20170214_RFI_No._SOL-472-17-000001__USAID_Timor-Leste_Tourism_Activity.pdf

REQUEST FOR INFORMATION

Reference Number: RFI No. SOL-472-17-000001 USAID Timor-Leste Tourism Activity Release Date: February 14, 2017 Response Due Date: March 1, 2017 at 4:00 PM (Bangkok local time)

The United States Agency for International Development (USAID/Timor-Leste) is in the process of designing a new stand-alone activity and statement of objectives (SOO) to expand Timor-Leste’s tourism offerings using an inclusive and sustainable approach.

This is a Request for Information (RFI) which intends to provide public information to parties interested in USAID’s support for the tourism sector in Timor-Leste, as well as to collect any information and suggestions about the USAID’s planned programming in this sector. This RFI incorporates the valuable information received from the development community from the previous RFI of March of 2016. Information collected is intended to help in the Mission’s activity design and development for an intended future solicitation which is anticipated to be issued in the early summer of 2017.

Requested Action:

At this time, USAID is seeking any feedback on the Statement of Objectives for the USAID Timor-Leste Tourism Activity.

Please note USAID is not seeking technical or cost proposals at this time and in accordance with FAR 15.201(e), responses to this notice are not offers and cannot be accepted by the Government to form a binding contract. Responses to this RFI are voluntary and USAID will not pay respondents for any information provided in response to this RFI. If a future solicitation is issued, it will be announced on the Federal Business Opportunities website at www.fbo.gov at a later date.

Instructions for Submitting Responses/Comments:

Please send all responses to this RFI via email to Karittha Jenchiewhcan at kjenchiewchan@usaid.gov with a copy to Gregory Wang at gwang@usaid.gov and Suthicha Chussananalin at schussananalin@usaid.gov by the date and time indicated above with the title “RFI No.SOL-472-17- 000001 USAID Timor-Leste Tourism Activity”. Respondents may also include self/organization information including past experiences working in this subject area, experience working with other stakeholders, or capacity information. You will only receive an electronic confirmation acknowledging receipt of your response, but will not receive individualized feedback on any suggestions.

Thank you for your assistance and interest in USAID programs.

Sincerely, /s/ Gregory Wang Regional Agreement/Contracting Officer USAID/RDMA, Bangkok, Thailand http://www.fbo.gov/ mailto:kjenchiewchan@usaid.gov mailto:gwang@usaid.gov mailto:schussananalin@usaid.gov

RFI No. SOL-472-17-000001 USAID Timor-Leste Tourism Activity

ATTACHMENT J.1—STATEMENT OF OBJECTIVES

J.1.1 INTRODUCTION

This Statement of Objectives (SOO) for the United States Agency for International Development (USAID) mission in Timor-Leste (TL) (henceforth referred to as USAID/TL or the Mission), provides the top-level objectives of this acquisition, and is provided in the Request for Proposal (RFP) instead of a Government-written statement of work (SOW) or performance work statement (PWS).

J.1.2. PURPOSE

The vision behind USAID’s investment in the tourism sector is to promote Timor-Leste’s competitiveness as an international tourism destination while preserving its unique environmental and cultural heritage.

The purpose this five-year, approximately $7-9 million activity, is to expand Timor-Leste’s tourism offerings using an inclusive and sustainable approach. The contractor will provide programmatic, administrative, and technical support to the Mission in the planning, management, implementation, and evaluation of the outcomes of the Tourism activity.

The aim is to facilitate private investment by working with government to establish incentives and obligations that are more private sector-friendly, promote sustainable tourism, and safeguard the environment and social characteristics of local communities. The Timor-Leste Strategic Development Plan 2011-2030 identifies five different tourism niches including: eco and marine, historical and cultural, adventure and sports, religious and pilgrimage, and conference and convention. While there are a variety of ways to characterize these niches, the activity will be expected to focus on at least two of these tourism niches or others and one type of handicraft product to augment receipts to the local economy. Detailed value chain analyses will be undertaken and a plan of action developed to address constraints to investment by the private sector and/or communities. It will be important to consider both private sector investment on private land and also how to create favorable conditions for private sector investment in management of public assets such as protected natural or cultural sites.

This SOO allows offerors to propose and price a solution that achieves the outlined objectives and contributes to measurable improvements in receipts derived from the tourism sector in Timor-Leste.

Illustrative indicators include:

● Number of rural households benefiting directly from USG interventions (Standard Indicator);

● Broad Timorese participation in selected tourist niche and handicraft activities;

● Participation in policy dialogue and development;

● Expenditures on tourism products/sites/activities linked to the activity;

● Number of key (defined by Timorese) maritime and terrestrial sites under protected status;

● Number of key (defined by Timorese) cultural sites under protected status;

● Number of tourism framework documents (defined at beginning of activity) approved and being implemented;

● Selected government agencies better able to perform their duties (Participatory Institutional

Capacity Assessment and Learning framework (PICAL1) or equivalent);

● Associations involved in the tourism sector strengthened (PICAL or equivalent).

● Conditions improved for private sector investment (to be defined) in at least two types of tourism

(marine, adventure, historic, religious, etc.); and

● Conditions improved for investment (to be defined) in at least one product (tais, carvings, ceramics, basketry, etc.).

● Measures of tourist satisfaction with niches/sites/products improved by the activity.

1 PICAL is an instrument used to measure institutional capacity of public institutions derived from the Partner Institutional Viability Assessment (PIVA). PIVA was developed in 2000 at USAID/REDSO and updated modified at USAID/DRC in 2014. Some type of formal tool will be utilized to measure institutional strengthening.

The contractor will select specific geographic areas and/or niches where it will operate and is not expected to cover the entire country.

J.1.3. SCOPE

USAID/Timor-Leste requires services that will sustainably and inclusively develop and expand Timor- Leste’s tourism sector. By sustainably, USAID/TL means a tourism sector of scale and scope suitable for the country’s small size, fragile environment and desire to maintain environmental and cultural integrity.

By inclusively, USAID/TL means to ensure that a broad cross section of the Timorese population can benefit. The tourism sector is defined as the service industries which benefit from tourism, including transportation services such as airlines, charter boats, other public and private transport;

hospitality services such as hotels and resorts; entertainment broadly defined such as natural attractions, shopping malls, music venues and theaters; and handicrafts, artistic products, etc. The end result will be a more coherent institutional, legal and regulatory environment in which tourism operators and investors will be able to expand their offerings and an increased number of tourism products and/or sites that are sustainable, can increase revenues derived from the sector and involve innovative partnerships.

It is difficult to anticipate how USAID requirements will evolve over the life of the contract due to upcoming elections in Timor-Leste in 2017 and the new U.S. Administration which may change priorities and funding sources. As such, the tourism activity must be able to rapidly incorporate changes. For instance, current funding is likely to come from the category—Climate Change/Adaptation which may disappear completely thereby requiring adjustments if other funding or foreign policy priorities are directed by the USG. In addition, technical interventions may evolve during the life of contract performance so the offeror must continuously seek ways to promote feasible, innovative and evidence-based approaches in support of this activity’s purpose and objectives.

J.1.4. BACKGROUND

General Context:

Timor-Leste is the world’s second youngest country with a young population (60 percent of which is 24 years or younger – 2015 census). Since independence in 2002, Timor-Leste has made significant progress in governance and public service delivery to citizens. Offshore petroleum production has been generating significant revenues which the Government of Timor-Leste (GOTL) uses to finance the majority of the national budget. Nonetheless, petroleum reserves are limited and the fundamental challenge for Timor-Leste is to rapidly diversify its economy with the most potential to be found in agriculture and tourism. Currently, the GOTL is spending its limited resources upgrading basic infrastructure, such as electricity, roads, ports, and airports and strengthening state institutions so they can deliver public services. The benefits of state spending, however, are not seen as being equitably shared, at least partly due to limited state capacity to reach a largely rural population and a number of large infrastructure projects that do not address their needs.

The country’s population still remains one of the poorest in the world with 60% of the employed population relying predominantly on subsistence farming, forestry and fisheries followed by public administration and defense (9.5%). Poor agricultural production practices and a lack of income to supplement home-grown products contribute to high levels of food insecurity throughout Timor-Leste.

USAID played an important role developing the coffee sector, which is continuing to evolve, and it is the key agricultural foreign exchange earner. USAID and other donors are now strengthening horticulture to raise domestic incomes and bring in foreign receipts.

Non-existent or underdeveloped infrastructure, high unemployment, relatively recent emergence from conflict and the potential for renewed insecurity pose major development challenges as the country transitions from post-conflict recovery to long-term economic and political development. As noted, over half of the population is under the age of 24. While this creates challenges, it also provides enormous opportunities. If this new generation acquires technical skills and joins the workforce they will respond to new opportunities with dynamism, creativity and enthusiasm, and can drive future economic growth and development.

At Independence the GOTL chose Portuguese and Tetun, an indigenous language, as the official languages. Bahasa Indonesia, the language of instruction from 1975 through Independence, and English serve as working languages. There are also 16 languages with about 30 different dialects used throughout the country. In recent years, the school system now instructs in the two official languages which creates significant challenges for the country’s work force generally and especially for the tourism sector.

Although there is substantial will to address these challenges, government institutions lack the systems, structures, personnel and processes needed to efficiently and effectively provide public services to their constituencies. The country is still at the early stages of nation building and development and the lack of human and institutional capability is challenging. The indigenous private sector and civil society are also nascent, fragmented, and relatively weak. With a legal system consisting of an overlay of Portuguese, Indonesian, United Nations and post-Independence laws and lack of clarity on the fundamentals such as land tenure, it is difficult to attract either domestic or foreign investment. This will remain the case until a friendlier business environment is established. Little credit is available for local businesses and transaction costs are high since Timor-Leste’s economy is dollarized. The banking sector is not well developed and credit card and ATM transactions are unusually expensive. Telecommunications is expensive compared to the rest of Asia and internet access sporadic in rural areas.

Tourism Sector:

Located in the Coral Triangle, Timor-Leste is home to extraordinary marine biodiversity as documented by recent fieldwork by Conservation International (CI) and the U.S. National Oceanic and Atmospheric Administration (NOAA)2. In addition to the fish species and corals, dolphins, whales and porpoises populate the waters during parts of the year. Nonetheless, little has been done to protect these marine resources and there is already evidence of over-fishing and pollution in some locations. Timor-Leste now has three Marine Protected Areas (MPAs) which include Nino Konis Santana (NKS) 3 in the eastern part of the country and two newly established MPAs located off Atauro Island4 and off Batugade5 in Bobonaro. Currently, most of the tourism is centered on the sea with diving and snorkeling being the most developed attractions. Although Timor-Leste is small (15,410 km2), the central part consists of spectacular mountain ranges and some forests that are virtually undeveloped. There are two national parks managed by the Ministry of Agriculture and Fisheries (MAF) but little protection is actually occurring. Additionally, Timor-Leste’s Portuguese colonial heritage, independence struggle, and varied ethnic traditions all provide tourism opportunities. In 2015 Timor-Leste signed three UNESCO cultural conventions indicating interest in protecting and promoting its cultural heritage in the future. Cross-linkages with agriculture could reduce leakages off the island. However, the small size of the country presents real challenges to develop an industry that benefits local communities, generates revenue for the country and is sustainable without over-exploiting its unique natural and cultural resources.

The tourism sector is nascent with limited, but growing, numbers of international tourists and an emerging tourist infrastructure6. Tourism development is one of the GOTL’s economic development strategies as highlighted in the 2011-2030 Strategic Development Plan. Nonetheless, it has been difficult for the GOTL

2 Conservation International Biodiversity Survey 2016 http://www.conservation.org/NewsRoom/pressreleases/Pages/Biodiversity-survey-reveals-reefs-in-Timor-Leste-s- Atauro-Island-hold-the-worlds-highest-reef-fish-species-average-.aspx and NOAA’s Interdisciplinary Baseline Ecosystem Assessment Survey, 2016 3 Government Resolution No.8 of 2007 4 Ministerial Decision No. 6/GM/I/2015 5 Ministerial Decision No. 5/GM/I/2015 6 Rajalingam, G. (2014) 2014 Survey of Travelers to Timor-Leste. The Asia Foundation http://www.conservation.org/NewsRoom/pressreleases/Pages/Biodiversity-survey-reveals-reefs-in-Timor-Leste-s-Atauro-Island-hold-the-worlds-highest-reef-fish-species-average-.aspx http://www.conservation.org/NewsRoom/pressreleases/Pages/Biodiversity-survey-reveals-reefs-in-Timor-Leste-s-Atauro-Island-hold-the-worlds-highest-reef-fish-species-average-.aspx to embark on a comprehensive approach to tourism partly due to inherent weaknesses in government institutions and lack of collaboration between the various ministries involved in the sector and a relatively fragmented private sector. Nonetheless, there are positive trends underway that suggest the timing is right to engage all stakeholders with renewed focus. A draft tourism policy has been developed that has been submitted for public comment. Entitled “Growing Tourism to 2030-Creating a Sense of National Identity”, it is meant “to underpin a new strategy by ensuring that social, economic, and environmental sustainability is central in order to maximize the future competitiveness of the country as a visitor destination.”

The Dili Institute of Technology hosted the “International Conference on Emerging Tourism Destinations (ICETD): Challenges and Opportunities” held October 24-26, 2016 which provided an opportunity for over 200 international and domestic tourism professionals, academics, and Timorese students in tourism to identify key themes to be considered as Timor-Leste develops. These were: slow development, not rapid growth, “get it right the first time because there is no going back”, the importance of environmental and cultural protection and conservation, mass tourism is not the right path, the need to ensure that communities benefit and the importance of choosing options that maintain as much revenue as possible for the country rather than it going overseas, the importance of understanding the market and targeting tourism products accordingly, and the need for Timor-Leste to become better known as a high value tourism destination. At the end of the conference, Timor-Leste’s new tourism website was launched: www.timorleste.tl.

The poor condition of the country’s road network, limited accommodation options, relatively expensive air links, poor quality of emergency and medical facilities, lack of products, and the small, fragmented private sector remain challenges to the sector’s growth. However, the GOTL is showing signs of willingness to take leadership and develop a strategy and action plan and consider new institutions required for the sector. For instance, the establishment of a new public-private Tourism Authority has been proposed as one option to guide implementation of tourism activities. Key stakeholders are enthusiastic about developing the industry. It may take decades to develop all the potential offerings but it is time to begin focused work in key areas foundational to getting the sector off the ground. Successful tourism development can bring jobs and income opportunities to Timor-Leste and can create a positive image for the country that will benefit investment and trade in other sectors.

Nonetheless, Timor-Leste faces extraordinary competition within the region as a tourist destination. It will take real ingenuity to identify niche tourism offerings and products to entice visitors to this remote island.

In addition to its unique Portuguese, Indonesian and Resistance history the country would probably benefit by playing up the Sparrow Trail, coffee tours, its exquisite “tais” or “ikat” tradition as well as whale and dolphin watching and the fantastic marine biodiversity. With so many goods imported onto the island there is room to expand linkages with the agricultural sector to source more local products and revive the varied culinary traditions that exist across the island.

Mission CDCS and other potential stakeholders:

The Mission’s Country Development Cooperation Strategy’s (CDCS) overall goal is to facilitate a more prosperous, healthy, and democratic Timor-Leste, specifically through the Mission’s Development Objective, “Institutional and human capacity for development strengthened to improve the lives of Timor- Leste citizens”. The Intermediate Result (IR 1), “Inclusive Economic Growth Accelerated in the Private Sector”; Sub IR 1-1 “Improved Ability of Citizens to Engage in the Private Sector and Sub IR 1-2, “Increased Productivity of Selected Value Chains” will be realized, in part, by the tourism activity as it sustainably and inclusively develops and expands Timor-Leste’s tourism sector.

There is potential to work with other partners in the tourism sector, such as the New Zealand Embassy, Australia’s Department of Foreign Affairs and Trade (DFAT), the Japanese Embassy, The Asia Foundation, the International Labor Organization (ILO), the East Timor Development Agency (ETDA), Noble Timor, the Association of Tourism Businesses in Timor-Leste (AETTL), the Chamber of Commerce, the Dili Institute of Technology, among others. The tourism sector’s cross cutting nature also requires that several GOTL branches play important roles towards its development including: the Ministry of Tourism, Arts and Culture; the Ministry of Commerce, Industry, and the Environment (MCIE); the Ministry of Agriculture and Fisheries (MAF); and the Office of the State Coordinating Minister of Economic Affairs (MECAE) among others. Post the 2017 elections the appropriate government partners may change as ministerial responsibilities may shift.

J.1.5 PERFORMANCE GOAL, OBJECTIVES AND TARGETS

As noted above, the long-term vision behind USAID’s investment in the sector is to promote Timor-Leste’s competitiveness as an international tourism destination while preserving its unique environmental and cultural heritage. The immediate goal is to expand Timor-Leste’s tourism offerings using an inclusive and sustainable approach. There are a number of results that need to be achieved in order to attain this vision, not all of which can be adequately dealt with in a project of the scale and scope envisioned here. It will require the concerted effort of the GOTL, the private sector, civil society, communities and donors to achieve these results and it could take a decade or more. The results identified are:

● Adequate conservation measures in place to protect high value for tourism marine and terrestrial environments and historical/cultural sites;

● Institutions, policies, and activities in place to facilitate implementation of the GOTL’s tourism vision and policy;

● Sustainable and inclusive tourism projects implemented by the private sector, associations and communities;

● Enhanced Timorese awareness and endorsement of tourism;

● Work Force Development;

● Access to finance for local investors;

● Quality assurance; and

● International and domestic demand for Timor’s tourism product increased through appropriate marketing and branding.

There is increasing forward momentum right now in the tourism sector with renewed interest on the part of the government, the private sector and donors. Not all of this may be positive or necessarily in line with the vision articulated by the former President and actual Minister for Planning, Strategy and Investment, Xanana Gusmao, in closing the ICETD 2016. To paraphrase, he noted that there is a need to protect the environment and unique biodiversity, to promote the unique cultural history and to invest in remote areas involving local communities ensuring that both women and men benefit. Current pending investments include two large-scale tourism resorts on either side of Dili and an effort to increase cruise ship stops. There are also unclear but potentially large-scale projects on Atauro Island and Oecusse, none of which are likely in harmony with the vision expressed above. Rampant, unplanned, fast-paced development presents a threat to Timor-Leste’s culture and natural environment. At the same time, opportunities and potential partnerships with large businesses that further Timor-Leste’s vision for tourism should be considered. For instance, large hotels or resorts might have the funds to co-fund new or expand existing training institutions; they might be willing to work with environmental groups on conservation and protection of natural resources if they see the benefits to their bottom line. USAID’s tourism activity will not be able to address all of the challenges confronting tourism development but proposes to work on some of the foundational elements in order to move the sector forward.

GOAL

Expand Timor-Leste’s tourism offerings using an inclusive and sustainable approach.

Achievement of the program goal will be measured by the following indicators:

● Number of rural households benefiting directly from USG interventions;

● Broad Timorese participation in selected tourist niche and handicraft activities; Expenditures on tourism products/sites/activities linked to the activity;

OBJECTIVES

Objective 1: Ensure that institutions, policies, and laws are in place that will facilitate the implementation of the National Tourism Policy.

Objective 2: Promote sustainable tourism projects which involve private sector resources and participation by local communities, local and international NGOs, and associations, among others, that serve as replicable models of sustainability and best practices.

Specific Objectives and Performance Standards

Objective 1: Ensure that institutions, policies, and laws are in place that will facilitate the implementation of the National Tourism Policy.

Despite some recent progress, such as a draft policy, discussions about establishing a Tourism Authority, the establishment of a website, and a recent academic conference, tourism may continue to flounder exists unless the government shows strong political will to engage closely with the private sector, civil society, and communities to move forward on appropriate legislation, policies and institutional strengthening needed to advance the sector. An agreed upon national tourism framework needs to be established that charts this path and allows various actors to begin implementing the different pieces.

This will require high level commitment from the government on whether the country will go the route of slow, steady, inclusive development or fast, un-managed growth.

Assuming that the rhetoric about slow, sustainable and inclusive development will guide this path then a number of essential steps are required. This national tourism framework consisting of legislation, policies and institutions will then guide investments in infrastructure, conservation and the enabling environment on the part of the government and actual investments in tourism products by the private sector, NGOS, communities and others. For instance, the draft policy needs additional vetting then adoption by the government. Once that is in place, a draft tourism strategy and a tourism action plan will also need to be developed through a broad stakeholder engagement process. Apparently a strategy exists but it was developed without wide consultation and before even the policy has been adopted. Recognizing that other donors and the government itself may continue to advance the process during 2017, the offeror should be positioned to engage and advance the process at whatever stage it is once the contract is awarded.

Part of this process will be determining the appropriate institutional arrangements needed to facilitate investment in tourism. Currently, a number of different government ministries are involved with lack of clarity about different roles and responsibilities. Mapping of this institutional landscape may be required.

This needs to be resolved as does the appropriate role of the government in natural and cultural conservation, setting of standards, and oversight of private/community investment. With a new government expected in 2017, it may be possible to influence some of these decisions to benefit the tourism sector. Some critical questions include:

● Is a Tourism Authority required and if so, how should it be structured and what would its relationship be to the current Association of Tourism Business in Timor-Leste (AETTL)?

● Are a variety of associations more likely to succeed and if so, how should these be promoted?

● What role/impact will political decentralization or deconcentration have on the sector?

No matter how some of these questions are answered, it will be necessary to select some government units and/or associations for capacity strengthening if the sector is to move forward.

There is currently no updated inventory of key terrestrial and marine resources in order to determine which should be placed under some type of protected status. Similarly there is no inventory of historical and cultural heritage sites. Some work has been done on this but it is unclear whether a comprehensive inventory will be completed and shared. Once the protected status is determined then additional legislation and/or implementing policies will be required. It is essential that the GOTL reaches internal agreement between the relevant ministries on this matter. Additionally, the “protectors” of these sites such as eco-guards, heritage police and/or communities will need to be provided the right training and tools to ensure that these unique locations are preserved. This may be an area for collaboration for donors or conservation partners interested in this line of work. Interest has been expressed in obtaining World Heritage Status for some sites which involves an entire approval process that is likely to require technical assistance.

The list of steps above is purely illustrative and does not cover all eventualities. It is meant as a guide only. A wide range of activities and interventions will be required to achieve this objective which the contractor should propose and which are likely to be modified as needed during implementation.

Performance Standards/Indicators

● Number of key (defined by Timorese) maritime and terrestrial sites under protected status;

● Number of key (defined by Timorese) cultural sites under protected status;

● Number of tourism framework documents (defined at beginning of the activity) approved and being implemented;

● Selected government agencies better able to perform their duties (Participatory Institutional

Capacity Assessment and Learning framework (PICAL) or equivalent);

● Broad Timorese participation in selected tourist niche and handicraft activities;

Objective 2: Promote sustainable tourism products/sites which involve private sector resources and participation by local communities, local and international NGOs, and associations, among others, that serve as replicable models of sustainability and best practices.

At the recent ICETD, a senior expatriate tourism consultant noted that many of the same challenges facing tourism and proposed solutions were discussed ten years ago, yet there does not seem to be much forward movement. There are a range of issues constraining the growth of both local and expatriate investment in Timor-Leste that need to be addressed overall by the government to increase investment generally. Timor-Leste’s score on the World Bank’s 2017 Doing Business report is 175 out of 190 countries and the World Economic Forum (WEF) Global Competitiveness Report 201-2015 ranked Timor-Leste 136 out of 144. The lack of secure land tenure is surely a major factor constraining investment but so is the World Bank’s assessment of Timor-Leste’s Enforcing Contracts indicator as the weakest in the world. The country is still an infant economy with little history of indigenous entrepreneurship and an acute lack of financing for small scale entrepreneurs. This may explain some of the paralysis in the sector. Furthermore, while the government espouses a slow, sustainable development path, the two recent approvals for tourism investment for multi-million dollar resorts on either side of Dili fit more into a conference/mega-resort model and not that of a slow development and/or eco-tourism model geared towards bringing income to small communities.

While this activity does not propose to address all the constraints to private sector investment, the focus will be on identifying and solving constraints for certain products and/or sites. USAID does not expect the offeror to propose interventions all over the country but instead to identify specific geographical locations which are promising.

The activity will focus on the creation of conditions for sustainable and replicable tourism investment activities (either in traditional sites that could benefit from upgrading or in urban or rural, non-traditional sites) that demonstrate the viability of joint ventures between the public, private, and business sectors and the local community while demonstrating cultural and/or environmental protection practices; and community participation tools that build economic opportunities, protection incentives and overall enthusiasm in site localities. The purpose of this work is NOT to develop individual tourist sites but to lay the groundwork for investors to do so. For instance, if the private sector identifies the constraints which prevent them from new or expanded investments then the activity can attempt to solve these but is not expected to actually invest into a particular tourism product or activity.

Across the globe a wide variety of models of private, public, community partnerships have been established using different financing and equity schemes that may be applicable to Timor-Leste.

Timorese stakeholders need to be involved in determining which different ones are most viable so that they can lobby for the necessary changes in policy and legislation to advance investment. Models used for protective areas, not just in Asia and the Pacific may be relevant, but also those used by investors in protected areas of Africa and Latin America. The contractor will need to work with local communities to help them understand the connections between conservation and preservation efforts and future revenues and ensure that they are in a position to better interact with potential investors. The judicious use of study tours, both in-country and overseas, may enhance the understanding of selected Timorese of various types of tourism.

Creating awareness among Timorese about the importance of tourism, its potential and its limitations, and the value of the natural and cultural heritage is critical. There is a need to develop a “culture of hospitality” and education on the repercussions of actions by local Timorese that affect tourism such as pollution, littering, sexual harassment, etc. The contractor will need to identify key areas and develop public information campaigns, school and outreach programs to help people gain a better understanding of tourism and help mitigate potential negative social impacts.

As noted, four key areas that have been identified by GOTL and USAID where additional assistance is needed in Timor-Leste are: 1) human resources; 2) quality assurance; 3) access to finance for local investors; and 4) marketing and branding. Each of these could be a donor-financed project or core focus of the GOTL by itself, thus this activity cannot address them in their entirety. Instead, for the two tourism niches and one product where the activity will play a facilitative role they will be addressed. And, as a key actor in stimulating the sector, the activity is likely to be involved in stakeholder discussion on these topics. If resources permit, broader analyses, workshops or conferences could be undertaken to help guide other donors or the government on working in these areas.

Performance Standards/Indicators

● Conditions improved for private sector investment (to be defined) in at least two types of tourism (marine, adventure, historic, religious, etc.);

● Conditions improved for investment (to be defined) in at least one product (tais, carvings, ceramics, basketry, etc.);

● Measures of tourist satisfaction with niches/sites/products improved by the activity;

● Number of tourism-related M/SMEs (by type e.g. accommodations, guiding, transportation).

● Number of rural households benefiting directly from USG interventions;

● Associations involved in the tourism sector strengthened (PICAL or equivalent);

J.1.6 GRANTS UNDER CONTRACT

This contract includes a grants component and authorizes grants under contract (GUCs) up to 25% of activity funding for activities to reduce risks to the start-up or expansion of small businesses, training small business owners or other initiatives to stimulate economic growth in tourism sector.

J.1.7 GENERAL CROSS-CUTTING REQUIREMENTS

A. Local Capacity/Sustainability: A fundamental goal of USAID, expressed in the USAID Forward reform agenda, is to build the capacity of the partner government, local NGOs and the private sector while simultaneously accomplishing our immediate development objectives so that improvements introduced are sustainable and entities can continue to advance independently.

The Contractor must ensure that all activities account for and maximize potential for local capacity building, including professional development for local project staff to assume higher levels of responsibility.

B. Environment, Climate Change and Climate Risk Management Located in the Coral Triangle, Timor-Leste along with Indonesia, Malaysia, Papua New Guinea, Philippines and Solomon Islands are home to the highest coral diversity in the world with 600 corals or 76% of the world’s known coral species, highest reef and fish diversity on the planet with 2,500 or 37% of the world’s reef fish species, and has the greatest extent of mangrove forest in the world which protects communities from storms, sea level rise and climate change impact.

Currently, the main tourism attractions in Timor-Leste are nature-based and include both marine and terrestrial protected areas. Poorly planned and managed tourism activities will have significant adverse impacts on the environment as well as on these resources. Thus, the activity is expected to undertake in-depth analyses to understand the potential environmental impacts that could result from this activity.

In addition, this activity must be robust in the face of potential climate change impacts. In 2014 U.S. President Barack Obama issued an Executive Order on Climate-Resilient International Development which directs federal agencies to systematically factor climate resilience into their international development programs and investments. Therefore, the Offeror shall identify expected climate change impacts over the life of the activity and expected benefits and demonstrate how those risks will be reduced in order to ensure sustainability of the activity’s objectives.

C. Gender and Youth The voices of both women and youth tend to be marginalized in Timorese society unless explicit actions are taken to promote their inclusion. The contractor is expected to undertake analyses to understand the current roles of young people, men and women in tourism and to focus explicitly on promoting the participation of women and youth, not just in lower paying roles but equitably across all activities.

J.1.8 ACTIVITY TARGETS*

# Target Description Year 1 Year 2 Year 3 Year 4 Year 5

1 Number of rural households benefiting directly from USG interventions (Standard Indicator)

2 Broad Timorese participation in selected tourist niche and handicraft activities

3 Participation in policy dialogue and development

4 Expenditures on tourism products/sites/activities linked to the activity

5 Number of key (defined by Timorese) maritime and terrestrial sites under protected status

6. Number of key (defined by Timorese) cultural sites under protected status

7 Number of tourism framework documents (defined at beginning of the activity) approved and being

# Target Description Year 1 Year 2 Year 3 Year 4 Year 5 implemented

8 Selected government agencies better able to perform their duties (Participatory Institutional Capacity Assessment and Learning framework (PICAL) or equivalent)

9 Associations involved in the tourism sector strengthened (PICAL or equivalent)

10 Conditions improved for private sector investment (to be defined) in at least two types of tourism (marine, adventure, historic, religious, etc.)

11 Conditions improved for investment (to be defined) in at least one product (tais, carvings, ceramics, basketry, etc.)

12 Measures of tourist satisfaction with niches/sites/products improved by the activity.

*To be proposed by the offeror.

- End of the Draft Statement of Objectives –