unstructuredio/SCORE-Bench · Datasets at Hugging Face

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USAID’s PSE focuses on collaboration with U.S. and international companies, which has the potential to “crowd out” local companies.
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Mythbuster
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USAID engages U.S., multinational, and local companies in achieving its objectives, depending on which are the best partner(s) to achieve our development and humanitarian objectives, as the examples below illustrate.




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Mythbusting Examples
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USAID/Indonesia collaborates with a consortium of U.S. and local companies that are operating across the supply-chain for spices that are sustainably sourced and produced in the Papua region. Leveraging $2 million in private-sector co-investment, the project strengthens local companies in the supply-chain, and links them to global purchasers. The partnership mutually benefits local and international companies. (Source: USAID/Indonesia; POC: Ignatius Indriartoto) USAID’s East African Trade and Investment Hub connects American companies that are looking to source products from Africa under the African Growth and Opportunity Act. Key sectors of focus include African textiles, apparel, home decor, and leather accessories. (Source: USAID/Kenya; POC: Scott Cameron) In Zimbabwe, under Feed the Future, USAID links smallholder farmers to local input-suppliers (like seed companies) and local buyers (like processing companies). (Source: USAID/Zimbabwe; POC: Emma Siamena)




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Myth
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PSE is likely to undermine the role of governments and inherently public-sector functions.
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Mythbuster
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In many cases, PSE has proven to be an effective means for building up government capacity and filling gaps in demand for basic social services. In addition, for every public good or basic social service (e.g., health care and education), there is an underlying private-sector supply-chain.


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Mythbusting Examples
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USAID/Indonesia collaborated with the U.S. medical technology company, Becton, Dickinson and Company (BD) from 2013-2017 to support the Indonesian Government’s National Tuberculosis (TB) Program. BD contributed its expertise and in-kind resources to improve laboratory and diagnostic practices in Government laboratories. Building on the success of this program, USAID and BD will launch another partnership to improve the quality and efficiency of testing for drug susceptibility for TB and HIV through a partnership called Strengthening TB Resistance Testing & Diagnostic Systems (STRIDES). Such partnerships strengthen the Government’s capacity to deliver improved public health outcomes, while providing an opportunity for companies to build their brand, and contribute to improved health care institutions that can provide market opportunities. (Source: USAID/Indonesia; POC: Ignatius Indriartoto) USAID/Pakistan supported four private-sector manufacturers to produce high-quality chlorhexidine gel to prevent infections of the umbilical cord among newborn infants. The Pakistani regulatory authorities approved the product for registration, and the companies are now producing and selling it locally. (Source: USAID/Pakistan; POC: Kanwal Bokharey)


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USAID PRIVATE-SECTOR ENGAGEMENT POLICY \| Myths and Mythbusters Regarding Private-Sector Engagement
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Myth
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USAID cannot fund income-generating activities with the private sector.
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Mythbuster
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In many cases, supporting market-based approaches to development and humanitarian challenges will lead to increased profits for the private sector. This is a good thing. It is part of USAID’s theory of change that market-based approaches will lead to more sustainable outcomes when the business case or market exists for providing a good or service. In these cases, USAID should carefully assess the additionality and value of USAID support in enabling a market-based approach that achieves the intended outcomes. USAID should also conduct analyses to reduce the potential for market-distortions. If the private sector can, and should, do something by itself, USAID should stay out of the way.
USAID has certain limitations around how it directly supports profit-making and income-generating activities, depending on the type of instrument (i.e., acquisition or assistance). Federal and Agency regulations govern the treatment of program income. (See Parts 200 and 700 of the 2 Code of Federal Regulations). USAID cannot directly pay profit under assistance awards (i.e., grants and cooperative agreements); however, under both assistance and acquisition, USAID can fund income-generating activities when there is a compelling development or humanitarian reason to do so. When projects generate income, the Agency must consider profit-distribution arrangements, and fully analyze them for their potential impact on markets:
Provided USAID’s collaboration with the private-sector fosters positive development outcomes and results that do not wholly, and solely, accrue to the private-sector partner(s), USAID is able to use assistance and approaches used under the GDA to fund for-profit activities with the private sector;
The DCA enables the Agency to fund for-profit banks and intermediaries through credit guarantees to extend financing to underserved markets; and
By capitalizing on “shared value,” companies may pursue profit-making strategies while addressing social issues in collaboration with USAID, where our interests align. Funding for-profit activities with the private-sector - which also have strong development and humanitarian outcomes - can effectively build sustainability.


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Mythbusting Examples
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A partnership between USAID and the National Association of Securities Professionals (NASP) and Mobilizing Institutional Investors to Develop Africa’s Infrastructure (MiDA) facilitates and expands opportunities for infrastructure-investment in sub-Saharan Africa. The program focuses on American investors, exposes them to co-investment opportunities with African counterparts, and deepens relationships with African institutional investors. Listed by the International Monetary Fund (IMF) as the second-fastest-growing region through 2020, Africa increasingly offers attractive opportunities for U.S. businesses and investors. MiDA leverages these trends, and facilitates and expands opportunities for investment in infrastructure for those who seek higher returns, while also making progress toward development objectives and advancing U.S. interests in the region. (Source: USAID/E3/PCM; POC: Cameron Khosrowshahi)
USAID support to small-scale, maize-growing farmers in Uganda provides another example of shared value in which multiple partners achieved a positive return on investment. In a community in Uganda, farmers were drying their maize on the ground near domestic animals. This meant that they lost 30-40 percent of their crop, and the remainder could not meet commercial standards. A large regional brewery owned by SABMiller operated in the area, but bought almost all of its grain from overseas. Through multiple USAID investments along the supply-chain and an off-taker agreement with the brewery to facilitate farmers’ access to credit and inputs, farmers were able to purchase improved seeds, equipment, fertilizers, and irrigation solutions. After five years, the supply-chain increased to 27,000 farmers. Crop yields increased by 65 percent, and annual household income more than doubled. Farmers’ families had a more-nutritious diet and were more resilient to drought because of insurance and better seeds. Annual sales of maize to the brewery increased from 480 to 12,000 metric tons, which produced a profitable outcome for farmers and the brewery. This attracted other investments to the region, and along the supply-chain. (Source: Harvard Business Review, Inclusive Growth: Profitable Strategies for Tackling Poverty and Inequality, 2018.)


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USAID PRIVATE-SECTOR ENGAGEMENT POLICY \| Myths and Mythbusters Regarding Private-Sector Engagement
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37
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SECTION VI: FINANCIAL INFORMATION
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(All information requested in this section is required)

THE DEPARTMENT OF TREASURY HAS MANDATED THAT FEDERAL PAYMENTS BE ISSUED VIA ELECTRONIC FUNDS TRANSFER (EFT). COMPLETE THE BANK ACCOUNT INFORMATION BELOW TO RECEIVE THIS PAYMENT ELECTRONICALLY. THE ACCOUNT MUST BE IN THE NAME OF THE PERSON, TRUST, ESTATE, ORGANIZATION/CHARITY/LEGAL ENTITY OF THE DESIGNATED BENEFICIARY.

DIRECT DEPOSIT/ELECTRONIC FUNDS TRANSFER INFORMATION: Please provide your banking information below.

32. NAME OF FINANCIAL INSTITUTION ___

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USAID’s PSE focuses on collaboration with U.S. and international companies, which has the potential to “crowd out” local companies.

--------------------------------------------------- Unstructured Sub-Title End

--------------------------------------------------- Unstructured Sub-Title Begin

Mythbuster

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USAID engages U.S., multinational, and local companies in achieving its objectives, depending on which are the best partner(s) to achieve our development and humanitarian objectives, as the examples below illustrate.

--------------------------------------------------- Unstructured Sub-Title Begin

Mythbusting Examples

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USAID/Indonesia collaborates with a consortium of U.S. and local companies that are operating across the supply-chain for spices that are sustainably sourced and produced in the Papua region. Leveraging $2 million in private-sector co-investment, the project strengthens local companies in the supply-chain, and links them to global purchasers. The partnership mutually benefits local and international companies. (Source: USAID/Indonesia; POC: Ignatius Indriartoto) USAID’s East African Trade and Investment Hub connects American companies that are looking to source products from Africa under the African Growth and Opportunity Act. Key sectors of focus include African textiles, apparel, home decor, and leather accessories. (Source: USAID/Kenya; POC: Scott Cameron) In Zimbabwe, under Feed the Future, USAID links smallholder farmers to local input-suppliers (like seed companies) and local buyers (like processing companies). (Source: USAID/Zimbabwe; POC: Emma Siamena)

--------------------------------------------------- Unstructured Sub-Title Begin

Myth

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PSE is likely to undermine the role of governments and inherently public-sector functions.

--------------------------------------------------- Unstructured Sub-Title End

--------------------------------------------------- Unstructured Sub-Title Begin

Mythbuster

--------------------------------------------------- Unstructured Sub-Title End

In many cases, PSE has proven to be an effective means for building up government capacity and filling gaps in demand for basic social services. In addition, for every public good or basic social service (e.g., health care and education), there is an underlying private-sector supply-chain.

--------------------------------------------------- Unstructured Sub-Title Begin

Mythbusting Examples

--------------------------------------------------- Unstructured Sub-Title End

USAID/Indonesia collaborated with the U.S. medical technology company, Becton, Dickinson and Company (BD) from 2013-2017 to support the Indonesian Government’s National Tuberculosis (TB) Program. BD contributed its expertise and in-kind resources to improve laboratory and diagnostic practices in Government laboratories. Building on the success of this program, USAID and BD will launch another partnership to improve the quality and efficiency of testing for drug susceptibility for TB and HIV through a partnership called Strengthening TB Resistance Testing & Diagnostic Systems (STRIDES). Such partnerships strengthen the Government’s capacity to deliver improved public health outcomes, while providing an opportunity for companies to build their brand, and contribute to improved health care institutions that can provide market opportunities. (Source: USAID/Indonesia; POC: Ignatius Indriartoto) USAID/Pakistan supported four private-sector manufacturers to produce high-quality chlorhexidine gel to prevent infections of the umbilical cord among newborn infants. The Pakistani regulatory authorities approved the product for registration, and the companies are now producing and selling it locally. (Source: USAID/Pakistan; POC: Kanwal Bokharey)

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34

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USAID PRIVATE-SECTOR ENGAGEMENT POLICY | Myths and Mythbusters Regarding Private-Sector Engagement

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--------------------------------------------------- Unstructured Plain Text Format 1.0.4

--------------------------------------------------- Unstructured Sub-Title Begin

Myth

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USAID cannot fund income-generating activities with the private sector.

--------------------------------------------------- Unstructured Sub-Title End

--------------------------------------------------- Unstructured Sub-Title Begin

Mythbuster

--------------------------------------------------- Unstructured Sub-Title End

In many cases, supporting market-based approaches to development and humanitarian challenges will lead to increased profits for the private sector. This is a good thing. It is part of USAID’s theory of change that market-based approaches will lead to more sustainable outcomes when the business case or market exists for providing a good or service. In these cases, USAID should carefully assess the additionality and value of USAID support in enabling a market-based approach that achieves the intended outcomes. USAID should also conduct analyses to reduce the potential for market-distortions. If the private sector can, and should, do something by itself, USAID should stay out of the way.

USAID has certain limitations around how it directly supports profit-making and income-generating activities, depending on the type of instrument (i.e., acquisition or assistance). Federal and Agency regulations govern the treatment of program income. (See Parts 200 and 700 of the 2 Code of Federal Regulations). USAID cannot directly pay profit under assistance awards (i.e., grants and cooperative agreements); however, under both assistance and acquisition, USAID can fund income-generating activities when there is a compelling development or humanitarian reason to do so. When projects generate income, the Agency must consider profit-distribution arrangements, and fully analyze them for their potential impact on markets:

Provided USAID’s collaboration with the private-sector fosters positive development outcomes and results that do not wholly, and solely, accrue to the private-sector partner(s), USAID is able to use assistance and approaches used under the GDA to fund for-profit activities with the private sector;

The DCA enables the Agency to fund for-profit banks and intermediaries through credit guarantees to extend financing to underserved markets; and

By capitalizing on “shared value,” companies may pursue profit-making strategies while addressing social issues in collaboration with USAID, where our interests align. Funding for-profit activities with the private-sector - which also have strong development and humanitarian outcomes - can effectively build sustainability.

--------------------------------------------------- Unstructured Sub-Title Begin

Mythbusting Examples

--------------------------------------------------- Unstructured Sub-Title End

A partnership between USAID and the National Association of Securities Professionals (NASP) and Mobilizing Institutional Investors to Develop Africa’s Infrastructure (MiDA) facilitates and expands opportunities for infrastructure-investment in sub-Saharan Africa. The program focuses on American investors, exposes them to co-investment opportunities with African counterparts, and deepens relationships with African institutional investors. Listed by the International Monetary Fund (IMF) as the second-fastest-growing region through 2020, Africa increasingly offers attractive opportunities for U.S. businesses and investors. MiDA leverages these trends, and facilitates and expands opportunities for investment in infrastructure for those who seek higher returns, while also making progress toward development objectives and advancing U.S. interests in the region. (Source: USAID/E3/PCM; POC: Cameron Khosrowshahi)

USAID support to small-scale, maize-growing farmers in Uganda provides another example of shared value in which multiple partners achieved a positive return on investment. In a community in Uganda, farmers were drying their maize on the ground near domestic animals. This meant that they lost 30-40 percent of their crop, and the remainder could not meet commercial standards. A large regional brewery owned by SABMiller operated in the area, but bought almost all of its grain from overseas. Through multiple USAID investments along the supply-chain and an off-taker agreement with the brewery to facilitate farmers’ access to credit and inputs, farmers were able to purchase improved seeds, equipment, fertilizers, and irrigation solutions. After five years, the supply-chain increased to 27,000 farmers. Crop yields increased by 65 percent, and annual household income more than doubled. Farmers’ families had a more-nutritious diet and were more resilient to drought because of insurance and better seeds. Annual sales of maize to the brewery increased from 480 to 12,000 metric tons, which produced a profitable outcome for farmers and the brewery. This attracted other investments to the region, and along the supply-chain. (Source: Harvard Business Review, Inclusive Growth: Profitable Strategies for Tackling Poverty and Inequality, 2018.)

--------------------------------------------------- Unstructured Page Footer Begin

USAID PRIVATE-SECTOR ENGAGEMENT POLICY | Myths and Mythbusters Regarding Private-Sector Engagement

--------------------------------------------------- Unstructured Page Number Block Begin

37

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--------------------------------------------------- Unstructured Page Footer End

--------------------------------------------------- Unstructured Plain Text Format 1.0.4

--------------------------------------------------- Unstructured Form Begin

--------------------------------------------------- Unstructured Sub-Title Begin

SECTION VI: FINANCIAL INFORMATION

--------------------------------------------------- Unstructured Sub-Title End

(All information requested in this section is required)

THE DEPARTMENT OF TREASURY HAS MANDATED THAT FEDERAL PAYMENTS BE ISSUED VIA ELECTRONIC FUNDS TRANSFER (EFT). COMPLETE THE BANK ACCOUNT INFORMATION BELOW TO RECEIVE THIS PAYMENT ELECTRONICALLY. THE ACCOUNT MUST BE IN THE NAME OF THE PERSON, TRUST, ESTATE, ORGANIZATION/CHARITY/LEGAL ENTITY OF THE DESIGNATED BENEFICIARY.

DIRECT DEPOSIT/ELECTRONIC FUNDS TRANSFER INFORMATION: Please provide your banking information below.

32. NAME OF FINANCIAL INSTITUTION ___