Sign-up to our newsletter for updates on calls for proposals, consulting opportunities or new research findings www.competecaribbean.org Inclusive and sustainable economic growth through global competitiveness DRAFT
Sign-up to our newsletter for updates on calls for proposals, consulting opportunities or new research findings
www.competecaribbean.org
Inclusive and sustainable economic growth through global competitiveness
DRAFT
Why Compete Caribbean?
ROSE Caribbean ROSE Caribbean
1970 2014
In the early seventies, real GDP per capita was 4x higher in the Caribbean than that of the Rest Of Small Economies (ROSE) of the world.
Today it’s smaller at 0.9
▪ A consortium of donors
▪ Phase 1 (USD$25M) completed in 2017 successfully:• 12,000 jobs created• 41% increased in revenues ($153M)• 23% increased in exports ($37M)
▪ Phase 2 (USD$20M) started in 2017 for 5 years• Same goals but greater focus on
• Sustainable and catalytic impact
• Women-owned firms (WOF)
• Climate change
3
What is Compete Caribbean?
Productivity & Innovation in the private sector
Business climate reforms
Pill
ar 1
Pill
ar 2
(a) Clusters and value chains
InclusivenessClimate change
SustainabilityCatalytic impactGender
▪ OECS, Jamaica and Barbados ecosystem
▪ Corporate venturing (regional)
▪ Social innovation in Belize
▪ Public procurement for innovation (regional)
▪ Community-based tourism (CBT)
(b) Entrepreneurship & innovation ecosystem
(c) Technology adoption in firms▪ Technology Extension Services (TES)
▪ Blue Tech Challenge
▪ Fintech and blockchain innovation
▪ Ag-Tech pilots
▪ Cluster capacity building in vulnerable countries
▪ Four calls for proposals
(a) Policy & regulatory reformsFocused on business and innovation
climate, particularly DB indicators
(b) Institutional strengtheningFocused on evidence-based policy-
making
(c) Knowledge products & disseminationEnterprise Surveys and others
Compete Caribbean Partnership Facility (CCFP): 2 pillars, various instruments
Productivity & Innovation in the private sector
Business climate reforms
Pill
ar 1
Pill
ar 2
(a) Clusters and value chains
InclusivenessClimate change
SustainabilityCatalytic impactGender
▪ OECS, Jamaica and Barbados ecosystem
▪ Corporate venturing (regional)
▪ Social innovation in Belize
▪ Public procurement for innovation (regional)
▪ Community-based tourism (CBT)
(b) Entrepreneurship & innovation ecosystem
(c) Technology adoption in firms▪ Technology Extension Services (TES)
▪ Blue Tech Challenge
▪ Fintech and blockchain innovation
▪ Ag-Tech pilots
▪ Cluster capacity building in vulnerable countries
▪ Four calls for proposals
(a) Policy & regulatory reformsFocused on business and innovation
climate, particularly DB indicators
(b) Institutional strengtheningFocused on evidence-based policy-
making
(c) Knowledge products & disseminationEnterprise Surveys and others
Compete Caribbean Partnership Facility (CCFP): 2 pillars, various instruments
6
Four calls for cluster proposals (+$3M)-> one for tourism only (2019-2020)
USD$100k to $300k technical assistance grant for each selected cluster
Technical assistance can include▪ Market research / Fam tour
▪ Product development / testing
▪ Marketing campaign
▪ Quality standards
▪ Organic certification
▪ Cluster coordination
▪ Geographic indicator
▪ Process reengineering
▪ Research & development
▪ Etc.
▪ Access to larger markets;
▪ Business development/branding;
▪ Cost sharing/saving;
▪ Workforce development;
▪ Higher and more uniform quality
standards;
▪ Supply chain or process
improvements;
▪ Advocacy
▪ Climate change adaptation / leadership
Objectives
A cluster is a group of interconnected firms operating
near each other that collaborate and compete to obtain a larger
share of the global market.
7
The cluster development and selection process
Concept Note
▪ Full budget &
implementation plan
▪ Partnership agreement
with commitment letter(s)
for counterpart
contribution (20%)
▪ Terms of Reference (ToR)
for all projects
▪ Baseline data
Cluster Development Plan (CDP)
▪ Application form
online
Investment Panel (IP)
▪ Independent
panel of judges
from the private/
public sector
▪ Selection of
projects based
on scoring
system
IDB Contract
▪ Letter of
Agreement
▪ Any other
conditional
requirements
+1 month
Implementation
▪ Recruit and manage
consultants
▪ Monitor and evaluate
progress
▪ Establish sustainable
structure and processes
24 months 3-month 1 day 2-month
Cluster selection process and timeline
Sept-Oct
2019
Feb–May
2020
June 2020
(to be confirmed)
Deadlines
2020-2022
Call for tourism clusters to be announced shortly – sign up to newsletter www.competecaribbean.org
▪ 9 countries, 10 BSOs
▪ Regional organisations➢ OECS secretariat
➢ CTO
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Cluster capacity building
1. Dominica (DEXIA)2. Grenada (GHTA and GIDC)3. Saint-Lucia (Export Saint-Lucia)4. Saint-Vincent & The Grenadines (CED)5. Guyana (THAG)
6. Jamaica (JMEA)7. Barbados (MoSmall Business/BIDC)8. T&T (TTCSI)9. Suriname (CUS/MoT)10. Belize (Beltraide)
120 hours of training plus support to prepare Cluster Development Plans (CDPs)
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CBT fosters inclusive development, diversifies the product offering, and helps sustain tourism assets
Tool Description
COMMUNITY TOURISM DEVELOPMENT
Use Users
A frame of reference to
assess the community’s
capacity for CBT based on
key success factors (KSFs).
ENTERPRISEDEVELOPMENT
Template to prepare an
inventory of tourism assets
found in the community.
Inventory number, range &
quality of tourism assets in
community, identify
strengths and gaps
Tourism Assets
Inventory
▪ Community Organizations
▪ National Tourism
Organisations (NTOs)
▪ Business Support
Organisations (BSOs)
Assess market readiness
and gaps to identify priorities
that can be included in a
project plan and/or funding
proposal
CBT Diagnostic ▪ Development agencies
▪ Community organisations
+/-2-page template to collect
information about the types of
experiences found in the
community to attract visitors.
MARKET DEVELOPMENT
Promote the diversity of
CBT opportunities in the
Caribbean
CBT Profiles
Database of CBT
profiles in the
Caribbean?
▪ CTO representatives in
USA, UK and Canada
▪ NTOs
▪ Tour operators
▪ Visitors
CBT Enterprise
handbook
▪ CBT Enterprises owners
& managers
▪ NTOs
▪ BSOs
User-friendly business guide to
develop profitable CBT
enterprises that return benefits to
communities.
Start, improve, formalize
and expand CBT business
operations
Community-Based Tourism (CBT) toolkit
Purpose
Assessment of willingness-to-
pay of American visitors for
experiences that can be
offered by Caribbean MSMEs.
PRODUCT DEVELOPMENT
Refine, expand
and price the
product offerings
to increase tourism
spending
Consumer
research in
American
market by
Euromonitor
▪ Entrepreneurs
▪ Business Support
Organisations (BSOs)
▪ National Tourism
Organizations (NTO’s)
Productivity & Innovation in the private sector
Business climate reforms
Pill
ar 1
Pill
ar 2
(a) Clusters and value chains
InclusivenessClimate change
SustainabilityCatalytic impactGender
▪ OECS, Jamaica and Barbados ecosystem
▪ Corporate venturing (regional)
▪ Social innovation in Belize
▪ Public procurement for innovation (regional)
▪ Community-based tourism (CBT)
(b) Entrepreneurship & innovation ecosystem
(c) Technology adoption in firms▪ Technology Extension Services (TES)
▪ Blue Tech Challenge
▪ Fintech and blockchain innovation
▪ Ag-Tech pilots
▪ Cluster capacity building in vulnerable countries
▪ Four calls for proposals
(a) Policy & regulatory reformsFocused on business and innovation
climate, particularly DB indicators
(b) Institutional strengtheningFocused on evidence-based policy-
making
(c) Knowledge products & disseminationEnterprise Surveys and others
Compete Caribbean Partnership Facility (CCFP): 2 pillars, various instruments
11
Technology Extension Services (TES) to increase productivity of firms
TES is a type of innovation policy that Governments have successfully used in other
countries to accelerate the pace at which SMEs “catch up” with more advanced firms by
transferring knowledge about best practices.
TES is expensive → requires advanced knowledge, skills and familiarity with modern technology
In the Caribbean → low economies of scale so a regional system is required
Nearly USD$1M will be invested to pilot access to TES by Caribbean SMEs involved in
tourism or agroprocessing via the SBDC network
Project to start in 2020
Productivity & Innovation in the private sector
Business climate reforms
Pill
ar 1
Pill
ar 2
(a) Clusters and value chains
InclusivenessClimate change
SustainabilityCatalytic impactGender
▪ OECS, Jamaica and Barbados ecosystem
▪ Corporate venturing (regional)
▪ Social innovation in Belize
▪ Public procurement for innovation (regional)
▪ Community-based tourism (CBT)
(b) Entrepreneurship & innovation ecosystem
(c) Technology adoption in firms▪ Technology Extension Services (TES)
▪ Blue Tech Challenge
▪ Fintech and blockchain innovation
▪ Ag-Tech pilots
▪ Cluster capacity building in vulnerable countries
▪ Four calls for proposals
(a) Policy & regulatory reformsFocused on business and innovation
climate, particularly DB indicators
(b) Institutional strengtheningFocused on evidence-based policy-
making
(c) Knowledge products & disseminationEnterprise Surveys and others
Compete Caribbean Partnership Facility (CCFP): 2 pillars, various instruments
▪ More than half of
Caribbean MSMEs are
underbanked for a variety
of reasons.
▪ The lack of access to
cost-effective digital
payment solutions
prevents access to
potential customers –
both online and offline
13
Fintech and blockchain innovation
*Using a Structural Gravity General Equilibrium Model, LSE study 2019
Two researches published in 2019
The Role of Fintech and Regulations in Enabling Caribbean MSMEs to grow and innovate
▪ Access to finance and cost
of finance represent the
greatest constraint to
growth
▪ The price friction
represents 2.2% of the
CARICOM GDP
▪ Addressing these barriers
can lead to an increase of
12.7% in tourist arrivals
annually*.
Tourism and Innovation: Leapfroging the Caribbean private sector
A global competition and a blockchain symposium will be organized in 2019-2020 to foster adoption of technology and help firms transition into the fourth industrial revolution.
We can all play un role in creating demand for innovative technology
Hythe, Maxwell Main Road
Christ Church, Barbados.
Tel: 1. 246. 627. 8500 • Fax: 1 .246. 429. 8869
Email: [email protected]
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A multi-donor facility that provides technical assistance to increase the competitiveness of the Caribbean private sector. The results expected are increased
employment, revenues and exports using an inclusive and sustainable approach.
❑ Firms must operate in CCPF’s 13 beneficiary countries:✓Bahamas, Barbados, Belize, Guyana, Jamaica, Suriname,
Trinidad and Tobago, Antigua and Barbuda, Dominica,Grenada, St. Lucia, St. Kitts and Nevis, and St. Vincent and theGrenadines
❑ Cluster Project must involve 3 or more private-sectorfirms
❑ Lead firm submitting application should provide legalcertification of registration
❑ Commitment for counterpart contribution of 20%
15
Eligibility
16
Counterpart Contribution (20%): half in-kind, half in-cash
Cash contribution (10%) In-kind contribution (10%)
• Equipment needed• Goods (eg: fertilizer, raw material)• Website• Purchase of license• Purchase of airline tickets• Etc.
• Staff allocated to manage a project
• Space provided for cluster consultants
Max. amount allocated by CCPF (80%) – for TA $300,000
Min. amount allocated by cluster in-kind (10%) $37,500
Min. contribution by cluster in-cash (10%) $37,500
Total estimated budget of cluster project $375,000
Example from previous call for proposals
➢ Job creation in the short and long term (~25%) – the extent to which the cluster project will create new jobs, including for women and other vulnerable or marginalised groups.
➢ Revenue generation (sales & exports) (~25%) – the extent to which the cluster project will generate increased sales outside the country, within the country indirectly throughout the value chain, or to a clear reduction of imports over time, especially for Small and Medium Enterprises (SMEs).
➢ Project feasibility/potential impact (~35%) – there is a critical mass of firms with the capacity to absorb technical assistance and become competitive in a global value chain or niche market.
➢ Sustainability (~15%) – the likelihood of sustaining the results achieved once the CCPF project ends; and considerations for climate change and sustainable development.
17
Evaluation criteria
18
Technology Extension Services (TES) to increase productivity of firms
Size guidelines # of employees Revenues (USD)
Micro < 5 0 – $250k
Small 5-15 $251k – $500k
Medium 16-50 $501k – $1.5M
Large > 50 > $1.5MSource: Caribbean Development Bank (CDB)
Target for TES: Caribbean SMEsTES is one type of
innovation policy that
Governments have
successfully used in
other countries to accelerate the pace at
which SMEs “catch up”
with more advanced
firms by transferring
knowledge about best
practices*.
For example in the USA, the Manufacturing Extension Partnership (MEP) program
generated $32 of return in economic growth for every 1$ invested, translating into $3.6
billion in total new sales annually for SME manufacturers. In terms of employment, an
impact assessment revealed that one job was created or retained for every $1,570 of
federal investment made in the program.
TES pilot in the Caribbean - DRAFT
4-step approach
(B) BSOs / SBDCs1. Jamaica2. Bahamas3. St. Lucia4. Belize5. Barbados6. St.Kitts & Nevis7. Antigua & Barbuda8. Dominica
(A) Eligible firms •High growth potential•Agroprocessing or tourism sector•Operating in a country of SBDC network•Diagnostic validated by certified business assessors*
Complete Caribbean
Export diagnostic tool
* Caribbean Export will train and certify over 30 business assessors across the region in 2018 within and outside the SBDC network. A site visit by a certified business assessor is required for eligibility.
Business Diagnostic (Target: 200 firms)
Technical Audit (Target: 75 firms)
Technical Intervention (Target: 50 firms)
Capital Investment (Target: 25 firms)
Ensure integrity of diagnostic*
Eligible? Coordinate
technical audit
(C)Technical Service Providers (TSP)•Lumin Consulting at UWI?•Caribbean Export?•CHTA?•CARIRI?
Provide support or refer to
others
Conduct technical audit (1-day)
Accept to implement?
Conduct technical intervention
Pay 25% of the budget
Monitor and record progress
on Neoserra
Facilitate technical
intervention
Technical Assistance Plan (TAP) with recommendations and budget
Share data on progress
Support client with investment proposal and presentation to
the bank
Need capitalto upgrade
technology?
YesNo
Yes
No
Update M&E system
Start
Technology Extension Services (TES) in the Caribbean
Database of TES
providers
(D) Financial institutions / Development Banks •Commercial banks?•Eco-micro network?•Microfinance / Credit unions?•Grant programs?
Offer financing for technology &
equipment
Receive final payment
Technical Assistance Report (TAR) with rational for improvements
Investment proposal for debt or equity financing
Example of TES
– General business analysis, strategic planning, successive planning, executive coaching
– Financial analysis, activity-based costing
– Energy management
– Environmental, health, and safety • food safety, ergonomics, waste management,
compliance, pollution prevention, carbon footprinting)
– Information technology• computer software/packages for accounting,
planning, order entry, scheduling, inventory, such as MRP II, ERP
• sourcing and matching for Technology, supplier and vendor
– Referral to qualified private consultants, technology
centers, or other relevant assistance programs
– Lean operations• lean production and lean office,
• use of methods such as “5 S”, value stream mapping, pull systems, quick changeover,
• cellular manufacturing,
• just-in-time systems
• waste minimization,
• preventive maintenance, and
– Quality improvement• certification to standards such as ISO 9000, TS
16949, ISO 13485, ISO/IEC 17025)
• Use of statistical process control and methods such as root cause and six sigma
– Product development and marketing• lean product development, ideation, market
research, business development assistance, lead generation, technology validation
What is a cluster? Why clustering?
• Joint marketing to increase global market share • Training – co-investment in human capital• Advocacy with government and partners• Research and product development• Value chain improvement
Objectives for firms
• Local proximity: Face-to-face interactions to build trust and share knowledge• Lead by the private sector, supported or facilitated by BSOs• Stakeholders reach consensus on top priorities for the cluster to grow• Starts with quick wins: address low-hanging fruits• A mix of firm size – micro, small, medium and large, local, international• Connections with academic and training institutions
Key success factors / Best practices
• Collaboration multiplies spillover in the community• Increase protection of natural assets• The combination of cooperation and competition
fosters innovation over time• Firms that are part of a cluster are stronger than
those that are not• Higher productivity, higher wages• More successful start-ups• Attracts Foreign Direct Investment (FDI)
Objectives for gov./NGOs/dev. agencies
A cluster is a group of interconnected firms operating near each other that collaborate and compete to obtain a larger share of the global market.