Page 1 Local & Regional Purchase (LRP) Emergency Food Security Program in Tajikistan The PepsiCo Foundation Meeting March 31, 2008.

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Local & Regional Purchase (LRP)

Emergency Food Security Program in Tajikistan

The PepsiCo Foundation MeetingMarch 31, 2008

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Background:

• Tajikistan has experienced a variety of economic, environment and social emergencies in recent years.

• Harvests over the past four years (2005-2008) have declined significantly over the last “normal yield” harvest in 2004.– Most recently, the harsh winter period (January – February 2008) and

drought (March – October 2008) resulted in poor agricultural harvest, particularly in the mountainous areas with limited or no access to irrigation systems.

• In 2007, the food security situation of rural population markedly deteriorated due to the global rise in cost of basic foodstuffs.– In a “normal” year, 50 percent of basic food needs are already

imported, rising in crisis times.– Rising fuel costs also added to higher transportation and, ultimately,

consumer costs.

• In addition, locust invasions (April – June 2008) affected crops in much of the country and further stretched the capacities of rural households to feed their children, increasing food insecurity at the household level.

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Background (Continued)

• The available food stocks for many vulnerable households were projected to last only until November 2008 leaving a 7-month food gap, through the winter and spring planting season.

• The confluence of these factors propelled the country into a state of “compound emergency,” as described by the United Nations.

Need for Action: Already-vulnerable families were pushed to the limit and forced to assume difficult coping strategies that put health at risk, particularly women and children.

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Rapid Emergency Response

• The emergency food insecurity situation necessitated Save the Children (SC), in partnership with Mercy Corps (MC), to embark upon Local & Regional Procurement (LRP) of food commodities and distribution among vulnerable households, funded by USAID.

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Projected Vulnerable Households Targeted:

• A total 11,545 vulnerable household/families were targeted - 6 members per families/household. – SC to provide food to 8,045 families – 48,270 beneficiaries in the

Khatlon region– MC to provide food to 3,500 families – 21,000 beneficiaries in the

Sodhg region

• Outcome: The project aimed to provide food security for 7.5 percent of the most vulnerable population in each targeted district of the aforementioned regions, throughout the winter season.

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Selection Criteria of Vulnerable Population: • Families with children under 2

• Households with orphans, disabled children or adults

• Female heads of household and caregivers

• Vulnerable families without the support of foreign remittances

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Vulnerable Family

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• Tender Process:• Sealed bids were invited from suppliers registered in Tajikistan

• Qualification and Selection Criteria: • Price• Meeting the prerequisites by providing the following documents with sealed and notarized bids bids:

• Tajik passport (together with copy of place of residence)• Copy of certificate from tax authorities • Charter and registration of the enterprise, detailed bank information, and valid commercial license

• SC local lawyer verified the authenticity of documents prior to awarding the contracts.

• A total of 13 bids were received and opened in presence of all the bidders by the procurement committee comprising of SC, MC and USAID local representative. • Three qualified local suppliers were selected to supply wheat flour, oil and lentils respectively. • The contract was awarded with detailed procurement and delivery schedule with a deposit of 3 percent of total contract value as performance bond. • One vendor dropped out and forfeited 3% performance bond

Procurement Process

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Quality Assurance and Control

• Detailed specification of commodities was provided in the tender announcement, including unit weight and types of packaging.

• As required by Tajik law, a selection of all all commodities was randomly tested by the Tajikistan Government Quarantine Office to assure the quality of food commodities before releasing from customs to consumers.– A phyto-sanitary certificate must be received within two days from the

date of collecting samples for lab-test.

• LRP commodities received phyto-sanitary certificates without problem and/or delay.

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TITLE II

Metric Cost C&F / MT Date Of Date Of NotesCommodity Tons (FAS) Ocean Inland Tajikistan Call Export

$/MT $/MT $/MT $/MT Forward Khujan Kurgan Tube

Wheat Flour 2,500.00 391.66 159.36 326 877.02 04 Nov 08 25 Feb 09 In Transit In Transit From CCC Procurement

Veg Oil 360.98 1,643.97 182.78 354 2,180.75 03 Nov 08 24 Dec 08 16 Feb 09 26 Feb 09 From Preposition

Yellow Peas 1,227.20 540.34 166.88 335 1,042.22 03 Nov 08 31 Dec 08 24 Feb 09 05 Mar 09 From Preposition

LRP

Metric Cost C&F / MT Date Of Date Of NotesCommodity Tons (FAS) Ocean Inland Tajikistan Purchase Export

$/MT $/MT $/MT $/MT Contract Khujan Kurgan Tube Kulob

Wheat Flour 2,309.00 467.20 60.60 527.80 04 Dec 08 13 Dec 08 23 Dec 08 25 Dec 08 31 Dec 08 From Kazhakstan

Veg Oil 184.72 1,454.77 460.73 1,915.50 02 Dec 08 28 Dec 08 03 Feb 09 03 Feb 09 05 Feb 09 From Russia

Lentils 577.25 879.60 100.80 980.04 02 Dec 08 19 Dec 08 07 Jan 09 31 Jan 09 05 Feb 09 From Russia

In Tajikistan

Date Of ArrivalIn Tajikistan

LRP / Title II AnalysisTAJIKISTAN

Freight Cost

Freight Cost Date Of Arrival

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Commodity Loss Mitigation

There was no commodity losses from the suppliers due to:

• Purchase contract clearly stipulating that that suppliers would be responsible for delivering and stacking commodities at the designated warehouses of SC and MC.

• All damaged, torn, under-weight and unfit commodities due to mishandling were under contract to be replaced by the suppliers at their own expense.

• No reconstituted bags were accepted.

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Cost Savings Vs. Quality of Commodities

In this emergency, LRP proved to be a useful mechanism for delivering commodities to vulnerable families in a timely manner:

• LRP enabled food to reach beneficiaries in a much shorter time than shipments originating from the U.S. (thus better for responding to an unfolding emergency).

• However, while LRP presented some cost savings over Title II for the SYAP, the commodities are not directly comparable in terms of grade, enrichment, etc. Therefore it is not possible to measure and compare savings accurately and conclusively for sustained food aid programs or non-emergency situations.

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Timeline of LRP Activities

Date …

Sept. 22, 2008 Prep WorkOct. 25, 2008Nov. 7, 2008

Dec. 2, 2008Dec. 2, 2008Dec. 4, 2008

Sep 20,08-Apr.30 '09

Oct-08 Nov-08 Dec-08 Apr-09

Wheat Flour

ActivitySep-08

LRP ApprovalAnnouncement of TenderLast Date of Submitting Bids

Life of Activity of LRP Project

33 Days13 Days

25 Days25 Days27 Days

200 days of LOA

Contracts Awarded to SuppliersLentil

Vegetable Oil

• Status of Distribution to Beneficiaries: – Food distribution was completed on March 31st,

2009

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Rahmati Kalon!Rahmati Kalon!

Thank you very much!Thank you very much!

The PepsiCo Foundation MeetingMarch 31, 2008Q&A