Ethiopia: REQUEST FOR PROPOSALS: ECONOMICS ANALYSIS TO IDENTIFY OPTIONS AND BEST PRACTICES FOR POLICY PROCESSES AND PROCEDURES - Ethiopia
Consultancy task: to carry out technical economic analysis to support the case for streamlining policy processes and procedures under which cereals export restrictions are imposed and revoked in Ethiopia
The Alliance for a Green Revolution in Africa (AGRA) is a not-for-profit organization formed in 2006. AGRA’s mission is to catalyze agricultural transformation in Africa through, innovation-driven and sustainable, productivity increases and access to finance that improve the livelihoods of smallholder farmers.
AGRA is implementing a five year Micro Reforms for African Agribusiness (MIRA) project in Burkina Faso, Ethiopia, Ghana, Nigeria and Tanzania. MIRA will provide these governments with access to high quality local and international technical assistance for identifying, prioritizing and reforming specific agricultural regulations that currently deter or limit private investment in agribusinesses operating in smallholder agricultural value chains. In doing so, the MIRA project will help to build the capacity of African governments to continuously review and reform regulations that unintentionally limit private investment in local agribusinesses operating in the smallholder value chains.
In Ethiopia, MIRA and government counterparts have identified and prioritized 5 reforms:
• Develop and approve a comprehensive contract farming legal framework that supports agro-processing and value addition
• Revisit import duties on agricultural machinery spare parts, irrigation/drainage equipment, and animal feed ingredients and compound feeds and reduce their burden on this sector
• Revisit taxes on agricultural machinery spare parts, irrigation/drainage equipment, and animal feed ingredients and compound feeds, and reduce their burden on this sector (including double taxation on animal feed)
• Develop and approve Directive/Guidelines for streamlining of policy processes and procedures under which cereals export restrictions are introduced and revoked
• Develop and approve Directives and Technical Guidelines to implement the Seed Proclamation and Council of Ministers Seed Regulation
As part of its support to the Ethiopian Agricultural Transformation Agency (ATA), AGRA wishes to undertake a series of economic assessments and legal reviews to build the case for various
reform options. The reviews are intended to help the ATA and its Transformation Council, and other relevant government agencies in articulating policy, legal, and regulatory review options.
Context for this consultancy work
As stated above developing and approving Directive/Guidelines for streamlining of policy processes and procedures under which cereals export restrictions are introduced and revoked is one of the policy reform area that MIRA supports in Ethiopia.
Many countries had imposed export restrictions on essential food stuff to mitigate high and volatile world prices and to protect domestic consumers during the food crisis in 2007-2008. Since 2007, Ethiopia, for longer periods of time, had a de facto ban on cereal exports to stabilize domestic prices. These types of export bans might be lowering the prices of food in the short run, but in the longer run, export restrictions have been found to reduce incentives to invest in agricultural production and processing.
Government of Ethiopia (GoE) had provisionally lifted the maize export ban in November 2014 by allowing producers and investors (as opposed to traders) to export the maize they had produced in 2013/14 and 2014/15 production seasons as there was a bumper harvest that could potentially depress domestic prices and hurt producers. However, the way the decision to lift the ban has been made and communicated to stakeholders (and public at large) was not clear enough, and was not widely and repeatedly communicated so as to create confidence for stakeholders to seriously consider maize export. The only official communication of the GoE decision to lift the maize export ban was a letter from Ministry of Trade to Ministry of Agriculture, in which, the former requested the latter to provide “volume of production for that season by each and all of “investors” engaged in maize production in the country.” Immediately after the ban had been lifted, it was not clear whether farmer cooperatives are also allowed to export until the definition of “investors engaged in maize production” (stated in the letter) was later clarified by Ministry of Trade to include farmer cooperatives.
The maize export ban has been imposed ‘temporarily’ again in late 2015 with the objective of mitigating the effects of the drought in the country. The current export ban has been put in place once again without wide consultations with stakeholders and the decision itself was not communicated adequately, timely, and widely to help market actors to properly plan their planting and marketing decisions.
Objectives of the Consultancy:
The main objective of this consultancy is, therefore, to undertake in-depth technical economic analysis of the impacts of unpredictable decisions in imposing and lifting export bans on exporters; document international best practices – both from the region and globally- on mechanism to ensure that cereals export restrictions are introduced and reintroduced in a predictable and transparent manner. In reviewing best practices, ways of promoting transparency and clear notification procedures before export restrictions are introduced is central to the analysis. Moreover, means to ensure that the government’s commitment to a predictable process where export ban cannot be imposed during the marketing year would be considered. The analysis would distil best practices for how the government retains policy space
to act in times of short-term food crisis at the same time as there is a system in place to ensure that the government is not acting arbitrarily.
Specifically, the consultant will perform the following tasks:
• Conduct an assessment of how export restrictions on food stuff has been applied in Ethiopia and the impacts of unpredictable decisions on exporters and on the business environment in general;
• Provide a brief comparative analysis of the policy decision on export bans in Ethiopia in light of the World Trade Organization regime governing export restrictions on food stuff ;
• Undertake a review of best international practices of different forms of export restrictions on food stuff used in other countries both from the region and globally and compare to Ethiopia’s and the pros and cons of the practices. The analysis should describe forms of export restrictions countries are using e.g. different forms of export taxes, minimum export prices, quotas as well as various mixed models. Assess which of these forms of export restrictions on food stuff constitute international best practices and whether they are feasible for the Ethiopian context;
• Review international best practices –both from the Eastern and Southern Africa region and globally- on mechanism to ensure that export restrictions on food stuff are introduced and reintroduced in a predictable and transparent manner. In reviewing best practices, ways of promoting transparency and clear notification procedures before export restrictions are introduced is central to the review. Moreover, means to ensure that the government’s commitment to a predictable process where export quotas cannot be reduced during the marketing year should be considered. The review should distil best practices for how the government is retaining the capacity to act in times of short-term food crisis at the same time as there is a system in place to ensure the private sector that the government is not acting arbitrarily, but that export restriction measures are proportional, transparent and predictable; and
• Considering the findings from the literature review, interviews with stakeholders, comparison with international best practices, and cost-benefit analysis, develop recommendations that are suitable for the Ethiopian context. These recommendations should strive to create a more predictable and transparent system with a focus on practical solutions. The recommendations should consider ways of clarifying the parameters for the restrictions (objective justifications for the restriction, what is restricted, the timeframe, exceptions etc.) how the restrictions are communicated and made available to the public and means to make the introduction and reintroduction of restrictions more predictable for the private sector.
Scope and approaches of the consultancy
The contractor shall undertake the necessary technical economic analysis (including cost-benefit analysis) and comparative analysis using the following approaches:
• Review of the literature and interviews with key stakeholders. Key stakeholders include but are not limited to the Ministry of Trade, the Ethiopian Revenue and Customs Authority, the Ministry of Industry, sectorial organizations and private enterprises
• Review international best practices of policy processes and procedures for imposing and revoking cereals export restrictions
• Carry out a cost-benefit analysis to identify recommendations for Ethiopia to improve policy processes and procedures under which cereals export restrictions are imposed and revoked
The contractor is also expected to carry out the following tasks:
• Present a kick-off meeting to clarify expectations and agree approach;
• Familiarize consultancy work team with salient details of the proposed consultancy
• Identify and review relevant literature, regional and multilateral frameworks, and national legislations and administrative practices relevant to proposed reforms;
• Carry out the cost-benefit analysis
• Present initial findings to the ATA and AGRA MIRA country team;
• Revise and complete the cost-benefit in line with feedback;
• Prepare a written report summarizing findings for the analysis;
• Present findings to the ATA and AGRA MIRA country team and relevant stakeholders
- An inception report outlining the methodology used for the study and the work plan for developing the deliverables in two weeks from start of the consultancy work
- Initial presentation of findings to ATA and AGRA MIRA country team of a written report to identify options and best practices for policy processes and procedures under which cereals export restrictions are imposed and revoked and as well as cost benefit analysis to identify recommendation to improve policy processes and procedures must include a policy note based on the recommendations
- Final presentation of findings to ATA, AGRA MIRA country team, and relevant stakeholders
All deliverables should be succinct but informative, and key points should be easily understandable to a wide range of stakeholders. Deliverables should be submitted in English
AGRA wishes to contract a firm or team of agricultural development practitioner(s)/ trade economics/ trade lawyers with the following skills and qualifications:
• Extensive experience in the context of enabling legal and regulatory environment for agricultural development/cross border trade in Africa
• Previous experience of conducting technical economic analysis of agricultural policies, laws and regulations
• Experience in the field of trade policy/law preferably agricultural trade in Ethiopia
• Excellent knowledge of the agricultural sector in Ethiopia
• Ability to present complex problems in easy-to-understand language
• Experience of working with the ATA or any other government agency(ies) with agriculture sector mandate
• Country presence in Ethiopia
Duration of the assignment: 3 months
Reporting arrangements: The consultant will report to AGRA’s Head of Policy and Advocacy throughout the engagement period. The consultant will also directly report to ATA/ MIRA Ethiopia team and will provide a biweekly updates on progress to a steering committee to be consisted by ATA.
How to apply:
Proposal submission: Taking into account the TOR, the consultancy candidate should submit a proposal containing the following elements:-
• Understanding of the assignment
• Outlining past experience of the firm/ consultant (Please provide a minimum of two concrete samples of similar work done for other organizations)
• Methodology proposed for the assignment (including tools proposed for the assignment)
• Work plan that includes clear timelines for the assignment
• Summary resume(s) of key staff who will work on the AGRA account
• Consultancy fee for undertaking the assignment and budget breakdown
Deadline of submission of proposals: 5 September, 2016
Interested consultancy firms or individuals should submit separately their technical and financial proposals indicating how they plan to undertake the assignment to: firstname.lastname@example.org
Important note: Technical and Financial proposals will need to be submitted as separate documents. Financial proposals will not be opened until the conclusion of the technical evaluation and then only for those proposals that are deemed qualified and responsive.
Payment terms: he contracted consultancy firm or individual will be paid 50 percent of agreed upon fees at inception of the assignment and the remaining 50 percent upon successful completion of the assignment.
Disclaimer: AGRA reserves the right to determine the structure of the process, number of short-listed participants, the right to withdraw from the proposal process, the right to change this timetable at any time without notice and reserves the right to withdraw this tender at any time, without prior notice and without liability to compensate and/or reimburse any party.