SSG Advisors and Tetra Tech Launch Mentor-Protégé Agreement

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SSG President Nazgul Abdrazaokova and President of Tetra Tech International, Jan Auman, launch a USAID Mentor-Protégé Agreement.

SSG Advisors is pleased to announce that we have launched a USAID Mentor-Protégé Agreement with Tetra Tech, a NASDAQ-traded consulting and engineering firm with 13,000 employees worldwide. Under the Mentor-Protégé Agreement, Tetra Tech will provide class-leading insight on operations, financial management, and strategy.

According to SSG President Nazgul Abdrazaokova, “Tetra Tech is one of the most experienced and capable organizations in international development today. Based on our shared Vermont roots, SSG and Tetra Tech have a long history of collaboration. We are currently implementing projects together in the Philippines, East Africa, and Afghanistan. Through the Mentor-Protégé Agreement, we will benefit from Tetra Tech’s deep expertise and systems in managing complex development projects and activities.   We are grateful to the Office of Small and Disadvantaged Business (OSDBU) for championing the mentor-protégé program and look forward to making this agreement a success for SSG, Tetra Tech, and USAID.”

Scaling Pilots through Partnership

By Steve Schmida

At a recent press conference, the Department of Science and Technology (DOST) of the Philippines announced its plans to scale upTWS BOOTH 2mx2m_final[1] the use of TV White Space (TVWS) Technology to deliver free broadband access via municipalities across the archipelago nation of 94 million. The $31 million initiative comes as a direct result of the TVWS public-private partnership (PPP) between DOST, Microsoft, and the USAID ECOFISH project, which piloted the technology over the last 18 months in several remote coastal communities. How did a PPP of a total dollar value of less than $1 million achieve such scale?

Scale is a buzzword in international development today, but few understand how to achieve it. At SSG, we see partnerships as a key tool in achieving scale and we often design our partnerships with scale in mind. Because PPPs share risks, they often allow partners to experiment and pilot new technologies and methodologies that partners could not attempt on their own.

What are the attributes of a good scaling PPP?

  • Institutional capability and mandate in at least one partner. Whether it is public sector or private sector, there needs to be at least one partner in the PPP that has the capacity and the will to scale the partnership. Here, DOST has the role of leveraging technology for development across the Philippines.
  • Strong incentives. These can be market-based or even political. In the case of the Philippines, DOST is in charge of the government pledge to deliver broadband across the nation. Thus, it had a very strong incentive to move forward in scaling. In other cases, such as our Non-Revenue Water PPP, it is the private sector partner that has the incentive to scale into a new market segment.
  • The right pilot gathering the right data. To borrow the old tech database adage, ‘Garbage in = Garbage out.’ Thus, it is critical that pilot efforts are selected carefully, so that they can make a clear case for scaling. In addition, gathering the right data from those pilots is equally critical. In the case of the TVWS partnership, the team was able to demonstrate how broadband access in remote municipalities dramatically improved government service delivery.

In the case of the Philippines, the partners invested considerable time on the front end of the partnership sorting out these issues, rather than rushing forward without a solid foundation on how the partnership could eventually scale. By embedding partnerships with strong fundamentals, partners can leverage small scale PPPs to achieve that most illusive of results: scale.

SSG to Build Agribusiness Partnerships in Haiti

SSG is pleased to announce that we are part of the winning consortium for the new USAID Port-au-Prince-Saint Marc Partnership. Chemonics International will be the lead implementer on the new 5-year food security program.

SSG’s Brett Johnson says, “The Port-au-Prince-Saint Marc Partnership represents a new and innovative approach to addressing the food security needs of the Haitian people. We are excited to be working with Chemonics to build market-driven agribusiness partnerships that will enhance lives and livelihoods in Haiti.”

Global Companies See Growth Potential in Sub-Saharan Africa’s Smallholder Farmers

By Isaac Williams

The dichotomy between the potential for agricultural productivity on the African continent and its dismal reality has long vexed governments, development P1030544organizations, and businesses alike. The World Bank has noted that agricultural productivity in Sub-Saharan Africa is routinely less than half that of geographically comparable Latin American and Asian countries. While the average sub-Saharan Africa country has four times the amount of arable land of its typical global counterpart, most African countries are heavily dependent on imports for the provision of staple foods. And the vast majority of food that is grown on the continent comes from smallholder farmers – families working plots of land of up to 20 hectares.

Over the past several decades, development agencies have helped drive significant improvements in the African smallholder farmer’s competitiveness on global markets. Concepts such as value chain development and approaches that focus on the central role of markets and market incentives have gone a long towards improving results of development programs. Nevertheless, success in sustainably increasing agricultural productivity and helping smallholders graduate into successful agricultural entrepreneurs has been halting.

All this is now beginning to change. It is a move led by major regional and global agribusinesses that increasingly see smallholder farmers as valuable new customers and the drivers for staggering forecast growth in the agricultural sector on the continent. Companies have begun adapting some of their core practices and products to this new customer segment. Advertising budgets are now spent on demonstration plots in rural villages, not impressive billboards in cities. Some firms work with NGOs on farmer training programs and tap development finance institutions for credit guarantees that help lower the risk of financing for inputs such as improved seed, fertilizer, and equipment for farmers.

Yet, significant challenges remain. Chief among them is finding cost-effective ways to get quality, appropriate inputs (e.g., seeds, fertilizer, and equipment) to smallholder farmers at appropriate scale, in the right place, and at the right time. And even when farmers are able to use these products to substantially increasing their yields, another hurdle presents itself. Unless local markets are sufficiently efficient and connected to global supply chains and infrastructure to absorb this jump in supply, farmers risk being victims of their own success through a sudden collapse in prices.

Partnerships between smallholders, businesses, and government, as well as innovative approaches to spreading new farming technologies will be central to addressing these challenges.

  • Increased collaboration between aligned businesses. By working together, complementary businesses, such as seed and fertilizer companies, equipment manufactures, banks, and commodities traders, can leverage each other’s respective strengths and networks, lowering the risk of working with smallholder farmers. For example in Nigeria, AfGri, a major South African agricultural services company, is working with smallholder farmers to ensure that the Dangote conglomerate has a steady of supply of tomatoes for a new tomato paste factory.
  • Partnerships with the public sector to improve the business environment. By partnering with governments and donors to improve local infrastructure and lower trade barriers, businesses can ensure that the crops their farmer customers produce reach market before spoiling and, on the other hand, that their own products can reach farmers on time and at a competitive price. In West Africa, the USAID-supported Borderless Alliance is working with major transport companies in the region to track bribes, checkpoint delays, and other barriers to getting goods to market quickly and efficiently.
  • Reducing risk and cost by working with smallholder associations and pre-negotiating contracts. By pre-negotiating purchase agreements with major, global food companies and providing support for the aggregation of crops from many small farms, businesses can be certain that farmers will have a ready market come harvest time. In Malawi, Mozambique, and Zambia, Cheetah Limited, a Dutch agro-trader and processor, has contracted 20,000 smallholder farmers to produce high-quality paprika.

These approaches provide promising examples of the type of innovative structures that can help to change the face of smallholder agriculture in Africa, turning it into an engine to feed the region and the world and working with farmers as customers and business partners, not aid recipients.

Partnering for Agribusiness in Timor-Leste

SSG Advisors is pleased to announce that we are a member of the newly-awarded USAID/Timor-Leste Avansa Agrikultura project. This new, 5-year project is focused on improving the country’s horticulture value chains and will assist Government of Timor-Leste efforts to join ASEAN through technical assistance on certain ASEAN ‘single window’ requirements. Cardno Emerging Markets is the prime implementer of the project.

According to SSG’s Brett Johnson, “We are excited to be working with our colleagues at Cardno on the new Avansa Agrikultura project. Timor-Leste has tremendous agricultural potential and innovative public-private partnerships will be a critical tool in unlocking investment and growth in the country’s horticultural value chains.   We look forward to working with the entire team to make this project a success for USAID and the people of Timor-Leste.”

Partnering to Make The Business Case For Solar in Cambodia

By Darius Li

35 Picosol- Solar Powered Center[2]The Cambodian Electricity Market
With a total installed electricity capacity of 360 MW, Cambodia currently imports 45% of its electricity from Thailand, Vietnam, and Laos. The high cost of imported diesel fuel, fragmented supply system, and lack of consumer subsidies lead to high tariffs—energy prices in Cambodia are among the highest in the region, second only to the Philippines. In 2011, the retail electricity rates ranged from $0.19 USD/kWh in Phnom Penh, $0.25 – $0.40 USD/kWh in other grid-connected areas, and up to $0.50 – $1.00 USD/kWh in rural areas (mostly diesel generators).

Cambodia also has the lowest electricity access rate of any of the 12 countries PFAN-Asia covers with only 31% of the population currently connected to the grid. The government has set ambitious targets to combat Cambodia’s slow energy sector development, including increasing village electrification to 100% by 2020 and individual household electrification to 70% by 2030. But, between now and then, millions of lives will continue to be adversely impacted by the lack of affordable and reliable electricity.

The enabling environment is also extremely challenging. Not only does Cambodia lack feed-in-tariff subsidies for renewable energy, the national electricity utility does not even allow independent power producers to feed energy into the grid—at any price. Moreover, the national grid extension plans are not clear, causing significant uncertainty and risk for power project developers who are weighing investments that can often require more than ten years of visibility to properly assess.

However, it’s not all bad news for renewables. Cambodia possesses immense natural resources that can fuel substantial renewable energy generation. Hydro, solar, biomass, and biogas are in abundance and comprise the majority of the country’s potential renewable energy resources, including 1,400MW wind, 10,300MW hydro, 6,700MW solar, and 16,400MW biofuels. To date, less than 1% of this potential capacity has been developed.

Cambodia Country Assessment Summary

The Opportunity for Off-grid Solar
Against the backdrop of this challenging environment, we believe there are significant opportunities for pioneering private-sector businesses to develop, innovate, and implement profitable business models using solar photovoltaics (PV) technology that can result in significant social and economic returns. The confluence of the following macro factors provide long-term, sustainable growth in this sector for those that are able to successfully navigate and overcome its implementation challenges:

  • High electricity tariffs – As previously mentioned, electricity tariffs in Cambodia are amongst the highest in the region and vary widely, ranging anywhere between $0.19 – $1.00 USD/kWH (possibly even higher in some areas), and is subject to continuous fluctuation due to a number of variables that impact the cost of fuel for generation.
  • Low rates of electricity access – With large parts of the country yet to be electrified, there remains many opportunities for private-sector businesses to fill in existing gaps.
  • Rapidly increasing GDP – With a forecasted GDP growth rate of over 7% in 2014 and 2015, increasing economic activity in the country will enable greater ability and demand for basic services such as electricity. The growth rate in electricity demand is estimated at around 20% per a year.
  • Declining costs of solar PV With costs having already decreased in the neighborhood of 80% in the past five years alone, solar PV technology development has driven down costs and will likely continue to do so – albeit, perhaps less aggressively – for years to come.
  • Uncertain fossil fuel prices – The continuing depletion of fossil fuel reserves combined with rapidly increasing demand from developing countries and rising global population will result in significant long-term price uncertainty and volatility for fossil fuels.

Partnering with Johns Hopkins University
In partnership with a 4-student team from John Hopkin’s University (JHU) School of Advanced International Studies (SAIS), we have been jointly developing a study on “The Business Case For: Solar PV in Cambodia.” The study will provide in-depth market analysis that will backup our initial hypothesis on the attractiveness of the solar market in Cambodia with real data points and detail the breadth and depth of specific commercial opportunities. This unique partnership brings substantial benefits to both parties involved. For PFAN-Asia and SSG Advisors, the SAIS team represents an extremely capable, highly motivated, and cost-effective team with broad experience from both public and private sectors.

Developing The Business Case For: Solar PV in Cambodia
Work began in earnest in October 2014. The team’s research highlighted two distinct models that appeared particularly interesting in the Cambodian context:

  • Revenue diversified mini-grids, which are mini-grids that serve a combination of commercial and household clients with one or more anchor clients, deployed in geographies that do not currently have access to the grid, and;
  • Custom industrial applications, which includes replacing or augmenting diesel-powered systems with solar components wherever such systems are already in operation. This also often includes displacing fuel usage in backup generators for large industrial customers.

The SAIS team traveled to Cambodia in January 2015 to conduct additional primary market research, including customer surveys, interviews, and other forms of data collection to validate their report. The team is currently reviewing their findings and compiling the data they have collected into the final report, which will be launched later this month.


About the Private Financing Advisory Network-Asia
The U.S. Agency for International Development (USAID) regional Private Financing Advisory Network-Asia program (PFAN-Asia) assists businesses, governments, and others in Asia’s developing countries to mobilize and scale up investments in clean energy. The primary goals of the program are to mobilize at least $1 billion in funds for clean energy investments and avoid or reduce greenhouse gas emissions amounting to at least 40 million tons of carbon dioxide equivalent. PFAN-Asia seeks to identify promising clean energy projects that have the capability of raising private sector financing.

About The Johns Hopkins School of Advanced International Studies (SAIS) IDEV Program
The SAIS International Development (IDEV) Program has been training international development practitioners for leadership roles in policy and practice for over seventy years. IDEV provides rigorous academic training in the economic, political and social dimensions of development, and practical skills to prepare students for the challenges of a career in international development.

A Hub of Creative Culture and Innovation in Vermont

By Crosby Fish

Since SSG Advisors first opened our doors in Burlington, Vermont in 2005, we’ve meandered from a small, shared office in the heart of downtown to a bright DSC_0151[1]converted mill building with space for a growing staff and an enviable perch
overlooking the Winooski River. Along the way, we have built a reputation for innovation in sustainable development, anchored by a company-wide passion for creativity and a culture that embraces new perspectives on and approaches to the development challenges to which we dedicate our careers.

The fact that SSG has thrived here in Burlington is no accident. As is the case with most businesses, SSG’s culture mirrors its surroundings, and Burlington offers a vibrant backdrop of startups, social enterprises, and non-profits that feed on the city’s energetic, progressive vibe. Craft beer and farm-to-table food aside, Burlington has long been home to entrepreneurs that want to do business differently. Last month, Forbes named Burlington as one of the top 10 innovative tech hubs in the US, placing it alongside the likes of San Francisco, Seattle, and Boston. SSG has grown out of this same fabric, and it’s easy to see the link between the surrounding community and our emergent staff culture.

This year, Burlington became the first city of its size to fulfill all of its energy needs with renewables. A combination of hydroelectric dams, biomass plants, and wind farms, along with increasingly prolific distributed solar installations, produce enough electricity to power the city’s homes and businesses year-round. This achievement is a prime example of the groundbreaking outcomes that constantly emerge from a Burlington community committed to finding new ways of making itself better. SSG is proud to share the same impulse, and, even as we grow offices in Washington D.C. and elsewhere, Burlington’s creative culture and commitment to sustainable business will continue to be reflected in our DNA.

Learning from the Field: The Role of the Private Sector in Enhancing Citizen Security in Latin America

By Ned Littlefield

It is tempting to think that public-private partnerships (PPPs) are most applicable to economically productive domains where the private sector can create value through collaboration with public entities to address social needs, such as workforce development, health, and agriculture. The case for shared value is often harder to make in sectors such as citizen security, which is traditionally thought of as a core responsibility of the public sector. However, in Latin America, a region where many countries have among the highest crime rates in the world, the complex security environment has direct impacts on the private sector. As such, companies, governments, and civil society in countries such as the Dominican Republic are forging innovative partnerships to enhance citizen security.

Private Sector Engagement in the Dominican Republic’s New Prison Model

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In many countries in Central America and throughout the region, overcrowding, poor infrastructure, and immature management systems often make prisons incubators for crime, both within and outside of penitentiary walls. Prison personnel exercise limited control over prisons themselves, with many prisoners continuing to engage in criminal activity through cell phones and other contraband that have been smuggled past bribed guards. Inmates in such prisons can continue to direct criminal activities, such as assassinations carried out on the streets, from within the prisons walls. Other prisoners have limited employability and few job prospects once released, so they can easily fall back into lives of crime.

To address the above mentioned challenges, the Dominican Republic has instituted the New Model of Prison Management, which is oriented around making prisons cleaner, offering more educational and professional enrichment opportunities for inmates, and professionalizing prison management for the newly created academy for penitentiary studies. Reportedly, “ten years after [opening] its first prison,” this model, which the Dominican government is implementing prison-by-prison across the country, is “gaining recognition from other countries in the region trying to reduce prison populations and cut recidivism rates.

Private sector actors determined in the early 2000s that, considering the constraints that extortion was placing on small and medium-sized businesses, justice sector reform was essential, and that prisons were a high-need focus of their efforts. This activism on the part of the private sector played a key role in establishing the New Model for Prison Management.

For example, the Dominican private sector has contributed significantly to the Institute of Professional Technical Training (or the Instituto de Formación Técnico Profesional in Spanish), which has expanded its professional development coverage into the prison system in order to prepare inmates to secure employment upon release and contribute to the Dominican economy. This partnership between the private sector and the penal system creates value for Dominican companies. By providing prison inmates with the skills they need to find employment and stay out of criminal activities once they are released, it eventually makes streets and businesses safer, while also potentially providing a skilled workforce for the companies to pull from – transforming a social problem into a potential business solution.

While the DR New Model is one compelling example of public-private collaboration in citizen security, there are other partnership models across the region emerging in Central America, Mexico, and Colombia. For companies, these partnerships help address the security concerns of their workforce and customer base. For governments and civil society, these partnerships provide resources and capabilities needed to address the needs of citizens. As Latin America continues to tackle the challenge of endemic crime, the importance of citizen security PPPs will only grow.

Photo courtesy of Michelle Karshan.

Community Partnerships: Unlocking the Sustainability of CSOs through Private Sector Collaboration

By Thomas Buck

Since the collapse of communism and the rise of the “Third Wave” of democratization, many donors including USAID, the UK Department for International Development (DFID) and the Swedish International Development Cooperation Agency (SIDA) have invested significant resources in strengthening new democracies by building the capacity of civil society organizations (CSOs) to bridge the gap between citizens and government. Through grants and other mechanisms, programs have focused on bolstering the technical and institutional capacity of community associations, advocacy organizations, agricultural producer groups, and other types of CSOs on issues ranging from operational systems strengthening to activity implementation. Capacity building and financial support for CSOs have remained core to projects across the development continuum from improving health services, food security, and climate resiliency to countering violent extremism and strengthening local governance. Recently, the US Government has specifically promoted organizational strengthening in its USAID Forward policy as a pillar in preparing local implementers to work directly with USAID Missions across the developing world.

Partnerships have proved extremely successful in the ECOFISH project in the Philippines.

Community partnership planning in the Philippines.

Despite great progress over the last two decades of this type of investment, donors and development implementers have struggled with the question of CSO financial sustainability. Many local organizations, dependent on program grants, have weakened or even collapsed without access to donor funding. One innovative way to solve this issue of grant dependency is by building organizations’ ability to identify and develop partnerships with companies and other resource partners. Recognizing the necessity of long-term sustainability and local ownership in development, SSG has developed a tailored capacity building approach as part of its Sustainable Transparent and Effect Partnership (STEP) methodology and has successfully utilized this method in contexts throughout the world. Through the STEP Community Partnership module, local CSOs learn to apply a “shared value” lens to identify specific opportunities for partnership in which they bring valuable resources, services, or products to a local market.

The benefits of this type of partnership for both the CSO and the public or private partner become quickly evident. In Kenya, for example, one youth organization formed a partnership with the Kenya Forest Service, which provides seedlings to the Forest Service and an entrepreneurship opportunity and much-needed income to the youth organization. This partnership came out of the USAID-funded Yes Youth Can! Western project focused on political enfranchisement and enhanced civic engagement of Kenyan youth. During this project, SSG catalyzed over 100 community-level, youth-led partnerships on a wide range of issues from agricultural commercialization and business training to conservation, ecotourism, and waste management, working with partners as varied as local agribusinesses, municipal governments, and ICT firms. For the Kenyan youth organizations, these partnerships served to unlock their own potential, not just for employment and economic gain, but also in contributing to society and the self-awareness that they actually have a seat at the table.

These community partnerships reinforce the social and economic empowerment of grassroots
organizations focused on marginalized communities. For example, under the ECOFISH project in the Philippines, SSG has facilitated partnerships between fisherfolk associations and a range of private and public sector resource partners to develop enterprises and lessen the dependency on subsistence fishing. Partnerships have ranged from mangrove reforestation and ecotourism development to crab fattening and sea ranching enterprises. These partnerships provide entrepreneurship opportunities to the fisherfolk villages, but also critically lessen community dependency on fishing for survival, thereby reducing pressure on fish stocks and improving environmental resiliency.

Community partnerships offer obvious benefits to the CSOs and the local or multinational partner. By building the capacity of CSOs to form locally driven public-private partnerships that align with their missions and provide financial and other resources, the benefits and progress that development projects bring to a community can continue on long after a single project has ended.

After Ebola: The Need for Public-Private Investment in West Africa’s ‘Last Mile’

As Ebola erupted across West Africa, government agencies, international healthIMG_4817 organizations and donors scrambled to gather and share critical information about the epidemic. Early warning signs of the outbreak had largely been missed, in part because the first cases emerged in rural areas where information telecommunications infrastructure is weak and broadband connectivity non-existent.   This lack of communications capability also left rural health workers isolated – lacking information about the nature of the epidemic and effective treatment. While NGOs such as Inveneo and NetHope have since been able to deliver critical connectivity support – mostly in the form of satellite connections – to many clinics and communities, these efforts are short-term, temporary fixes and not intended to address the region’s long-term challenges in delivering connectivity to West Africa’s ‘last mile.’

As the immediate epidemic subsides, it is essential that the focus shift from crisis response to addressing longer-term needs in rural West Africa.   Clearly, communications infrastructure is critical for enabling an effective early response to an outbreak. Moreover, reliable ICT infrastructure, will not only facilitate effective outbreak response, it will have a demonstrable impact on a country’s economic growth.

While the need is clear, investment in ICT infrastructure is low across the region and virtually non-existent in rural areas. Public sector funds –whether host government or donor – are simply insufficient to meet West Africa’s broadband needs. Therefore, to meet this challenge, private investment will be essential. Only the private sector can mobilize the financial resources and technologies needed to connect poor, outlying communities in West Africa. Only the private sector can develop and scale the business models needed to maintain the infrastructure. However, private investors are wary of wading into small low-income markets with uncertain regulatory regimes. Therefore, there is a critical need for public-private partnerships to ‘crowd-in’ private investment in West Africa’s Last Mile. Here are a few ways – some innovative, some proven – that donors and governments can collaborate with the private sector to drive investment:

  • Project Preparation. Feasibility studies, environmental impact assessments, regulatory reviews are all significant pre-investment costs and often represent a major impediment to private investment in the region. Here, donors can catalyze investment in ICT infrastructure by funding these upfront costs for promising ICT projects. Examples such as the Agricultural Fast Track Fund show the potential of project preparation to unlock investment for undercapitalized industries in the region.
  • De-Risk Investments. Credit guarantees such as USAID’s Development Credit Authority, political risk insurance from OPIC and first loss positions can be instrumental in de-risking private investment in the region’s rural ICT infrastructure. Here, innovative approaches to leveraging existing universal service funds (USFs) could unlock large amounts of capital investment for broadband.
  • Pilot and Accelerate New Business Models. Existing ICT access business models may not be effective in rural West Africa – one of the world’s poorest regions.   Here, impact investors can make small investments to capitalize and support African entrepreneurs to pilot new business models for testing, proving, and scaling promising technology platforms to demonstrate development and business value, while helping to create the market base needed to justify an investment.
  • Technical Assistance for policymakers. A key constraint in many countries is a weak policy environment. Here, technical assistance for regulatory authorities and policy makers can enhance the attractiveness of a market for investors.

By partnering with the private sector, donors, foundations and governments can mobilize capital to address West Africa’s ICT infrastructure deficit. Doing so will not only better prepare the region for future disease outbreaks, it will also lay the groundwork for a more sustainable ICT ecosystem that serves rural West Africa’s social and economic development long into the future.