USAID's business forecast provides insights for the year ahead

CANBERRA — 2017 has provided new opportunities for businesses to engage in a real-time manner with the U.S. Agency for International Development and understand their business priorities and objectives. Converting their business forecast database from a quarterly snapshot to a live feed has enabled business insight into the rapidly evolving priorities of USAID. This is crucial as businesses and partners plan and prioritization potential tender opportunities. But the agency also encourages businesses to engage directly to understand how USAID works with the private sector. On Dec. 15, a business call from Washington, D.C., for the first quarter of 2018 provided an important opportunity to discuss new and changing program objectives, as shown in our interactive feature for the budget forecast. A total of 205 business opportunities with USAID are forecasted for the year ahead. The business opportunities range in value from $150,000 to $2.5 billion and provide opportunities for businesses to partner with USAID in delivering solutions for job development, HIV response, and support for the 2018 Mali elections, among others. Regionally, the highest number of projects are focused on Afghanistan and the Philippines — both of which have eight projects listed in the forecast. But by forecast value, South Africa is the priority region, with almost $1.2 billion of business opportunities forecast. This is followed by $525 million forecasted to support business opportunities in Nigeria. Business opportunities to watch More than 40 percent of all opportunities forecasted for this quarter are listed as “new opportunity not previously forecast,” and the biggest business opportunity of these is the Integrated Health Systems IDIQ. IDIQ is a $750 million program to be implemented by the Office of Health Systems over a five-year period with partial set-aside opportunities for small businesses. “This program is still early in design stage and the activity has not been approved yet,” USAID explained in their question and answer report for the quarter. “A subset of awards will be reserved for small business. It is planned to be a multiaward IDIQ. We anticipate approximately five to six awards, a couple of them will be reserved for small business.” An associated new opportunity, the Integrated Health Systems TO, will see an additional $500 million invested, providing technology supporting the main program. $500 million is also forecast to be set aside by the Office of Infectious Diseases to support a program for the control and elimination of neglected tropical diseases over a five-year period. The business partner, or partners, will be expected to provide technical assistance, capacity building, and support program implementation while leveraging the support and resources of private and pharmaceutical sectors. And a total of $600 million is forecasted to support HIV programs in Nigeria and Zimbabwe. Only eight new forecast opportunities — less than 10 percent — are valued at less than $1 million, providing great opportunities for current and potential business partners to support USAID in the coming year. The impact of small business set-asides This quarter sees 15 opportunities listed as partial or total set-asides for small businesses — including IDIQ and three $25 million opportunities related to global health, economic growth, and management needs. The small business set-asides are designed to provide opportunities for new and smaller businesses to engage with the USAID program. Tom Babington, deputy spokesperson for USAID, told Devex the initiative is showing important success in achieving its aims. “Small business set-asides have historically been one of the most effective ways to encourage new partners to compete for USAID procurement actions,” he said. “Small businesses frequently tell us that set-asides provide them with much more realistic opportunities to succeed. Competition against larger, more established partners can be challenging for small businesses that are new to the USAID market. As a result, the use of set-asides usually results in more robust competitions on USAID contract awards.” Banington explained that there are several examples of new small businesses being able to partner as a result of the set-asides. “The JLN-B360, a joint venture, was completely new to the USAID market when it competed for and won the Sustainable High Impact Infrastructure for Education and Agriculture (SHINE) award for $17 million in Liberia,” he said. “Amethyst Technologies, another new small business partner, was awarded the Site Improvement through Monitoring Systems assessments in Tanzania for $4 million. Amethyst Technologies is a female-owned small business headquartered in Maryland, with offices in Tanzania and Ghana.” Small businesses will continue to remain a partnership priority in 2018, with USAID’s Office of Small and Disadvantaged Business Utilization targeting 12 percent small business goal for the year. And small business initiatives will be expanded, with the aim to implement programs encouraging engagement of small businesses in all USAID missions. Further initiatives will see USAID develop a Small Business Applied Research Initiative in early 2018, calling for graduates of the Small Business Innovation Research set-aside program — and other small businesses — to participate in this activity and connect with innovative businesses through Acquisition and Assistance Labs in Frankfurt and South Africa. Agriculture, energy, mobile communications technology, and water projects will be the priorities for early stages of this program. Increasing opportunities linked to disability-inclusive development One of the new opportunities for this quarter is a program supporting disability activity in Malawi. The opportunity, estimated to be between $1 to $4 million over three years, will see suppliers develop a scalable intervention allowing for the detection, instruction, and testing of children with disabilities in order to help them learn to read. A second opportunity supporting global child blindness is a forecast investment of up to $25 million for technical support to expand the delivery of quality eye care services. It will assist vulnerable children and other populations with limited access to sight-saving services over a five-year period. And they are two examples of an increasing number of opportunities enabling partners to support USAID’s disability-inclusive development initiatives, Babington explained. “As we seek to improve our service delivery for target beneficiaries, we continue to search for evidence-based approaches to inclusive education,” he said. “Specific opportunities that we are currently working on will target different types of disabilities, including people who are blind or have low vision, deaf or hard of hearing, and people with learning disabilities.” Outside the business forecast, there are a number of ways USAID is engaging support for disability-focused programs. USAID’s Cambodia mission recently posted a job announcement to hire a consultant to conduct a disability landscape analysis in Cambodia's education sector USAID’s Nepal mission is planning to support a new program in inclusive education. And USAID’s Bureau for Economic Growth, Education, and Environment has also conducted introductory disability-inclusive education training for more than 50 USAID education officers based in Africa, Asia, and Latin America and the Caribbean during the past financial year. “This is part of our efforts to increase the knowledge base and capacity for programming disability-inclusive education,” Banington said. “Serving people with disabilities has always been a focus of USAID activities, particularly in the education sector, where our mission is to ensure equal learning opportunities for all. Disability inclusiveness is a priority for USAID throughout the world.” A focus on food security This quarter has seen a spike in opportunities available from the Bureau of Food Security. For the past two quarters, the Bureau has listed four opportunities in the forecast. But this quarter sees a total of nine opportunities — six not previously forecast — and up to $1.8 billion invested in projects supporting gender empowerment, capacity building, data use, farmer-to-farmer education, and programs specifically targeting fish and legumes. All aim to help build agricultural production, workforce capability, and improve animal and plant production for increased food security. For business partners to understand more about opportunities in this space, the U.S. Government Global Food Security Strategy provides information on priorities and objectives for USAID to 2021. Lost opportunities The Afghanistan Trade and Revenue Initiative is one of the biggest programs cancelled this month, with no clear explanation for the cancellation. “The ATARI activity has been cancelled and will be removed from the business forecast after this current fiscal quarter,” USAID explained in their question and answer report. “The current notes indicate cancellation. This was due to changes in the Office of Economic Growth’s strategy.” The objectives of ATARI were to support trade facilitation, revenue generation, and export-focused economic growth and job creation in Afghanistan. El Salvador has also seen the loss of a potentially important project to the region with the cancellation of a $10 million clean energy project. Other cancelled opportunities include a $100 million program Bureau of Democracy, Conflict and Humanitarian Assistance supporting to promoting inclusive development through the establishment of an umbrella Empowerment and Inclusion Solicitation and Management mechanism and a $10 million technology and commercialization partnerships program from the Bureau for Food Security. The latter was cancelled as USAID investigate options for future activities in the commercialization space. Understanding USAID’s 2018 business objectives During the business call, USAID explained that agency redesigns under the guidance of new administrator Mark Green will see business priorities also evolve with the agency over the coming year. Key priorities for USAID include encouraging and supporting partner countries in self-reliance, greater interagency coordination to support national security priorities, better partnerships and administrative reforms. These, and other planned reforms, will likely creep into the design, function and deliverables of future business opportunities. Procurement reform is also a top priority for the agency. For business partners, this means USAID is seeking the greater collaboration with the private sector to support with technology, private financial investments, and other innovative development approaches. USAID explained in the business call that they want their procurement processes to embrace creativity and entrepreneurship and encourage co-financing of programs. “With this in mind, we are exploring how we can enhance our program design methods, and our use of solicitations, to include practices that invite the partner community to engage and collaborate,” Mark Walther, USAID’s acting director of Office of Acquisition and Assistance, explained. “We are also looking at expanding the use of award approaches that are more outcome- or results-focused, align budgets and outcomes more effectively, and build in some flexibilities to adjust or adapt to social, economic, and security challenges in our awards.” Reviewing the year that was The business forecast for the quarter was an opportunity to wrap USAID’s 2017 business outcomes, with Walther outlining what he considered to be the success stories for the year. “Last fiscal year, USAID obligated $17.25 billion through acquisition and assistance mechanisms, through more roughly about 24,000 transactions,” he said. “In terms of dollars and transactions, it was the largest to date. As comparison, in financial year 2016, USAID awarded $16.4 billion through 22,700 transactions.” Almost a third of this funding, Walther explained, went to new awards and they were near evenly split between contracts, grants and cooperative agreements. Walther lists other USAID business success stories as their Acquisition and Assistance Labs which expanded into Southeast Asia. The lab operates as an innovation hub, encouraging the development of the workforce of the future in the region with a lab, and supports the testing and scaling of innovative products and solutions to support aid challenges. 2017 also saw them launch a mentoring program associated with the lab, work to expand their business managers toolkit and coordinate community of practice calls to advise contracting and procurement staff of their direction towards innovative and cost-effective solutions. But the creation of a live feed of forecast business opportunities may be the biggest success story for year. “At the end of the fiscal year, we pulled metrics on the usage of the live feed forecast,” Walther said. “From January to September, the forecast had more than half a million web-page hits — which is quite astounding. Compare this to financial year 2016, while not apple to apples, our quarterly forecast was downloaded more than 67,000 times. We definitely appreciate the interest and use of the forecast and we are always looking for ways to improve and enhance the forecast.” Further details on USAID’s 2017 business stories will be outlined further in their annual progress report to be released early in 2018. In the meantime, current and future business partners are encouraged to engage with the business forecast data to see how they can add value in supporting developing countries. For further insights into the USAID business forecast, interact with our Tableau visualization and delve into business opportunities by sector and region.