USAID business forecast: Q2 2022

Last week, the U.S. Agency for International Development held its quarterly business forecast conference call. The call highlighted the agency’s work on localization, supporting partners from marginalized communities, and the Ukraine crisis. Devex looked into the data to see where USAID’s money will go and what the agency will prioritize in the coming months. The second business forecast for this year includes 248 opportunities listed as being worth almost $29 billion — a 5.5% increase compared with the previous quarter. This is driven by an additional $1.5 billion allocation for the environment and $1.5 billion for crises and conflict response. However there is some ambiguity about the latest forecast, in particular around the two largest contract opportunities, which are two procurement service agent — or PSA — contracts. These are part of the Next Generation Global Health Supply Chain Suite of Programs, known as NextGen. The two largest contracts, one for the procurement of malaria and maternal health supplies, known as Integrated PSA, and the other for the procurement of HIV/AIDS health supplies, or PSA-HIV, are both listed as having a maximum value of $3 billion. USAID had previously estimated the maximum value of these contracts as $5 billion and $4.1 billion respectively, and a request for proposal for the Integrated PSA has recently been published on SAM.gov, listing it at $4.1 billion. When asked about the PSA-HIV, USAID said only that it would be more than $3 billion. However there is little to suggest it has changed the expected value of the contract. If the value of these contracts has not changed, then the total opportunities would be $32.1 billion — a 17% increase. Trends in health Global health remains the top priority among the sectors, with 41 opportunities listed as worth up to $16.7 billion, potentially rising to $19.8 billion with the higher value for NextGen contracts. A further $479.9 million, co-funded by the U.S. President's Emergency Plan for AIDS Relief, is allocated for 11 opportunities for HIV/AIDS. NextGen still accounts for the biggest share. NextGen is a group of 10-year global health programs that funds the procurement and distribution of health commodities in partner countries. The latest business forecast lists the maximum potential value of the NextGen contracts as $13.6 billion for eight opportunities. The previous maximum value was $16.7 billion. A ninth NextGen contract, estimated to be worth up to $300 million and due to be awarded shortly, is not included in the forecast, bringing the total maximum value of NextGen to $17 billion. Other large forecast opportunities under NextGen include up to $2.8 billion for HIV/AIDS laboratory, diagnostic, and molecular commodities, known as PSA Diagnostics; up to $2.5 billion for the Comprehensive Technical Assistance for Health Supply Chain and Pharmaceutical Management contract, known as CompTA; and up to $1.5 billion for the warehousing and transportation of USAID-funded health commodities. Meanwhile, other global initiatives also received significant allocations: • $1.4 billion to address infectious diseases such as malaria and tuberculosis. • $150 million to support activities for HIV/AIDS control and prevention. • $100 million for three cooperative agreements under the Promoting Results and Outcomes through Policy and Economic Levers Annual Program Statement, a USAID initiative for population and reproductive health. Uganda and Ethiopia are the priorities for country-specific health initiatives, with up to approximately $300 million each. This includes a $300 million cooperative agreement to increase access to health care services in Uganda and five contracts worth $50 million each that are related to nutrition, the supply chain, and reproductive, maternal, newborn, child, and adolescent health in Ethiopia. What are the other development priorities? USAID allocated an additional $10.3 billion for 176 opportunities in seven thematic sectors, including: Environment and global climate change • Up to $1.5 billion for the implementation of USAID’s global energy sectors programs. • Up to $300 million to support the Green Recovery Investment Platform — an anticipated USAID initiative that would mobilize finance for climate- and energy-related activities. • Up to $100 million for the new Green Cities mechanism — A USAID initiative for climate resilience in urban cities. Democracy, human rights, and governance • Up to $300 million under the annual program statement for the El Salvador Country Development Cooperation Strategy. • Up to $100 million to support anti-corruption activities in Ukraine, which was also included in the previous forecast, or before the Russian invasion in the country. • Up to $100 million for reconciliation and victim support in Colombia. Working in crises and conflict • Up to $1.5 billion for administrative, operational, and technical support to USAID’s Humanitarian Assistance Support activities. • Up to $50 million to partner with organizations working toward recovery from conflict or violence. • Up to $50 million to strengthen emergency response planning at USAID’s Bureau for Humanitarian Assistance. Scrutiny and oversight • Nearly $1.5 billion for forecast opportunities related to administration and management, such as auditing; monitoring, evaluation, and learning services; and staffing services. How about the Ukraine crisis? While the business forecast did not include any new opportunities that would address the current crisis in Ukraine, future procurements for the country are expected to significantly increase, following the U.S. administration’s $13.6 billion commitment through the Ukraine Supplemental Appropriations Act. Furthermore, James Hope, director of USAID’s Ukraine mission, reported during the call that the agency has been working with partners to rechannel resources where they are needed most. This includes ensuring a continued flow of electricity, protecting communications networks, and supporting shelters for people displaced within the country. Try out Devex Pro Funding today with a free five-day trial, and explore funding opportunities from over 850 sources in addition to our analysis and news content.