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Political Economy Consultant, Malawi II Statement of Work

A. Introduction

In order to assess opportunities and risks associated with infrastructure implementation and policy reform, the Malawi II Compact Development team is securing the support of an individual consultant to conduct Political Economy Analysis[footnoteRef:1], principally at the sector level. [1: See Appendix 1 for an operationalization of political economy analysis]

The Millennium Challenge Corporation (MCC) is a U.S. Government corporation whose mission is to provide assistance that will support economic growth and poverty reduction in carefully selected countries that demonstrate a commitment to just and democratic governance, economic freedom, and investments in their citizenry. For more information on the MCC, please visit www.mcc.gov.

MCC Compacts—large, five-year grants—are developed by our partner countries, with MCC, over the course of several years. The compact development process is data-driven and iterative, moving through milestones of sector identification, root cause analysis, opportunity identification, and project development before the final Compact is signed by both governments. Typically, MCC investments focus on alleviating a single, clearly defined challenge in one or two sectors of the economy, known as a “binding constraint to growth.” For more on our sector selection process, please visit:

https://www.mcc.gov/our-impact/constraints-analysis.

Regardless of the chosen sectors, MCC investments typically involve some significant institutional reform components. They are also required to consider equity concerns in line with MCC’s Gender Policy and address social and environmental impacts of proposed investments in line with IFC performance standards.

In December 2018, MCC’s Board of Directors selected Malawi as eligible to develop a compact, and it is currently in the early phase of compact development. MCC anticipates having identified sectors and beginning root cause analysis in late summer / early fall of 2019.

B. Scope

MCC seeks a consultant to provide ongoing political economy research and guidance, principally at the sector level, during the compact development process in Malawi. While sectors and constraints have not been formally chosen or ratified by MCC’s Board or the Malawian government, MCC has tentatively identified land and the high cost of transport on rural roads and railroads to be areas of current high interest, while other areas of interest include the high lending interest rates, business environment, and possibly skills/education. These areas may shift with new evidence, or during MCC’s peer review process. It is anticipated that the Consultant’s assignment would begin with high-level sector and problem overviews, and evolve—along with the Compact development process—to providing technical guidance on project design and refinement in one, or perhaps two, sectors.

The next phase of program design is known as the Root Cause Analysis (RCA), which seeks to develop a better understanding of the identified constraints and the range and nature of the underlying factors or issues that give rise to them. The RCA will look at numerous causal factors, including political and economic factors, which explain the status quo and limit reform in the constraint area(s) chosen, Based on a clear understanding of the root causes of the binding constraint, a project (or projects) will be designed with the aim of addressing these causal factors. The Political Economy Analysis will be a critical source of information for understanding key factors limiting reform relating to the targeted constraint area(s).

C. Country

Malawi and other sub-Saharan MCC partner countries, and any other MCC eligible countries.

D. Tasks and Deliverables

Tasks:

The consultant’s assignments shall include the following:

· Conduct literature reviews and field research to inform high-level sector and problem analyses. These will include analysis of or contributions to the team’s approach to the following:

1. Problem analysis, including root cause analysis[footnoteRef:2]; [2: For more on MCC’s approach to and uses of root cause analysis, see https://www.mcc.gov/resources/story/story-cdg-chapter-6-guidelines-for-root-cause-analysis]

2. Power, accountability, and decision-making structures and relationships;

3. Formal and informal economic institutions;

4. Organization(s) and public administration;

5. Stakeholder mapping and analysis;

6. Social relationships and institutions consequential to our investments and reform efforts;

7. Social and political conflicts and their consequences for our investments and reform efforts;

8. Cultural and ideological issues consequential to our investments and reform efforts;

9. Features of the social and political landscape which might undermine inclusive growth and the equitable distribution of project benefits;

10. Landscape of on-going or proposed reforms and opportunities and barriers for proposed reforms;

11. Actionable guidance on stakeholder engagement strategies, program design, and organizational and institutional change strategies.

· Conduct literature and field research to inform project design and selection. This will include:

1. A more focused (place, problem, organization, and agency-specific) analysis of the eleven dimensions listed above;

2. Technical review of received project proposals and reports and work products from other MCC Due Diligence consultancies.

· Provide ongoing technical support to the MCC country team to facilitate politically informed, contextually appropriate and strategically sound approaches to Compact design and partner engagement. This might include:

· Attending (via Skype or in person) team meetings;

· Generating briefings or presentations;

· Brief, rapid-response memos on critical emerging issues and questions;

· Organization of briefings or consultations with key experts, as needed;

· Technical inputs and guidance on country team due diligence;

· Develop on-the-ground relationships in Malawi to facilitate ongoing learning and information-exchange.

The consultant is expected to work closely with members of the MCC country team to ensure that political economy analysis is well integrated into sector and problem analyses and project design. This will require routine communication and collaborative problem-solving, and will likely include discussions or workshops with MCC staff to refine the team’s PEA questions and research agenda on an ongoing basis.

Deliverables:

· Research reports;

· Research briefs and memos;

· Presentations and briefings (in-person or Skype);

· Technical feedback on relevant documents, including due diligence products from other consultants.

E. Period and Place of Performance

All work shall be completed between the dates of the award through a five year period of performance.

The estimated level of effort is up to 900 hours for the first year and 1,000 hours per year for the remaining years for a total of 3,900 hours with an estimated 3 trips per year. MCC anticipates this level of effort but does not guarantee this level of effort as it may increase or decrease.

The consultant shall perform the tasks under this call order in MCC-eligible countries and at his/her own facilities. The consultant will meet at MCC offices in Washington, DC as requested. Collaboration and communication with the MCC Malawi II Compact Development team is critical, and such routine communication will also be conducted via conference call, Skype, and/or e-mail. The Consultant may be expected to join the MCC Malawi II Compact Development team on missions to Malawi.

F. Subcontracting

Consultants are authorized to subcontract data collection, data preparation, economic analysis, and related services as needed. The overall costs for subcontracting shall not exceed 25% of the consultant’s total negotiated unloaded direct labor cost.

G. Conflict of Interest

The consultant will be precluded from bidding on work and services (design, assessment, construction, and supervision) to be procured by the local accountable entity or using funds advanced under MCC work in the relevant country.

H. Time and Reporting

All formal communication with MCC, including reports, will be submitted to the Contracting Officer Technical Representative (COR), Program Manager (PM), and other designated MCC personnel. The COR/PM for this requirement will be identified via separate correspondence.

The COR/PM will have technical responsibility for monitoring the contractor’s performance. The COR/PM will review and evaluate the contractor’s performance, and also will coordinate any communications with relevant counterparts and other donor agencies and organizations.

Any changes in the terms of the ToR will be made in writing and approved by the Contracting Officer. No representation of the COR/PM shall serve as a basis for an alteration in the general scope of this ToR or of the terms and conditions of the ToR unless confirmed in writing by the Contracting Officer. The contractor must communicate with the Contracting Officer on all matters that pertain to the Contract terms. Proceeding with the work without proper contractual coverage could result in nonpayment for that work.

I. Evaluation Criteria

Required

· Minimum 5 years of experience doing sector or problem-level political economy research in international settings. This experience must include both field research and literature reviews, and span more than two sectors.

· MA in a social science field or a field (e.g., history) with a strong political economy tradition.

· Minimum 5 years of experience and expertise in Sub-Saharan Africa.

· Demonstrated ability to provide clear, actionable guidance and recommendations.

· Ability to work with colleagues and stakeholders from a broad array of disciplinary and cultural backgrounds.

Preferred

· Minimum 10 years of experience doing sector-level political economy research in international settings. This experience must include both field research and literature reviews, and span more than four sectors.

· PhD in a social science field, or a field (e.g., history) with a strong political economy tradition.

· Experience and expertise in Malawi.

· Experience in program design or implementation.

· Experience in organizational analysis.

· Experience or expertise in one or more of the following sectors: land administration, access, or reform; transport; or agriculture.

J. Other requirements

Travel to country may be required up to three weeks for each visit. The Consultant may be requested to mobilize on a short notice and will be expected to deliver high quality finished products in a timely manner.

Appendix 1: Political Economy Analysis

MCC recognizes that there are multiple, distinct traditions of political economy analysis across several academic disciplines, and – moreover – that applied political economy analysis is evolving as its own distinct subfield.

For the purposes of this consultancy, we adopt the OECD-DAC definition:

Political economy analysis is concerned with the interaction of political and economic processes in a society: the distribution of power and wealth between different groups and individuals, and the processes that create, sustain and transform these relationships over time.

Consistent with this definition, political economy analysis is understood as a useful tool because it helps to explain:

· The interrelationship between governance dynamics and economic processes and interests;

· Contestation and bargaining between interest groups with competing claims over rights and resources;

· The role that both formal and informal institutions play in shaping economic activity, governance dynamics, and social behavior;

· The interests and incentives that shape the behaviors of all actors in a society, particularly the role of those interests and incentives in shaping policy making, policy implementation, and public administration;

· The de facto organization of authority, power, and decision-making in political and economic life – and its intersection with other social and economic dynamics and relationships;

· The organization of social exclusion and social and economic inequalities;

· The organization of political voice;

· The nature and history of social and political conflict;

· The political settlements that shape the terrain of action and contestation;

· The nature and extent of corruption and rent-seeking;

· The ideologies and norms that shape behavior in political and economic life;

· The role and perception of donors in partner countries.

Analyses should also provide pointed guidance on operational and programmatic issues like:

· Entry points to or leverage points for change;

· Barriers to change, including frank assessments of the political viability of particular interventions or activities;

· Guidance for “threading the needle” of viability in complex and challenging environments;

· Stakeholder mapping or analysis, including assessment of potential allies and opponents of MCC programming or reform efforts;

· Clear description or mapping of how decisions are made or implemented in particular sectors, organizations, or places, with guidance on critical challenges these might pose to compact development or programming and potential solutions;

· Likely winners and losers of proposed reforms or programs, and the potential implications for social inequality, political or social conflict, and political buy-in.

· Assessments of the lessons from past efforts at reform.

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