USAID COMPETE PROJECT MONTHLY PROGRESS REPORT

May, 2018

USAID COMPETE PROJECT MONTHLY REPORT MAY 2018 Page | 1

USAID COMPETE PROJECT MONTHLY REPORT

May, 2018

DAI Contract Number: AID-294-C-12-00001

The author’s views expressed in this publication do not necessarily reflect the views of the United States Agency for International Development or the United States Government. It was prepared by DAI.

Cover photo: Farmers in Deir Abu Da’if started using a locally made cucumber sorting machine.

USAID COMPETE PROJECT MONTHLY REPORT MAY 2018 Page | 2 TABLE OF CONTENTS

INTRODUCTION ...... 4 WEST BANK KEY HIGHLIGHTS ...... 7 AGRIBUSINESS ...... 7 Baby Cucumber: ...... 7 Grapes Program ...... 8 TECHNOLOGY ...... 11 STONE & MARBLE ...... 12 TOURISM ...... 13 GAZA KEY HIGHLIGHTS ...... 14 AGRIBUSINESS ...... 14 FISHING ...... 15 ICT ...... 15 TEXTILE & GARMENT ...... 17 ANNEX A: UPCOMING EVENTS June 2018 ...... 19

USAID COMPETE PROJECT MONTHLY REPORT MAY 2018 Page | 3 INTRODUCTION DAI is pleased to present its May 2018 monthly report. USAID through its Compete Project is focused on building the production capacity of firms to grow locally and expand regionally and internationally. Our focus is on addressing key market failures that will open the horizon for new value chains. The report presents the key accomplishments and details in May 2018 of each technical sector first in the West Bank and followed by accomplishments in Gaza. Support to the Agribusiness, Technology, Fishing, Garment and ICT sectors under Firm Level Assistance Program (FLAP) continued its progress during May 2018 where several firms showed progress in their work. To t a l FLAP applications to date reached 5060; 1699 approved applications. USAID through its Compete Project expanded its support for baby cucumber value chain to work with farmers in Tamoun and the Deir Abu Da’if to create new clusters. USAID through its Compete Project signed an in-kind grant agreement with Al Torab Agricultural Company and delivered a baby cucumber sorting machine which was designed by Palestine Polytechnic University and assembled by a local company. In Addition, the Project supported Deir Abu Da’if farmers through establishing a packing house for sorting baby cucumber including a baby cucumber sorting machine. The sorting machine and the cooling room were delivered in May 2018. To introduce a new vegetables production pattern, USAID through its Compete Project has announced a baby cucumber netting house program in the Northern West Bank targeting baby cucumber farmers. 116 applications were received, 37 were approved covering 240 dunums, and delivery will be completed by first week of June. This has enhanced baby cucumber quality and decreased investment cost by 75% in comparison to greenhouse production.

USAID through its Compete Project announced in November 2017 a seedless grapes program for supporting Y shape hanging system in the Northern West Bank. The ongoing program approved 113 farmers covering 431.5 dunums of seedless grapes. Y shape hanging system was delivered and additional 13 applications were approved through FLAP covering 34.5 dunums, and delivery was completed by May 2018. The Project announced in January 2018 another seedless grape program in the north to support farmers with insect netting. Compete received 259 applications and approved 149 covering 572.5 dunums. All insect nettings were delivered. USAID through its Compete Project signed a grant with Ketaf Company for Investment and Agricultural Marketing to support them with a shock freeze room and signed another grant with Al Buqeea Company for Investment and Irrigated Crops to support them with two cooling rooms with a storage capacity of 1,000 MT of fresh vegetables; delivery is expected in July 2018. USAID through its Compete Project signed a new LOA with Al Jerashi Company to develop a business plan to study the feasibility of diversifying their production to include Polyethylene plastic films for various packaging application for food and non-food products in local and Israel markets in addition to Arab countries. USAID through its Compete Project assisted Deir Sharaf Agricultural Cooperative by implementing a pilot project for treated wastewater to assist eight farmers. Currently, the project is in progress with 50% of completion and is expected to be completed in June 2018. Gaza shading net program aims at introducing new vegetables production pattern by covering the plastic roof or insect net roof in greenhouses with 35% shading net. 73 applications out of 334 were approved with total area 240.5 dunums, and 73 of them signed the LOA.

USAID COMPETE PROJECT MONTHLY REPORT MAY 2018 Page | 4 USAID through its Compete Project has signed an LOA with Jihad Zoqmat Company to deliver a cooling room to store sweet potato in Gaza, and signed an in-kind grant agreement with Palestine Palm Commercial Company to develop the production line of paste dates. In the fishing sector, USAID through its Compete project signed an LOA to assist Al-Bahar Fishery to improve the capacity of its fish hatchery and increase the quantity of production to reach 530,000 fingerlings. Al Bahar has sold 4.6MT of sea bream for markets in Gaza and West Bank, while Fish Fresh total sales reached 9MT for local market and West Bank markets as well. In Technology, Palestine Polytechnic University (PPU) has concluded the design process for four machines. The Vegetable Sorting Machine for baby cucumber was manufactured by Al-Taqaddum Scales Co. in Hebron and was delivered to Al Torab Company in Jenin by end of April. A second Vegetable Sorting Machine for baby cucumber was delivered to Deir Abu Da’if Cooperative in Jenin on 1st of May 2018.

In Stone and Marble, one company in Bethlehem is still showing results of USAID interventions. Funoon Company was supported with a sales representative and in participating in trade shows in Qatar and Saudi Arabia during April and May.

Only one site renovation project is still in progress in the tourism sector: Rehabilitation of Haram Al Rameh archeological site in Hebron, with 80% of completion. The project is expected to be completed in June 2018.

Gaza ICT continued to show progress during April 2018. By end of May, USAID through its Compete Project signed one LOA with Asayel Group and continued to deliver assistance to Gaza ICT approved clients. The Project continued to work with companies to receive assistance approved earlier. USAID is assisting 1to3 Company to conduct a market study in Oman and UAE, a marketing campaign in the gulf countries as well as enhancing its productivity through a provision of MacBook Pro and iPad. USAID signed three apprenticeship contracts with DIETII, a company specialized in nutrition and fitness to develop software and with a nutrition expert. USAID through its Compete Project designed a collective training that targets 26 trainees nominated by 6 companies that participated in the niche market assessment program. USAID through its Compete Project plans to enhance the ecosystems for business startups and small businesses through building the capacities for incubators/accelerators and business providers. During May, USAID continued to support PICTI’s PitHub and will equip this co-working space with new technology equipment to be available for the co-working space tenants.

In Textile and Garment, USAID through its Compete Project continued providing new technology and equipment on a case-by-case basis. USAID support includes machinery to Kirdash Company with button machine and vacuum finishing table machine delivered in May 2018. Rajab Al Ashi Company received support for adding new machines to the production including two overlock machines, fabric cutting machine, regel machine and fabric press Machine. A new company was approved to receive support to enhance the production capacity. 33 apprentices completed the training period supported by USAID as part of the Workforce Development Program and 31 apprentices were hired.

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Figure 1: Cutting peppermint in Daraghmeh fresh herbs farm, Faraa

USAID COMPETE PROJECT MONTHLY REPORT MAY 2018 Page | 6 WEST BANK KEY HIGHLIGHTS

As a result of the Firm Level Assistance Program (FLAP), supported agribusinesses continued to demonstrate results during April 2018. In the West Bank, total FLAP applications to date reached 2783; 1171 approved applications, 91% of which came from the agriculture sector.

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Figure 2: Firm Level Assistance Program (FLAP) activity in the West Bank (since start of FLAP)

AGRIBUSINESS The project is currently supporting a range of activities, including large-scale programs in agriculture sectors identified as developing, particularly baby cucumbers and grapes. The project continued to work with farmers across the sector to enhance their productivity and facilitate trade through improved supply chain management.

Baby Cucumber Following the successful enhancement of the Kufr Dan Cooperative facilities, Ellar and Jordan Valley supporting the baby cucumber value chain and the creation of clusters, USAID through its Compete Project expanded its support to work with farmers in Tamoun and Deir Abu Da’if to create new clusters. The baby cucumber clusters targeted pickling companies as well as selling baby cucumbers as fresh produce. USAID through its Compete Project signed an in-kind grant agreement with Al Torab Agricultural Company and delivered a baby cucumber sorting machine which was designed by Palestine Polytechnic University and assembled by a local company. To support the commercialization process of this machine, USAID through its Compete Project identified Al Torab Agriculture Company, to test the prototype baby cucumber machine, rather than a readymade and/or commercially available one and provide feedback to PPU regarding its usability and performance. The sorting line was delivered in end of April 2018. In May, another baby cucumber sorting machine was delivered to

USAID COMPETE PROJECT MONTHLY REPORT MAY 2018 Page | 7 Deir Abu Da’if Cooperative in Jenin. USAID through its Compete Project supported Deir Abu Da’if farmers through establishing a packing house for sorting baby cucumber which is owned by Mohmoud Abdul Razeq. The packing house includes a baby cucumber sorting line machine and a cooling room. The Sorting Machine was delivered early May 2018. In March, USAID through its Compete Project has announced a baby cucumber netting house program in the Northern West Bank targeting baby cucumber farmers. The netting program targets greenhouses for farms between 3-10 dunums area. Following the announcement, USAID through its Compete Project has organized three workshops for baby cucumber farmers and identified and discussed the problems facing the cucumber sector, the benefits of net houses and the new program’s application procedures. 116 applications were received, 37 were approved covering 240 dunums, and delivery will be completed by first week of June.

Figure 3: Locally made baby cucumber sorting machine, Der Abu Dai’f, Jenin

The purpose of the program was to introduce a new vegetables production pattern by installing net houses instead of greenhouses for baby cucumber production to improve the ventilation during the spring and summer period. This has enhanced baby cucumber quality and decreased investment cost by 75% in comparison to greenhouse production.

Grapes Program USAID through its Compete Project announced in November a seedless grapes program for supporting Y shape hanging system in the Northern West Bank and received 315 applications covering 1368 dunums of farmland. The ongoing program approved 113 farmers covering 431.5 dunums of seedless grapes. Y shape hanging system was delivered to beneficiaries by April. Additional 13 applications were approved through FLAP covering 34.5 dunums, and delivery was completed by May 2018.

USAID COMPETE PROJECT MONTHLY REPORT MAY 2018 Page | 8 The Project announced in January another seedless grape program in the north to support farmers with insect netting. By the end of February, we received 259 applications and approved 149 covering 572.5 dunums. All insect nettings were delivered.

Figure 4: In Bardalah, seedless grapes is ripe early, in April

The Project expanded the netting program to improve quality and introduce high value production patterns based on analysis conducted by the USAID through its Compete Project team. The program targeted around half of the area recently cultivated for enhanced grape production this year. The program supported farmers who have a minimum of two dunums with a cost share up to 5 dunums per farmer.

Mushroom House, received support for phase two mushrooms for the installation of mycelium lab and equipment. USAID through its Compete Project supported phase 1 compost which ensured successful production of mushrooms. The Grantee will sell mycelium and compost to other companies. Equipment was delivered in December 2017. Mushroom cultivation will commence by July 2018.

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Figure 5: Preparing lab at Mushroom House, Saffa, Ramallah

USAID through its Compete Project signed a grant with Ketaf Company for Investment and Agricultural Marketing to support them with a shock freeze room which will help the company deliver seedless grapes to international markets in a good condition, thus reducing rejection rates and increasing their profits. Through this grant, USAID through its Compete Project will facilitate access to new local and international markets by using new technology. Delivery is expected in July 2018. USAID through its Compete Project signed a grant with Al Buqeea Company for Investment and Irrigated Crops to support them with two cooling rooms with a storage capacity of 1,000 MT of fresh vegetables. This grant will help the company to expand their cultivation area with an additional 1,000 dunums and meet customer specifications for export. Delivery is expected in July 2018. USAID through its Compete Project signed a new LOA with Al Jerashi Company to develop a business plan to study the feasibility of diversifying their production to include Polyethylene plastic films for various packaging application for food and non-food products in local and Israel markets in addition to Arab countries.

Waste Water Treatment Project USAID through its Compete Project assisted Deir Sharaf Agricultural Cooperative to improve the livelihood of its members by implementing a pilot project for treated wastewater reuse at West Nablus treatment plant. The Project aimed to encourage agricultural development and to improve the socio-economic conditions of the area.

USAID COMPETE PROJECT MONTHLY REPORT MAY 2018 Page | 10 Following the favorable results of Deir Sharaf pilot project, USAID through its Compete Project supported eight farmers to establish additional 55 dunums, making total number of Pilot project around 200 dunums. Currently the project is in progress with 50% of completion. The Project is expected to be completed in June 2018.

TECHNOLOGY Palestine Polytechnic University (PPU) has commenced the design process for four machines [Vegetables & Fruits Drying Machine, Stone Defect Detection Machine, Filling, Sealing and Capping Machine, and Vegetables Sorting Machine]; the design of the baby cucumber machine was concluded by the end of December 2017 and the design of the Vegetables & Fruits Drying Machine was concluded by the end of February 2018. The remaining machines concluded by end of March, 2018. The Vegetable Sorting Machine for baby cucumber was being manufactured by Al-Taqaddum Scales Co. in Hebron and was delivered to Al Torab Company in Jenin by end of April. A second Vegetable Sorting Machine for baby cucumber was delivered to Der Abu Da’if Cooperative in Jenin by 1st of May 2018.

The aim of this in-kind grant is to assist Al Torab Agriculture Company and Deir Abu Da’if Cooperative with baby cucumber sorting machines produced by a local machine manufacturer to improve the cucumber acceptance rate and, therefore, enhance their profits.

Figure 6: The first locally produced baby cucumber sorting machine first run in Al Torab Co. Faraa.

USAID COMPETE PROJECT MONTHLY REPORT MAY 2018 Page | 11 STONE & MARBLE USAID through its Compete Project is supporting Techno Funoon with one sales representative in the UAE to be able to capitalize on previous work, plan ahead and maximize exposure at trade shows. Sales Representative in the UAE will be able to visit all Middle Eastern countries, reach customers and focus on direct sales. Techno Funoon hired the representative starting February 1, 2018 through April 2018, and USAID through its Compete Project contributed for his compensation for three months on a 70% share. In May, Techno Funoon hired the representative as a full time employee. USAID through its Compete Project also supported Techno Funoon to participate in two trade shows in Saudi Arabia and Qatar: Saudi Stone Surface trade show, April 10-12, and Qatar Tech Project Qatar Stone trade show May 8-11. For Saudi Stone Surface trade show, a series of business to business meetings were prepared with architects, contractors and stone suppliers where current results include bidding on three projects (villa, development project and a library) which includes some decorative stone works.

Exhibiting at Project Qatar was definitely a sound business decision, despite the difficulties, constrains and high cost. A total of 93 visitors entered Funoon booth, (mainly contractors, architects and stone suppliers). Currently, Funoon is preparing to submit prices for four projects, mostly residential villas.

Figure 7: Techno Funoun participates in Stone Tech - Project Qatar trade show in Doha

USAID COMPETE PROJECT MONTHLY REPORT MAY 2018 Page | 12 TOURISM Currently one site renovation project is in progress: Rehabilitation of Haram Al Rameh archeological site in Hebron, with 80% of completion. The project aims to upgrade and enhance the site for visitors through refurbishment of the existing ruins, construction of tourist facilities, landscaping, installation of lighting system to enable night visits, and installation of walking trails to organize tourist flow. The project is expected to be completed in June 2018.

Figure 8: Installation of steel structure at Haram Al Rameh, Hebron

USAID COMPETE PROJECT MONTHLY REPORT MAY 2018 Page | 13 GAZA KEY HIGHLIGHTS USAID through its Compete Project continues to receive and assess new applications under FLAP. To date, 2277 applications have been received since the beginning of the Gaza program in 2015, of which 528 applications were approved, 82% of which came from the agriculture sector.

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Figure 9: Firm Level Assistance Program (FLAP) activity in Gaza (since start of FLAP)

AGRIBUSINESS

Shading Net Program

USAID through its Compete Project announced publicly the shading net program for Gaza farmers. The Projects’ experts organized two workshops in Rafah and Deir Al Balah and 334 clients applied online. The purpose of the program is to introduce a new vegetables production pattern by covering the plastic roof or insect net roof in greenhouses with 35% shading net to decrease the temperature during summer, which will increase yield and enhance quality. The program targets 428 dunums of pepper greenhouses. The program targets combinations of small farmers with a minimum of 2 dunums and more. 73 applications out of 334 were approved with total area 240.5 dunums, and 73 signed LOAs and done with the cost share. 21 out of 73 received and installed the shading net and the remaining clients will receive their shading net in the coming days.

Compete has signed an LOA with Jihad Zoqmat Company to deliver a cooling room to store sweet potato. Jihad Zoqmat Company will establish a packing house and cooling room for sweet potato with storing capacity 600 MT a year which will help the company to comply with local and export market needs. Delivery is expected in June.

Compete has signed an in-kind grant agreement with Palestine Palm Commercial Company to develop the production line of paste dates. The aim of this grant is to assist the Company to develop

USAID COMPETE PROJECT MONTHLY REPORT MAY 2018 Page | 14 its production line by adding two dryer machines for raw dates, a mincer machine for dried dates, and a 50KVA electric generator. Delivery will be over by June.

Figure 10: Greenhouses with shading net in Gaza

FISHING In May, USAID through its Compete project signed an LOA to assist Al-Bahar Fishery to improve the capacity of its fish hatchery. Al Bahar fish farm will increase the quantity of production to reach 530,000 fingerlings a year and enhance the quality of fingerlings by establishing a fish mother’s nursery suitable for 120 fish (60 male and 60 female). Compete will assist Al-Bahar in providing the needed equipment and the solar system to operate the submersible wells pumps. Some equipment were delivered in May including a laptop and a digital microscope, while the fiberglass tank and the chiller will delivered in June. In May 2018, Al Bahar has sold 4.6MT of sea bream for local market, and around 5 MT of sea bream for West Bank market. Al Bahar established a fish hatchery to produce fingerlings for his farm supported by USAID. Fish Fresh was supported with expansion tanks to reach a capacity of 350MT and has started selling sea bream. In May 2018, total sales reached 9MT for local market, where they have sold around 7.5 MT of sea bream in the local market and around 1.5 MT of sea bream in the West Bank market.

ICT During May, USAID through its Compete Project signed an LOA with Asayel Group and continued to deliver assistance to Gaza ICT approved clients.

USAID COMPETE PROJECT MONTHLY REPORT MAY 2018 Page | 15 Asayel Group is a private shareholding company located in Gaza city and was founded in 2012. Asayel offers Games, Web, and Mobile applications development, audio and video production, Digital design and printing in addition to Event Management. USAID through its Compete Project aims to assist Asayel to develop their audio, video and design equipment through provision of new technology Apple equipment that will enable Asayel to improve their production quality and productivity while Asayel will purchase new audio, photography and video equipment. Compete has delivered the equipment during May. USAID through its Compete Project continued to work with the following companies to receive assistance approved earlier: Yasser Abdulrahman Murtaja and Partners (Ain Media) is specialized in professional visual production and media services, started its work in 2011 and registered in 2012, by a team of IT youth graduates in filming and developing documentary videos for local advertising companies. Ain Media noticed there is a growing demand on animation and motion graphics products by their local clients; a Niche Market Assessment was carried out during March while Compete plans to assist the company to enhance their productivity and product quality for the animation and motion graphics department through provision of new IT technology equipment. Due to the tragic death of one of the partners, Mr. Yasser Murtaja, the journalist who was shot dead during his coverage to the events on Gaza boarder with Israel, Compete put this LOA on hold until updating registration, and vetting is carried out. 1to3 Company for Information Technology, with brand name iPhone Alsham, is a private shareholding company was founded in 2011. The company develops website and APIs, smart (mobile) phone applications, enterprise Resource Planning (ERP) consultancy; including, planning and management resource, information systems, business management and resources management systems in addition to other IT services including, graphic design, info graphics, logo design, branding content etc. 1to3 Company main market is the Saudi Arabia and they wanted to extend its market to Oman and other gulf countries. Compete is assisting 1to3 Company to conduct a market study in Oman and UAE, a marketing campaign in the gulf countries as well as enhancing its productivity through a provision of MacBook Pro and iPad. While the equipment was delivered during May, the marketing research and marketing campaign is ongoing. Dietii, is a business startup based in Gaza and provides a free and easy nutrition and fitness “weight loss” advises using a mobile application. The business was created by three young female graduates. Compete aims to assist this startup to develop their website and mobile applications and add a premium-paid version where users can get the service on return to their subscription. For this purpose, Compete signed three apprenticeship contracts with (1) two software developers to develop the website and mobile applications and (2) one nutrition experts to provide advises to the users. The website and two applications are up and running. Develop the soft skills of IT company employees: following the completion of the niche market assessment service carried out during Y7Q1 and based on the recommendation of the Compete consultant, compete designed a collective training that targets 26 trainees nominated by 6 companies participated in the niche market assessment. The training aims to develop the skills of the employees in two main topics; (1) Professional English Language and (2) Business Management, Marketing and Sales. The SoW was developed and service provider was selected. While the professional English training is completed by end of May, the business training will be concluded by end of June. Compete plans to enhance the ecosystems for business startups and small businesses through

USAID COMPETE PROJECT MONTHLY REPORT MAY 2018 Page | 16 building the capacities for incubators/accelerators and business providers. During April, Compete approved and signed a grant agreement to assist the Palestine Information and Communications Technology Incubator-PICTI’s Gaza branch, to create the first modern business co-working space located in the new Capital Mall in Gaza that will provide a professional business environment for the Gazan startups. Through this co-working space, which is called BitHub, PICTI aims to introduce a new acceleration methodology (FastForward) that will accelerate the creation of a startup, improve its success and become more attractive to external investors and venture capitalists. Compete will equip this co-working space with new technology equipment to be available for the co-working space tenants. The creation of this accelerator will assist PICTI’s strategic goal for 2018 and improve its financial stability.

Figure 11: PitHub at PICTI

TEXTILE & GARMENT The Project continued providing new technology and equipment on a case-by-case basis to develop quality assurance systems, process raw materials, and identify sources of operating and investment capital. USAID support includes machinery to Kirdash Company, which is a women-owned small company, producing and marketing traditional Palestinian handicrafts and manufacturing traditional clothes, with button machine and vacuum finishing table machine delivered in May 2018. Rajab Al Ashi Company received support for adding new machines to the production including two overlock machines, fabric cutting machine, regel machine and fabric press Machine. Machines were delivered in April and May 2018. Saqqa and Haddad Company was approved to receive support to enhance the production capacity. Saqqa and Haddad Company is one of the main men’s suits producers and exporters in Gaza; they will expand their market share in the local and Israeli markets. As part of the Workforce Development Program (WDP), 33 apprentices completed the training period supported by USAID. 31 were hired by garment companies that benefited from the Program.

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Figure 12: Unipal Garment Factory, Gaza

USAID COMPETE PROJECT MONTHLY REPORT MAY 2018 Page | 18 ANNEX A: UPCOMING EVENTS June 2018 June 2018

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