Attachment J.2 DIGI Activity DCE.pdf

https://ecd.usaid.gov/document.php?doc_id=62336

DETERMINATION OF CATEGORICAL EXCLUSION

Document Purpose:

The purpose of this DCE is to provide the first environmental review for the DIGI Zambia activity. DIGI Zambia catalyzes private sector debt & equity investments into technology and tech-enabled businesses.and accelerates technology startup companies. This analysis expires March 31, 2029.

ORGANIZATIONAL DATA

Activity Name: Digital Innovation and Growth Initiative in Zambia (DIGI) Geographic Location(s): Zambia, Country-wide Funding Operating Unit(s): Zambia

Other Involved Operating Unit(s): EDEV Funding Account(s): CPIF Life of Project Funding (ceiling): TBD Activity Start/End Date

If Amended, New End Date:

September 30, 2024 – September 30, 2028

Solicitation/Contract/Award Number(s) : TBD Mechanism Type: Fixed Price Contract Implementing Partner(s): TBD

DOCUMENT TRACKING

Bureau Tracking ID: https://ecd.usaid.gov/document.php?doc_id=62336 If an Amendment, Tracking ID of Preceding Compliance Document(s)

No

Tracking ID or Hyperlink of Other Related Compliance Documents

NA

Document Expiration Date March 31, 2029 Sector Type(s) Economic Growth

ENVIRONMENTAL COMPLIANCE REVIEW DATA

Environmental Determination(s) Categorical Exclusion Additional Analyses or Reporting Required:

Activity will involve construction, as defined by ADS 201 and 303

No construction is planned or authorized under this activity

Potential Impact to Threatened or Endangered Species or Critical Habitat per 216.5

No impact to Threatened or Endangered Species or Critical Habitats

Applicability of Safeguards for Activities Supporting Parks and Protected Areas

No, this activity will not support Parks and Protected Areas

Climate Risks Identified (#) in Annex 1:

Climate Risks Addressed (#) in Annex 1:

High 0 Moderate 0 Low 2 High 0 Moderate 0 Low 2

AFR BUREAU/ZAMBIA MISSION/DIGI ACTIVITY 1

Digital Innovation and Growth Initiative in Zambia (DIGI) DCE https://ecd.usaid.gov/document.php?doc_id=62336 https://ecd.usaid.gov/document.php?doc_id=62336 https://www.usaid.gov/sites/default/files/documents/201maw.pdf https://www.usaid.gov/sites/default/files/documents/201maw.pdf https://www.usaid.gov/environmental-procedures/environmental-compliance-esdm-program-cycle/safeguards-for-activities-supporting-parks-and-protected-areas

Approval: /s/ Robin Sharma 05/23/2024

Robin Sharma, Acting Mission Director Date:

Clearance: /s/ Amanda Van den Dool 05/14/2024

Amanda Van den Dool, Deputy Office Director EDEV Date:

Clearance /s/ Mwewa Katongo 05/14/2024

Mwewa Katongo, Mission Environmental Officer Date:

Clearance:

/s/ Emily Rupp

02/14/2024

Emily Rupp, Program Office Director Date:

Clearance: /s/ Brian Lecuyer for Michael Capobianco 05/21/2024

Michael Capobiano, OAA Office Director Date:

Clearance: /s/ Michael Weaver 05/16/2024

Michael T. Weaver, Regional Environmental Advisor Date:

Clearance /s/ Ian Robertson for Samantha Ferreira 05/22/2024

Samantha Glover Ferreira, Resident Legal Officer Date:

Clearance:

/s/ Michael Capobianco

05/22/2024

Michael Capobianco, Acting Deputy Mission Director Date:

AFR BUREAU/ZAMBIA MISSION/DIGI ACTIVITY 2

Digital Innovation and Growth Initiative in Zambia (DIGI) DCE

Clearance: /S/ Tashiana Osborne 06/05/2024

Concurrence: /S/ Brian Hirsch 6/4/24 Brian Hirsch, AFR Bureau Environmental Officer Date

AFR BUREAU/ZAMBIA MISSION/DIGI ACTIVITY 3

Digital Innovation and Growth Initiative in Zambia (DIGI) DCE

Tashiana Osborne , AFR Climate Integration Lead Date

PURPOSE OF THIS DOCUMENT

In accordance with Title 22, Code of Federal Regulations, Part 216 (22 CFR 216), this document is to establish that all proposed activities belong to classes of actions eligible for Determination of Categorical

Exclusions (DCE), as set out in Agency regulations (22 CFR 216.2(c)), and that there are no foreseeable significant direct or indirect impacts that would preclude a CE determination. Upon approval of this document, the DCEs are affirmed for this activity.

This document also captures (in Annex 1) the results of the Climate Risk Management process, in accordance with USAID policy (ADS 201mal).

1. ACTIVITY OVERVIEW & DESCRIPTION

DIGI Zambia will generate positive investor excitement and promote inclusive economic growth to the Zambian people through two mutually-reinforcing activities that will be managed by the selected investment fund manager:

● Catalyzing private sector debt & equity investments into technology and tech-enabled businesses that utilize rights-respecting technology to increase revenues, expand employment, and provide proof of viable options for investors, investees, and technology companies.

● Accelerate technology startup companies to reach their second birthday with at least three full-time equivalent employees and $50,000 USD in revenues, essentially doubling the number of growth-orientated tech companies that can service the Zambian economy.

TABLE 1: ILLUSTRATIVE ACTIVITIES, SUB-ACTIVITIES, OR INTERVENTIONS

Project/Activity - 1 —Private Sector Investment - Catalyzing private sector debt & equity investments into technology and tech-enabled businesses that utilize rights-respecting technology to increase revenues, expand employment, and provide proof of viable alternatives for investors, investees, and technology companies.

Sub Activity 1.1 Connect with private sector investors & secure their investment willingness Sub Activity 1.2 Identify firms that are ready to receive debt/equity investment and rate investment potential Sub Activity 1.3 Match investors with investable firms and secure investment into firms Sub Activity 1.4 Support firms over life of investment to ensure repayment of investment Sub Activity 1.5 Distribute investment returns to investors and seek their continued investment Project/Activity - 2 — Tech Startup Ecosystem - Accelerating technology startup companies to reach their second year of operation with at least three full-time equivalent employees and $50,000 USD in revenues, essentially doubling the number of growth-oriented tech companies that can service the Zambian economy.

Sub Activity 2.1 Identify nascent tech startups and rate their ability to be growth orientated by their second birthday Sub Activity 2.2 Build the capacity of growth-oriented businesses through investment, mentorship, and networking Sub Activity 2.3 Coach businesses to become leaders in the Zambian digital economy

2. DETERMINATION OF CATEGORICAL EXCLUSIONS

A DCE is recommended for the following activities or interventions (sub-activities) that fall under the classes of actions defined in §216.2(c)(2). No further analysis is required for the activities/interventions

AFR BUREAU/ZAMBIA MISSION/DIGI ACTIVITY 4

Digital Innovation and Growth Initiative in Zambia (DIGI) DCE https://ecd.usaid.gov/document.php?doc_id=62336 https://www.usaid.gov/our_work/environment/compliance/22cfr216 https://www.usaid.gov/ads/policy/200/201mal described in Table 1. In the event of modification to the scope of work or addition of new activities, an amendment will be required.

Activity or Intervention #

Recommended Determination for Categorical Exclusion

Project/Activity - 1 —Private Sector Investment - Catalyzing private sector debt & equity investments into technology and tech-enabled businesses that utilize rights-respecting technology to increase revenues, expand employment, and provide proof of viable alternatives for investors, investees, and technology companies.

Sub Activity 1.1-1.5

§216.2(c)(2)(x) Support for intermediate credit institutions when the objective is to assist in the capitalization of the institution or part thereof and when such support does not involve reservation of the right to review and approve individual loans made by the institution

Project/Activity - 2 — Tech Startup Ecosystem - Accelerating technology startup companies to reach their second year of operation with at least three full-time equivalent employees and $50,000 USD in revenues, essentially doubling the number of growth-oriented tech companies that can service the Zambian economy.

Sub Activity 2.1-2.3

§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.)

3. MANAGEMENT AND REPORTING

3.1 USAID IMPLEMENTATION AND MONITORING REQUIREMENTS FOR AWARDS

The DCE is contingent upon full implementation of the following requirements.

Changes to scope of awards require a determination be made as to whether such change may have an environmental impact not previously assessed (per §216.3(a)(9)). Per ADS 204, it is the responsibility of the AOR/COR to keep the MEO/REA and BEO informed of any new information or changes in the activity(ies) subject to this DCE.

3.1.1. Provide briefings for implementing partner(s) on environmental compliance responsibilities relevant to the award (justification for DCE and limitations - such as no physical works, ensure activities remain within the scope of the DCE, monitoring to ensure activities do not result in unintended environmental impacts, etc.);

3.1.2 Ensure integration of DCE limitations in prime and sub-awards and grant agreements;

3.1.3.Ensure compliance with applicable partner country requirements;

3.1.4. Annual review of activities to ensure that scope is consistent with the DCE;

3.1.5. Records Management: The AOR/COR will maintain environmental compliance documents in the official activity file and upload records to the USAID Environmental Compliance Database;

3.1.6. Corrective Action: When noncompliance or unforeseen impacts are identified, the AOR/COR will initiate the corrective action process, in consultation with the cognizant environmental officer(s) (e.g., MEO, REA, or BEO). The Corrective Action Plan is used to document findings, recommendations, and a timeline for making the corrections.

AFR BUREAU/ZAMBIA MISSION/DIGI ACTIVITY 5

Digital Innovation and Growth Initiative in Zambia (DIGI) DCE mailto:environmentalcompliancesupport@usaid.gov

ANNEX 1. CLIMATE RISK MANAGEMENT

ANNEX 1A. CLIMATE RISK MANAGEMENT SUMMARY

This section summarizes the methodology used and findings of the CRM Screening, in accordance with ADS 201mal. The 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.).

The analysis revealed low risks associated with this activity. However, increasing access to funding for tech companies, like any other sector, has the potential to contribute to greenhouse gas emissions. An opportunity exists for the Mission or this Activity to create training opportunities on climate mitigation for companies operating in the tech industry.

Climate considerations will be included in work plan development, and shared with the IP, including in solicitations, to help address climate risks.

ANNEX 1B. CLIMATE RISK MANAGEMENT SUMMARY TABLE

Activity1 Climate Risks2 Risk Rating3 How Risks are Addressed at Project Level4

Opportunities to Strengthen Climate Resilience or Climate Mitigation5

1. Private Sector Investment Increased support and demand may contribute to an increase in carbon emissions.

Low Consider investing in companies that show commitment towards preserving the environment and for emissions reduction.

Create training opportunities on climate mitigation for companies in the tech industry.

2. Tech Startup Ecosystem Increased support and demand for technology may contribute to an increase in the accumulation of electronic waste and carbon emissions

Low IP to consider ways to avoid or manage e-waste

Collaborating with companies working in the recycling sector

5 Describe opportunities to achieve development objectives by integrating climate resilience or mitigation measures.

4 Describe how risks have been addressed at the project level. If a decision has been made to accept the risk, briefly explain why.

3 Low/Moderate/ High

2 List key risks related to the project elements identified through either the strategy- or project-level climate risk assessment.

1 Purpose/Sub-purpose, Area of Focus, or Activity/ Mechanism, etc.

AFR BUREAU/ZAMBIA MISSION/DIGI ACTIVITY 6

Digital Innovation and Growth Initiative in Zambia (DIGI) DCE https://www.usaid.gov/ads/policy/200/201mal

AFR BUREAU/ZAMBIA MISSION/DIGI ACTIVITY 7

Digital Innovation and Growth Initiative in Zambia (DIGI) DCE