Attachment J.11 IEE LAC-23-09 SET.pdf

LAC/COLOMBIA/SUSTAINABLE ECONOMIC TRANSFORMATION (SET)

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INITIAL ENVIRONMENTAL

EXAMINATION

Project/Activity Data

Project/Activity Name: Sustainable Economic Transformation (SET) activity

Geographic Location(s) (Country/Region): USAID/Colombia/LAC

Amendment (Yes/No), if Yes indicate # (1, 2...): No

Implementation Start/End Date (FY or M/D/Y): FY 2023 – FY2028

If Amended, specify New End Date: N/A

Solicitation/Contract/Award Number(s): TBD

Implementing Partner(s): TBD

Bureau Tracking ID: LAC-23-09

Tracking ID of related Programmatic IEE: N/A

Tracking ID of Other, Related Analyses: LAC-IEE-20-75 (Amendment #1 COVID-19 Response) and LAC-IEE-20-47 (Initial COVID-19 Response)

Organizational/Administrative Data

Implementing Operating Unit(s):

(e.g. Mission or Bureau or Office)

COLOMBIA/Sustainable Ecosystems and Economic Development Office (SEED Office)

Other Affected Operating Unit(s): N/A

Lead BEO Bureau: LAC

Funding Account(s) (if available): ESF funds

Original Funding Amount:

If Amended, specify funding amount: N/A

If Amended, specify new funding total: N/A

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Prepared by: Edgar Prieto

Date Prepared: 2/16/2023

ENVIRONMENTAL COMPLIANCE REVIEW DATA

Analysis Type: ☒Environmental Examination ☐Deferral

Environmental Determination(s): ☒Categorical Exclusion(s) ☒Negative ☐Positive ☐Deferred (per 22 CFR 216.3(a)(7)(iv)

IEE Expiration Date (if applicable): N/A

Additional Analyses/Reporting Required: ☒EMMP/EMMR

Climate Risks Identified (#): Low ___7___ Moderate ___0___ High ___23___

Climate Risks Addressed (#): Low ___7___ Moderate ___0___ High ___23___ about:blank about:blank

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THRESHOLD DETERMINATION AND SUMMARY OF FINDINGS

ACTIVITY SUMMARY

The purpose of the Sustainable Economic Transformation (SET) Activity is to support profitable and resilient business models and improve sustainable economic opportunities and investment in a targeted geography to foster equitable and environmentally sustainable growth, development, and peace implementation, as outlined in the Country Development Cooperation Strategy (CDCS) 2020-2025.

SET is a comprehensive rural development project where economic diversification, competitiveness improvement and climate change adaptation are the central strategies to improve resilient economic opportunities and livelihoods in conflict affected communities. Non-agricultural opportunities have the potential to diversify rural economies, enhance the local economic dynamic, preserve biodiversity, and promote cultural knowledge. Diversification of incomes is particularly crucial for women, considering that seventy-three (73.7%) percent of rural women earn income from non-agricultural activities. Agriculture will continue to play an important role under SET, given its importance in the Colombian rural economies: sixty-two (62%) of the rural population depend on agricultural related activities. Further, given the vast variety of agricultural products, and the possibilities to increase crop efficiency, and generate economies of scale, Colombia’s agricultural sector has the potential to grow and contribute to reduced rural poverty and improved livelihoods in conflict affected communities. The rural economic opportunities need to be profitable, sustainable and scalable and should be approached and complemented with strategies and actions to improve access to public and productive services and goods. In addition, economic opportunities should aim to mitigate climate change impacts and promote resilience to revitalize the local economy. Priority will be given to the regions included in the Development Plans with Territorial Approach (Spanish Acronym: PDETs) that USAID/Colombia is targeting under the CDCS.

The initiatives designed under this activity will follow a market systems approach. The technical strategy will incentivize market players to implement activities to develop new businesses, agribusinesses, and service opportunities that are economically, socially, and environmentally resilient and sustainable in rural municipalities. To reduce poverty, improve agricultural competitiveness, diversify rural economies, and further support implementation of the peace accords, SET was designed with a two-pronged mutually supporting approach. This includes: 1) Increase rural business growth and diversification and 2) Enhance environment for rural economic competitiveness.

This Activity contributes to the 2020-2025 USAID Colombia Country Development Cooperation Strategy (CDCS). Specifically, this Activity contributes directly to DO3 (Promote Equitable and Environmentally Sustainable Economic Growth). However, SET will also contribute to Development Objective 2: Strengthen Governance to Meet Citizen Needs and Increase Citizen Confidence in the State. Objective 2 of the CDCS is supported by SET’s IR 2.1 and 2.3 that encourages Community-Based Organizations (CBOs) to actively participate in public spaces.

These IRs will strengthen CBOs’ capacity to participate in the public discussions actively and effectively on climate-change information use and rural development, and promote open dialogues between the CBOs, private sector actors, and local and national governments.

The activity also supports Colombia’s Journey to Self-Reliance (J2SR) by promoting local ownership and leveraging local resources and expertise. This activity will contribute to several

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key issues for USAID including youth, gender and women’s empowerment, local actors, and private sector engagement.

ENVIRONMENTAL DETERMINATIONS

Upon approval of this document, the determinations become affirmed, per Agency regulations

(22 CFR 216).

TABLE 1: ENVIRONMENTAL DETERMINATIONS

Projects/Activities Categorical Exclusion Citation (if applicable)

Negative Determination

Positive Determination1

Deferral2

ACTIVITY: SET

Objective 1: Increased rural business growth and diversification.

Intermediate Results:

IR 1.1 Improved business performance (business model). This IR will strengthen the competitiveness of existing businesses and value chains, and will support rural economic diversification with the development of new economically, socially, and environmentally sustainable, climate-resilient income generating activities.

§216.2(c)(2)(i) Education, technical assistance, or training programs except to the extent such programs include activities directly affecting the environment (such as construction of facilities, etc.)

§216.2(c)(2)(iii) Analyses, studies, academic or research workshops and meetings

§216.2(c)(2)(v) Document and information transfers

X ☐ ☐

IR 1.2: Increased inclusive private sector investment.

This IR will seek to mobilize and leverage investment from micro, small, medium, and large private sector companies from diverse sectors to support socially and environmentally sustainable businesses

§216.2(c)(2)(i) Education, technical assistance, or training programs except to the extent such programs include activities directly affecting the environment (such as construction of facilities, etc.)

X ☐ ☐

1 Positive Determinations require preparation of a Scoping Statement and Environmental Assessment.

2 Deferrals must be cleared through an Amendment to this IEE prior to implementation of any deferred activities.

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and value chains.

Investment should be aligned with their core business interests, in multiple forms, including, but not limited to, technology transfer;

market knowledge; and business innovation, expansion, and financial contributions linked to IR 1.1.

§216.2(c)(2)(iii) Analyses, studies, academic or research workshops and meetings

§216.2(c)(2)(v) Document and information transfers

Special IR 1.3 Increased access to financial services. This IR will improve businesses and local value chains’ access to financial services like credit, savings accounts, digital payment services, and other new and relevant financial tools and services. This IR will be linked to business and value chains supported under IR1.1.

§216.2(c)(2)(i) Education, technical assistance, or training programs except to the extent such programs include activities directly affecting the environment (such as construction of facilities, etc.)

§216.2(c)(2)(iii) Analyses, studies, academic or research workshops and meetings

X ☐ ☐

Objective 2: Enhanced environment for rural economic competitiveness.

IR 2.1: Improved local development planning using climate information.

This IR will improve community, public, and private actors’ ability to plan effectively by encouraging and enabling these actors to use relevant, best available climate information and technologies in local planning, including production

§216.2(c)(2)(i) Education, technical assistance, or training programs except to the extent such programs include activities directly affecting the environment (such as construction of facilities, etc.)

§216.2(c)(2)(iii) Analyses, studies, academic or research workshops and meetings

§216.2(c)(2)(v) Document and

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information transfers

IR 2.2: Increased investment in climate resilient infrastructure, such as improvement of existing tertiary roads through small-scale interventions (box-culverts, placa huella, retaining wall, small drainage systems, etc.), and small-scale social infrastructure improvements (schools, training centers).

§216.2(c)(2)(i) Education, technical assistance, or training programs except to the extent such programs include activities directly affecting the environment (such as construction of facilities, etc.)

§216.2(c)(2)(iii) Analyses, studies, academic or research workshops and meetings

§216.2(c)(2)(v) Document and information transfers

X ☐ ☐

IR 2.3: Improved community capacity to maintain and use infrastructure. SET will improve community capacity to maintain, use, and prioritize climate resilient infrastructure investments that positively impact local businesses, value chains, and economic competitiveness

§216.2(c)(2)(i) Education, technical assistance, or training programs except to the extent such programs include activities directly affecting the environment (such as construction of facilities, etc.)

§216.2(c)(2)(iii) Analyses, studies, academic or research workshops and meetings

§216.2(c)(2)(v) Document and information transfers

Shared IR 1.4/2.4: Enhanced evidence for systems and policy change.

IR1.4/2.4 Enhanced evidence for systems and policy change. This IR will provide inputs and insights for structural and systemic changes

§216.2(c)(2)(i) Education, technical assistance, or training programs except to the extent such programs

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required to sustainably enable the economic dynamics in targeted regions. While implementing interventions under Objectives 1 and 2, evidence-based information and experiences from the public and private sectors and communities will be gathered.

include activities directly affecting the environment (such as construction of facilities, etc.)

§216.2(c)(2)(iii) Analyses, studies, academic or research workshops and meetings

CLIMATE RISK MANAGEMENT

This section summarizes the methodology used and findings of the CRM Screening, in accordance with ADS 201mal. The Sustainable Economic Transformation (SET) Activity design team, in consultation with the CIL, considered the potential effect of climate risks/stressors on the sustainability of the Activity (changing precipitation patterns, rising temperature, floods, droughts, fires, landslides, etc.) in addition to the impact of activities on the climate (increased greenhouse gas emissions, land use changes, etc.). See Annex 1 for the complete CRM table.

SET will strengthen local businesses and value chains, both agricultural and non-agricultural, to improve firm level competitiveness and support rural economic diversification. For agricultural activities, it will consider climate smart, regenerative agriculture, value addition, and other sustainable productive models, like permaculture, agroforestry and silvopastoral agriculture.

Also an efficient use and protection of water sources will be prioritized. Agriculture will only be supported in regions with adequate agricultural and environmental conditions, and agroforestry and silvo-pastoral models will be promoted, to prevent further deforestation. For the SET Activity, rural economic diversification refers to those economic opportunities that are feasible, offer sustainable economic alternatives to reduce the expansion of the agricultural frontier, and mitigate potential impacts and vulnerabilities to climate change. For protected and fragile regions, SET will support the development of businesses based in Non-timber forest products, sustainable tourism, cultural-based economies, etc.

Further, SET will foster a more competitive, resilient, and attractive rural economic landscape for investment, will promote open dialogues between the CBOs, private sector actors, and local and national governments, and will create and sustain links to municipal, departmental, and national markets. It will use climate information and mobilize public and private sector investment to develop climate resilient public and productive infrastructure. Climate resilient infrastructure is infrastructure that is designed, built, delivered, and/or operated in a way that anticipates and adapts to changing climate conditions, and withstands potential shocks.

The activities to be developed under the activity are identified mainly as low, moderate, and high risks in terms of climate risk management. Activities that were identified as high risk are related to small-scale infrastructure and agricultural production and markets.

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The activity is not expected to generate any significant greenhouse gas emissions. Ongoing monitoring will ensure that implementation of project activities does not increase greenhouse emissions.

Climate change adaptation activities will be conducted for each sub-activity to be implemented under SET. Please find the Climate Risk Management in Annex 1 the project and the illustrative mitigation measures that will address the main climate risks identified. The mitigation measures presented in this section constitute the minimum required based on available information at the time of the IEE. These measures shall provide general direction for completing the Environmental Mitigation and Monitoring Plan (EMMP) and/or the EA and PERSUAP, if required.

BEO SPECIFIED CONDITIONS OF APPROVAL

Safety measures shall be taken to prevent transmission of COVID-19 during activity implementation. Specifically, the implementing partner (IP) will ensure that the following requirements are met:

Ensure compliance with applicable partner country requirements and technical guidelines to prevent COVID-19 transmission over the course of the activities. This includes ensuring staff safety, safety of community members, and adequate management of waste. As appropriate, train staff and beneficiaries on social distancing, personal protective equipment (PPE) use, and disinfection. IP may follow WHO and/or CDC guidance as appropriate implementation.

IMPLEMENTATION

In accordance with 22 CFR 216 and Agency policy, the conditions and requirements of this document become mandatory upon approval. This includes the relevant limitations, conditions and requirements in this document as stated in Sections 3, 4, and 5 of the IEE and any BEO Specified Conditions of Approval.

This activity will be implemented by a contractor, possibly comprising a consortium of actors, and will be awarded through a full and open competition procurement process. The SET Activity will be implemented through a contract and USAID/Colombia will designate a Contracting Officer’s Representative (COR).

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INITIAL ENVIRONMENTAL

EXAMINATION

CONTENTS

1.0 PROJECT/ACTIVITY DESCRIPTION 11

1.1 PURPOSE OF THE IEE 11

1.2 PROJECT/ACTIVITY OVERVIEW 11

2.0 BASELINE ENVIRONMENTAL INFORMATION 14

2.1 LOCATIONS AFFECTED AND ENVIRONMENTAL CONTEXT (ENVIRONMENT,

PHYSICAL, CLIMATE, SOCIAL, THREATENED AND ENDANGERED SPECIES) 15

2.3 COUNTRY/MINISTRY/MUNICIPALITY ENVIRONMENTAL CAPACITY ANALYSIS (AS

APPROPRIATE) 15

3.0 ANALYSIS OF POTENTIAL ENVIRONMENTAL RISK 16

PROJECT/ACTIVITY 1: SET 16

4.0 ENVIRONMENTAL DETERMINATIONS 17

4.1 RECOMMENDED ENVIRONMENTAL DETERMINATIONS 17

4.2 CLIMATE RISK MANAGEMENT 21

5.0 CONDITIONS AND MITIGATION MEASURES 21

5.1 CONDITIONS 21

5.2 AGENCY CONDITIONS 23

5.3 SOCIAL SAFEGUARDS 23

5.4 MITIGATION MEASURES 24

6.0 LIMITATIONS OF THIS INITIAL ENVIRONMENTAL EXAMINATION 30

7.0 REVISIONS 31

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1.0 PROJECT/ACTIVITY DESCRIPTION

1.1 PURPOSE OF THE IEE

The purpose of this document, in accordance with Title 22, Code of Federal Regulations, Part 216 (22 CFR 216), is to provide a preliminary review of the reasonably foreseeable effects on the environment of the USAID intervention described herein and recommend determinations and, as appropriate, conditions, for these activities. Upon approval, these determinations become affirmed, and specified conditions become mandatory obligations of implementation.

This IEE also documents the results of the Climate Risk Management process in accordance with USAID policy (specifically, ADS 201mal), as well as USAID's Policy on Promoting the Rights of Indigenous Peoples (Pro-IP Policy), Parks and Protected Areas Social Safeguards (PASS), and the new Climate Change Strategy.

Potential environmental impacts should be addressed through formal environmental mitigation and monitoring plans (EMMPs) and/or other measures as described in Section 5.

1.2 PROJECT/ACTIVITY OVERVIEW

The purpose of the Sustainable Economic Transformation (SET) Activity is to support profitable and resilient business models and improve the sustainable economic opportunities and investment in a targeted geography to foster equitable and environmentally sustainable growth, development, and peace implementation, as outlined in the Country Development Cooperation Strategy (CDCS) 2020-2025. The Activity will implement comprehensive rural development activities in targeted conflict-affected regions characterized by low state presence, lack of economic opportunities, and a high presence of illegal economies.

This Activity contributes to the 2020-2025 USAID Colombia Country Development Cooperation Strategy (CDCS). Specifically, this Activity contributes directly to DO3 (Promote Equitable and Environmentally Sustainable Economic Growth). However, SET will also contribute to Development Objective 2: Strengthen Governance to Meet Citizen Needs and Increase Citizen Confidence in the State. Objective 2 of the CDCS is supported by SET’s IR 2.1 and 2.3 that encourages Community-Based Organizations (CBOs) to actively participate in public spaces.

These IRs will strengthen CBOs’ capacity to participate in the public discussions actively and effectively on climate-change information use and rural development, and promote open dialogues between the CBOs, private sector actors, and local and national governments.

The activity also supports Colombia’s Journey to Self-Reliance (J2SR) by promoting local ownership and leveraging local resources and expertise. This activity will contribute to several key issues for USAID including youth, gender and women’s empowerment, local actors, and private sector engagement.

1.3 PROJECT/ACTIVITY DESCRIPTION

SET is a comprehensive rural development project where economic diversification, competitiveness improvement and climate change adaptation are the central strategies to improve resilient economic opportunities and livelihoods in conflict affected communities. Non-agricultural opportunities have the potential to diversify rural economies, enhance the local economic dynamic, preserve biodiversity, and promote cultural knowledge, which is crucial for women, considering that seventy-three (73.7%) percent of rural women earn income from non-agricultural activities. Agriculture will continue to play an important role under SET, given its https://www.usaid.gov/our_work/environment/compliance/22cfr216 https://www.usaid.gov/ads/policy/200/201mal https://www.usaid.gov/indigenous-peoples/usaid-policy-on-indigenous-peoples

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importance in the Colombian rural economies: sixty-two (62%) of the rural population depend on agricultural related activities. Further, given the vast variety of agricultural products, and the possibilities to increase crop efficiency, and generate economies of scale, Colombia’s agricultural sector has the potential to grow and contribute to reduce rural poverty and improve the livelihoods of conflict affected communities. The rural economic opportunities need to be profitable, sustainable and scalable and should be approached and complemented with strategies and actions to improve access to public and productive services and goods and mitigate climate change impacts to revitalize the local economy. Priority will be given to the regions included in the Development Plans with Territorial Approach (Spanish Acronym:

PDETs) that USAID/Colombia is targeting under the CDCS.

The initiatives designed under this activity will follow a market systems approach. The technical strategy will incentivize market players to implement activities developing new businesses, agribusinesses, and service opportunities that are economically, socially, and environmentally resilient and sustainable in rural municipalities. To reduce poverty, improve agricultural competitiveness, diversify rural economies, and further support implementation of the peace accords, SET was designed with a two-prong mutually supporting approach. This includes: 1) Increase rural business growth and diversification and 2) Enhance environment for rural economic competitiveness.

Objective 1 will consider and leverage natural, cultural, and productive sectors in the targeted regions to promote licit, equitable, profitable, climate-resilient, and sustainable economic opportunities. The Contractor will strengthen local businesses and value chains, both agricultural and non-agricultural, to improve firm level competitiveness and support rural economic diversification. Local businesses and value chains will be strengthened to support the rural diversification process through market driven options that take into account the region’s natural, cultural, and productive potential, and will promote innovation of existing business models, and upgrade the skills and retool the workforce to help introduce new technologies that raise productivity and competitiveness. Alternative development models supported under this objective will be tailored to community skills and interests; enable the local economic environment; attract private sector investment needed for economic territorial transformation;

and contribute to reduced emissions, deforestation, and biodiversity loss. For the on-farm agricultural actions to be conducted or leveraged by SET, including technical assistance provision, the use of sustainable and good agricultural practices and the approved PERSUAP will be prioritized, as well as the use of organic, regenerative and sustainable agriculture practices.

Objective 2 will improve local economic conditions by leveraging and mobilizing public and private sector investment in public goods and services, like roads, productive and training infrastructure, storage facilities, and services. Through this objective, SET will foster a more competitive, resilient, and attractive rural economic landscape for investment, will promote open dialogues between the CBOs, private sector actors, and local and national governments, and will create and sustain links to municipal, departmental, and national markets. The contractor will use climate information and mobilize public and private sector investment to develop climate resilient public and productive infrastructure. Small-scale infrastructure interventions, like the improvement of tertiary roads and community-owned collection centers, decrease production costs, enhance market access, and improve business productivity and competitiveness. As a priority, investment under this objective must support interventions defined under Objective 1, to foster the competitiveness of the supported licit economic opportunities. This component will follow a participatory approach to prioritize and design interventions, clearly define contributions from all the relevant stakeholders, and implement the defined actions. Lessons learned from

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previous USAID interventions will be taken into account to avoid pitfalls and improve project impact. SET will coordinate with relevant stakeholders and public institutions to guarantee and adequate maintenance of the infrastructure to be intervened. Further, prior to the interventions of the of productive infrastructure, the Contractor will ensure that: i) the infrastructure is part of an operational and profitable business, ii) other preconditions for the infrastructure and the business it is part of are already in place or properly planned, iii) expected impacts in the business as a result of the intervention are properly calculated, iv) CBOs in charge have adequate management capacity for proper operation, v) that a maintenance plan is in place to guarantee functionality and sustainability, and that there is a full compliance with USAID’s and the Government of Colombia (GoC’s) environmental requirements and other relevant regulations.

The shared IR 1.4/2.4 “Enhanced evidence for systems and policy change” will provide inputs and insights for structural and systemic changes required to sustainably enable the economic dynamics in targeted regions. While implementing interventions under Objectives 1 and 2, SET will gather evidence-based information and experiences from the public and private sectors and communities to inform select regional and national public policy development related to rural economic development planning and implementation, including rural climate adaptation efforts.

This work will also include making recommendations to improve existing policy implementation in order to make policies and processes more responsive to communities needs and to private sector and market incentives.

TABLE 2: DEFINED OR ILLUSTRATIVE ACTIVITIES AND SUB-ACTIVITIES

Objective 1: Increased rural business growth and diversification.

Intermediate Result 1.1. Improved business performance (business model). This IR will strengthen the competitiveness of existing businesses and value chains, and will support rural economic diversification with the development of new economically, socially, and environmentally sustainable, climate-resilient income generating activities.

Intermediate Result 1.2. Increased inclusive private sector investment. This IR will seek to mobilize and leverage investment from micro, small, medium, and large private sector companies from diverse sectors to support socially and environmentally sustainable businesses and value chains. Investment should be aligned with their core business interests, in multiple forms, including, but not limited to, technology transfer; market knowledge; and business innovation, expansion, and financial contributions linked to IR 1.1.

Intermediate Result 1.3. Sustainable private sector investment increased. The activity will leverage private sector investment aligned with their core business interests, in multiple forms, including, but not limited to, technology transfer; market knowledge; and business innovation, expansion, and financial contributions linked to IR 1.1. Specific small-scale productive and training infrastructure investments will be developed under Objective 2.

Objective 2: Enhanced environment for rural economic competitiveness.

Intermediate Result 2.1: Improved local development planning using climate information. This IR will improve community, public, and private actors’ ability to plan effectively by encouraging and enabling these actors to use relevant, best available climate information and technologies in local planning, including production

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Intermediate Result 2.2. Increased investment in climate resilient infrastructure, such as improvement of existing tertiary roads through small-scale interventions (box-culverts, placa huella, retaining wall, small drainage systems, etc.), and small-scale social infrastructure improvements (schools, training centers).

Intermediate Result 2.3 Improved community capacity to maintain and use infrastructure. SET will improve community capacity to maintain, use, and prioritize climate resilient infrastructure investments that positively impact local businesses, value chains, and economic competitiveness.

Shared IR 1.4/2.4 — Enhanced evidence for systems and policy change. This IR will provide inputs and insights for structural and systemic changes required to sustainably enable the economic dynamics in targeted regions. While implementing interventions under Objectives 1 and 2, evidence-based information and experiences from the public and private sectors and communities will be gathered.

Will this activity involve construction3 as defined by ADS 201 and 303? Yes ☒ No ☐

The activity may include the improvement of small-scale infrastructure, such as improvement of existing tertiary roads by intervening in specific critical points (box-culvert, placa huella, retaining wall, small drainage systems, etc.,) to be defined with relevant stakeholders. SET will also implement small-scale tourism facilities (trails, solar energy systems, etc.,), productive infrastructure like post-harvesting facilities (fermentation, solar-dry and cleaning centers) and small-scale collection and training centers (collective storage centers, school and training center improvements) to enhance the competitiveness of the business identified under objective 1, yet no major construction activities will be conducted and no construction intervention will be conducted in national parks nor protected areas. Each sub-activity will be discussed separately with relevant stakeholders including community members, Government of Colombia representatives, local authorities, private sector, etc., so that USAID plays a catalytic role in the development of the rural development actions. Further, all the infrastructure activities will observe USAID’s preferred approach and other relevant regulations. USAID/Colombia will follow Construction Risk Management requirements. Completing the CRM survey will be done, if required.

2.0 BASELINE ENVIRONMENTAL INFORMATION

SET will work in rural areas of 30 municipalities of 5 to 6 departments (Cauca, Nariño, Putumayo, Meta, Guaviare and Guajira). USAID/Colombia prioritize these municipalities based on the following criteria: i) these are part of the Government of Colombia PDET strategy which is aligned with the Mission’s CDCS, ii) they have a high prevalence of illicit crop production and

iii) they are aligned with other USAID/Colombia interventions iv) Municipalities with economic sectors that have increased vulnerability to climate change impacts; and v) Municipalities with previous USAID interventions that could be leveraged and strengthened to achieve the development tipping point.

3 Construction, as defined by ADS 201 and 303, includes: construction, alteration, or repair (including dredging and excavation) of buildings, structures, or other real property and includes, without limitation, improvements, renovation, alteration and refurbishment. The term includes, without limitation, roads, power plants, buildings, bridges, water treatment facilities, and vertical structures. In the box below, describe any construction planned for this project/activity. Refer to ADS 201maw for required Construction Risk Management procedures.

https://www.usaid.gov/sites/default/files/documents/1865/201maw.pdf

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These areas may include private owned lands, state owned lands, indigenous reserves, Afro- Colombian areas, as well as parks and/or protected areas. Specific targeted municipalities can be found in Annex 2.

The Activity will focus the intervention making the following considerations:

a) Protect ecologically sensitive ecosystems, such as wetlands, tropical forest, freshwater and other ecosystems of the intervened region.

b) Conserve and protect existing forests.

c) Ensure that sites are in safe (or less vulnerable) areas to landslides, floods, fires, frosts, etc.

d) Respect land use designations, as well as river management plans, defined by local authorities.

e) Local communities, entities and sectors will be consulted and will have an active participation.

f) Obtain all legal permits/licenses required by appropriate authorities.

g) Avoid burning.

h) Avoid and/or control modifying or affecting the hydrological network.

i) Avoid felling trees and/or extracting fauna.

j) Site the activities in previously-disturbed areas, with low vegetation, instead of opening or deforesting new ones.

2.1 LOCATIONS AFFECTED AND ENVIRONMENTAL CONTEXT (ENVIRONMENT, PHYSICAL,

CLIMATE, SOCIAL, THREATENED AND ENDANGERED SPECIES)

SET will support GOC efforts to improve rural livelihoods by promoting comprehensive rural development interventions at regional and local levels. The Activity will be focused on improving the competitiveness of sustainable agricultural activities as well as supporting the diversification of the rural economies while conducting climate-change adaptation strategies. The goal is for Colombians living in historically neglected areas and affected by the conflict to have sustainable economic opportunities that provide them with a path out of poverty and a means of avoiding the trap of illicit economies. Thus, SET’s geographic focus considers isolated conflict-affected regions with a high prevalence of illicit crops, where deforestation and other illicit economic activities (illegal mining) are strong. These areas include 30 municipalities of 6 Departments (see Annex 2) and may include protected areas from different levels (national, regional and/or local). These areas may include private owned lands, state owned lands, indigenous reserves, Afro-Colombian areas, as well as parks and/or protected areas.

2.2 APPLICABLE AND APPROPRIATE PARTNER COUNTRY AND OTHER INTERNATIONAL

STANDARDS (E.G. WHO), ENVIRONMENTAL AND SOCIAL LAWS, POLICIES, AND REGULATIONS

The activities will follow national regulations defined by local and National Authorities such as ICA, INVIAS, Ministry of Agriculture and Rural Development, Ministry of Environment and Sustainable Development, USAID’s environmental regulations (22CFR216), environmental procedures (ADS 204), and the new Climate Strategy.

2.3 COUNTRY/MINISTRY/MUNICIPALITY ENVIRONMENTAL CAPACITY ANALYSIS (AS

APPROPRIATE)

The implementation of the Activity requires coordination with the departmental and municipal governments where the activity will take place as well as with regional environment authorities and where necessary because of overlap with protected areas and/or ethnic territories.

https://www.usaid.gov/ads/policy/200/204

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3.0 ANALYSIS OF POTENTIAL ENVIRONMENTAL RISK

PROJECT/ACTIVITY 1: SET

TABLE 3. POTENTIAL IMPACTS

Project/Activity Potential environmental and social impacts

Objective 1: Increased rural business growth and diversification

Intermediate Results 1.1: Improved business performance (business model). This IR will strengthen the competitiveness of existing businesses and value chains, and will support rural economic diversification with the development of new economically, socially, and environmentally sustainable, climate-resilient income generating activities.

● Air Pollution

● Pesticides use

● Public/Worker Health & Safety

● Socioeconomic Impacts

● Soil & Water Impacts

Intermediate Results 1.2:

Increased inclusive private sector investment.

This IR will seek to mobilize and leverage investment from micro, small, medium, and large private sector companies from diverse sectors to support socially and environmentally sustainable businesses and value chains.

Investment should be aligned with their core business interests, in multiple forms, including, but not limited to, technology transfer;

market knowledge; and business innovation, expansion, and financial contributions linked to IR 1.1.

Specific small-scale productive infrastructure investments will be developed under Objective 2.

● Habitat loss

● Air Pollution

● Pesticides use

● Public/Worker Health & Safety

● Socioeconomic Impacts

● Soil & Water Impacts

● Solid Waste Management & Disposal

● Hazardous waste Management & Disposal

Special IR 1.3 Increased access to financial services.

This IR will improve businesses and local value chains’ access to financial services like credit, savings accounts, digital payment services, and other new and relevant financial tools and services. This IR will be linked to business and value chains supported under IR1.1.

● Habitat loss

● Air Pollution

● Pesticides use

● Public/Worker Health & Safety

● Socioeconomic Impacts

● Soil & Water Impacts

● Solid Waste Management & Disposal

● Hazardous waste Management & Disposal

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Objective 2 — Enhanced environment for rural economic competitiveness.

Intermediate Result 2.1:

Improved local development planning using climate information.

This IR will improve community, public, and private actors’ ability to plan effectively by encouraging and enabling these actors to use relevant, best available climate information and technologies in local planning, including production.

N/A

Intermediate Results 2.2: Increased investment in climate resilient infrastructure, such as improvement of existing tertiary roads through small-scale interventions (box-culverts, placa huellas, retaining wall, small drainage systems, etc), and small-scale social infrastructure improvements (schools, training centers).

● Habitat loss

● Air Pollution

● Pesticides use

● Public/Worker Health & Safety

● Socioeconomic Impacts

● Soil & Water Impacts

● Solid Waste Management & Disposal

● Hazardous waste Management & Disposal

Intermediate Results 2.3:

Improved community capacity to maintain and use infrastructure.

SET will improve community capacity to maintain, use, and prioritize climate resilient infrastructure investments that positively impact local businesses, value chains, and economic competitiveness.

Shared IR 1.4/2.4 — Enhanced evidence for systems and policy change.

Shared IR 1.4/2.4: This IR will provide inputs and insights for structural and systemic changes required to sustainably enable the economic dynamics in targeted regions. While implementing interventions under Objectives 1 and 2, evidence-based information and experiences from the public and private sectors and communities will be gathered.

N/A

4.0 ENVIRONMENTAL DETERMINATIONS

4.1 RECOMMENDED ENVIRONMENTAL DETERMINATIONS

IEE TEMPLATE VERSION 1.0

The following table summarizes the recommended determinations based on the environmental analysis conducted. Upon approval, these determinations become affirmed, per 22 CFR 216.

Specified conditions, detailed in Section 5, become mandatory obligations of implementation, per ADS 204.

TABLE 4: ENVIRONMENTAL DETERMINATIONS

Projects/Activities Categorical Exclusion Citation (if applicable)

Negative Determination

Positive Determination4

Deferral5

ACTIVITY: SET

Objective 1: Objective 1: Increased rural business growth and diversification.

Intermediate Results:

IR 1.1 Improved business performance (business model). This IR will strengthen the competitiveness of existing businesses and value chains, and will support rural economic diversification with the development of new economically, socially, and environmentally sustainable, climate-resilient income generating activities.

assistance, or training programs except to the extent such programs include activities directly affecting the environment (such as construction of facilities, etc.)

§216.2(c)(2)(iii) Analyses, studies, academic or research workshops and meetings

§216.2(c)(2)(v) Document and information transfers

X ☐ ☐

IR 1.2: Increased inclusive private sector investment.

This IR will seek to mobilize and leverage investment from micro, small, medium, and large private sector companies from diverse sectors to support socially and environmentally sustainable businesses and value chains.

§216.2(c)(2)(i) Education, technical assistance, or training programs except to the extent such programs include activities directly affecting the environment (such as construction of facilities, etc.)

§216.2(c)(2)(iii)

X ☐ ☐

4 Positive Determinations require preparation of a Scoping Statement and Environmental Assessment.

5 Deferrals must be cleared through an Amendment to this IEE prior to implementation of any deferred activities.

IEE TEMPLATE VERSION 1.0

Investment should be aligned with their core business interests, in multiple forms, including, but not limited to, technology transfer;

market knowledge; and business innovation, expansion, and financial contributions linked to IR 1.1.

Analyses, studies, academic or research workshops and meetings

Special IR 1.3 Increased access to financial services.

This IR will improve businesses and local value chains’ access to financial services like credit, savings accounts, digital payment services, and other new and relevant financial tools and services. This IR will be linked to business and value chains supported under IR1.1.

§216.2(c)(2)(i) Education, technical assistance, or training programs except to the extent such programs include activities directly affecting the environment (such as construction of facilities, etc.)

§216.2(c)(2)(iii) Analyses, studies, academic or research workshops and meetings

§216.2(c)(2)(v) Document and information transfers

X ☐ ☐

Objective 2: Enhanced environment for rural economic competitiveness.

IR 2.1: Improved local development planning using climate information.

This IR will improve community, public, and private actors’ ability to plan effectively by encouraging and enabling these actors to use relevant, best available climate information and technologies in local planning, including production.

assistance, or training programs except to the extent such programs include activities directly affecting the environment (such as construction of facilities, etc.)

§216.2(c)(2)(iii) Analyses, studies, academic or

IEE TEMPLATE VERSION 1.0

research workshops and meetings

§216.2(c)(2)(v) Document and information transfers

IR 2.2: Increased investment in climate resilient infrastructure, such as improvement of existing tertiary roads through small-scale interventions (box-culverts, placa huellas, retaining wall, small drainage systems, etc.), and small-scale social infrastructure assistance, or training programs except to the extent such programs include activities directly affecting the environment (such as construction of facilities, etc.)

§216.2(c)(2)(iii) Analyses, studies, academic or research workshops and meetings

§216.2(c)(2)(v) Document and information transfers

X ☐ ☐

IR 2.3: Improved community capacity to maintain and use infrastructure. SET will improve community capacity to maintain, use, and prioritize climate resilient infrastructure investments that positively impact local businesses, value chains, and economic competitiveness.

§216.2(c)(2)(i) Education, technical assistance, or training programs except to the extent such programs include activities directly affecting the environment (such as construction of facilities, etc.)

§216.2(c)(2)(iii) Analyses, studies, academic or research workshops and meetings

§216.2(c)(2)(v) Document and information transfers

Shared IR 1.4/2.4 — Enhanced evidence for systems and policy change.

IEE TEMPLATE VERSION 1.0

Shared IR 1.4/2.4: This IR will provide inputs and insights for structural and systemic changes required to sustainably enable the economic dynamics in targeted regions. While implementing interventions under Objectives 1 and 2, evidence-based information and experiences from the public and private sectors and communities will be gathered.

§216.2(c)(2)(i) Education, technical assistance, or training programs except to the extent such programs include activities directly affecting the environment (such as construction of facilities, etc.)

§216.2(c)(2)(iii) Analyses, studies, academic or research workshops and meetings

4.2 CLIMATE RISK MANAGEMENT

This section summarizes the methodology used and findings of the CRM Screening, in accordance with ADS 201mal. The project design team, in consultation with the CIL, considered the potential effect of climate risks/stressors on the sustainability of the project (changing precipitation patterns, rising temperature, floods, droughts, fires, landslides, etc.) in addition to the impact of project activities on the climate (increased greenhouse gas emissions, land use changes, etc.). See Annex 1 for the complete CRM table.

5.0 CONDITIONS AND MITIGATION MEASURES

5.1 CONDITIONS

The environmental determinations in this IEE are contingent upon full implementation of the following general implementation and monitoring requirements, as well as ADS 204 and other relevant requirements.

5.1.1 During Pre-Award:

5.1.1.1 Pre-Award Briefings: As feasible, the design team and/or the cognizant environmental officer(s) (e.g., MEO, REA, BEO) will provide a pre-award briefing for potential offerors on environmental compliance expectations/responsibilities at bidders’ conferences.

5.1.1.2 Solicitations: The design team, in coordination with the A/CO, will ensure solicitations include environmental compliance requirements and evaluation criteria. A/CO will ensure technical and cost proposal requirements include approach, staffing, and budget sufficient for complying with the terms of this IEE.

5.1.1.3 Awards: The A/COR, in coordination with the A/CO, will ensure all awards and sub-awards include environmental compliance requirements.

https://www.usaid.gov/ads/policy/200/201mal

IEE TEMPLATE VERSION 1.0

5.1.2 During Post-Award:

5.1.2.1 Post-Award Briefings: The A/COR and/or the cognizant environmental officer(s) (e.g., MEO, REA, BEO) will provide post-award briefings for the IP on environmental compliance responsibilities.

5.1.2.3 Work Plans and Budgeting: The A/COR will ensure the IP integrates environmental compliance requirements in work plans and budgets to comply with requirements, including EMMP implementation and monitoring.

5.1.2.4 Staffing: The A/COR, in coordination with the IP, will ensure all awards have staffing capacity to implement environmental compliance requirements.

5.1.2.5 Records Management: The A/COR will maintain environmental compliance documents in the official project/activity file and upload records to the designated USAID environmental compliance database system.

5.1.2.6 Host Country Environmental Compliance: The A/COR will ensure the IP complies with applicable and appropriate host country environmental requirements unless otherwise directed in writing by USAID. However, in the case of a conflict between the host country and USAID requirements, the more stringent shall govern.

5.1.2.7 Work Plan Review: The A/COR will ensure the IP verifies, at least annually or when activities are added or modified, that activities remain within the scope of the IEE. Activities outside of the scope of the IEE cannot be implemented until the IEE is amended.

5.1.2.8 IEE Amendment: If new activities are introduced or other changes to the scope of this IEE occur, an IEE Amendment will be required.

5.1.2.9 USAID Monitoring Oversight: The A/COR or designee, with the support of the cognizant environmental officer(s) (e.g., MEO, REA, BEO), will ensure monitoring of compliance with established requirements (e.g., by desktop reviews, site visits, etc.).

5.1.2.10 Environmental Compliance Mitigation and Monitoring Plan: The A/COR will ensure the IP develops, obtains approval for, and implements Environmental Mitigation and Monitoring Plans (EMMPs) that are responsive to the stipulated environmental compliance requirements.

5.1.2.11 Environmental Compliance Reporting: The A/COR will ensure the IP includes environmental compliance in regular project/activity reports, using indicators as appropriate; develops and submits the Environmental Mitigation and Monitoring Reports (EMMRs); and completes and submits a Record of Compliance (RoC) describing their implementation of EMMP requirements in conjunction with the final EMMR or at the close of sub activities (as applicable). And where required by Bureaus or Missions, ensure the IP prepares a closeout plan consistent with contract documentation for A/COR review and approval that outlines responsibilities for end-of-project operation, the transition of other operational responsibilities, and final EMMR with lessons learned.

IEE TEMPLATE VERSION 1.0

5.1.2.12 Corrective Action: When noncompliance or unforeseen impacts are identified, IPs notify the A/COR, place a hold on activities, take corrective action, and report on the effectiveness of corrective actions. The A/COR initiates the corrective action process and ensures the IP completes and documents their activities. Where required by Bureaus or Missions, ensure Record of Compliance is completed.

5.2 AGENCY CONDITIONS

5.2.1 Sub-award Screening: The A/COR will ensure the IP uses an adequate environmental screening tool to screen any sub-award applications and to aid in the development of EMMPs.

5.2.2 Programmatic IEEs (PIEE): PIEEs stipulate requirements for additional environmental examination of new or country specific projects/activities. The A/COR of any project/activity being implemented under a PIEE will ensure appropriate reviews are conducted, typically through a Supplemental IEE, and approved by the cognizant BEO.

5.2.3 Supplemental IEEs (SIEEs) will be prepared pursuant to the terms of the presiding PIEE for any new project/activity being planned. The SIEE will provide more thorough analysis of the planned activities, additional geographic context and baseline conditions as well as specific mitigation and monitoring requirements.

5.2.4 Other Supplemental Analyses: The A/COR will ensure supplemental environmental analyses that are called for in the IEE are completed and documented.