Oxford Economics Sole Source Justification--CO Approved on 7-28-2020.pdf

EXPORT-IMPORT BANK OF THE US

Justification and Approval for Other Than Full and Open Competition Commercial Services

IAW FAR Part 13.501(a)-2(ii) Services Exceeding the Simplified Acquisition Threshold

1. Contracting Activity: Export-Import Bank of the US, Research & Information Services for the Office of Chief Risk Officer, Country Risk & Economic Analysis Division

2. Nature and/or Description of the Action Being Processed:

In accordance with FAR 13.501(a)-2(ii) for sole source contracts exceeding the simplified acquisition threshold. The Export-Import Bank (EXIM) will award sole source purchase order for the Oxford Economics Global Economic Model (OE GEM). The vendor, Oxford Economics is located at 5 Hanover Square, 5th Floor, New York 10004.

CREA and EXIM Bank previously used EIU Country Data, but the EIU platform did not allow the manipulation of a truly-global macroeconomic model in order to stress-test, analyze shocks or plan scenarios at the country, industry and World levels.

Since November 2019, CREA has been without a robust working tool to support its analyses.

The OE GEM is a state-of-the-art product which will greatly facilitate the kind of country analysis required by EXIM & the Interagency Country Risk Assessment System (ICRAS).

ICRAS determines the country risk ratings utilized for all U.S. government international loans, guarantees and insurance.

Type: Firm-fixed price.

3. Description of Supplies/Services Required to Meet the Agency’s Needs:

The OE GEM is a global-integrated econometric model and it is a working tool for economic forecasting/scenario analysis/country risk analysis.

Costs and Period of Performance

Purchase order 83310120P0038 was awarded in the firm fixed-price amount of $326,003.00, inclusive of a base-year of 12-months with four (4) additional option periods. The purchase order was awarded on 7/13/2020.

4. Demonstration that the Contractor’s Unique Qualifications or Nature of the Acquisition Requires the Use of the Authority Cited Above (applicability of authority):

Oxford Economics makes its econometric model available as commercial information technology / software.

Currently there are no globally-integrated econometric models that are sold on the market apart from that offered by Oxford Economics. Several third-party research providers sell alleged econometric models, but these are not macroeconometric applications and they are not globally integrated. They are generally limited to just one country. The OE GEM allows individual economists to forecast a cross-set of variables at the country levels, and to elucidate an observable impact at the global level.

Aside from the econometric and quantitative advantages offered by Oxford Economics’ model in comparison with other third-party data aggregators and consensus forecast collectors, the GEM supports a number of functions and utilities such as forecasting, stress-testing at the country and industry level, scenario-planning, shock-analysis, market sizing and data codification. Such dynamics and functions set the Oxford Economic global econometric model apart from the competition.

There is only one responsible source. The OE GEM is highly specialized. Substantial duplication of cost and unacceptable delays would result if the agency was forced to develop its own global economic model.

Accordingly, Oxford Economics is the only firm capable of providing the supplies and services described in Section III above without EXIM Bank experiencing substantial duplication of cost that could not be expected to be recovered through competition, as well as unacceptable delays in fulfilling its requirements.

5. Description of Efforts Made to ensure that offers are solicited from as many potential sources as deemed practicable:

Market research was conducted to determine if other responsible sources exist (see below).

The market research indicates that Oxford Economics offers the only globally-integrated econometric model for sale on the market.

6. Determination by the Contracting Officer that the Anticipated Cost to the Government will be Fair and Reasonable:

The estimated price seems to be in line with other sophisticated and specialized database offerings and online tools. A 50% discount off the company’s usual pricing has been incorporated.

7. Description of the Market Research Conducted and the Results, or a Statement of the Reasons Market Research Was Not Conducted:

• The EXIM Bank Country Risk and Economic Analysis group (CREA) evaluated and researched a number of other potential providers, namely Haver Analytics, Macrobond, IHS Global Insights, and EIU.

• CREA read all pertinent materials available on these providers’ public websites to find out what services they offer, and in some cases did additional work, as indicated below.

• Haver – The Chief Economist has used Haver for over 20 years in previous positions. CREA had a demo session several months ago in which the team was shown the Haver applications. It is a data provider only; they don’t have a model or econometric application used for forecasting/estimations/etc.

• Macrobond – The Chief Economist spoke to the rep, read their literature and attended a virtual demo. He determined that it is a data and financial market pricing provider, not a macro model.

• IHS Global Insights – The Chief Economist used IHS GI for 7 years in a previous position.

Recently he reviewed their literature and latest applications as discussed on their Internet website. IHS does not offer a macroeconometric model, integrated at the global level. It only offers a US macro model.

• EIU – An examination of EIU offerings on their websites indicates that they are offer a news service, not a macroeconometric model. They provide forecasts and economic indicators, but they don’t make their forecasting model available for purchase to allow external economists to manipulate it.

8. As described in Section 8 above, market research, in accordance with FAR Part 10, was conducted by soliciting inquiries from providers, meeting with vendors, observing demonstrations, and reading websites.

9. Any Other Facts Supporting the Use of Other than Full and Open Competition:

None.

10. Listing of Sources that Expressed, in Writing, an Interest in the Acquisition:

Moody’s submitted their capabilities on July 10, 2020.

11. A Statement of the Actions, if any, the Agency May Take to Remove or Overcome any Barriers to Competition before Making subsequent acquisitions for the supplies or services required:

Oxford Economics does not have any competitors. If a competing product is developed, it will be considered and evaluated. A five-year contract is anticipated to ensure continued availability of this important working tool. In addition, less work is required to renew each year on a five-year contract. Also, savings result from extending five years’ worth of work to the vendor.

12. Requirements Certification: I certify that the requirement outlined in this justification is a Bona

Fide Need of the Export-Import Bank of the US and that the supporting data under my cognizance, which are included in the justification, are accurate and complete to the best of my knowledge and belief.

Name Date Title Division

Approvals

a. Contracting Officer's Certification (required): I certify that the foregoing justification is accurate and complete to the best of my knowledge and belief.

Kevin Alexander 7/28/20 20 Name: Kevin Alexander Date Title: Contracting Officer