72061522RFI00002 - Private Sector Development Initiative.pdf

Request for Information (RFI)

Reference: Request for Information No. 72061522RFI00002 Issue Date: March 7, 2022 Response Due Date: March 28, 2022, 11.00 am, Nairobi, Kenya Time Title: USAID/Kenya and East Africa Private Sector Development Initiative

USAID/Kenya and East Africa (USAID/KEA)’s Office of Economic Growth and Integration is designing a new activity. The purpose of this Request for Information (RFI) is to request comments and recommendations related to the structure of this activity from private corporations, financial institutions, chambers of commerce, and other private-sector organizations, as well as implementing partners, development partners, government, and other relevant counterparts operating in Kenya.

The RFI is an attempt to reach out to the market in an effort to determine the scope of industry capabilities and interest and will be treated as information only. Responses (comments, suggestions and enhancements) to this notice are not applications and cannot be accepted by the Government to form a binding agreement. This is not a Request for Proposals (RFP) or a Request for Applications (RFA) and therefore should not be construed as a commitment by the U.S. Government or USAID to issue any solicitation or Notice of Funding opportunity, or ultimately award a contract or assistance agreement on the basis of this RFI. Do not submit any proposal/application at this time in response to this RFI.

Responses to this RFI are strictly voluntary. USAID will not pay respondents for the information provided in response to this RFI. Information, comments, and suggestions received will be reviewed and may be incorporated into a future solicitation. Responses to this RFI will not be returned and respondents will not be notified of the result of the review, but this information will be held confidential. Responding to this RFI does not give any advantage to any firm or organization in any subsequent competition. USAID reserves the right to respond to any, all, or none of the comments and questions submitted. USAID’s responses (if any) will be posted on https://www.grants.gov/ and on https://beta.sam.gov. Please continue to monitor the sites for any updates to this RFI.

This RFI does not restrict the Government’s approach on a future solicitation. No decision has been made regarding the type of instrument that will be used (e.g., acquisition or assistance). For this reason, this RFI will be posted on the Federal grants website, https://www.grants.gov/ and the Federal Government Business Opportunities website at https://beta.sam.gov.

Please review Attachment 1 and 2 to this RFI and submit any arising clarifications as well as your organization’s final responses via email to Sandra Jansen at sjansen@usaid.gov with a copy to Wacu Kiragu at wkiragu@usaid.gov with the subject entitled: “RFI No.72061522RFI00002 USAID/Kenya and East Africa Private Sector Development Initiative.” If a Solicitation is issued related to this RFI, it will be announced publicly either on https://www.grants.gov/ or on https://beta.sam.gov at a later date.

Sincerely, /s/ Sandra Jansen, Contracting and Agreement Officer USAID/KEA/Office of Acquisition and Assistance (OAA) https://www.grants.gov/ https://beta.sam.gov/ https://www.grants.gov/ https://beta.sam.gov/ mailto:sjansen@usaid.gov mailto:wkiragu@usaid.gov https://www.grants.gov/ https://beta.sam.gov/

RFI No.72061522RFI00002 USAID/Kenya and East Africa Private Sector Development Initiative

Attachment 1 RFI Concept

USAID/Kenya and East Africa Private Sector Development Initiative

USAID/KEA is developing a new private sector development activity to accelerate agriculture-led growth in Kenya. The purpose of this Request for Information (RFI) is to request comments and recommendations related to the structure of this activity from private corporations, financial institutions, chambers of commerce, and other private-sector organizations, as well as implementing partners, development partners, government, and other relevant counterparts operating in Kenya.

Approach: USAID is developing a new activity focused on accelerating ag-led growth in Kenya through partnerships with larger agricultural sector firms (such as processors and off-takers) and expansion of smallholder farmer out-grower schemes. The anticipated activity will focus on creating jobs and generating large scale increases in sales/exports in the agriculture sector cost-effectively and, ideally, through a sustainable and locally-led vehicle. The activity would combine tools used in USAID’s traditional private-sector development activities with tools used to mobilize finance and investment into one mechanism -supporting a range of agricultural firms to expand investments and operations via a blended finance approach.

This activity would identify the highest impact partnership opportunities and bring a full range of tools necessary to support firms in various stages of growth - targeted technical assistance, performance-based grants, transaction advisory services, as well as commercial finance such as loans, reimbursable grants, direct investments/equity, and de-risking instruments. These tools could be combined and applied as needed, in the least market-distorting way, to realize job creation and increased sales/exports.

The mechanism would employ tools that work across different firm sizes, and use pay for results models and cost-sharing. We want to explore creative structures that would permit capital to be revolved and reinvested to promote sustainability beyond the life of the project.

The anticipated activity will support the Feed the Future1 (FtF) objective of increasing ag-led growth through increased employment and strengthened and expanded access to trade and markets. It will also support one of USAID/KEA’s primary development objectives2 - catalyzing economic growth opportunities, especially for youth and women.

Geographic focus: While this activity will prioritize partnerships in FtF’s Zone of Influence (ZOI), it will also have flexibility to support opportunities with high potential for job creation outside of the ZOI. It will be important to leverage the resources of commercial farmers and firms in productive areas outside the target counties who would be willing to invest in and structure deals that benefit households within the ZOI. The ZOI counties include: Taita Taveta, Makueni, and Kitui in southeastern semi-arid areas; Turkana, Marsabit, Isiolo, 1 See the Global Food Security Strategy Country Plan for Kenya: https://www.usaid.gov/documents/1867/global-food-security-strategy-gfss-kenya-country-plan 2 See USAID Country Development Strategy for Kenya 2020-2025:

https://www.usaid.gov/sites/default/files/documents/CDCS_Kenya_2020_to_2025.pdf

Garissa, Samburu, and Wajir in the northern arid areas; and Kakamega, Busia, Migori, Homa bay, Kisumu, Vihiga, Bungoma and Siaya in the western high rainfall areas. The activity will build upon current and previous USAID achievements and activities focused on private sector development in the agricultural sector, including the Kenya Investment Mechanism (KIM) and the Kenya Crops and Dairy Market Systems (KCDMS) activity.

Local ownership: In line with USAID’s emphasis on locally-led development, USAID will seek to partner on this activity with an entity that’s established in Kenya and has significant experience mobilizing finance into the agriculture sector.

End of Attachment 1

Attachment 2

INSTRUCTIONS TO RESPONDENTS FOR SUBMISSION

I. Eligibility: Although responses to this RFI may come from any source, USAID intends to restrict eligibility for any possible Solicitation to local Kenyan entities.

II. Submission of Responses: Responses (comments, suggestions, and enhancements) to this RFI are due to the USAID/KEA/OAA Points of Contact identified below by March 28, 2022, at 11:00 am, Nairobi time. Interested parties shall submit an electronic copy of their responses in either Microsoft Word or Adobe Acrobat formats. No Google documents will be accepted. The agency server is unable to accept *zip files and therefore respondents may not send any files in this format. Please email responses to Sandra Jansen at sjansen@usaid.gov with a copy to Wacu Kiragu at wkiragu@usaid.gov with the subject title, “RFI No.72061522RFI00002 USAID/Kenya and East Africa Private Sector Development Initiative”.

III. Pre-solicitation Conference: USAID/KEA, may at its discretion, hold a Pre-solicitation Conference at a later date to be determined by USAID and after the Responses Due Date specified on the cover page.

IV. Preparation of Responses. Responses to this RFI must be limited to not more than 7 pages (12-point Times New Roman font, double-spaced, and with one-inch margins) and respond to the following questions:

1. What are the biggest constraints impeding and unlocking the growth of agribusinesses and outgrower schemes in Kenya?

2. What innovative models or structures could bring together traditional tools used to support firms (such as technical assistance and performance-based grants) with commercial finance tools? Are there other tools that should be included which have not been identified?

3. Are there entities in Kenya currently providing the full range of tools to support agricultural firms in expanding?

4. How could this project create or partner with an entity to create a sustainable long term funding vehicle for agriculture firms?

5. Is there a minimum amount of capital contributed from USAID that would make this attractive and viable?

6. What are recommendations for structuring appropriate levels of cost share or co-investment with companies that receive technical assistance or grants?

7. Should resource partners (e.g., funds, investors) be encouraged to bring some mailto:sjansen@usaid.gov mailto:wkiragu@usaid.gov proportion of capital for the project prior to awarding of the procurement?

8. What controls should be built into the structure to prevent it from undercutting existing financial service providers and distorting the market?

9. What period of performance/length of project is needed for maximum success?

10. This activity will prioritize investments in the 17 county FtF Zone of Influence (including Kenya’s arid and semi-arid lands), which includes areas where it has been difficult to attract private sector interest. What are the best approaches for attracting private sector investment in more remote areas? What approaches have been successful in similar areas?

11. Are there any other suggestions you wish to offer to improve the design of the program?

V. Submissions Review Process

USAID KEA will review all responses to the RFI. The quality and depth of responses will help to inform USAID’s future procurement approach.

End of Attachment 2

END OF RFI