PRIVATE SECTOR ACTIVITY (PSA) Quarterly Progress Report Year 1. Quarter 1: September 18 – December 31, 2019 Jarchi Hagverdiyev’s team received recommendations regarding to the construction of warehouse in accordance to ISO 22000 Prepared for review by the United States Agency for International Development under USAID Contract No. 72011219C00001, Private Sector Activity (PSA) implemented by CNFA. Private Sector Activity Quarterly Progress Report September 18 – December 31, 2019 Submitted by: CNFA USAID Contract 72011219C00001 Implemented by CNFA Submitted to: USAID/Azerbaijan Samir Hamidov, COR Submitted on December 13, 2019 Table of Contents Executive Summary................................................................................................................. 5 Detailed PSA Progress by Activity and Component ............................................................. 5 Operations ............................................................................................................................... 5 Legal Registration .................................................................................................................................... 8 Document and Deliverables Submission ............................................................................................ 8 Programs ................................................................................................................................ 10 Berry Value Chain ................................................................................................................................ 10 Hazelnut Value Chain .......................................................................................................................... 11 Orchard Fruit Value Chain ................................................................................................................. 13 Pomegranate Value Chain ................................................................................................................... 14 Vegetable Value Chain ......................................................................................................................... 16 Second U.S.-Azerbaijan Agricultural Forum ........................................................ 16 Azerbaijan Food Safety Agency (FSA) .................................................................. 17 Azerbaijan Small and Medium Business Development Agency (SMB) ............. 18 Azerbaijan State Agrarian University.................................................................... 18 Agro Procurement and Supply Open Joint Stock Company .............................. 19 State Tourism Agency ............................................................................................. 20 World E-Commerce Forum ................................................................................... 20 Azerbaijan Rural Women’s Association ................................................................ 21 Technology Transfer Fund ...................................................................................... 23 Facilitating Linkages with U.S. Agribusiness ......................................................... 23 Access to Finance ..................................................................................................... 24 Quality and Food Safety .......................................................................................... 24 Monitoring, Evaluation and Learning (MEL) ......................................................... 25 Environmental Management and Monitoring ....................................................... 25 Appendix A. Draft PSA Year One Performance Monitoring Plan (PMP) ......... 26 Appendix B. Short-Term Technical Assistance/International Assignments ..... 26 Appendix C. Finance Research Reports ................................................................ 26 3 Private Sector Activity (PSA) Quarterly Progress Report Acronyms ABPEA Azerbaijan Berry Producers and Exporters Association AHPEA Azerbaijan Hazelnut Producers and Exporters Association ASAU Azerbaijan State Agricultural University AzPromo Azerbaijan Export and Investment Promotion Foundation BDS Business Development Services BMSB Brown Marmorated Stink Bug BSP Business Service Provider CBI Center for the Promotion of imports for developing countries CNFA Cultivating New Frontiers in Agriculture DAS Deputy Assistant Secretary of State ERC Environmental Review Checklist FSA Food Safety Agency GAP Good Agricultural Practices HACCP Hazard Analysis and Critical Control Points HSE Health, Safety, and Environmental ICD Islamic Cooperation for Development ICT Information and Communication Technology IPM Integrated Pest Management IR Intermediate Result MELP Monitoring Evaluation & Learning Plan MoA Ministry of Agriculture MOU Memorandum of Understanding PERSUAP Pesticide Evaluation Report and Safer Use Action Plan PMP Performance Monitoring Plan PPE Personal Protective Equipment PPEAA Pomegranate Producers and Exporters Association of Azerbaijan PVE Preventing Violent Extremism PY Project Year ROC Record of Compliance SEDA Socioeconomic Development Activity SMB Small and Medium Business Development Agency SME Small and Medium-Sized Enterprise STTA Short-Term Technical Assistance TA Technical Assistance TTF Technology Transfer Fund USACC United States-Azerbaijan Chamber of Commerce VC Value Chain 4 Private Sector Activity (PSA) Quarterly Progress Report Executive Summary On June 25, 2019, USAID and CNFA signed a contract for the Private Sector Activity (PSA), a five-year, $15 million project with the goal of utilizing a partnership and co-investment approach to support a more resilient Azerbaijani economy and improve the business enabling environment. The project, underpinned by a belief that supporting the non-oil sector, by improving the competitiveness of the private sector with a special emphasis on agriculture, and reducing the administrative barriers that hinder the development of micro, small, and medium enterprises (MSMEs), will contribute to a more secure and sustainable Azerbaijani economy. The quarter not only marked the start of the Project’s operation, but also was an extremely busy period for implementation. Within the reporting period, PSA provided significant funding for and co-organized a series of events such as the second U.S.-Azerbaijan Agricultural Forum, which took place this time in Oklahoma, a Safe Use of Food Additives workshop and a Fruit and Vegetable Juice Production Quality and Safety event in Baku, and exhibited at the third International Hazelnut, Walnut, and Chestnut Festival held in Zagatala region and the Tea, Rice, and Citrus festival held in Lankaran region. Within its work with Azerbaijani government agencies, PSA supported the four Food Safety Institute laboratory employees to attend a training in Dubai, provided translation services for a plant protection short course taught by a U.S. professor at Azerbaijan State Agricultural University (ASAU) in Ganja, and organized a series of meetings for the chairman of the Small and Medium Business Development Agency (SMB) with U.S. counterparts in New York City and Washington, DC. While many of the aforementioned events were large, high-level events requiring a great deal of organizational efforts, PSA also continued its start-up activities in parallel. PSA is following in the footsteps of the USAID Agricultural Support to Azerbaijan Project (ASAP), a previous CNFA- implemented project, which closed out one day prior to PSA’s launch. This eased the Project’s start-up, which included PSA drafting and signing agreements with major subcontractors Nathan Associates and WCC International, recruiting new staff for open project positions, expanding upon existing or building new relationships and partnerships with state agencies, conducting a value chain study with its Serbian subcontractor SEEDEV, and drafting the work plan for the first year of the Project’s operation. The PY1 Work Plan will serve as a guide to implementation of a robust slate of activities over the remaining months of the Project’s first year. Detailed PSA Progress by Activity and Component Operations Establishing an Office Although PSA is a distinct project, it is following in the footsteps of the USAID Agricultural Support to Azerbaijan Project (ASAP), a previous CNFA-implemented project, which closed out one day prior to PSA’s launch. During the first week of the project, PSA conducted a review of office space availability and pricing in central Baku within walking distance of the USAID office in order to determine an ideal office location that would facilitate frequent meetings and coordination between PSA and USAID. Based on its findings, PSA decided to remain in ASAP’s 5 Private Sector Activity (PSA) Quarterly Progress Report former office, at least initially, as the location is ideal, the rental price is competitive and within the PSA budget, and it was fully equipped and available for use from day one of PSA. Thus, CNFA signed a one-year lease agreement during the first week of the project. During the first month, CNFA upgraded its internet access from a telephone line to a dedicated fiberoptic line in order to provide for more reliable internet access. Though the office space may prove to be smaller than ideal once PSA is fully staffed, the initial project workload, which included the organization of several high-profile events over the project’s first 60 days, was deemed sufficiently demanding that the time and effort