Expert in export development funding programs and trade finance instruments

Job Description

BACKGROUND

Funded by Global Affairs Canada, the Expert Deployment Mechanism for Trade and Development (EDM) provides technical assistance to Official Development Assistance (ODA)-eligible countries to maximize trade and investment development impacts. Over seven years (2018-2025), EDM will invest CAD 16.5 million to support Canada’s developing country trading partners to negotiate, implement and benefit from and adapt to trade and investment agreements with Canada.

EDM is a demand-driven project that will benefit potential partners – including governments, local private sector groups and local civil society organizations – through capacity building and technical advisory support on policy reform issues that have a high potential to reduce poverty and gender inequalities and support progress in trade and investment agreement negotiations.

Since the end of its 20-year civil war in 2000, Peru has seen strong economic growth and poverty reduction. However, that growth has relied heavily on resource extraction (principally copper, gold and silver) and is vulnerable to global demand and price fluctuation. Economic growth has also been centered on Lima, with little reaching the regions and rural populations. Regional inequity has been mirrored by social inequity, witnessed by Peru’s GINI score of 43.3 and rural poverty rates that dwarf the rates of urban centres.

Recent economic assessments (e.g. World Bank Multi-Dimensional Review) suggest the central challenge to Peru is the “middle-income trap” – a prolonged slowdown at middle-income status as the competitive advantage of low-cost labour and natural resource endowments driving growth reach their limits. Further growth must now come from increased productivity and innovation, diversifying exports, connecting to global value chains, and moving production higher up the value chain. Deepening regional integration also holds opportunities for economic growth through the creation of more viable markets. Regional trade is underdeveloped due in part to the similarity of the export baskets of Andean countries.

Trade and investment are important pillars of Peru’s national development strategy, and the country has pursued an ambitious agenda of negotiations to integrate the regional and global economies. Harvesting the benefits of these agreements will require technical assistance to implement their obligations and seize their opportunities. In the context of Canada-Peru trade and investment relations, this agenda includes the implementation of the CPTPP and the Canada-Peru Free Trade Agreement, as well as advancing the Canada-Pacific Alliance negotiations.

Peru’s National Strategic Plan for Exports 2025 sets out four priorities for supporting export growth: engaging more Peruvian companies in exporting and diversifying export markets; diversifying export products; improving trade facilitation and logistics; and capacity building for export development.

A central objective of the trade facilitation pillar is to develop new foreign trade financing tools.
Trade finance tools established by the Government of Peru include the pre- and post-shipment Export Credit Insurance Program for SMEs (SEPYMEX), the Business Guarantee Fund (FOGEM), export credit through the Municipal Savings Banks (Cajas Municipales) (PYMEX) and the Program to Support Internationalization (PAI) were developed. Since its implementation in 2017, PAI has generated a significant impact by benefiting about 255 companies with non-refundable resources to support them in the different stages of internationalization.

Notwithstanding these initiatives, 40% of companies surveyed cited access to capital as one of the main barriers to export development. This recent survey underlines the need for additional tools to support exporters with both refundable and non-refundable financing.

There are access to capital challenges at every stage of the export development process. At the beginning of the process, companies – especially MSME – may lack the resources to undertake trade readiness training, to explore foreign market opportunities or to develop export development plans. Government programs can provide direct services (training or advisory services of trade officials) or funding (grants or conditionally repayable contributions) to help companies prepare to export. At the export stage, 80% rely on some form of trade finance (credit, payment guarantees, insurance) typically provided by commercial financial institutions, but sometimes in risk-sharing partnerships with government.

MSME face the greatest hurdles in accessing affordable trade financing. Globally, more than half of all SME trade finance requests are rejected by financial institutions, compared with 7% for large firms. The challenge is even greater for MSME led by women, Indigenous Peoples and other marginalized groups.

To address the access to capital needs of Peruvian exporters – and firms with export potential – the Ministry of Trade and Tourism (MINCETUR) has requested expert assistance to guide the design of financing programs and instruments to support export development.

LINKAGE TO EDM PERFORMANCE MEASUREMENT FRAMEWORK

Technical assistance to strengthen trade facilitation and trade finance policies and programs is consistent with the approved EDM Country Needs Assessment Plan for Peru, Mandate 1: Trade Policy Capacity Building.

This assistance is also aligned with the EDM Performance Management Framework, intermediate outcome 1200 – Improved policy or regulatory environment within EDM partner countries for the implementation of sustainable and inclusive trade and investment agreements with Canada – and immediate outcome 1210 – Enhanced ability of partner country MDAs to strengthen, develop, and execute legislation, regulations and policies supporting the implementation of sustainable and inclusive trade and investment agreements with Canada.

The direct beneficiaries of this assistance will be MINCETUR and other government trade policy and promotion officials. The indirect beneficiaries will the approximately 8,000 exporting companies in Peru, including the over 5,000 SMEs engaged in exporting, of which 33% are women-led.

DESCRIPTION OF TECHNICAL ASSISTANCE REQUEST

Under this technical assistance activity, the expert(s) will:

• Conduct a broad survey and targeted consultations with Peruvian companies to identify their access to capital needs at all stages of the export development process and to gauge their awareness of public and private sector export financing programs and instruments available to support their export development efforts.
• Conduct research to identify international best practices in public and private sector export financing programs and instruments that might serve as models for Peru.
• Recommend and provide detailed designs for new financing programs and instruments to address the priority needs of exporters. Without limiting the content of program or instrument design proposals, these should include: purpose, eligibility (of beneficiaries and projects), expected demand, risks, estimated default rates, administrative costs, WTO compliance, etc.
• Identify the special challenges of MSME in accessing export financing and propose measures that can be taken to address these challenges.

The detailed description of the study, as presented by MINCETUR, is attached as Annex A. Bidders should provide an assessment of the proposed approach to the study, identifying gaps or methodological weaknesses, including those related to gender equality and social inclusion.

Consistent with Canada’s inclusive trade approach, the EDM seeks to promote gender equality/social inclusion and environmental protection as cross-cutting objectives of all technical assistance. Proposals should explain how these objectives will be integrated into both the content and conduct of the study. This includes identifying and providing recommendations to address the unique barriers to trade financing faced by SMEs led by women and Indigenous Peoples, international best practices to address them, criteria for gender-responsive and inclusive financing tools, and recommendations for trade finance policies and programs that address the needs of all Peruvian SMEs, including those led by women and Indigenous peoples. It also includes identifying financing gaps and providing recommendations to promote sustainable development or “green” trade financing.

TECHNICAL EXPERT PROFILE/EXPERTISE REQUIRED

Bidders will be evaluated on the basis of expertise in trade financing, as well as policy research and program development experience. The evaluation criteria include:

• University degrees and professional certifications in economics, international business, trade, public, or other relevant studies;
• Experience in the design and delivery of trade finance policies and programs;
• Experience in the design and delivery of trade finance instruments;
• Experience in the design and conduct of policy research studies in directly related subjects;
• Experience in the development of policy and program recommendations in or for public sector organizations;
• Demonstrated understanding of the impact of trade on gender equality/social inclusion and environmental protection and the formulation of policies and programs to promote their integration in trade; and
• Experience in the design and delivery of trade technical assistance to developing countries.

Note: The EDM includes a core focus on gender and social inclusion as well as on environmental issues associated with trade activities. Successful applicants must research and integrate specific good and emerging practices in this area, partnering with other expert consultants if necessary. Any prior experience in the provision of TA on gender equality and social inclusion and the environment will be viewed as a strong asset.

Before starting activities, the successful consultant(s) will be required to complete the Government of Canada’s online Gender-Based Analysis Plus (GBA+) training (approximately 2 hours).

TIMELINES

• The recruitment of experts is expected to be completed in December 2022. The study and final narrative report are expected to be completed by April 30, 2023.

DELIVERABLES

• A detailed work plan, work schedule and budget for the delivery of activities, taking into account any COVID-19-related travel restrictions
• Completed EDM Performance Measurement Framework template for the TA, including baseline data and targets against EDM indicators.
• Draft and final reports of the findings of the needs assessment survey and consultations.
• Draft and final reports of the international best practices study.
• Draft and final reports of the recommended export financing programs and instruments, together with their detailed design.
• Final Narrative Report on Mandate: Due within 30 calendar days of completion of all TA activities. The report shall describe activities delivered; results achieved (versus initial expected results and baseline); lessons learned of relevance to future EDM activities; expenses incurred by the Consultant in carrying out the TAA; gender equality and social inclusion outcomes, environmental outcomes, document officials trained/participating in activities (name, gender, job title, institutional affiliation). This report will be reviewed and approved by EDM prior to being shared with Global Affairs Canada.
• Contribute as necessary to the development of EDM communication materials and participate in an EDM roundtable highlighting key results achieved

PROPOSAL SUBMISSION PROCESS

For your proposal to be considered, please name your document in the following format:
3.11 Peru, Consultants Last Name, First Name (Proposals can be submitted by a single consultant or a consortium of consultants).

Your proposal should contain the following sections:

1. Cover letter
2. Proposal that includes the following:

• Your approach to implementing this TA, taking into account COVID-related travel restrictions. Provide as much detail as possible. (10 pages maximum)
• Describe your approach to ensuring that gender equality and social inclusion are considered in all aspects of the TA, including approach, content, and delivery. (2 pages maximum)
• Describe your approach to ensuring that environmental components are considered in all aspects of the TA, including approach, content, and delivery. (1-page maximum)
• Outline your project management and monitoring strategy for the implementation of the activities. (3 pages maximum)
• Indicate all experts proposed to implement this project, their roles and responsibilities. Include all CVs of proposed personnel/experts. (3 pages maximum per CV)

1. Provide an estimated level of effort (in days @ 7.5 hrs per day) and provide consulting rates (in CAD$) for each proposed personnel and/or expert implementing the project.

Please submit your proposal as a single PDF document through the Cowater Career Page (attach your PDF document under the Cover note, do not upload your resumes separately). Emailed proposals will not be accepted. If you have any questions, please email info@edm-mde.ca.

ABOUT US

With more than 35 years’ experience, Cowater International is a global leader in management consulting services specializing in international development and has managed the implementation of over 800 projects in more than 80 countries around the globe. We work with governments, partner organizations, communities and civil society to design and implement sustainable solutions that generate lasting social, financial and environmental impacts. Our adaptive approach to management has led to our yearly award-winning work and recognition as one of Canada’s Best Managed Companies since 2017. Headquartered in Ottawa, Canada, Cowater International also has corporate offices in Montreal, Quebec; London, United Kingdom; Nairobi, Kenya; and Brussels, Belgium, in addition to project offices in a wide variety of other locations across Northern and Sub-Saharan Africa, the Middle East, Latin America, the Caribbean and Asia.

We thank you for your interest in building a better tomorrow with Cowater International.

About the Organization

With more than 35 years’ experience, Cowater International is a global leader in management consulting services specializing in international development and has managed the implementation of over 800 projects in more than 80 countries around the globe. We work with governments, partner organizations, communities and civil society to design and implement sustainable solutions that generate lasting social, financial and environmental impacts. Our adaptive approach to management has led to our yearly award-winning work and recognition as one of Canada’s Best Managed Companies since 2017. Headquartered in Ottawa, Canada, Cowater International also has corporate offices in Montreal, Quebec; London, United Kingdom; Nairobi, Kenya; and Brussels, Belgium, in addition to project offices in a wide variety of other locations across Northern and Sub-Saharan Africa, the Middle East, Latin America, the Caribbean and Asia.

We thank you for your interest in building a better tomorrow with Cowater International.