● subnational jurisdictions where sufficient private sector interest aligns with environmental and social sustainability goals for commodity production supply chains that reduces threats to biodiversity and greenhouse gas emissions from land use.

Priority must be given to subnational jurisdictions with known orangutan populations and where habitat of these known populations is currently under threat.

Offerors may develop criteria for geographic site selection that also address the following factors:

● subnational jurisdictions with sites that are still intact and under relatively reduced threat, which exhibit a strong likelihood of success to put in place the enabling environment to manage future pressures;

● subnational jurisdictions with sites that support conservation of locally important biodiversity, as identified through consultation with indigenous peoples, local communities, universities, nongovernmental organizations, and subnational levels of government;

● subnational jurisdictions where previous USAID biodiversity and Sustainable Landscapes activities were implemented.

High conservation value areas may be co-located with high carbon stock areas in targeted jurisdictions, but are not required to do so.

Using the criteria above, Offerors must develop and carry out an evidence-based analysis to identify and rank the threats to high conservation values and high carbon stocks. Ranking of threats must consider the scale, intensity, and risk associated with each threat. Offerors must develop a simple, yet scientifically sound, ranking method to identify priority subnational jurisdictions where this Activity should be implemented. To document this analysis and its results, Offerors must clearly and concisely present a written report to document:

● justification and explanation of data and methods used in the analysis;

● the extent of high conservation values and high carbon stock areas;

● the key direct threats to high conservation values and high carbon stock areas;

● subnational jurisdictions that exhibit a likelihood of success for achieving the Activity goal and objectives;

● results of priority jurisdiction ranking; and,

● brief description of the priority jurisdictions that will be targeted for interventions in this

Activity.

It is important to note that the results of the geographic site selection analysis could possibly include jurisdictions where previous USAID activities (i.e., USAID IFACS and/or USAID LESTARI) reported results. Therefore, if the results from the priority jurisdiction ranking conducted by the Offeror includes these areas, the Offeror must convincingly describe how interventions implemented under this Activity will go above and beyond the results of interventions reported by previous USAID activities.

2. Biodiversity Code, Theory of Change, Situation Model, Results Chains

This Activity must meet the legislative requirements for the portion of its funding allocated for biodiversity conservation. As such, proposed interventions must align with the USAID Biodiversity Code (https://www.usaid.gov/biodiversity/impact/requirements). Using theories of change and results chains to design, implement and monitor interventions in an adaptive process is a foundational element of this Activity, and critical for measurably reducing threats to biodiversity and greenhouse gas emissions from land use.

USAID ADS 201 defines a theory of change as “the reasoning behind how and why a purpose or result is expected to be achieved in a particular context.” In USAID biodiversity programming, this definition is expanded to include a description of the logical causal relationships among a strategic approach and multiple levels of conditions or preliminary results needed to achieve a long-term result. A results chain is a graphic representation of a theory of change that displays the assumptions between what an Activity intends to do and the changes and results it hopes to accomplish to achieve its purpose.

In order to evaluate Offerors’ technical understanding and capability in preparing the theory of change and results chains, Offerors must develop and submit a theory of change and results chain for each objective (also may be referred to as a strategic approach) based on the situation model in Attachment J.2 that identifies key drivers and threats to biodiversity objectives in Indonesia. Offerors must describe how the theory of change will drive the Activity’s monitoring and evaluation methodology and be represented in the Activity Monitoring, Evaluation, and Learning Plan.

3. Collaborating, Learning, and Adapting (CLA)

Collaborative learning is a critical part of USAID’s work. Integrating CLA into activities helps ensure that USAID’s programs are coordinated with others, grounded in a strong evidence base, and iteratively adapted to remain relevant throughout implementation. The Contractor https://drive.google.com/open?id=1ZBsnObISjpWekd3Qx0gBj5PjXmUeDCs0 must integrate CLA throughout implementation. The Contractor must make adjustments and refinements in the situation model, theories of change, results chains, and interventions based on iterative and adaptive learning, thereby customizing interventions throughout the life of the Activity. Through CLA, the Contractor must quickly hone in on approaches and interventions that are getting results, drop those that are not, and adapt approaches and interventions where indicated. Adaptive management of the Activity requires a flexible monitoring system, across approaches and interventions, stakeholders, and development partners. The Contractor must use rigorous, credible methods to establish and expand the evidence base for assessing the effectiveness of interventions in achieving the goal, and use this evidence to inform an adaptive management approach that will adjust approaches and interventions as needed to achieve maximum results.

Offerors must propose and clearly explain political economy analytical approaches within an adaptive management framework that incorporates “thinking and working politically”. Within this framework, Offerors must clearly explain how collaborative, adaptive approaches and interventions will be implemented that provide incentives relevant to current political economies.

Offerors must clearly explain how such incentives will be sufficient to motivate relevant actors in achieving the Activity goal and objectives.

4. Monitoring, Evaluation, and Learning (MEL)

Effective adaptive management requires the development of indicators and other metrics for monitoring and evaluation during Activity planning and implementation. Offerors must clearly demonstrate how indicators directly link to the Activity’s proposed theory of change. Options for integration and collaboration through monitoring and evaluation include the use of indicators that capture both biodiversity and other development outcomes, and identifying opportunities to capture and track development co-benefits and impacts of biodiversity activities. Offerors must clearly describe how they will measure and report annual progress towards objectively verifiable output-level and outcome-level indicators that document achievement of the Activity goal and objectives.

5. Safeguards and Risk Mitigation

This Activity aims to reduce threats to biodiversity and reduce GHG emissions from land uses.

These aims include conservation and sustainable management of forests and natural resource commodities throughout their supply chains. USAID, in ADS 204.1 Environmental Procedures, requires implementation of environmental sustainability measures which must be mainstreamed into all interventions to avoid inadvertent harm to people and nature. Within the goal and objectives of this Activity, Offerors must propose integrated measures to mitigate potential negative consequences of a changing climate, weak governance, social and environmental impacts, including additional analyses as necessary. Offerors must provide information essential to assessing the potential impacts of interventions, and to the identification and detailed design of appropriate mitigation and monitoring measures. USAID, in ADS201mal Climate Risk Management Procedures, requires the Contractor to articulate practices and interventions that can enable climate resilient approach to succeed and support the sustainability of the investment made under this activity.

The Contractor must develop a system to monitor environmental and social safeguards throughout implementation. In developing this system, the Contractor must take into account relevant international obligations, national circumstances, laws, policies, and regulations.

Implementation of this safeguards system aims to ensure interventions are: 1) consistent with the conservation of natural forests and biological diversity; 2) used to incentivise conservation of natural forests and to enhance social and economic benefits, particularly for marginalized people; and, 3) not used for the conversion of natural forests.

As one example, GOI’s REDD+ Safeguards Information System (SIS-REDD+) establishes safeguards for greenhouse gas emission reduction in land use activities. SIS-REDD+ contains the following seven principles.

1. Legal compliance and consistency with national forest programs Activities shall comply with government regulations and nationally ratified international conventions/ agreements and shall be consistent with the objectives of national forest programs.

2. Transparency and effectiveness of national forest governance Activities at all scales and contexts shall contribute to transparent and effective forest governance in accordance with national sovereignty.

3. Right of indigenous and local communities Activities shall respect indigenous and local communities rights through action appropriate to the scale and context of implementation.

4. Effectiveness of stakeholder participation Activities shall be based on proactive and transparent identification of relevant stakeholders, and the engagement of them in planning and monitoring processes, with an increasing level of intensity from national level to site level scales.

5. Conservation of biodiversity, social and environmental services Activities shall include effective strategies that maintain, conserve or restore biodiversity and ecosystem services for social and environmental benefits.

6. Reducing risks of reversals Activities shall seek to reduce risk of reversals (permanent) through means appropriate to the scale and context, emphasizing sub-national action and national level policy initiative.

7. Reduction risks of displacement Activities shall include strategies to reduce displacement (leakage) of emissions and support sub-national and national monitoring.

To meet the goal and objectives of this Activity, the Offeror must demonstrate significant and meaningful engagement with the private sector. Private sector engagement promotes achievements at greater scale, sustainability, and effectiveness of development outcomes.