ASIA AND MIDDLE EAST ECONOMIC GROWTH BEST PRACTICES PROGRAM (AMEG) Task Order No. AID-OAA-12-00008 Quarterly Report—FY2016, Quarter 4 Inside this Report: AMEG Activity Highlights July 1, 2016 – September 30, 2016 AMEG AT A GLANCE National Trade Portal and Digitizing Employee Single Window Best Practices Registration in Kurdista….3 The USAID Asia and Middle East Bureaus’ office in South Asia ……..…......….1 of Technical Support Economic Growth team Summary of AMEG Activities…………..……….4 (ME.TS/EG) established AMEG to help USAID Making the Case for Revenue missions identify, strategically develop, and pilot Capital Financing in MENA...2 economic growth best practices and innovations in Financial Summary……….6 Asia and the Middle East. AMEG pursues two overarching objectives: (a) pilot innovative Outlining Options for the M&E Data………………….7 approaches in economic growth programming and Electricity Crisis in Libya…...2 (b) consolidate best practices in economic growth projects from the two bureaus. single windows. The Forum included a variety of In close collaboration with USAID, AMEG manages NTPs and single-window development topics, multiple assessments, case studies, and pilot including: designing and establishing NTPs, legal activities, while actively designing new scopes of arrangements for NTPs and NSWs, institutional work for future implementation. AMEG is currently coordination for effective platforms, the need for working on 16 activities. updated information, and functional and technical architecture. National Trade Portal and Single Window Best Practices in South Asia The Honorable Atul Keshap, U.S. Ambassador to Sri Lanka, Mr. Thomas Bayer, USAID Acting The lack of system integration within South Asian Mission Director, and his Excellency, Ravi countries and across borders results in unnecessary Karunanayake, Minister of Finance opened the first delays and opportunities for corruption. The day of the Forum, noting the importance of trade experience of the Association of Southeast Asian connectivity in the region to bring about more Nations (ASEAN) in promoting a unified single window, on the other hand, shows the potential for countries across Asia to adopt platforms that are more efficient, transparent, and predictable. Notably, India, Bangladesh, and Sri Lanka are individually adopting national trade portals (NTP) and the single- window (NSW) platform. Under the Indo-Pacific Economic Corridor (IPEC) Activity, AMEG hosted a National Trade Portal and Single Window Best Practices Forum in Colombo, Sri Lanka on August 9-10, 2016. AMEG brought 55 customs and trade-related officials from India, Bangladesh, Nepal, Bhutan, and Sri Lanka together with trade representatives from ASEAN countries and USAID trade capacity building programs in The Petrapole-Benapole check point between India and Southeast Asia to share best practices and lessons Bangladesh will be a focus of Phase 3 of AMEG’s Indo- learned implementing national trade portals and Pacific Economic Corridor Activity. Page 2 Asia and Middle East Economic Growth Best Practices Program (AMEG) coherent economic growth through freer flow of operationalizing a revenue-capital driven fund and goods and people across borders in South Asia. how they believe that revenue-capital financing can Speakers presented successful NTP experiences, be further leveraged to support SME growth in mapping steps taken, progress to date, and the Tunisia. Takeaways gleaned from TAEF leadership positive impacts such portals have had on trade in and investees further confirmed the positive effects the region. The second day of the Forum featured that revenue-capital financing has on SME growth ASEAN country officials’ experiences with Single due to the limited or nonexistent collateral Window design and practice, and specific elements requirements, risk sharing approach, and “pay as needed for successful single window initiatives such you grow” methodology. as appropriate legal frameworks, inter-ministerial coordination, functioning steering committees, Meetings with BPL executives covered their adequate funding and staffing, and data experience utilizing revenue-capital based financing harmonization. for SMEs throughout South Africa and sub-Saharan Africa. As trendsetters in the revenue-capital financing field, BPL shared the suite of services and financial products they offer their clients; best Making the Case for Revenue Capital Financing practices and lessons learned managing the Revenue-capital financing provides growing financing mechanism, such as their streamlined due businesses with investor-funded capital in return for diligence process; hiring practices for Investment a percentage of ongoing gross revenues, creating a Officers; and methods to ensure the financing shift from capital gains to revenues. This financing mechanism is sustainable over time. model can be an incentive for investors and improve Both the TAEF and BPL case studies will be their appetite for incorporating early-stage included in the “Making the Case for Revenue businesses into their portfolio since an exit is not Capital: Summary Report,” that will be produced in required for significant profitability. the coming quarter. The activity also aims to produce a webinar and regional workshop to This quarter, AMEG launched the Revenue-Capital increase understanding and utility of this model to Finance Knowledge Sharing Activity. The objective fund SMEs in the MENA region. of this activity it to support the utility of revenue- capital financing for early-stage business development in the MENA region by analyzing the current state and impacts of revenue capital Outlining Options for Libya’s Electricity Crisis financing and carrying out capacity building efforts A side effect of ongoing conflict in Libya is a major on how to operationalize the financing mechanism. electricity shortage. Parts of the country have dealt The activity to date has focused on case study with blackouts of up to 18 hours on a regular basis. development on the Tunisian American Enterprise Mobile phone coverage has broken down due to Fund (TAEF) and Business Partners Ltd (BPL), both shortages and critical infrastructure providing of which utilize a revenue-capital financing structure potable water to citizens has become crippled in to fund SMEs. In September, Revenue-Capital places. All of this has occurred throughout 2016, Finance Specialist Tom Gibson and AMEG including through the summer, a time where air Technical Manager Christy Sisko traveled to Tunisia conditioning and water are of paramount importance to meet with TAEF leadership and to Johannesburg to Libyans. Not only a humanitarian crisis, this and Cape Town, South Africa to meet and conduct electricity shortage has caused civil unrest and in-depth interviews with BPL executives. Meetings protests, and threatens the fragile internationally with TAEF focused on the progress of the fund to backed Government of National Accord. date, best practices and lessons learned Quarterly Report : July to September 2016 Page 3 Digitizing Employee Registration in Kurdistan AMEG is playing a key role in supporting the Kurdistan Regional Government (KRG) in Iraq to introduce a new employee registration and electronic payment system that will be used to modernize the KRG’s current method of distributing wages to government employees. AMEG payroll advisor, Bill Monks devised a phased roll out for the new payroll system, including designing and introducing streamlined registration and validation processes for individual employees, military service Libya’s key stakeholders and the international community members, pensioners, and others on the government discusses a road map for Libya’s electricity shortages payroll as part of the first phase. The main goal of the new system is to identify and eliminate duplicate This quarter, responding to requests from the U.S. records (and duplicate payments). AMEG also Ambassador and the Senior Development Advisor, helped the Council of Ministers IT and software the AMEG Libya PFM team quickly mobilized a development team revise data and process models team of utility experts to develop an options paper that incorporate biometrics and improved processes for U.S. and Libyan stakeholders to respond to the for securing and validating individual data for each crisis. The paper included viable short-, medium-, person in receipt of Government funds. Prime and long-term options for alleviating the crisis, and Minister Nechirvan Barzani and Deputy Prime balancing Libya’s growing demand for electricity Minister Qubad Talabani were the first government with a more sustainable supply. In order to gather employees to have their electronic cards and data, the team met with the Government of Libya- biometric data registered at an inaugural event for run General Electricity Company of Libya the new system. The system is now live and in the (GECOL), Libyan mayors and council coming weeks, AMEG will support the KRG to roll- representatives, the Tunisian Electricity Company, out the equipment and processes in more than 80 and other stakeholders to find viable solutions. The branches of the Government Banks in Kurdistan and paper was submitted to USAID in August 2016. to enroll the remaining 1.4 million recipients of public funds. Following submission of the draft of the paper, USAID invited the electricity experts back to Tunis to support a roundtable discussion with the international donor community in September, facilitated by GECOL. GECOL proved to be an enthusiastic counterpart for