Attachments 1 2 3 5 6 7 8.pdf

Attachment 1 - List of Acronyms

ACFTA: Africa Continental Free Trade Area

ADS: Automated Directives System

AGOA: Africa Growth and Opportunity Act

CLA: Collaborating, Learning and Adaptability

COP: Chief of Party

CO: Contracting Officer

COR: Contracting Officer’s Representative

CPA: Certified Public Accountant

CV: Curriculum Vitae

Development Experience Clearinghouse (DEC)

DFC: U.S. International Development Finance Corporation

EMMP: Environmental Mitigation and Monitoring Plans

ENRM: Environmental and Natural Resource Management

ESMF: Environmental and Social Management Framework

EXIM: Export-Import Bank of the United States

FAF: Foreign Assistance Framework

FAR: Federal Acquisition Regulation

FtF: Feed The Future

FSR: Financing Self-Reliance

GAO: Government Accountability Office

GDA: Global Development Alliance

GAAS: Generally Accepted Auditing Standards

GH: Global Health

GUCS: Grants Under Contracts

ICT: Information and Communication Technology

PIEE: Programmatic Initial Environmental Examination

JRS: Joint Regional Strategy for Africa

MCC: Millennium Challenge Corporation

MEL: Monitoring, Evaluation and Learning Plan

NGO: Non Governmental Organization

NICRA: Negotiated Indirect Cost Rate Agreement

NPI: New Partnerships

OTA: Treasury’s Office of Technical Assistance

PAES: Prosper Africa Executive Secretariat

PATI: Prosper Africa Trade and Investment

PMP: Performance Management Plan

PPIRS: Past Performance Information Retrieval System

RFP: Request for Proposal

SOW: Statement of Work

SSA: Sub-Saharan Africa

TDA: U.S. Trade and Development Agency

UNCTAD: United Nations Conference on Trade and Development

USAID: United States Agency for International Development

USG: United States Government

W-GDP: Women’s Global Development and Prosperity

2021-AFR-PATI-PIEE

PROGRAMMATIC INITIAL ENVIRONMENTAL EXAMINATION

PROJECT DATA

ORGANIZATIONAL/ADMINISTRATIVE DATA

ENVIRONMENTAL COMPLIANCE REVIEW DATA

AFRICA AND MIDDLE EAST/PROSPER AFRICA TRADE AND INVESTMENT ACTIVITY 1

Project Name: USAID Prosper Africa Trade and Investment Activity Geographic Location(s) (Country/Region): Africa (Continent wide) Amendment (Yes/No), if Yes indicate # (1, 2...): No

Implementation Start/End Date (FY or M/D/Y): FY 2021-FY 2026 If Amended, specify New End Date:

Solicitation/Contract/Award Number(s): TBD

Implementing Partner(s): TBD Bureau Tracking ID: 2021-AFR-PATI-PIEE Tracking ID of Related RCE/IEE (if any):

Tracking ID of Other, Related Analyses:

Implementing Operating Unit(s): Africa Bureau/SD and Missions

Other Affected Operating Unit(s): Middle East Bureau and North Africa Missions Lead BEO Bureau: Africa Funding Account(s) (if available):

Original Funding Amount: $500,000,000 If Amended, specify funding amount:

If Amended, specify new funding total:

Prepared by: Africa and Middle East Bureau Compliance Teams Date Prepared: July 2020

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): December 2025

Additional Analyses/Reporting Required: ☒ Supplemental IEE ☒ EMMP/EMMR ☒Other(ESMF)

Climate Risks Identified (#): Low ___3___ Moderate ___4___ High ___#___ Climate Risks Addressed (#): Low ___3___ Moderate ___4__ High ___#___

1.0 ACTIVITY DESCRIPTION

1.1 PURPOSE OF THE PATI PROGRAMMATIC IEE

The purpose of this document, in accordance with 22 CFR 216, is to provide a preliminary review of the reasonably foreseeable effects on the environment of interventions to be conducted through the Prosper Africa Trade and Investment (PATI) contract and recommend determinations and, as appropriate, conditions, for these interventions. 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).

This IEE is a critical element of USAID’s mandatory environmental review and compliance process meant to achieve environmentally sound design and implementation. It also documents the results of the Climate Risk Management process in accordance with USAID policy (specifically, ADS 201mal).

This IEE is termed, “Programmatic”, because it is intended to provide an analysis of the PATI program of activities as a whole, with the expectation that supplemental analyses will be conducted of other elements of the PATI program as those elements are defined. Specifically, this Programmatic IEE (PIEE) seeks to do the following:

1) Provide analysis of the foreseeable environmental and social impacts of the PATI program’s general scope of work, and assign an initial threshold decision of Negative Determination with Conditions for the PATI mechanism’s general scope of work. This means that the PATI activities defined to date are not expected to have a significant negative impact on the environment, so long as the required mitigating conditions are implemented. Accompanying this determination is the understanding that specific PATI interventions yet to be identified may receive a Positive Determination through a screening process that will be a core part of PATI’s Environmental and Social Management Framework (ESMF); (See Section 4)

2) Highlight operational considerations to improve the environmental performance of PATI;

(see Section 2 and Section 3.2)

3) Communicate requirements for the PATI ESMF, to be developed by the implementing partner (IP), for COR and BEO approval; (See Section 4)

4) Specify conditions and requirements for implementation of PATI to ensure adequate environmental oversight and monitoring; (See Section 4 and Section 5)

5) Define the schedule and process for re-evaluation of this environmental compliance structure and efficacy. (See Section 4 and Section 5)

The multi-part environmental review process required by this PIEE and described herein is intended to be flexible and adaptive, in response to the nature of the PATI program. The purpose of PATI is to mobilize enterprise-driven solutions that increase trade and investment in Africa, including North and Sub-Saharan Africa. This activity is designed to be demand-driven and flexible, so specific trade or investment interventions have not yet been identified and cannot be analyzed in this document. This PIEE applies as a broad framework for the initiation of PATI activities. It anticipates an environmental and social impact screening process applied to all proposed PATI interventions. That screening process is expected to be rapidly applied to most of the potentially thousands of trade and investment interventions anticipated through the PATI contract. However, depending upon the nature and scale of the proposed interventions, the environmental and social impact screening process may trigger the development of Supplemental IEEs or even full Environmental Assessments.

AFRICA AND MIDDLE EAST/PROSPER AFRICA TRADE AND INVESTMENT ACTIVITY 2

https://www.usaid.gov/our_work/environment/compliance/22cfr216 https://www.usaid.gov/ads/policy/200/201mal

1.2 ACTIVITY OVERVIEW

In partnership with Prosper Africa, Feed the Future, and other initiatives, the USAID Africa Bureau, Africa Regional Missions, and the Middle East Bureau are jointly establishing the Prosper Africa Trade and Investment (PATI) Activity. The purpose of this Activity is to mobilize enterprise-driven solutions that increase two-way trade and investment between the U.S. and Africa, including North and Sub-Saharan Africa. It will strengthen Africa’s markets by developing new trade and investment relationships, particularly between the U.S. and Africa, and achieve development outcomes across all sectors in line with USAID’s Private Sector Engagement Policy, Journey to Self Reliance (J2SR) Framework, and the USG Prosper Africa initiative.

Driven by market demand, the Activity will embrace innovative approaches to achieve its goals.

The Activity is envisioned as a small set of centrally coordinated technical and institutional support activities, and a large, flexible performance-based subcontracting and grants under contract facility designed to support the needs and opportunities that the private sector identifies. The Activity will mobilize private sector resources and expertise, in conjunction with other USG interagency partners, resulting in the increased capacity, competitiveness and availability of businesses, investors and intermediaries that will drive future trade and investment efforts on African nations’ Journeys to Self-Reliance.

1.3 ACTIVITY DESCRIPTION

PATI will operate with four interrelated project objectives. These four objectives may be applied across a multitude of sectors, some of which may not have been identified. The four objectives are:

1) increased trade, 2) increased investment, 3) improved business environment, and 4) institutional support to USAID and the Prosper Africa Secretariat.

Objective 1: Increased trade This objective seeks to mobilize trade, including two-way trade between the U.S. and Africa, through a proactive approach that identifies and/or improves awareness of opportunities, information sharing and direct facilitation of new and existing business relationships. This effort will require significant collaboration and creativity that leverages the combined resources of the USG, especially through engagement with Deal Teams and the Department of Commerce to expand U.S. trade with Africa, as well as facilitating increased information sharing with the private sector to ensure programming is grounded in transactions and market opportunities that businesses and investors prioritize.

Illustrative components under objective 1 include, but are not limited to: a) supporting new business and sourcing relationships, b) market intelligence, c) business-to-business linkages, and

d) strengthening the capacity of trade facilitators/service providers.

Objective 2: Increased Investment To facilitate increased investment, this objective will identify and support a wide variety of external and internal sources of funds, including bank and non-bank sources, such as pension funds and private equity. These efforts will require close collaboration with USG partner agencies and private sector sources of financing to leverage their unique strengths, while also exploring creative new approaches and mechanisms that can facilitate or attract increased investment.

Illustrative components under objective 2 include, but are not limited to: a) identifying, disseminating and promoting investment opportunities, b) transaction facilitation and deal structuring, c) developing new financing solutions, and d) strengthening the capacity of investment intermediaries/facilitators/service providers.

AFRICA AND MIDDLE EAST/PROSPER AFRICA TRADE AND INVESTMENT ACTIVITY 3

Objective 3: Improved Business Environment The USAID Prosper Africa Trade and Investment Activity will focus on a narrow set of interventions that are strategically and judiciously deployed when needed to unlock a potential trade or investment opportunity or to unstick an existing transaction and advance it to closure. In collaboration with Embassy Deal Teams, the Activity’s policy work will be driven by private sector requirements. With high-level host-country political buy-in, these targeted policy interventions must be linked to tangible, direct impacts on increased business opportunities.

Business environment interventions could include a wide variety of tasks, such as addressing investment restrictions, intellectual property rights protection, regulation of the digital economy, customs/tariff or tax treatment, standards issues, product licensing and approval requirements, etc.

Objective 4: Programmatic and Institutional Support to USAID and the Prosper Africa Executive Secretariat This objective provides USAID and the Prosper Africa Executive Secretariat (PAES), both in Washington D.C. and in the field, with broad technical, logistical, and administrative support necessary to assist in tracking, managing, implementing and publicizing the Prosper Africa initiative.

This support includes a) Monitoring, Evaluation and Learning (MEL), b) Communications and Outreach, c) Advisory Support to Missions and Deal Teams, d) Ad-Hoc Reports And Analysis, e) Back Office And Administrative Support

Will this program involve construction1 as defined by ADS 201 and 303? Yes ☒ No ☐

It is possible that construction support will be requested and implemented under a PATI subcontract. Any such engagement will be coordinated with the Bureau for Development, Democracy and Innovation (DDI) Energy and Infrastructure Office and in compliance with this PIEE and any relevant subsequent reviews or analyses.

2.0 BASELINE ENVIRONMENTAL INFORMATION

To understand the potential environmental and social impact of PATI activities and the trade and investment that they will facilitate, it is important for all parties to understand the environmental context in which those activities will take place, both physical and social. A library of existing “Country-Level Environmental Context Information ” is available here for reference. The PATI implementing partner (IP) is expected to utilize this and similar information during implementation.

The IP is responsible for identifying relevant partner country laws and regulations as well as any limiting environmental factors that may impede successful execution of trade and investment deals or otherwise curtail sustainable development outcomes of PATI activities.

2.1 LOCATIONS AFFECTED AND ENVIRONMENTAL CONTEXT (ENVIRONMENT, PHYSICAL, CLIMATE, SOCIAL, THREATENED AND ENDANGERED SPECIES)

The PATI geographic focus area includes the entire continent of Africa, both sub-Saharan Africa and North Africa, including Egypt. The Activity will have multiple strategically located offices designed to provide a critical interface for USG agencies and high-volume business centers, 1 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.

AFRICA AND MIDDLE EAST/PROSPER AFRICA TRADE AND INVESTMENT ACTIVITY 4

https://drive.google.com/drive/u/1/folders/1YXn3g_IbgL7KabsEJUzO6M0p0nx0iHA_ https://www.usaid.gov/sites/default/files/documents/1865/201maw.pdf including South Africa and potentially Kenya, Ghana and North Africa. In addition to the widespread geographic scope of the PATI, the trade deals will encompass all sectors.

2.2 APPLICABLE AND APPROPRIATE PARTNER COUNTRY AND OTHER INTERNATIONAL

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

USAID: Section 117 of the Foreign Assistance Act and 22 CFR 216 require USAID to utilize an Environmental Impact Assessment (EIA) process to evaluate the potential impact of USAID’s activities on the environment prior to implementation, and to “fully take into account” environmental sustainability in designing and carrying out its development programs. Additionally, as USAID seeks to facilitate trade and investment in Africa, USAID is compelled to consider also the environmental sustainability of these efforts. The USAID Environmental and Natural Resource Management (ENRM) Framework states, “Sustainable economic growth that incorporates the responsible use of natural resources and applies environmental safeguards proactively is critical for the Journey to Self-Reliance.” Threats to land, water, air and biodiversity in the region are significant and have the potential to undermine long-term economic growth and human welfare.

USAID must also consider host country regulations, policies, and development strategies. Across Africa, regulatory frameworks and their enforcement vary drastically from well developed to very weak. Given the recognized weakness of regulatory frameworks and their enforcement, it is incumbent upon USAID to build reinforcement of environmental protections into its efforts to advance economic growth.

Per USAID’s Indigenous Peoples’ Policy2, USAID staff and implementing partners will engage Indigenous Peoples as meaningful partners in development processes; safeguard them against harm; and enhance their ability to promote their rights, determine their own priorities, and advance their self-reliance. This should be done with focus on the five identified operating principles: 1.

Identify Indigenous Peoples, 2. Analyze Indigenous Peoples’ Opportunities and Challenges, 3.

Engage Indigenous Peoples, 4. Safeguard Indigenous Peoples’ Rights and Well-Being, and 5.

Establish Partnerships with Indigenous Peoples. Adherence to this policy is a critical element of social safeguards.

Land Tenure and Property Rights: The laws and regulations governing land tenure and property rights vary from country to country. PATI should integrate internationally adopted good practice and guidelines to mitigate tenure risk with respect to private sector engagement. Extensive guidelines exist, which include: USAID's Operational Guidelines on Responsible Land-Based Investments, FAO's Technical Guide for Investors, and the Interlaken Group's Guide for Companies.

Other USG: Many of the trade and investment deals originating from PATI will be supported through other USG entities, such as the U.S. International Development Finance Corporation (DFC). DFC has established its own Environmental and Social Policy and Procedures (ESPP) which align with U.S. Government policies and regulations and the International Finance Corporation’s Performance Standards on Social and Environmental Sustainability. The ESPP defines the area of influence of the project for the environmental and social review process, identifies and categorizes projects based on a preliminary assessment of their environmental and social risks and impacts, and determines requirements for documentation and monitoring of on-going projects. The DFC expects its implementing partners to develop an Environmental and Social Management Framework that is responsive to the ESPP.

Market Based Certifications and Standards: Market driven (and to a certain extent regulatory) certifications and standards can serve as a catalyst for improving firm-level environmental

2 https://www.usaid.gov/sites/default/files/documents/1866/USAID-IndigenousPeoples-Policy-mar-2020.pdf

AFRICA AND MIDDLE EAST/PROSPER AFRICA TRADE AND INVESTMENT ACTIVITY 5

https://www.land-links.org/tool-resource/operational-guidelines-for-responsible-land-based-investment/ http://www.fao.org/3/a-i5147e.pdf https://assets.website-files.com/5d819417269ec7897f93e67a/5dcb5321c74abf8a8ef7fbc0_InterlakenGroup-VGGT-Guidance-Revised-2019.pdf https://www.dfc.gov/sites/default/files/media/documents/DFC_ESPP_012020.pdf performance and protections. Adoption and incorporation of relevant certifications and standards in company operations in turn can help open up markets. Annex 2 provides an illustrative list of certifications and standards relevant to potential PATI value chains for consideration.

African Country Commitments: At the 15th Session of the African Ministerial Conference on the Environment (AMCEN) in 2016, the Cairo AMCEN Declaration was signed which committed to put in place ‘strategies for sustainably harnessing Africa’s natural capital including instituting appropriate policies and practices to reverse ecosystems degradation and promote sustainable consumption and production patterns.’ PATI should consider this declaration and partner country commitments when engaging governments on enabling environment reforms.

Additionally, The African Continental Free Trade Area (AfCFTA) includes a clause recognizing “the right of State Parties to regulate in pursuit of national policy objectives, and to introduce new regulations, on the supply of services, within their territories, in order to meet legitimate national policy objectives, including competitiveness, consumer protection and overall sustainable development with respect to the degree of the development of services regulations in different countries, the particular need for State Parties to exercise this right, without compromising consumer protection, environmental protection and overall sustainable development;” [emphasis added].

● General Objectives of the AfCFTA include:

○ Promoting and attaining sustainable and inclusive socio-economic development, gender equality and structural transformation of the State Parties;

○ Promoting industrial development through diversification and regional value chain development, agricultural development and food security.

○ Article 3 states that this Protoocol’s objectives also include the promotion of

“sustainable development in accordance with the Sustainable Development Goals (SDGs).”

○ Article 7 establishes Special and Differential Treatment by requiring State Parties to “provide special consideration to the progressive liberalisation of service sectors commitments and modes of supply which will promote critical sectors of growth, social and sustainable economic development.”

PATI consists of a small set of centrally coordinated technical and institutional support activities, and a large, flexible subcontracting and grant facility designed to support the needs and opportunities the private sector identifies. All trade deals will adhere to the environmental and social best practice guidelines at the national and regional levels. Effort should be made to support partner country government strategies, policies, and commitments, as applicable, towards the adherence to AfCFTA commitments.

3.0 ANALYSIS OF POTENTIAL ENVIRONMENTAL, SOCIAL, AND

CLIMATE RISK

3.1 ADVERSE ENVIRONMENTAL AND SOCIAL IMPACT

The purpose of PATI is to mobilize enterprise-driven solutions that increase two-way trade and investment between Africa and the U.S. The Activity will mobilize private sector resources and expertise, in conjunction with other USG interagency partners, resulting in the increased capacity, competitiveness and availability of businesses, investors and intermediaries that will drive future trade and investment efforts on Africa’s Journey to Self-Reliance. Although many actions mobilized through this activity will result in little to no direct environmental or social harm, the implementing

AFRICA AND MIDDLE EAST/PROSPER AFRICA TRADE AND INVESTMENT ACTIVITY 6

partner(s) must also assess indirect impacts, and mitigate those that pose moderate or higher risk.

Some actions do have the potential for direct impacts as well, such as investment in the mining sector or construction undertaken by the activity to facilitate an investment. In addition, due to the catalyzing nature of the activity, each trade or investment has the opportunity to multiply its impact.

The full scope of PATI and the sectors it will cover is not known at the time of this PIEE’s preparation. Also, a significant portion of PATI will be implemented through subcontracts and grants, the scope of which is not yet identified. Further environmental and social impact analysis of PATI activities is needed, and must be developed as PATI sub-contracts and grants are established and before the sub-obligation of PATI resources to detailed scopes of work. The specific additional impact analysis needed will be identified through the PATI environmental and social management framework (ESMF), and through consultations with the cognizant Bureau Environmental Officers.

The potential adverse direct, indirect and cumulative environmental and social impacts of expanded trade and investment activities could include, but are not limited to:

● Increased pollution of air, water, and soil,

● Resource depletion and water scarcity,

● Land conversion and degradation,

● Biodiversity loss,

● Social impacts including loss of land and resource rights, and

● Health and Safety of workers.

Stand-alone trade and investment and the liberalization of policies aimed at enhancing economic development may have negative environmental and social impacts. Such activities indirectly impact the environment by increasing pollution and/or degrading natural resources. Additionally, all sectors will be impacted by climate variability and change in Africa, and climate variability and change often acts as a ‘threat multiplier’ or exacerbates existing challenges within sectors.3

Three illustrative sectors that are expected to be particularly vulnerable to climate are described below. These three sectors rely on infrastructure that is threatened by climate variability and change, such as sea level rise or extreme weather negatively impacting key transportation routes, and are not equipped to address current or future climate and weather challenges.

● Agriculture: a reliance on rainfed agriculture and crops that are often grown at their thermal tolerance; rising sea level and associated floods and salinization are expected to result in a decline of coastal agriculture along the low-lying-deltas of North Africa, where most of the crops are grown.

● Public health: potential primary (i.e. spread of infectious diseases) and secondary (i.e.

human migration due to flood negatively impacting maternal and child health) impacts of climate change.

● Industrial sector: likely to be negatively affected by the worsening climate and the associated increased competition over the limited energy and water resources.

The combination of increased trade and investment opportunities is intended to lead to more demand for manufacturing, extraction, construction, etc. The PATI IP should be aware that policy

3 For a detailed summary of how various sectors are impacted by climate change please see the 2014 assessment of the Intergovernmental Panel on Climate Change. Chapter 22, Africa Specific Context:

https://www.ipcc.ch/site/assets/uploads/2018/02/WGIIAR5-PartB_FINAL.pdf Sector Specific Context:

https://www.ipcc.ch/site/assets/uploads/2018/02/WGIIAR5-PartA_FINAL.pdf

AFRICA AND MIDDLE EAST/PROSPER AFRICA TRADE AND INVESTMENT ACTIVITY 7

https://www.ipcc.ch/site/assets/uploads/2018/02/WGIIAR5-PartB_FINAL.pdf https://www.ipcc.ch/site/assets/uploads/2018/02/WGIIAR5-PartA_FINAL.pdf changes that improve business opportunities should not minimize environmental and social safeguards. As per ADS 201.6, PATI will consider long term environmental and social risks as part of its due diligence4 process when selecting trade and investment deals to facilitate. Additionally, it is expected that PATI will align with host country environmental and social policies and development strategies when addressing the enabling environment.

3.2 ADDRESSING RISK THROUGH PROGRAM DESIGN/DEAL SELECTION

Trade and investment and associated enabling environment activities of PATI can be an effective means to support African countries towards implementation of the 2030 Sustainable Development Agenda (SDGs). By supporting economic growth, development, and social welfare, increased trade can also positively contribute to a greater capacity to manage the environment more effectively. At the firm level, PATI can improve access to new technologies that make local production processes more efficient, decreasing inputs such as energy, water, and raw materials while also decreasing and/or mitigating pollution. Improvement of input quality, increases in efficiency, and reduced waste volumes are key strategies to improve business competitiveness and profitability.

PATI’s “Improved Business Environment” objective, if implemented from such a perspective, can position the business environment and the broader African economy for long term sustainable growth. Such an approach would align with existing partner country development strategies and other donor initiatives on the African Continent such as the United Nations and European Union.

The UN Environment Programme (UNEP)'s Green Economy Initiative is designed to assist governments in “greening” their economies by reshaping and refocusing policies, investments and spending towards a range of sectors, such as clean technologies, renewable energies, water services, green transportation, waste management, green buildings and sustainable agriculture and forests. Similarly, the European Union is supporting a shift in this direction through financing programs such as SWITCH Africa Green.

Clear, secure, and negotiable rights to land and resources are an essential foundation for trade and a key component of a growth-friendly enabling environment. When governance systems effectively protect these rights, individuals, groups, and legal entities make a variety of forward-looking investments in capital and other inputs because they are more confident that they will capture any future returns from their efforts.

Research has found that improved land tenure rights leads firms to allocate their resources more effectively, which leads to more robust growth. On the other hand, when firms, families and communities fear their property will be expropriated or lost, or when transaction costs associated with protecting resource rights become prohibitively high, fewer formal transactions take place and fewer investments are made.

Credible commitments by governments and customary authorities to protect land tenure and resource rights go a long way towards improving the climate for doing business which promotes more expansive entrepreneurship, trade, and export opportunities.

4 Due Diligence: The technical term for the necessary assessment of the past performance, reputation, and future plans of a prospective alliance partner, private sector, or other entity with regard to various business practices and principles.

This assessment of a prospective alliance partner would normally involve, at a minimum, examining their social, environmental, and financial track records. (ADS 201.6)

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4.0 ENVIRONMENTAL DETERMINATIONS

4.1 RECOMMENDED ENVIRONMENTAL DETERMINATIONS

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

A Negative Determination with conditions is given to the PATI contract’s general scope of work, inclusive of the four objectives described in Section 1. The primary condition of this determination is that an Environmental and Social Management Framework (ESMF) is developed by the implementing partner in coordination with and approved by the USAID COR and the cognizant BEOs. The ESMF, described in Section 4.2, will be the primary tool to screen proposed interventions including, but not limited to grants, subgrants, trade or investment deals, and policy actions for potential environmental and social impacts. This screening will be used to inform decisions regarding USAID support of the proposed interventions. Until the ESMF is developed and approved, no PATI interventions can proceed beyond the development of capacities and preparations to pursue PATI’s four objectives. As a result of the ESMF screening process, some individual actions, deals, grants, or subgrants may require supplemental analyses and may result in additional threshold determinations. It is anticipated that many PATI interventions will involve investments, trades, subgrants, or policy work that have been identified as having little to no environmental impact. These actions would not require supplemental analyses or mitigation measures.

The ESMF will include information-gathering to inform due diligence examinations of proposed interventions, and could lead to supplemental analysis, depending upon the activity and the nature and extent of USAID’s involvement. Additional analysis may take the form of a Supplemental IEE, subgrant- or deal-specific EMMP, or other analysis as appropriate. These could potentially lead to a Positive Determination and subsequent Environmental Assessment (EA) for some activities based upon a likelihood of significant environmental or social impact, as described in section 4.3.

AFRICA AND MIDDLE EAST/PROSPER AFRICA TRADE AND INVESTMENT ACTIVITY 9

Program Area Negative Determination

Implementation Requirement

Objective 1: Increased trade x Deals screened through ESMF

Objective 2: Increased Investment x Deals screened through ESMF

Objective 3: Improved Business Environment x Actions screened through ESMF

Objective 4: Programmatic and Institutional Support to USAID and the Prosper Africa Executive Secretariat x Actions screened through ESMF

4.2 ENVIRONMENTAL AND SOCIAL MANAGEMENT FRAMEWORK (ESMF)

The PATI ESMF shall set out the general principles, rules, guidelines, and procedures to assess the environmental and social risks and impacts; establish general measures to reduce and mitigate adverse risks and impacts; and outline documentation and reporting norms. The ESMF will ensure environmental due diligence and that reviews conducted for PATI are able to inform other USG environmental reviews (such as DFC) conducted under Prosper Africa.

In development of the ESMF, budget and staffing capacities should be sufficient to rapidly respond to proposed trade and investment deals and other interventions. The environmental and social impact screening needs to be conducted quickly to keep pace with decision-making. It must also bring sufficient information and expertise to the decision-making process to ensure that USAID and PATI staff are aware of the potential direct and indirect environmental and social impacts of a proposed intervention before deciding to support a specific trade or investment transaction or other, larger set of interventions.

The following aspects will be addressed by the implementing partner in the establishment of their

ESMF:

i. Develop an environmental and social impact screening methodology that includes, but is not limited to, the following aspects:

a. Screening and documenting all proposed PATI interventions, under all four objectives, including grants and subcontracts, for potential environmental and social impacts and climate risks. Potential outcomes from such screening should include:

i. Intervention can proceed without mitigations by PATI (zero to low range projected impacts);

ii. Intervention can proceed, but certain mitigations by PATI are required as outlined in environmental mitigation and monitoring plans (EMMPs) to be developed by the implementing partner (for moderate to medium range projected impacts);

iii. Intervention’s potential impacts need further examination, so supplemental analysis is needed, such as a Supplemental Initial Environmental Evaluation (SIEE, see Section 4.3, below) to be developed by the Implementing Partner in consultation with USAID (high to significant range projected impacts);

iv. Intervention presents substantial environmental and/or social impact risks, such that support is not recommended, or which might demand an Environmental Assessment to proceed.

b. Incorporating environmental, social, and climate risk due diligence (IAW ADS 201.6, ADS 201mal) as critical aspect of decision making regarding deals;

c. Recommendations for firm-level process improvements (i.e. pollution prevention, cleaner production, etc) based on findings from the due diligence;

d. Ensuring all host countries laws and regulations are adhered to, including development of ESIA based on host country requirements;

AFRICA AND MIDDLE EAST/PROSPER AFRICA TRADE AND INVESTMENT ACTIVITY 10

e. Incorporating adequate mitigation measures to minimize adverse impacts identified through the screening process outlined above (section 4.2.1.a. parts ii, iii., and iv.)

in coordination with USAID Regional BEOs or their designee;

f. Implementation, monitoring, and reporting;

i. Develop and refine a process to ensure and document incorporation and implementation of the screening process and mitigation measures that are identified during the screening process;

ii. Develop and refine a process to ensure and document monitoring of implementation;

iii. Develop and refine a means for the USAID Regional BEOs or their designee to have ready access to review ESMF outputs.

ii. Budgeting and staffing roles and responsibilities and process for revision when necessary;

iii. Develop an approach and schedule for evaluating and validating with the environmental compliance team of USAID the effectiveness of the ESMF screening and implementation process. As needed, the ESMF may be modified to improve environmental, social, and climate management or correct identified deficiencies.

The ESMF should include guiding principles for supporting practices that can lead to environmentally sustainable development on the African continent. PATI will ensure implementation of sound environmental policies, including as applicable conducting environmental due diligence, working with exporters and investors to promote cleaner production practices and mitigating impacts as required by U.S. and host country regulations. Encouraging environmentally sustainable economic growth through PATI’s engagement areas with partner governments and the private sector aligns USAID with ongoing efforts of other donors in Africa. This further opens doors for trade with US firms who specialize in innovative technologies for cleaner production and resource conservation.

4.3 SUPPLEMENTAL ANALYSIS

Development of an SIEE or EA will be required for the following:

1. Direct funding of activities identified through the ESMF as having a high to significant impact on the environment including, but not limited to those listed under §216.2(d)(1);

2. All actions involving direct construction* or procurement/use of pesticides;

Potential environmental impacts of PATI’s interventions will be identified through the ESMF screening process (Section 4.2 above) and, as indicated below, through appropriate supplemental analyses.

i. Zero to low range projected environmental and/or social impacts → No further analysis or mitigations required

ii. Moderate to medium range projected environmental and/or social impacts → Mitigation measures to be identified, implemented and monitored through an Environmental Mitigation and Monitoring Plan (EMMP). The EMMP will be reviewed and approved by the

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BEO or designate prior to implementation.

iii. High to significant range projected environmental and/or social impacts → More information and analysis will be needed in the form of a SIEE. The SIEE will be reviewed and approved by the BEO. Mitigation measures to be identified, implemented and monitored through an Environmental Mitigation and Monitoring Plan (EMMP). The EMMP will be reviewed and approved by the BEO or designate prior to implementation.

iv. Substantial environmental and/or social impact impacts → An EA will be required.

(Note: The supplemental analyses will provide more thorough analysis of the planned activities, additional geographic context and baseline conditions, environmental and/or social impacts of the activities as well as specific mitigation and monitoring requirements.)

*Any construction directly undertaken by PATI will be coordinated with the DDI construction risk management team and in compliance with this PIEE and any relevant subsequent reviews or analyses.

4.4 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 analysis.

PATI will work across multiple sectors, many of which are especially climate sensitive in Africa.

Due to the continent’s high exposure to slow onset climate change and extreme weather events, combined with the low capacity to adapt to climate change, Africa is extremely vulnerable to climate variability and change.

Overall, the PATI mechanism has a moderate climate risk. This moderate risk applies in both the near term and long term relative to USAID’s investment to facilitate trade and investment across Africa. As such, and in accordance with ADS 201, the due diligence conducted by the IP’s deal teams should also assess the potential for climate risk on the specific investment.

Key findings of climate analysis

The climate risks identified in PATI as moderate are:

● Key agriculture value chain production negatively impacted by extreme weather event;

including drought and flood, or increased temperatures, reducing crop yield and success of agricultural businesses;

● Climate change-driven urbanization causes transition from agrarian-based economy to urban economy reducing crop yield and success of agricultural businesses;

● Key infrastructure is damaged or destroyed during extreme weather events, disrupting trade, and increasing cost of doing business, across multiple sectors;

● Extreme weather negatively impacts the tourism industry;

● Climate variability or change increases health challenges in areas where Prosper Africa is working, decreasing the ability to do business;

● Increased water stresses driven by climate change limiting economic growth and development;

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● Inadequate and/or inactivated national climate-change resilience and adaptation strategies result in significant economic losses and a decline in GDP. In North Africa, for example, the World Bank estimates the decline in GDP to range between 6 percent and 14 percent, if adaptation measures fail to be implemented;

To address risks the following actions were identified for next steps for PATI:

● The climate analysis5 conducted for Prosper Africa should be provided to implementing partners;

● If climate and/or weather events change decision making for implementation, they should be tracked and reported to USAID;

● Moderate rated climate risks are required to be assessed and addressed as part of the due diligence process;

Climate Variability and Change While it is useful to identify how the climate will likely change at a continent-wide scale, it will be more useful for PATI activities to identify specific changes in countries or regions where activities occur. Regional and country information can be found on USAID’s climate webpage, climatelinks.org, or the World Bank Climate Knowledge Portal (https://climateknowledgeportal.worldbank.org/).

5.0 IMPLEMENTATION AND MONITORING REQUIREMENTS

The environmental determinations in this PIEE are contingent upon full implementation of the following general implementation and monitoring requirements, as well as ADS 201 and 204 and other relevant requirements.

5.1 DURING PRE-AWARD:

5.1.1 The design team and/or the cognizant environmental officer(s) (e.g., REA, BEO) will provide a pre-award briefing for potential offerors on environmental compliance expectations/responsibilities at bidders’ conferences.

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

IEE.

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

5.2 DURING POST-AWARD:

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

5 Annex 1

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https://climateknowledgeportal.worldbank.org/

5.2.2 Work plans and Budgeting: The COR will ensure the IP integrates environmental compliance requirements in work plans and budgets to comply with requirements, including ESMF development, implementation and monitoring.

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

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

5.2.5 Host Country Environmental Compliance: The IP shall comply with applicable and appropriate host country environmental requirements, which the COR shall monitor, 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.

5.2.6 Work Plan Review: The COR will ensure the IP verifies, at least annually or when activities are added or modified, that activities remain with the scope of the PIEE.

Activities outside of the scope of the PIEE cannot be implemented until the PIEE is amended.

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

5.2.8 USAID Monitoring Oversight: The 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.).

Additionally, the IP will meet with the cognizant BEO(s) or their designees quarterly to review implementation of the ESMF.

5.2.9 Environmental and Social Management Framework (ESMF): The COR will ensure the IP develops, obtains BEO approval for, and implements an ESMF that is responsive to the stipulated environmental compliance requirements.

This ESMF should be subject to refinement and ongoing adaptive management based upon regular consultations with the cognizant BEOs.

5.2.10 Environmental Mitigation and Monitoring Plan: The 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 as defined in the ESMF.

5.2.11 Environmental Compliance Reporting: The COR will ensure the IP includes environmental compliance in regular activity reports, using indicators as appropriate;

develops and submits Environmental Mitigation and Monitoring Reports (EMMRs) as defined in the ESMF. As appropriate, this includes completing and submitting a Record of Compliance (RoC) describing their implementation of EMMP requirements.

5.2.12 Corrective Action: When noncompliance or unforeseen impacts are identified, the IP will notify the COR, place a hold on activities, take corrective action, and report on the effectiveness of corrective actions. The COR initiates the corrective action process and ensures the IP completes and documents their activities.

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5.3 AGENCY CONDITIONS

5.3.1 Sub-award Screening: The COR will ensure the IP adheres to the ESMF and adequate environmental screening occurs for sub-awards and grant applications and to aid in the development of EMMPs.

5.3.2 Supplemental IEEs (SIEEs) will be prepared pursuant to the terms of this PIEE for any construction related activities funded under PATI. 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.

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

5.3.4 Positive Determination: If during implementation activities arise that warrant a Positive Determination threshold determination, the COR will notify the BEO and ensure a Scoping Statement, and if required an Environmental Assessment (EA), is completed and approved by the BEO before the subject activities are implemented.

6.0 LIMITATIONS OF THE PROGRAMMATIC INITIAL ENVIRONMENTAL

EXAMINATION

The determinations recommended in this document apply only to activities and sub-activities described herein. Other activities that may arise must be documented in either a Supplemental IEE, an IEE amendment if the activities are within the same activity, or other type of environmental compliance document and shall be subject to an environmental analysis within the appropriate documents listed above.

This PIEE does not cover activities, normally having a significant effect on the environment as described in 22 CFR 216.2(d) that would trigger a Positive Threshold Determination.

Any of the following actions implemented under PATI will require additional environmental analyses and BEO concurred environmental determinations. If such actions are being explored under PATI for consideration under the broader Prosper Africa Initiative, the responsible USG entities environmental regulations will apply:

● Support project preparation, project feasibility studies, or engineering design for activities listed in §216.2(d)(1);

● Affect endangered and threatened species or their critical habitats per §216.5, FAA 118, FAA 119;

● Provide support to extractive industries (e.g. mining and quarrying) per FAA 117;

● Promote timber harvesting per FAA 117 and 118;

● Lead to new construction, reconstruction, rehabilitation, or renovation work per

§216.2(d)(1);

● Research, testing, or use of genetically engineered organisms per §216.1(b)(1), ADS 211

● Assist the procurement (including payment in kind, donations, guarantees of credit) or use

(including handling, transport,…