TRANSFORMING MARKET SYSTEMS ACTIVITY SEVENTH …

TRANSFORMING MARKET SYSTEMS ACTIVITY

SEVENTH QUARTERLY PROGRESS REPORT Quarter 1 – FY 2020

October – December 2019

Transforming Market Systems Activity

Quarterly Report October – December 2019

I

TRANSFORMING MARKET SYSTEMS ACTIVITY

SEVENTH QUARTERLY PROGRESS REPORT Quarter 1 – FY 2020

October – December 2019

This report covers activities under USAID IDIQ Contract No. 72052218D00001

Task order No. AID-522-TO-18-00001

SUBMITTED TO:

Activity Management Specialist

Office of Economic Growth

Contract Officer’s Representative

U.S. Agency for International Development

SUBMITTED BY:

Country Representative

Chief of Party

January 31, 2020

DISCLAIMER

This report is made possible by the support of the American people through the United

States Agency for International Development (USAID). 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.



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CONTENTS

SECTION I: BACKGROUND ............................................................................................ 1 SECTION II: SUMMARY ................................................................................................... 1 SECTION III: PROGRESS BY ACTIVITY COMPONENT .......................................... 4 COMPONENT 1 ............................................................................................................................................. 4 VALUE-ADDED AGRICULTURE ................................................................................................................. 4

Alliances and current results: .......................................................................................................................... 4 COMPONENT 2: .............................................................................................................................. 10 TOURISM AND CREATIVE INDUSTRIES .............................................................................................. 10

Alliances and current results: ........................................................................................................................ 10 COMPONENT 3: ............................................................................................................................... 16 ENTREPRENEURSHIP ............................................................................................................................... 16

Alliances and current results: ........................................................................................................................ 16 ............................................................................................................................................................................ 20 COMPONENT 4: ............................................................................................................................................ 20 BUSINESS ENABLING ENVIRONMENT................................................................................................ 20 Social Inclusion, Environmental Compliance and Communications .......................................................... 24

SOCIAL INCLUSION .................................................................................................................................. 24 ENVIRONMENTAL COMPLIANCE ......................................................................................................... 26 COMMUNICATIONS .................................................................................................................................. 27

SECTION IV: MONITORING, EVALUATION AND LEARNING .......................... 30 MONITORING & EVALUATION SYSTEM .............................................................................................. 30 COLLABORATION, LEARNING, AND ADAPTING .............................................................................. 31 SECTION V: PROGRAM MANAGEMENT .................................................................. 32 CONTRACTUAL DELIVERABLES ............................................................................................................ 33 PARTNERSHIP AND INNOVATION FUND (P&IF) ............................................................................. 33 SECTION VI: LOOKING FORWARD ........................................................................... 34 SECTION VIII: FINANCIAL INFORMATION ........................................................... 35 ANNEX I – TMS IN NUMBERS ..................................................................................... 37

NUMBER OF PARTICIPANTS BENEFITTING FROM TMS ASSISTANCE .......................................... 37 PERCENTAGE OF DIRECT BENEFICIARY PARTICIPANTS FROM VULNERABLE GROUPS ....... 39 AMOUNT OF CAPITAL LEVERAGED (IN USD) AS A RESULT OF USG ASSISTANCE ................... 40 ....................................................................................................................................................................... 40

ANNEX II – COMMUNICATIONS ................................................................................ 41 ANNEX III – SENTINEL STUDY - WEB PRESENCE AND SOCIAL MEDIA

TRAINING ......................................................................................................................... 45 ANNEX IV – 2019 LEARNING REPORT ...................................................................... 48



III

ABBREVIATIONS

ALPROSA Almacenadora de la Producción

AGRTOTECH Congress on Technological Innovation for the Agricultural Sector

ANDE Aspen Network Developing Entrepreneurs

AMCHAM American-Honduran Chamber

AMHON Association of Municipalities of Honduras

BEE Business Enabling Environment

CANATURH Honduran National Chamber of Tourism

CCICH Chamber of Commerce and Industry of Choloma

CIES Center for Economic and Social Research

CLA Collaboration, Learning and Adapting

CNI National Investment Council

COHEP Consejo Hondureño de la Empresa Privada

COMSA Café Orgánico Marcala, S.A.

COR Contracting Officer Representative

COHONDUCAFE Fundación de la Compañía Hondureña de Café

DO Development Objective

EFISolutions Efficient Solutions

FNAMP Honduran anti-gang Task Force

GALI Global Accelerator Learning Initiative

IDB Interamerican Development Bank

IDIQ Indefinite Delivery, Indefinite Quantity

IFAD International Fund for Agricultural Development

IIES Institute for Social and Economic Research

IHT Honduran Institute of Tourism

INALMA Inversiones Amalgamadas S.A.

LGBTI Lesbian, Gay, Bisexual, Transgender, Intersex

ME&L Plan Monitoring, Evaluation, and Learning Plan

MESCLA M&E Support for Collaborative Learning and Adapting

MIPYME Micro, Pequeña y Mediana Empresa

MSME Micro, Small and Medium Enterprises

OPTURH Honduras Inbound Tour Operators Association

OGD Destination Management Organization

OIJ International Youth Organization for Ibero-America

P&IF Partnership and Innovation Fund

SME Small and Medium Enterprises

SNA Social Network Analysis

TMS Transforming Market Systems Activity

UNAH National Autonomous University of Honduras

UNDP United Nations Development Program

UNICEF United Nations Children’s Fund

USAID United States Agency for International Development

VAA Value-added Agriculture



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SECTION I: BACKGROUND

Through Indefinite Delivery, Indefinite Quantity (IDIQ) Contract No. 72052218D00001, dated

April 13, 2018, the United States Agency for International Development (USAID) awarded

ACDI/VOCA the Transforming Market Systems Activity (TMS, or, the Activity) with an ordering

period through April 12, 2023 and a performance period through April 12, 2025.

The purpose of the Transforming Market Systems IDIQ is to foster competitive, resilient, and

inclusive market systems that provide increased economic opportunities (jobs and income) that

incorporate poor, marginalized Hondurans and reduce incentives to migrate.

TMS prioritizes investments based on U.S. Government strategic interests, objectives, and ongoing

investments, as currently defined in the USAID/Honduras Country Development Cooperation

Strategy (CDCS) and as based on continuing learning being undertaken on U.S. Government efforts

to counter illicit migration to the United States.

Task Order No. 1 of the IDIQ (No. AID-522-TO-18-00001), dated April 16, 2018, covers the

development of the Activity’s Monitoring, Evaluation, and Learning Plan (ME&L Plan), the

execution of actions under this ME&L Plan, and implementation of all Collaboration, Learning and

Adapting (CLA) activities, including analyses, studies and pilots throughout the life of the IDIQ.

This Task Order also covers the implementation of an Inception Phase, comprised of a series of

formative consultations, assessments, and analyses with the purpose of developing Life of Activity

Action Plans for priority economic sectors and their corresponding strategic areas for intervention,

including improvements in the business enabling environment, with an emphasis on actions where

USAID can have a competitive advantage. Task Order No. 1 was amended on October 29, 2018 to

incrementally fund the contract.

This document presents the quarterly progress of TMS covering the fourth quarter of fiscal year

2019 (the sixth quarter of Activity implementation), encompassing activities from July 1st to

September 30th, 2019, and the overall annual progress of the TMS Activity in fiscal year 2019.

SECTION II: SUMMARY

"I’m excited about USAID’s and TMS’ full involvement in the (H2A

and H2B temporary workers) program. This will be something we can

all be very proud of."

Consul General, U.S. Embassy in Honduras

October 19, 2019



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The most significant developments and accomplishments resulting from TMS implementation

during the reporting period include the following:

❖ Services created by TMS and provided by ag-brokers have increased smallholder farmers’

ability to consistently access technical assistance and inputs while at the same time provide

quality products to larger processors like INALMA, who formally integrated to date 43 new

farmers into their supply chain, diversifying their production and decreasing their exposure

to risk.

❖ TMS supported COMSA in finalizing the first 10 youth ventures to be business launch-

ready, including a wide range of initiatives in coffee, tourism, food processing, dairy,

poultry, medical and transport services.

❖ An evaluation that TMS commissioned to the Rain Forest Alliance, and conducted this year

on already installed solar coffee dryers, confirmed that farmers receive an additional

income of 180 lempiras per 100-pound bag of dried coffee parchment which represents

approx. a 10 percent increase in price translating into an approx. $160 increase in net cash

income per hectare.

❖ TMS, in partnership with JJ Agro, has facilitated the start-up of a new strawberry project in

La Esperanza, Intibucá, creating 30 new jobs and mobilizing investment of over $200K in

the first two hydroponic greenhouse modules.

❖ With TMS's support, installation of a distillation unit and a state-of-the-art dryer managed

by Inversiones Morales, one of five satellite companies developed in partnership with EFI

Solutions in Lempira, has led to the establishment of two new contracts with international

buyers for lemongrass oil and certified cardamom for teas that will benefit more than 100

growers in the area.

❖ New financial products, co-created between EFI Solutions and TMS, exposed unknown

value chains to the banking system in the country. New sales for growers of cardamom,

ginger, lemongrass, and vetiver of $164,067.60 have been reported in addition to 65 new

hectares of these crops planted.

❖ CANATURH and TMS provided technical assistance to small tour operators in Joya de Los

Lagos District (Cabañas Pulhapanzak, Hotel Casa Lenca, Viajes Topaz), in connection with

the e-commerce strategy with SUBE LA, to increase the available offerings of local tours

and activities on the official tourism website: Honduras Travel.

❖ TMS shared the analysis of national crime statistics and their impact on the tourism

industry with the Ministry of Tourism and the U.S. Consular Section.

❖ To secure placement opportunities for Hondurans on Cruise Lines, a special law for

Honduran seafarers' training and job placement was enacted in Tegucigalpa, on October 8,

by President , which will enable thousands of Honduran seafarers

to obtain employment.

❖ TMS facilitated a trip of Practical Employee Solutions, a large-scale U.S. contractor, tointerview 58 potential H2B workers from Intibucá. The selected workers will receive their

job offers in early 2020 and will work in landscaping and carnival occupations from

February to November 2020, with a wage rate between $9-$19 per hour.

❖ 30 local specialists completed the first Honduran online Train-of-Trainer program and

certification on e-commerce and financial technologies from partner institutions CDE

Lempa, CDE Region Occidente, and the Chamber of Industry and Commerce from Puerto

Cortés and Omoa (CCIPO). This certification provided attendees with new tools on how tofacilitate the usage of a payment platform and e-commerce tools to local SMEs.

❖ TMS attended the Central American and the Caribbean Impact Investment Forum 2019

(FLII CAC 2019), which took place November 13 and 14 in Antigua, Guatemala. TMS



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facilitated 12 Choloma PYME owners and 3 technical staff from the Choloma Chamber of

Commerce to participate in the FLII CAC 2019.

❖ TMS partner COHEP, and the Economic and Social Research Institute (IIES) of the

National University of Honduras, led five days of focus groups with the Chambers of

Commerce of Tegucigalpa, La Ceiba, San Pedro Sula, Choloma and Santa Rosa de Copán

(September 21-26), focusing on in-depth discussions about a shared understanding of what

variables drive enterprise competitiveness, resilience and inclusion.

❖ TMS completed a proposed new tax regime reform for Honduras in alliance with COHEP

to promote economic activity as well as to attract national and foreign investment.

❖ TMS completed a diagnosis of the current state of eight associated centers of the National

Property Institute (IP) and a legal feasibility study to merge their services into the Chamber

of Commerce and Industry of Tegucigalpa (CCIT).

❖ TMS and AMHON conducted three events for the inception of a local economic development agenda in San Marcos de Ocotepeque and La Ceiba through a one-stop-shop

model for municipal services.



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SECTION III: PROGRESS BY ACTIVITY COMPONENT

COMPONENT 1 VALUE-ADDED AGRICULTURE

This quarter, through its strategic agricultural partnerships, TMS made significant

progress in improving existing business models in target supply chains, and in developing

entrepreneurship incubation services. The partnerships have facilitated youth engagement, the

adoption of innovative and successful changes to production and policy, and have led to

investments in Honduran agricultural sectors, improving the diversity and resilience of the

economy.

Alliances and current results:

Innovative Supply Chains - Industrias Amalgamadas S.A de C.V. (INALMA) TMS has advanced in its efforts to implement a new

supply chain model, incentivizing a fee-based

arrangement with local brokers (agribusinesses,

individual professionals, associations, input vendors, etc).

Last quarter, INALMA and TMS forged the first five (5)

fee-based contracts with local suppliers, which resulted in

the incorporation of 20 new small-size plantain and

cassava growers into INALMA's supply chain.

During the reporting period, one additional supplier was

selected, , an experienced agronomist from

Olancho. The difference in this case is that is not a

grower himself. inaugurates another

innovation in INALMA’s business model by becoming

the first external sourcing agent to complement

INALMA’s own team of six (6) sourcing technicians.

TMS and INALMA interviewed over 30 local actors

around the company’s operating areas and developed a list of qualified candidates. was

selected based on his commitment to supply INALMA’s sweet potato demands in addition to

plantain and cassava. In less than three months, he selected and organized 23 additional small

farmers, started imparting technical assistance and innovative practices, facilitated access to

agricultural inputs, and made available basic infrastructure for washing and peeling to add value in

closer proximity to the farms. This new total of 43 farmers work 36 hectares and will generate a

total of 10,620 agricultural wages over the next nine months, or 40 full-time equivalent jobs.

is not only helping INALMA reach its volume demands (which elevates the standard of

INALMA’s own internal sourcing team) but is enabling small farmers to be integrated into a supply

chain that otherwise they would not be able to penetrate alone.

TMS also worked with INALMA to develop an agreement with its Employee Cooperative to set up

a credit facility that will be used to finance the cost of inputs to smallholder farmers under contract.

The agreement was on signed on December 20th, 2019, and will ensure the timely application of

inputs to guarantee higher yields and increase farmer incomes.



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Youth Coffee Microenterprise Model - Café Orgánico Marcala, S.A. (Comsa) This quarter, TMS supported COMSA in finalizing the first 10 youth ventures to be business

launch-ready, including a wide range of initiatives in coffee, tourism, food processing, dairy,

poultry, medical and transport services. All these initiatives have access to personal coaching,

finance and one-on-one mentoring for incubation and will start operations in the first quarter of

2020. Through these ventures, TMS and COMSA aim to include youth in coffee and other

agriculture value chains, spurring a new generation of farmers and processors, and to ensure long

term business sustainability through the development of new supply chains and service providers.

These first 10 new market businesses will be provided capacity building, access to credit and

markets, and mentoring throughout the ongoing incubation period during 2020. These ventures will

support TMS's goals to promote an entrepreneurial mindset among youth and the economic

diversification of coffee farmers.

TMS sponsored three (3) training workshops for youth entrepreneurship in coffee in Márcala, La

Paz, on October 28-November 1, November 11-15, and November 25-29. Fifty-two people received

the trainings, constituted by 21 women and 31 men. A total of 44 (85%) are under the age of 30, 29

of which are between 16 and 22 years old, 11 are between 23 and 27 and only 4 are 28 and 29 years

old. Each workshop consisted of a five-day course to provide knowledge and tools to the

entrepreneurs to grow their small business initiatives or to start a new business. At the end of the

course they each received a work guide to assist in developing a new business plan.

This training is an important milestone for the activity with COMSA, as the participants have

overwhelmingly responded positively to the training in already informing their business decisions.

The entrepreneurs will now receive individual advisory services to create and execute their plans to

grow their businesses or start on new projects. Additionally, they may now apply for seed funding

through COMSA's rural bank, BanCOMSA, which offers better financing rates and personalized

attention than otherwise available to them.

First training workshop for entrepreneurship at Finca La Fortaleza.



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Investment and Export Promotion – JJ Agro This quarter, JJ Agro Industries (a partnership formed last quarter through an exploratory mission to

Guatemala with public and private actors), made great

strides in its diversification strategy. JJ Agro completed

the first phase of its new hydroponic blackberry project

in La Esperanza, Intibucá, through an investment of

over $200K in the first two greenhouse modules,

planting a batch of 54,000 strawberry mother plants,

and creating 30 new permanent jobs. The project

currently covers 2,000 m2 and is planned to reach across

15,000 m2 of greenhouses in 2020 to supply local and

regional supermarket chains. This milestone of

production is establishing a "before and after" of the

berry industry in Honduras.

TMS’s strategy to create new and better jobs in western

Honduras is not only based on economic diversification

through the introduction of new nontraditional market-

driven crops like strawberries; it also includes

technology innovation. This quarter, TMS was

instrumental in introducing AI systems to irrigate JJ

Agro’s greenhouses instead of open fields, and

changing JJ Agro's mindset towards diversification and

investment. JJ Agro has been the primary supplier of potatoes to principal supermarkets in

Honduras for years, however, due to soil quality decrease and lack of additional land, JJ Agro had

been precluded from continuing to grow and even start thinking about export markets. With TMS

assistance, the company is launching an aggressive expansion plan to double the number of local

farmers to source potatoes from, and further diversifying its production this year with the addition

of new crops like snow peas. JJ Agro represents the possibility for individual producers in the

region to diversify their products, improve their processes, and add hundreds of jobs to the

economy. TMS will replicate the success of JJ Agro with similarly sized firms and production

channels in 2020.

Nestlé Global Youth Initiative - Fundación CoHonducafé This quarter, TMS made progress on its goals to facilitate coffee farmers’ access to and adoption of

improved solar drying technology to improve the quality of their coffee through consistent drying.

To meet these goals, TMS first facilitated the evaluation and upgrade of the solar dryers’ model

being promoted by Fundación CoHonducafé. Consulting firm CREA Consultores, contracted last

quarter, completed an inspection of 36 working solar dryers in six different locations and setting up

a testing trial in 3 locations (Comayagua, Lempira, and Santa Barbara) to measure the solar dryer

performance. Proper instruments have been purchased and technical staff have been trained on data

collection to measure and establish coffee drying curves under different weather conditions that will

be used to improve the operational efficiencies of the first batch of 647 dryers that have been

already installed through the alliance. The evaluation will also be used to design a couple of new

and improved models in terms of key efficiencies and costs that will become available to farmers in

2020.



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A separate economic evaluation, commissioned to Rain Forest Alliance, confirmed that farmers

received an additional income of 180 lempiras per 100-pound bag of dried coffee parchment which

represents approx. a 10 percent increase in price translating into an approx. $160 increase in net

cash income/hectare.

TMS delivered a one-day workshop in La Libertad, Comayagua on November 1 for 19 of the pilot

group of 30 young participants of the Youth Initiative who are currently receiving the 5-module

training program. TMS designed and directly facilitated this training module using the Canvas

methodology, to give these youth the opportunity to evaluate and present their business ideas to a

panel composed of TMS and CoHonducafé representatives. An observer from La Libertad

Municipal Mayor´s Office also accompanied the event. This was the first group to benefit from the

first training center and they represent the pilot of a program that is planned to reach a total of

25,000 rural youth in the next four years.

Market Opportunities in Non-Traditional Crops - EFI Solutions

This quarter, TMS and EFI sought to diversify crop production through non-traditional market

driven crops and to add value and ensure sustainability through technology innovation, certification,

and empowerment of young entrepreneurs in rural areas.

Satellite companies MultiInversiones, in Peña Blanca, and Inversiones Morales, in Lempira, are two

of the five satellite companies developed by EFI Solutions. Both work with cardamom growers,

which have started the process of value addition though a unique drying method and the

implementation of a specific certification protocol to comply with international tea trade standards

in terms of sustainability, food safety, and quality. With TMS support, the installation of a

distillation unit and a state-of-the-art dryer, managed by Inversiones Morales, has led to the

establishment of two new contracts with international buyers for lemongrass oil and certified

cardamom for teas that will benefit more than 100 growers in the area.

This equipment, which has allowed certifiers to quickly test samples for quality, has been key in the

negotiation with buyers to secure short-term contracts for the future scaling up processes for these

two value chains. Both pieces of equipment have been manufactured in Honduras following a

sustainable design. The dryer uses liquified gas instead of wood with an estimated savings of 1.6

metric tons of wood for each metric ton of cardamom dried. The dryer has four trays allowing

growers to dry small quantities compared to traditional circular cardamom batch dryers which

require big volumes of product. The new design also allows for an easy loading/unloading of the

product preventing farmers from stepping on the product, ensuring human consumption safety. A

total of 77 growers in the municipalities of Peña Blanca, Belén, Piraera, Gualcince, Erandique and Candelaria will benefit from this technological improvement. Additionally, the availability of these

Solar dryers in construction in Lempira,

Intibucá Experts inspecting solar dryers



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processing stages is motivating the local women's network to grow cardamom and lemon grass in

2020.

Certified organic cardamom traded from Guatemala is suffering a reputational risk, as prohibited

substances are often found in the finished product. EFI has identified this problem as a big market

opportunity for Honduras and it is allocating resources to try to make Honduras a recognized origin

for high quality, truly certified organic cardamom. To date, more than 30 cardamom growers living

in the buffer zone of the Texiguat Wildlife Reserve in Mezapita, Atlántida have obtained their

organic certification through Mayacert under the leadership of another satellite company, Allan

Reyes LLC. Mayacert is an organic certification body, which audits and certifies organic growers,

traders and processors in the region. Allan Reyes LLC secures the market through EFI and provides

technical assistance and financial services to grow cardamom under agroforestry systems following

organic regulations and ensuring zero deforestation.

With TMS and EFI support, ginger and vetiver growers have fine-tuned their crop and postharvest

practices by making use of their reject product in compliance with international standards, which

allows them to compete in international markets. As a result, samples of essential oils for both crops

have been tested and approved by EFI’s buyers. This is a key step in improving the competitiveness

of ginger growers since it will allow them to add value to product that is rejected in the fresh market

(up to 20 percent of their product) and doesn´t currently have commercial value. Further, they will

be able to incorporate the underserved Garifuna communities as they are hired to dry the vetiver on

their land which is otherwise considered of low value.

Socialization meeting with lemon grass producers in Lempira

Producers of cardamom, Peña

Blanca

Lemon grass oil

sample and

with

the new lemon grass oil

distiller in Gualcince,

Lempira.

farm and TMS team with cardamom dryer.



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Additionally, farmers of non-traditional crops like cardamom, ginger, vetiver, and lemongrass that

have been integrated into market systems through the different satellite companies, now have access

to credit through Banrural. These new loans, negotiated between EFI and TMS, exposes these

unknown value chains to the banking system in the country. New sales for growers of cardamom,

ginger, lemongrass, and vetiver of $164,067.60 have been reported in addition to 65 new hectares of

these crops planted. As a next step, between the end of November 2019 and January 2020, 3,000

quintals of ginger produced by 26 beneficiaries will be sold in Europe, with a value of

approximately of $ 84,934.

EFI Solutions and TMS held a Pause & Reflect session in December to evaluate interventions taken

to date, results achieved and future actions for the activity. The session reflected on progress made

with satellite companies, as alternatives to informal coyote intermediaries. An increasing emphasis on food safety and quality certifications was identified to continue to expand into export markets.

Implications were discussed about what scaling of this model would look like in the future.

Other Noteworthy Achievements

TMS explored opportunities to create synergy and to strengthen 15 growing SMEs. During the

quarter, TMS engaged the Center for the Promotion Imports (CBI), implementing entity of the EU-

funded “Connecting Central America” Program, to explore opportunities to create synergy and to

strengthen 15 Honduran Small and Medium sized Enterprises (SMEs) and cooperatives. CBI has

the mandate to help Honduran SMEs to become (more) competitive to penetrate the European

market through 2021. The 15 companies have been selected across three sectors: fish & seafood,

specialty coffee, and fresh fruits and vegetables. TMS believes several of these companies are

showing enough promise that they will be identified as the new anchor firms for the VAA scaling

up phase in 2020.



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This quarter, TMS worked to develop an integrated crisis management toolkit that

mitigates and shifts negative perceptions of Honduras as a travel destination. TMS also supported

the Honduran Tourism Strategy through IHT, CANATURH and OPTURH to develop and

implement a strategic communications management framework that helps foster an image of safety

and attractiveness to foreign visitors. Lastly, TMS fostered opportunities to address irregular

migration and generate economic opportunities for Hondurans through the temporary foreign work

program (Programa de Trabajo Temporal en el Extranjero - PTTE), a multi-stakeholder alliance

with the Consular Section of the U.S. Embassy, the Ministry of Labor, the Ministry of Tourism, the

National Institute for Professional Training (INFOP), and the Merchant Marine of Honduras.


Advancing a National Tourism Approach – CANATURH This quarter, TMS and CANATURH completed the

national strategic framework of interventions for tourism

marketing, in close collaboration with the National

Tourism Council (CNT). The framework prioritizes

market segments and marketing actions that impact

Honduras’ largest outbound markets with the goal of

increasing tourist visits. Additionally, TMS developed a

crisis management framework that mitigates and shifts

negative perceptions of Honduras. Over the next six

months, TMS will support CANATURH and the CNT,

as well as other public and private sector entities, to

develop and implement the new strategic

communications and crisis management toolbox based

on the UNWTO guidelines that helps MSMEs to adapt

a d become resilient to the most common crises, e.g. riots related to political instability.

CANATURH and TMS provided technical assistance to small tour operators in the Joya de Los

Lagos District (Cabañas Pulhapanzak, Hotel Casa Lenca, Viajes Topaz), in connection with the e-

commerce strategy of TMS partner SUBE LA, to increase the available offerings of local tours and

activities on the official tourism website: Honduras Travel. Technical assistance provided from

November 20 to December 31, helped local businesses create 20 new tour packages and improve

the ease with which potential guests can learn more about available experiences and then to book

them directly online.

In order to consolidate the Meetings, Incentives, Conferences and Events (MICE) sub sector within

the tourism industry, a segment with great potential to affect systemic changes, particularly in

enhancing travelers’ experience and therefore expenditure pattern, TMS and CANATURH

supported the Honduras Conventions and Visitors Bureau to develop a professional certification

program for Conference Specialists & Meeting Planners. To date, 26 professionals have received a

certification from the Meetings & Events Institute of Mexico, and six (6) have been granted hosting

status of new events since their certification. TMS will provide technical and financial assistance to

help the Conventions Bureau increase their market share, target different market segments, and to

understand the impact of these events on the local economy.

n

COMPONENT 2:

TOURISM AND CREATIVE INDUSTRIES



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This quarter, TMS received the first set of tourism data from TripAdvisor, covering the time period

of September 2016 through June 2019. TMS developed a slide deck with the data for the Ministry

of Tourism which provides in-depth information about Honduras's overall views and clicks on the

TripAdvisor website, with sub data at the district level, and further provides information on the top

markets and geolocations. These data insights help TMS partners to understand the current tourism

demand, build plans for managing their online reputation, conduct effective marketing campaigns,

and strategically allocate their investments that collectively make a significant difference in the

major tourism destinations.

The information will be presented next quarter by Minister of Tourism, Nicole Marrder, to the

National Tourism Council, which includes OPTURH, IHT, and CANATUR, in addition to other

tourism operators such a airlines and car rental companies.

Improving Honduras’s Reputation Management - OPTURH This quarter TMS worked with OPTURH to improve the international perception and image of

Honduras to reduce the perceived risks for international travelers, supporting the economic recovery

of the tourism sector.

TMS completed an analysis of national crime statistics and their impact on the tourism industry and

shared the results with the Ministry of Tourism and the U.S. Consular Section. The parties will also

meet in January to discuss the analysis, and then it will be additionally shared with embassies and

consulates in Honduras. The study developed under the TMS partnership with OPTURH, sheds

light on the impact of travel warnings on tourists' travel intentions by demonstrating how travel

advisories have overemphasized existing dangers in Honduras, which have then been intensified in

the way the advisories are presented by the media, both locally and internationally. The study

highlights the misinformation and outdated facts on the internet which fuel the perception that

Honduras is a dangerous place to visit. Further, the study illuminates the countries’ positive efforts

to reduce the homicide rate and it emphasizes the fact that foreign travelers in Honduras are not

specific targets, as they account for less than 0.5 percent of total homicides in the country.

Further, TMS received the online reputation audit commissioned to international firm Net

Reputation, about targeted mainland Honduras destinations: La Ceiba, Copán Ruins, Tegucigalpa

and San Pedro Sula, was delivered in December. The main findings were:

• Organic search results of keywords yield several negative results throughout page one,

steering consumers away from Honduras altogether or towards its competitive destinations.



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• Google Autocomplete suggests the terms: murder, crime, travel, safety.

• Currently, positive reviews and feedback on travel sites are not being prioritized through

Google's rankings, leading to unfavorable purchasing patterns.

• A tremendous correlation was found between negative social media content and web-based

articles and decreasing travel to Honduras.

TMS concluded that the Reputation Management Strategy will have to address both online and

social media content, generating shifts in the ranking authority and prioritizing positive content

steering potential consumers towards choosing Honduran destinations. Net Reputation will focus

next quarter on a Reputation Management Strategy, which will include: domain purchases, web

development, press releases, Google Autocomplete alteration, a paid marketing strategy, marketing

via influencers, managing online reviews, and marketing via community forums.

Urban Revitalization and Creative Industries - National Identity Foundation (MIN) The partnership with the Interamerican Development Bank

(IDB), Raiz Capital, and Foundation MIN (implementing

partner of the alliance) launched this quarter four (4) activities

within the strategy to revitalize the historical district of

Tegucigalpa and Comayaguela:

• A research, design, and pilot of night-time economy

initiatives. This will include a complete mapping of existing

and potential night-time activities such as concerts, open

festivals, and other activities that occur in open spaces and

emphasize the relevance of a lively local night scene to

attract the ‘creative class’. Expanding night-time activity

not only stimulates tourism and economic growth, but also improves generalized perceptions of

safety after dark. (Hae, 2012).

• Implementation of the first pilot project prioritized among a portfolio of projects reviewed and

discussed as part of the Urban Lab Platform (ULab). The ULab works on experimental urban

planning processes for practical and collaborative solutions and methodologies that are relevant

for local stakeholders. This first pilot consists of the re-conditioning of pedestrian spaces at Los

Dolores neighborhood, accompanied by a communications campaign and workshops with local

beneficiaries.

OPTURH, TMS, IHT and the U.S. Consulate discussing the “Analysis of Crime Statistics in Honduras and the

Impact on the Tourism Industry”.



13

• Design and implementation of a creative training curricula based on the current needs of

creative entrepreneurs and the inclusion of new available technologies. The curricula will be

implemented in pre-grad and post grad programs at Escuela de Bellas Artes and local

universities. The course program will integrate components of design, investigation, learning

and innovation for a specific target population.

• Launch of a feasibility and marketing study for PRODITE – (Programa de Diseño e Innovación Tecnológica para Emprendedores), a new entrepreneurship program within the National

University of Honduras (UNAH), to determine the scope and reach of the program and its

market potential within the creative entrepreneurial ecosystem.

Temporary Foreign Work Program (PTTE) The multi-stakeholder alliance forged by TMS with the Consular

Section of the U.S. Embassy, the Ministry of Labor, the Ministry

of Tourism, the National Institute for Professional Training, and

the Merchant Marine of Honduras evolved significantly this

quarter. In addition to the C-1/D program (temporary workers as

crew members for ships that will be transiting through the United

States or its waters), the alliance will now support two new

temporary foreign work opportunities: The H-2A temporary

agricultural program, which establishes a means for U.S.

agricultural employers who anticipate a shortage of domestic

workers to hire nonimmigrant foreign workers to perform

agricultural labor or services of a temporary or seasonal nature;

and the H-2B temporary work program for non-agricultural

services or labor based on the employers' temporary need. The

temporary need is established as one of the following, one-time

occurrence, seasonal need, peak-load need, or intermittent need.

TMS worked with the Ministry of Labor to assess its capacity to seek and secure these enhanced

foreign temporary work opportunities for Honduran citizens. The assessment lead to the creation of

a specific department to handle foreign temporary work opportunities, the newly created Temporary

Foreign Work Program (Programa de Trabajo Temporal en el Extranjero - PTTE). TMS will

support this unit through technical assistance, training, and equipment, as needed, to assist

interested and qualified candidates through the recruitment and hiring process, while at the same

time providing employers from the United States, Canada and other countries, a free, public and

transparent recruitment service.



14

To secure placement opportunities for Hondurans

on Cruise Lines, a special law for Honduran

seafarers' training and job placement was enacted

in Tegucigalpa, on October 8, by President

, which will enable thousands

of Honduran seafarers to obtain employment.

TMS played a key role in this groundbreaking

legislation through the discussion of drafts with

stakeholders, and in the provision of content

input and support for job fairs in alliance with the

Ministries of Tourism, Labor, and Investment,

the National Workforce Training Institute, and

the Merchant Marine

On the C-1D program, or Gente de Mar initiative, TMS, the Merchant Marine Service, and INFOP

focused on implementation of the training phase. On one hand, 2,430 candidates signed up for basic

training at INFOP, while 3,336 began training in different seafarer specialties in the three training

centers of the Merchant Marine.

Additionally, the Merchant marine conducted a recruitment event for a specific demand of

seafarers. The Apollo Group, a full-service hospitality management company headquartered in

Miami, Florida, that has been a top employer and leader in supply chains and logistics in South

Florida for 50 years, visited Honduras and tested 78 candidates (19 women, 59 men).

On the H-2A and H-2B programs, TMS facilitated a series of key meetings with potential

employers in Dallas, Texas; Little Rock, Arkansas; Laguna Beach, California; and Seattle, for the

Ministry of Labor, the Vice Minister of Foreign Affairs, and the U.S. Consulate to Honduras.

More than 200 potential employers were identified

during the several encounters with large scale

contractors and local associations including: The

Arkansas Farm Bureau, the Texas Farm Bureau, the

Northwest Horticultural Council and the Washington

State Tree Fruit Association.

As a result of the trip, U.S. contractor Practical

Employee Solutions (PES), a Frisco, Texas-based

company that specializes in sourcing and placement of

temporary non-agriculture unskilled labor since 1996,

President enacts Seafarers’ Law

Successful selection of Honduran workers from La Esperanza, Intibucá.



15

Meetings with more than 250 businessmen in 4 States to promote Honduran workforce

visited Tegucigalpa, in December, to begin the recruitment of the first workers from Intibucá. TMS

facilitated the interview process for 58 potential H2B workers and coordinated additional targeted

meetings with banks, airlines, and hotel associations to enable the hiring process. Companies

participating in the H2B program, such as PES, give high importance to overseeing all the different

logistics elements involved in the placement of Honduran workers such as transportation and other

services. PES has placed over 50,000 temporary workers to date in hospitality, landscaping, and

general construction jobs. The selected workers will receive their job offers in early 2020 and will

work in landscaping and carnival occupations from February to November 2020, with a wage rate

between $9-$19 per hour.

TMS will continue supporting the implementation of temporary work programs through technical

assistance for the screening and registration of candidates, the recruitment processes, and the

identification of potential contractors as well as the incubation of national employment agencies

authorized by the Ministry of Labor. This initiative offers a unique opportunity to address irregular

migration and generates needed economic opportunities for Hondurans.


IHT This quarter, TMS and IHT worked towards developing a strategic framework for the development

and implementation of the tourism district strategy, with the goal of improving the local tourism

offerings and supporting local destinations' marketing efforts. TMS and IHT ran the first diagnostic

workshops in two tourism districts: Lenca Maya (December 10) and Joya de Los Lagos (December

17). The diagnostic is based on the Travel and Tourism Competitiveness Index (TTCI), produced by

the World Economic Forum (WEF). Its objective is to measure the factors and policies that make

destinations a viable place to invest within the travel and tourism sector.

The diagnostic will contribute to steering the tourism district strategy and helping stakeholders in

ascertaining which factors help them to gain advantages over rival destinations in order to attract a

greater number of visitors and, therefore boost revenue, thus contributing to overall economic

development and the well-being and prosperity of the local population.

Destination Management Organization (DMO) Atlántida

This quarter, TMS and DMO Atlántida successfully completed a strengthening and improvement

plan for their promotional website (https://visitatlantida.com/) to increase their capability to

manage and direct tourism development.

https://visitatlantida.com/



16

COMPONENT 3:

ENTREPRENEURSHIP

This quarter, TMS leveraged its alliances and made significant progress towards

promoting the entrepreneurship ecosystem, the digitalization and scaling of ICT solutions,

strengthening business development service providers, and increasing access to seed, risk and

impact investment capital. Additionally, TMS attended and presented at FLIICAC 2019, enhancing

and connecting alliances to further TMS goals.


E-Commerce for All – SUBE Latinoamérica The training module of the comprehensive e-commerce Learning Management Systems platform

(LMS) was completed by SUBE LA. The platform was successfully installed in the first three (3)

business development service providers, CDE Región Lempa, CDE Región Occidente, and the

Chamber of Industry and Commerce from Puerto Cortés and Omoa (CCIPO).

The first module is a seven-course train-of-trainer program where business advisors learn how to

facilitate the usage of a payment platform and e-commerce tools to local SMEs. To date, 30

technical advisors have been certified on the platform. The goal of the partnership is to certify 100

business advisors on target areas. This certification also provides advisors the technical skills to

generate a revenue as a FINTECH advisor. Moreover, this new service also represents a revenue

stream for business development institutions through a fee-based mechanism as SMEs sign up for e-

commerce services.

Additionally, six (6) new business development providers signed contracts to become part of the

program next quarter, including Real Ledge Honduras, CDE Sta Bárbara, Junior Achievement

Honduras, Fundación Nacional para el Desarrollo de Honduras (Funadeh), CRS Partners and the

Chamber of Industry and Commerce of Atlántida (CCIA) from USAID’s DO1 and DO2 zones.

The second course will prepare business service providers in topics like basic business concepts,

introduction to online sales and tools, digital strategies, and online payments, amongst various other

topics. These institutions will assist dozens of SMES in their regions to implement these new

financial technologies.

The course is available here: https://academia.sube.la/. User: [email protected]. Password:

test1234

An Enabling Business Environment for FINTECH – Central Bank of Honduras This quarter, TMS made progress as the technical secretariat of the Financial Innovation Table

(MIF), chaired by the Central Bank of Honduras (BCH), and including the National Bank and

Insurance Commission, the IADB, the Honduran Association of Banking Institutions (AHIBA),

three national banks (Ficohsa, Promerica, and Atlantida), and two private sector FinTech users

(Tigo Honduras and TENGO).

The MIF received the first part of a seven-month assessment of 22 national fintech services

commissioned by the IADB. The study provides a complete fintech ecosystem stakeholder map, the

business segments with most concentration of Honduran fintech companies, an analysis of the

current state and the evolution of Honduran fintech companies and the investment in the sector.

TMS facilitated two (2) workshops among MIF members to discuss recommendations provided by

the study about functions and roles of MIF members.

https://academia.sube.la/

mailto:[email protected]



17

TMS also hosted the second official meeting of the MIF

on December 3. During the meeting, members agreed on

the main objectives for the 2020 workplan, and working

groups were formed around topics such as: access to the

Credit Information Center managed by the National

Bank and Insurance Commission (CNBS); legalization

of the electronic signature for securities and

commercial-financial contracts; an incentive-based

system between banks that encourages the growth of

electronic transfers versus cash and check payments; and

expansion of electronic wallets in the country.

Additionally, during the meeting, TMS, BCH, and the CNBS agreed on the terms of reference for

two additional consultancies that will complement the IADB-funded assessment. These consultancies will focus on two major topics: the digitalization of traditional financial channels in

Honduras, and a revision and suggested adaptations of the national fintech regulatory framework.

MSME Incubation and Acceleration - Chamber of Commerce and Industries of

Choloma (CCICH) During the quarter, CCICH completed the baseline diagnostic of 30 anchor firms from the

municipality of Coloma. The study identified the demand for products and services these firms have

and can be satisfied by local SMEs. Some of the findings include: 62 percent of this demand is

currently outsourced from outside the area, which confirms the big opportunity that this partnership

is addressing; all firms confirmed a willingness to include local SMEs in their supply chains but

they have not done so in the past for lack of information; 63 percent of firms do not have a supplier

development mechanism (this represents an opportunity for CCICH as a service provider); and most

firms maintain a 10-year average relationship with their suppliers.

The results of the study will feed into the SME selection criteria for the Cultivation and Supply

Chain Development phase of the program, which is scheduled to begin in February as follows:

• TMS and CCICH recruit at least 170 SMEs in four cohorts

• CCICH provides incubation to these firms and selects the best 45

• TMS and CCICH provide specialized cultivation to the 45 selected SMEs and link them with

anchor firms

The cultivation phase guides anchor firms through a process of business-oriented mentality, product

differentiation, and better understanding of their business model. Key hands on activities like

development of negotiation abilities, personal development, enterprise introspection, cultivating

business relationships, and creating impact in the community, guide entrepreneurs through a path to

scale their businesses.

Additionally, CCICH completed its own institutional strengthening plan through a weeklong

(December 16-20) analysis session. The plan is comprised by a new theory of change,

organizational restructuring, and updated programs and services focused on the needs of their

affiliates. New tools for monitoring, evaluation, learning and innovation are being co-created with

TMS and CCICH will add a knowledge management component to all their programs in order to

create manuals and guides for all their technical staff and external consultants.

Presentation of the main objectives for the

2020 workplan



18


Central American and the Caribbean Impact Investment Forum 2019 -

FLIICAC 2019 This quarter, TMS attended FLIICAC 2019 and facilitated the participation of 12 Choloma SME

owners and three (3) CCICH technical staff, which took place November 13-14 in Antigua,

Guatemala.

FLIICAC is the largest regional impact investment space that brought together more than 700

leaders from over 35 countries to weave business routes towards sustainable development. During

this event, 60 investors from various regional and international funds gathered, representing more

than $2 billion in assets as well as participants from a variety of sectors: investors, entrepreneurs,

financial organizations, SMEs, corporate leaders, public sector, etc.

TMS, in collaboration with Alterna (the

forum organizer), created a special agenda

for Choloma participants to begin to deepen

their focus on inclusive supply chains.

Honduran participants had a personalized

workshop, one-on-one sessions with expert

consultants, and access to all forum

sessions.

TMS also presented at the FLIICAC 2019.

TMS was invited as speaker to share views

and experiences on public-private

partnerships, migration, job generation and

impact investment. Panels with TMS

representation included: “Impact investing, a solution to migration challenges”, focused on how,

beyond a humanitarian response, mitigating migration requires systemic solutions to boost

employment, economic opportunities, and self-sufficiency and how investing in migrants has the

potential to catalyze long-lasting and much-needed responses to the current crisis by leveraging

capital to address the root causes; and “Understanding and tackling the migration challenge from a

systemic perspective”, which addressed how

systemic collaborations can strengthen market

solutions that generate positive impact on a large

scale, mitigate migration, and create opportunities

for vulnerable groups.

TMS had a chance to share its approach and

experience with a regional audience and to bring

attention to what’s happening in Honduras and

the investment opportunities that exist in the

country. These activities feed into TMS´s

Entrepreneurship Component´s Systemic Change

Objective 1, which focuses on facilitating ecosystems in Honduras to learn, connect and interact

with ecosystems in other countries, to position Honduras at a regional level and to recognize local

talent.

The full Honduran delegation present at the FLIICAC 2019 included 31 representatives (more than

all the previous four years combined) from local institutions like Impact Hub Tegucigalpa, SICSA,

sharing the experience of bringing

investment opportunities to Honduras

Choloma SMEs owners focused on the workshop



19

Naranja Republik, Fondo CACEIF of Banco Lafisse, the Choloma Chamber of Industry and

Commerce, Thinkers and Makers, and various other entrepreneurs.

Honduran Delegation in the 5th edition of the Latin American Impact Investment Forum

, CEO of Raíz Capital explaining

how to transform urban core into ecosystems of

opportunity

Senior IADB Lab specialist, do presenting the

Naranja Republik project to the regional entrepreneurial

ecosystem



20

COMPONENT 4: BUSINESS ENABLING ENVIRONMENT

This quarter, TMS continued to make progress in San Marcos de Ocotepeque and La

Ceiba towards its goal to address key bottlenecks and streamline administrative processes. TMS

also supported the current public-private dialogue to debate legislation and reforming of existing

and laws to increase Honduran competitiveness.


Facilitating a Private Sector-Driven Tax Reform – COHEP Specialist a fiscal policy expert consultant with 20 years of experience

designing and advising tax reforms in Latin America, completed the analysis commissioned last

quarter by TMS of the Honduran tax regime.

The study involved a technical investigation, based on a thorough review of the Honduran tax

system, particularly its configuration and performance, both at the level of the regulatory

framework and the tax administration. At the same time, the study analyzed draft tax reforms

prepared by COHEP in order to contrast them with the following objectives: a) achieving greater

economic growth, b) guaranteeing fiscal sustainability, and c) improving tax equity. A third element

of the study included an estimation of impacts of the reform in three areas, improvements to the

collection system, economic growth, and improved redistribution of taxes. Additionally, the tax

code analysis was benchmarked against similar countries in the region who score much higher on

the Ease of Doing Business index. The research included documentary analysis of existing laws,

regulations, working documents of public institutions, international organizations and research

centers. It also involved interviews with the main actors of the Honduran economy and public

finances.

The study specifically identified that reforms are needed within the Income Tax Law (ISR), Sales

Tax Law (ISV), and within municipal taxes, among other laws and regulations. The analysis was

submitted to COHEP for review the first week of December and final comments are expected in

January 2020.

The purpose of this effort between TMS and COHEP is to offer a new tax regime to promote the

economic activity of large, medium and small companies, as well as to attract national and foreign

investment, in addition to creating consistency with the country's promotion of policies in tax

matters. By improving the legal framework surrounding taxes, it will encourage investments and

create more and better jobs nationwide.

Promoting Inclusive Investment – National Investment Council (CNI) Expert consultant , an economic growth professional with 15 years of experience on

integrated and evidence-based approaches to regional competitiveness, legal and regulatory policy,

trade and investment promotion, completed drafting a new legal framework proposal for agro-

industrial parks in Honduras.

The study analyzed current legislation through interviews and secondary document review of the

benefits of an agro-industrial park for Honduras. Further, the document also provides a new bill

specifically to promote agro-industrial parks, which is now under review by CNI. An analysis of the

economic and social impact of the new Agribusiness Law, its limitations and its opportunities for

the country, was also completed. TMS is providing technical assistance to CNI so that it can review



21

and present the analysis to the local key actors (both public and private) and engage in discussion

about the law. Once the law is finalized under CNI, it will be presented to the National Congress for

discussion.

As a result of steady population growth and increased migration, there is a growing need to promote

the reform of several laws and regulations to positively impact national competitiveness as well as

to negotiate the installation of agro-industrial parks in Honduras. Honduras has a highly competitive

textile maquila sector but has not been able to replicate similar success in the promotion of agro-

industrial parks. These parks have huge potential to generate jobs and investment in the region, and

TMS is supporting CNI in the analysis of a framework to make the parks a reality.

Streamlining Land and Property Registration-Chamber of Commerce and Industries of Tegucigalpa (CCIT) The TMS alliance with CCIT is working to make property registration more efficient and

transparent within the district of Francisco Morazán. Currently, eight (8) property registration

centers operate across the district, each with unique processes, fees, regulations, and resources. As

property registration is a necessary step to perform legal business operations, a reform to these

centers and processes will help current SMEs formalize their businesses and further attract outside

investment to the region. Specifically, CCIT will centralize and consolidate operations of the eight

centers, streamlining and making more efficient the registration processes and therefore the

business environment in the region.

This quarter, Business Law Partners (BLP) completed the feasibility study commissioned by TMS

last quarter. The study includes a diagnosis of the current state of the National Property Institute's

(IP) eight associated centers in Francisco Morazán, Comayagua, Siguatepeque, La Paz, Marcala,

Yuscarán, Danlí, and Juticalpa, and an evaluation of the gaps between the ideal standard of

operation and their current installed capacities (infrastructure and human resources). The analysis

included gathering detailed information on each step of the property registration process at each

center, identifying points of entry to improve and reduce the processes, the required information for

the execution of the consolidation in consideration of the new contracts that must be made, as well

as the stages for the transfer of the administration and the required legal reforms. The study was

accepted and approved by the CCIT and IP in December 2019.

A transition plan has been proposed which includes step by step actions CCIT needs to take to grow

and merge functions and people, and a target schedule to implement service changes. With this

information, CCIT will do a financial feasibility study that will complement the final decision on

when and how to merge the eight centers.

Simplification of Municipal Processes – Association of Honduran Municipalities

(AMHON) This quarter, the TMS alliance with AMHON made progress in three areas: the simplification of

municipal administrative processes, the creation of the municipal competitiveness strategic plan,

and the review of the municipal arbitration plan.

TMS and AMHON conducted three events for the inception of the local economic development

agenda (Nov 5-7, Nov 12-14, and Dec 2-5) which took place in La Ceiba, with a total of 72

participants from the technical and tourism unit, the environment management division, and

members of the Municipal Business Committee. In total, of the three events, there were 47 women,

25 men; 17 between the ages of 18-30, and 55 between 31-60. Two events took place in San Marcos

de Ocotepeque (Nov 6 and Dec 20) with a total of 26 participants representing municipal employees



22

and authorities, technical teams, an accountant, a municipal auditor, a cadaster service, purchasing

and contracting members, the municipal secretary and members of the Municipal Corporation.

There were 26 participants, 9 women, 17 men; 9 between the ages of 18-30, and 17 between 31-60.

Another event was held in La Ceiba, Atlántida (Dec 17) with a total of 11 participants including

municipal employees; 5 women, 6 men; 2 between the ages 18-30 and 7 between 31-60.


TMS provides support for the dialogue between COHEP and AMHON On November 26, the Honduran Council of Private Enterprises (COHEP) and the Association of

Municipalities of Honduras (AMHON) elevated their newly reinitiated dialogue to identify

strategies that will improve the overall business environment and promote competitiveness

nationally, by signing an agreement to materialize the operation of the MOU, established in Q3

2019. The two organizations will now meet on a monthly basis to formally negotiate how to

streamline and reduce municipal taxes. The dialogue is based on the research carried out by

AMHON and TMS in the municipalities of San Marcos de Ocotepeque and La Ceiba.

COHEP and IIES Continue 2019 Market Systems Diagnostic Roadshow COHEP, and the Economic and Social Research Institute (IIES) of the National University of

Honduras, led five days of focus groups with the Chambers of Commerce of Tegucigalpa, La Ceiba,

San Pedro Sula, Choloma and Santa Rosa de Copán (September 21-26), focusing on in-depth

discussions about a shared understanding of what variables drive enterprise competitiveness,

resilience and inclusion.

Socialization with municipal actors on the processes to redesign and simplify, in San Marcos, Ocotepeque.

Entrepreneurs in La Ceiba discussing competitiveness

issues with COHEP

President of the Chamber of Commerce

and Industry of Cortes, talking about the importance of the

Market Systems Diagnostic results



23

The behind-the-scenes achievements of this phase of dissemination of the 2019 Market Systems

Diagnostic are threefold: A) COHEP’s Sustainable Enterprises team (one of the most important

technical teams within COHEP) joined the roadshow, thus opening the possibility to leverage

information they gather on an annual basis from other surveys in 2020. B) It was the first

opportunity for the research teams at UNAH and COHEP to utilize focus group methodologies,

which will equip them with valuable participatory and qualitative know-how. C) Through the focus

groups, multi-level windows of collaboration opportunities opened between UNAH, COHEP and

the chambers of commerce, as well as the Honduran Association of International Cargo Agencies

(AHACI), the Deputy Mayor of Choloma, and the Business Development Center in Santa Rosa de

Copán.


Quarterly Report October – December

2019

24

SOCIAL INCLUSION, ENVIRONMENTAL COMPLIANCE AND COMMUNICATIONS

SOCIAL INCLUSION

During the period, TMS Component Leaders were trained on how to motivate self-recognition of

vulnerable populations in response to the need for improving the activity’s data collection. In

addition, a two-pager was developed to raise awareness among partners of the importance of

making vulnerable groups visible within their business practices, encouraging particular recognition

of diverse groups and minorities.

Measuring TMS impact in these groups is important to ensure that all individuals succeed in the

long term. Inclusion and diversity further bring diversity of thought, experiences, ways of doing

things, and ideas that enrich any business. Diversity leads to more creativity and innovation by

representing a broader spectrum of human perspectives to enhance understanding of specific

problems.



2019

25

Additionally, TMS celebrated the International Day for the Elimination of Violence against

Women, or, International Day of No Gender Violence, which is commemorated annually on

November 25 to denounce violence against women by men around the world and to encourage

countries for its eradication. TMS joined this campaign by sharing the accompanying infographic

that invited the TMS team, partners, stakeholders, and friends to prevent and combat any kind of

violence against women.



2019

26

ENVIRONMENTAL COMPLIANCE

During TMS monitored implementation of the environmental monitoring and mitigation plan

designed with EFI Solutions’, specifically in Belén, and Gualcinse. TMS was able to verify

compliance with organic production in Belen, application for MABA GROWN certification, and

correct installation and operation of the cardamom dryer.

In Gualcinse, TMS verified the installation and operation of the lemon grass oil distiller.



2019

27

Crisis Management Manual in

Tourism Sector

Statistical Analysis of Crime in Honduras and its Impact on the Tourism Industry

Diagnosis of Crisis Management and

Communication Management

Brochures Portfolio of Social Investment

Opportunities Honducafe promotional coffee

samples

COMMUNICATIONS

TMS supported partners during the quarter on the development of promotional materials and

organization of workshops.

TMS was also actively involved in the planning and design of the Merchant Marine Gente de Mar

Program launch, by creating informative and official banners, brochures and a video, which

highlighted the multi-stakeholder cooperation of the Ministries of Tourism, Labor, and Investment,

the National Workforce Training Institute, and the Merchant Marine. The materials have been

widely used by government officials in Honduras and abroad.

https://acdivoca.sharepoint.com/:v:/s/Intranet/projects/honduras/tms/EapkWNo7HbFFuExe

sczrRJkB8cXcmt17ieNcFvVQ_tLcug?e=AEycOv

https://acdivoca.sharepoint.com/:v:/s/Intranet/projects/honduras/tms/EapkWNo7HbFFuExesczrRJkB8cXcmt17ieNcFvVQ_tLcug?e=AEycOv

https://acdivoca.sharepoint.com/:v:/s/Intranet/projects/honduras/tms/EapkWNo7HbFFuExesczrRJkB8cXcmt17ieNcFvVQ_tLcug?e=AEycOv



2019

28

USAID Featured in Principal Panel of the 2019 Central America Donors Forum (CADF). Migration in Latin America is a symptom of deeply rooted problems such as

extreme inequality, poverty traps, and structural obstacles to long-term prosperity. These challenges

are compounded by the new uncertainties and complexities of the fourth industrial revolution. To

address these issues, USAID, through the TMS Activity, promotes public-private alliances to

accelerate job creation for youth in Honduras. Three of these alliances were presented in a panel

called “Tackling the Impossible: Creating Economic Opportunities That Incorporate New Methods

of Public-Private Partnerships” at the CADF in Tegucigalpa, October 23. The panelists were

USAID/Honduras Mission Director ; the Honduran Minister of Tourism,

; Interamerican Development Bank Representative for Honduras, ; Nestlé

General Manager for Honduras, ; and Co-Honducafe Executive Director,

The Central America Donors Forum is the premier networking and learning space to advance

philanthropy and development efforts in Central America. Each year, the Forum brings together

over 400 leaders from business, philanthropy, government, and civil society to discuss priority

issues and successful models of development, and to explore co-investment for social impact.

Mission

Director USAID/Honduras. USAID’s high-level panel



2019

29

CADF participants also had the opportunity of joining a guided tour of one of TMS’s job creation

projects in Tegucigalpa, the urban revitalization of the city’s historical center and promotion of

creative industries. They heard from TMS partners SUBE LA and National Identity Museum (MIN)

about how their public private partnership has improved their institutions and community and how

these partnerships are key to scaling the projects in their influence regions.

USAID/Washington Officials Visit TMS Urban Employment Project. On

December 11, , the new USAID Country Desk Officer for Honduras, and

, Deputy Director, LAC’s Strategy & Program Office visited Casa Quinchón Leon, a

remodeled building turned into a vibrant entrepreneurship community. and

experienced the synergy of two TMS technical

components implementing complementary activities:

Entrepreneurship and Tourism, and Creative Industries. At

Casa Quinchón Leon, activities such as creative urban

planning and new forms of eFinance and eCommerce

entrepreneurship take place amplifying opportunities for urban

employment to curb migration.

“This combination of art, entertainment and digital innovation

is exactly what a city like Tegucigalpa needs to develop

attractive economic opportunities for young people, foster

their roots and instill pride for their city.” -

iDE’s Senior Director of Impact & Analytics.

Chris Nicoletti



2019

30

SECTION IV: MONITORING, EVALUATION AND LEARNING

MONITORING & EVALUATION SYSTEM

In this quarter, the TMS ME&L team completed the coding and analysis of the contribution analysis

for the FY2019 Annual Report and Public Private Partnership Report. This was the first in a series

of internal evaluations to establish contribution by TMS to system-level changes. This first iteration

answered the evaluative question “Did TMS make a difference with our partners, through its co-creation processes, other than what would have happened in the absence of TMS support?” The

next iteration, to take place in Q4 of 2020, will establish contribution to changes identified in the

planned outcome harvest in Q3 of 2020.

In December, the TMS ME&L team completed a sentinel study of the tourism enterprise Web

presence and social media Training

outcomes as a result of the web presence and social media training conducted by TMS and

CANATURH from June to August of 2019. The study included sentinel indicators that serve as a

“canary in a coal mine” to assess whether interventions are on track towards achieving desired

results. The summary findings are presented in Annex III. The analysis is being shared with

CANATURH and the tourism component leader to inform learning and adaptation of future

interventions in online reputation management.

Seven partners collected and submitted participant

registration and participation data through TMS's

electronic data reporting system in this quarter. Six

partners manage data collection through KoBo Toolbox

accounts. One partner collects and reports data through

Excel-based forms. To manage timely and accurate

reporting among a diverse portfolio of partners requires

an electronic data management system. The TMS ME&L

team has provided training to nine partners in how to

collect and manage electronic data collection.

Together with COHEP and UNAH, TMS began coding

of focus group discussions for the Market Systems

Diagnostic. TMS and MESCLA supported training of these partners in qualitative analysis

techniques. The coding validated and provided context to existing variables identified, and further

resulted in the discovery of more than 20 new variables. Most of these variables emerged across

multiple regions and multiple discussion tables on competitiveness, inclusion and resilience. The

final report of findings will be completed in Q2 of 2020 and will inform the selection of indicators for the enterprise survey.

In Annex IV is included the learning report for the year 2019 which covers learning from the launch

of pilot activities under Task Order No. 1. The annex includes an annual learning agenda for 2020

which focuses on priority learning themes related to the scale-up of activities and mechanisms for

systemic change. For TMS, continuous learning is critical to implement intentional and systematic

approaches that are based on a nuanced understanding of the market system and the changes the

Activity should seek to catalyze.

Choloma Chamber of Commerce and

Industries Team, training in data collection

through KOBO/ODK.



2019

31

COLLABORATION, LEARNING, AND ADAPTING

• In collaboration with MesoPartners and the USAID MESCLA Activity, TMS held a

Systemic Change Workshop in November with the TMS technical team. This workshop

helped to strengthen the team's understanding of systemic change by introducing concepts

from institutional economics and systemic competitiveness.

• EFI Solutions and TMS held a Pause and Reflect in December to evaluate interventions

taken to date, results achieved and future actions for the activity. The session reflected on

progress made with satellite companies, as alternatives to informal coyote intermediaries.

An increasing emphasis on food safety and quality certifications was identified to continue

to expand into export markets. Implications were discussed about what scaling of this

model would look like in the future.

• TMS participated in a Market Systems Learning Exchange with USAID Kenya and their

portfolio of Feed the Future Activities. In this exchange, TMS facilitated two sessions on

feedback and causal loop diagrams and market systems ME&L.

• TMS Featured in Principal Market links Seminar: Realities of Co-Creating with the Private

Sector. Co-creation with the private sector is a challenge, but essential to success in market

systems development activities. To address these issues, TMS Activity, presented a

successful and effective co-creation process, collaborating, learning and adapting (CLA),

market systems facilitation, and private sector engagement that will accelerate job creation

in Honduras. On November 20th in Washington, DC, a webinar organized by USAID

discussed how some of its activities shifting mindsets around co-creating with the private

sector, tailoring operational mechanisms, and leveraging partnerships to create change for

vulnerable populations. The presenters were TMS COP, ; USAID’s Feed the

Future Mozambique Agricultural Innovations COP, ; and USAID's Feed the

Future Uganda Youth Leadership for Agriculture COP,



2019

32

SECTION V: PROGRAM MANAGEMENT

Security As ACDI/VOCA prioritizes security for its staff and partners, , Vice President of

Global Risk Management and Office Operations at ACDI/VOCA Headquarters visited Honduras

November 3-7, 2019 to conduct a security assessment and provided the operations team with action

items. The checklist covered: 1) ongoing security intelligence, 2) updated TMS’ Security Risk

Management Policy including current office security measures, in-country travel/road protocol,

“phone tree”/WhatsApp protocol, and the Security Focal Point roles and responsibilities, 3) provide

sample briefing on travel risk for external travelers, 4) recommendation to engage security

consultant to draft crisis management and contingency protocol, incorporating a TMS security

management team (SMT).

Staff Field Office Operations Director, presented her resignation, effective December

31, 2019 given the uncertainty of project funding. TMS has found a temporary replacement for

to ensure that all project activities and operations continue without disruption.

was in Honduras for 2 weeks in December working with on a transition plan

and is slated to return to Honduras to provide temporary support to TMS early 2020.

Partners The only remaining critical staff extended under subcontractor LINC is ,

Systems and Learning Analyst, who was retained to provide support the MEL team and is expected

to support the project until early 2020.

Program Management TMS team is organizing a scaling strategy workshop for the first week of January 2020. The session

will bring together component leads and operations team to identify initiatives or approaches that

are ready to be scaled in 2020 and develop strategies to take each initiative to scale and plan

different scenarios of systemic change.

This quarter, TMS fielded one (1) administrative short-term assignment as follows:

No. Staff Date Assignment

1

December 2-14,

2019

Provide administrative supervision and assistance to the TMS

team with annual project programming and budgeting, as well

as discussing further upcoming descaling actions.

 



2019

33

VAA TOUR EMP BEEAction

ReasearchTOTAL

COMPLETED 0

IN CO-CREATION 2 2 1 1 6

IMPLEMENTATION 5 7 3 5 2 22

PENDING USAID APPROVAL 1 1 1 3

8 10 5 5 3 31

PENDING USAID APPROVAL

IN COR REVIEW 0

IN EMMP REVIEW 0

IN DUE DILIGENCE REVIEW 1 1 1 3

VAA TOUR EMP BEE Action

Reasearch

2 2 11

5 73 5

2

1 11

DECEMBER 2019

COMP LETED IN CO-CREATION IMPLEMENTATION PENDING USAID APPROVAL


Reasearch

11

5 6

1

4 1

1 2

3

SEPTEMBER 2019



Reasearch

1 1

5

2

1

2

62

4

1

JUNE 2019


CONTRACTUAL DELIVERABLES

TMS submitted two contractual deliverables, the TMS 2019 Annual Report, and the Public Private

Partnership Report for Fiscal Year 2019. No approvals for contractual deliverables were received

from USAID during the quarter.

PARTNERSHIP AND INNOVATION FUND (P&IF)

Continuing with the co-creation process, TMS worked with partner organizations to develop

improved supply chain relationships, more effective tourism management, stronger

entrepreneurship and institutional ecosystems, and an improved business enabling environment,

aiming at maximum job creation. TMS closed the quarter with 31 in its portfolio, 22 of which are

under implementation as follows:



2019

34

SECTION VI: LOOKING FORWARD

The most salient activities planned for the following quarter are:

❖ Start documenting lessons learned and impact of TMS’s strategic agricultural partnerships and

new supply chain business model

❖ Organize the first fact-finding investment trip of 2020, with a specific focus on the agropark

model

❖ Initiate design of a transaction unit to facilitate DFC financing in Honduras

❖ Conduct a review of the training curricula of TMS partners’ Marina Mercante and Naranja

Republik (through creative schools)

❖ Initiate the job placement phase for temporary workers and seafarers selected by Apollo Group

and Practical Employee Solutions

❖ Initiate design of second-phase FAAs with COHEP, CNI, and AMHON

❖ Receive the final report of the analysis and recommendations to reform the national system of

food and animal safety

❖ UNAH students from five university campuses - Tegucigalpa, Comayagua, Santa Rosa de

Copan, San Perdo Sula and La Ceiba - will conduct the enterprise survey for the 2020 Market

Systems Diagnostic as part of their economic practice requirements for their degree

❖ The National Tourism Chamber will upgrade their national tourism registry database and data

management systems with the support of TMS, as a first step in strengthening Honduras

tourism monitoring system to generate needed data needed to measure impact

❖ Partners will be introduced to logic model training by TMS, including instruction on diverse

methods to help plan, evaluation and communicate their program interventions

❖ Conduct at least three environmental compliance reviews with TMS implementing partners

❖ Design a gender and social inclusion training course for TMS partners

❖ Conduct inclusion workshops with partners Co-Honducafe, CANATURH, Marina Mercante

and COMSA

❖ Ensure a smooth transition and coverage within the Operations team through

STTA in country

❖ Address action items and recommendations from the security check-list provided by

ACDI/VOCA's head of Risk Management



2019

35

SECTION VIII: FINANCIAL INFORMATION



2019

36



2019

37

ANNEX I – TMS IN NUMBERS NUMBER OF PARTICIPANTS BENEFITTING FROM TMS ASSISTANCE



2019

38



2019

39

PERCENTAGE OF DIRECT BENEFICIARY PARTICIPANTS FROM VULNERABLE GROUPS



2019

40

AMOUNT OF CAPITAL LEVERAGED (IN USD) AS A RESULT OF USG ASSISTANCE

ing Market Systems Activity

Report October – Decem

41

ANNEX II –

COMMUNICATIONS

CLOSING THE

GENERATIONAL

GAP Mezapita, Honduras – Two entrepreneurs’ partner to produce

cardamom, increase their income, and generate local employment.

describes himself as “a man of a thousand uses.” He began working with a

machete at a very early age in his native Santa Barbara, 140 miles northwest of the Honduran

Capital, Tegucigalpa. His repertoire of skills translated perfectly to farming, where he has witnessed

the possibilities and the uncertainties that come with agriculture in Honduras. In his formative

farming years tried to grow the spice, cardamom. Although not a very well-known crop, he

soon became passionate about it: “I don’t know if it was its' strong taste, the unique fragrance, or the baffling concept that something that I could grow in the soil could later become one of the most

expensive spices in the world, but the truth is, I was hooked to cardamom the moment I saw it.”

Unfortunately, after a difficult first attempt to grow and sell the crop, the market was not yet viable

to support cardamom sales and he had to table his passion so he could make a living; " I decided to

move to the city ... to San Pedro Sula, where I worked every possible job available" he says.

In 1998, resolved to give cardamom another chance. He acquired a small farm in Mezapita,

some 86 miles further northwest of San Pedro Sula. He worked relentlessly to make cardamom a

success, but after a few years, the market still proved unready and he had to once again delay his

dream, “I lost everything I had invested, I had no other choice, so I moved to the United States, there was no other way out.”



2019

42

began a long journey that took him to Houston, then to Miami, and later to New Orleans,

working in several different positions in the construction industry, but he couldn’t shake the idea

that he could make cardamom a success in Honduras. In 2011, he was determined to return home

and cultivate cardamom in Mezapita once again.

UNLIKELY PARTNERSHIPS is the only child of a family of farmers in Mezapita. At just 16 years old he

was gifted 6 acres of land with which he needed to make a living as his family could no longer

support him. While the odds were against him to succeed, and his family unable to provide much

help, his father was able to make a crucial connection for him. He introduced him to ,

trusting that his extensive experience and age would benefit , particularly in dealing with

seasoned workers at the farm.

as he calls him, put his love for cardamom to work, and he and entered the spice

business together. The first harvest was difficult, prices were very low, and it was hard to deal with

intermediaries, but hard work and knowledge began to pay dividends, "we were

together in the good and the bad…and together we begin to see profit from our work."

In 2019, and were invited to join a revolutionary new business model implemented by

EFI Solutions, a Honduran company dedicated to the export of raw materials for the cosmetics,

food and aromatherapy industries. Through an alliance with the USAID/Honduras Transforming

Market Systems Activity, EFI is strengthening satellite enterprises to make technical assistance,

financing, and post-harvest processing locally available in remote areas, which gives farmer groups

a better chance to be part of high-end export value chains.



2019

43

Through this new venture, and

have not only expanded their land

cultivated with cardamom but have

formed a microenterprise that is

facilitating the trade of 8 tons of

cardamom per harvest season (September

to February), for 58 local farmers, who

in-turn generate over 140 jobs. Saul

reports that cardamom is a better crop

than coffee because it requires less

maintenance and yields better and more

stable prices. With this new business

model, cardamom is a real and tangible

opportunity for people to build a new future in Mezapita.

EFI Solutions is the source manager of Nelixia-Firmenich, a company based in France that supplies

companies such as Loreal, Givadau, and Naturex.



2019

44

TMS IN THE NEWS

The following links correspond to news, articles, and social media featuring TMS during the

quarter:

• https://www.laprensa.hn/economia/1321729-410/empresas-m%C3%A1s-j%C3%B3venes-

fueron-las-m%C3%A1s-rentables

• https://www.devex.com/news/q-a-idb-takes-a-tech-focused-approach-in-honduras-95963

• https://presidencia.gob.hn/index.php/gob/el-presidente/6416-presidente-hernandez-

sanciona-ley-de-contratacion-de-hondurenos-en-cruceros

• https://www.latribuna.hn/2019/10/08/presidente-hernandez-sanciona-ley-de-contratacion-

de-hondurenos-en-cruceros/

• https://www.laprensa.hn/economia/1333642-410/uth-desarrollara-primer-festival-

economia-naranja-honduras

• https://www.laprensa.hn/premium/1331813-410/honduras-acuerdo-migratorio-estados-

unidos-20000-visas-seran-ocho-meses

• https://www.laprensa.hn/honduras/1333370-410/casa-presidencial-estados-unidos-visas-de-

trabajo-hondurenos

• https://www.laprensa.hn/honduras/1332419-410/preseleccionan-primeros-3100-

hondurenos-trabajar-estados-unidos

• https://www.laprensa.hn/honduras/1333882-410/200-empresas-eeuu-interesadas-contratar-

mano-obra-hondurena

• https://twitter.com/ArFB/status/1194284497044459522

• https://twitter.com/dana_deree/status/1195727479094288385

• https://twitter.com/StrabajoH/status/1195473620480462848

• https://twitter.com/usembassyhn/status/1195872091209371648

• https://www.latribuna.hn/2019/11/01/honduras-le-apuesta-al-turismo-de-congresos-con-

certificacion-opc/

• https://www.laprensa.hn/sanpedro/1330602-410/certificaran-25-empresas-turismo-honduras

• https://www.latribuna.hn/2019/10/31/canaturh-fortalece-turismo-de-reuniones/

• https://hondudiario.com/2019/10/30/potenciaran-25-empresas-de-turismo-con-certificacion-

internacional/

• https://www.marketlinks.org/event/marketlinks-seminar-realities-co-creating-private-sector

• https://www.laprensa.hn/economia/1336502-410/trabajadores-empresas-emigran-empleo-

honduras

https://www.laprensa.hn/economia/1321729-410/empresas-m%C3%A1s-j%C3%B3venes-fueron-las-m%C3%A1s-rentables

https://www.laprensa.hn/economia/1321729-410/empresas-m%C3%A1s-j%C3%B3venes-fueron-las-m%C3%A1s-rentables

https://www.devex.com/news/q-a-idb-takes-a-tech-focused-approach-in-honduras-95963

https://presidencia.gob.hn/index.php/gob/el-presidente/6416-presidente-hernandez-sanciona-ley-de-contratacion-de-hondurenos-en-cruceros

https://presidencia.gob.hn/index.php/gob/el-presidente/6416-presidente-hernandez-sanciona-ley-de-contratacion-de-hondurenos-en-cruceros

https://www.latribuna.hn/2019/10/08/presidente-hernandez-sanciona-ley-de-contratacion-de-hondurenos-en-cruceros/

https://www.latribuna.hn/2019/10/08/presidente-hernandez-sanciona-ley-de-contratacion-de-hondurenos-en-cruceros/

https://www.laprensa.hn/economia/1333642-410/uth-desarrollara-primer-festival-economia-naranja-honduras

https://www.laprensa.hn/economia/1333642-410/uth-desarrollara-primer-festival-economia-naranja-honduras

https://www.laprensa.hn/premium/1331813-410/honduras-acuerdo-migratorio-estados-unidos-20000-visas-seran-ocho-meses

https://www.laprensa.hn/premium/1331813-410/honduras-acuerdo-migratorio-estados-unidos-20000-visas-seran-ocho-meses

https://www.laprensa.hn/honduras/1332419-410/preseleccionan-primeros-3100-hondurenos-trabajar-estados-unidos

https://www.laprensa.hn/honduras/1332419-410/preseleccionan-primeros-3100-hondurenos-trabajar-estados-unidos

https://twitter.com/ArFB/status/1194284497044459522

https://twitter.com/dana_deree/status/1195727479094288385

https://twitter.com/StrabajoH/status/1195473620480462848

https://twitter.com/usembassyhn/status/1195872091209371648

https://hondudiario.com/2019/10/30/potenciaran-25-empresas-de-turismo-con-certificacion-internacional/

https://hondudiario.com/2019/10/30/potenciaran-25-empresas-de-turismo-con-certificacion-internacional/

https://www.marketlinks.org/event/marketlinks-seminar-realities-co-creating-private-sector



2019

45

SENTINEL STUDY WEB PRESENCE AND SOCIAL MEDIA TRAINING

BEHAVIORS ADOPTED BY ENTERPRISES

NETWORKS AND ALLIANCES CREATED

SNAPSHOT OF SOCIAL MEDIA AND WEB USE

SAMPLE FRAME AND METHODOLOGY

SENTINEL INDICATOR RESULTS

191 Participants in Training

* 30 participated both modules

59 Sample Size

15% Non-response rate

50 Enterprises surveyed

……………………………………………Sample based on 90% Confidence Level and 10% Margin of Error

SAMPLE FRAME AND METHODOLOGY

Training Event Location Participants Sample

First

Module

Tela 22 6

San Pedro Sula 23 6

Tegucigalpa 1 23 6

Santa Rosa de Copán 15 4

La Esperanza 14 4

Second

Module

La Ceiba 20 5

San Pedro Sula 34 9

Tegucigalpa 2 24 6

Gracias 16 4

Total 191 50

Tour Operation

41 Trained

13 Surveyed

Lodging

71 Trained

24 Surveyed

Food Services

19 Trained

8 Surveyed

1

Support Functions

60 Trained

5 Surveyed

ANNEX III – SENTINEL STUDY - WEB PRESENCE AND SOCIAL

MEDIA TRAINING



2019

46



2019

47

SENTINEL INDICATOR RESULTS

6

86%

PERCENTAGE OF TOURISM ENTERPRISES

THAT ADOPTED ONE OR MORE BEHAVIORS

86% of interviewed enterprises responded that they adopted one or more web presence and social media behaviors. 14% of

enterprises reported a significant increase in number of customers since adopting these behaviors. 42% reported a slight

increase while 38% reported no change at all. 6% of respondents did not answer the question.

14%

42%

38%

0%

6%

A significant

increase

A slight

increase

No change A decrease No response

PERCENTAGE CHANGE IN NUMBER OF CUSTOMERS SINCE

ADOPTION BEHAVIOR (IF DID NOT ADOPT = NO CHANGE)

SNAPSHOT OF SOCIAL MEDIA AND WEB USE

N = 60

PERCENTAGE OF TOURISM ENTERPRISES WITH

SOCIAL MEDIA ACCOUNT (AS OF NOV 30, 2019)

Facebook continues to be the primary social media site used by tourism enterprises in the sample. The adoption of non-Facebook

social media platforms has not occurred yet for late majority and laggard tourism enterprises. Only half of enterprises have

referenced their geolocation on-line. Nearly two-thirds posted new content to social media platforms in the last month.

97%

47%

49%

54%

44%

61%

52%

Faceboook Profile

Instagram Profile

TripAdvisor Profile

Google M y Business

Website

New content in last month

GeoreferencedInnovators Early Adopters Early Majority Late Majority Laggards

7



2019

48

ANNEX IV – 2019 LEARNING REPORT

USAID HONDURAS TRANSFORMING MARKET SYSTEMS LEARNING REPORT 2019 AND LEARNING PLAN 2020

For the USAID Honduras Transforming Market Systems (TMS) Activity, continuous learning is needed to implement intentional and systematic approaches based on a nuanced understanding the market system and the changes TMS should seek to catalyze. The year 2019 marked the end of the Inception Phase of the TMS Activity and the launch of pilot activities under Task Order No 1. The learning report in Section 1 provides a summary of three core learning products from 2019 that respond to priority issues from the year. The learning agenda in Section 2 includes priority learning themes for 2020.

SECTION 1: LEARNING REPORT 2019 This learning report documents key learning from 2019 with respect to -

• Enabling TMS to maintain a systemic view and be able to discover and track system-level variables that allow the Activity to respond to emerging system dynamics, systemic constraints, unexpected contextual shifts and learning opportunities that emerge;

• Enabling TMS to manage adaptively in its partnerships through rigorous collection of evidence of its partnership processes, learning how to adjust in response to new information and continuing to improve its partnership approach to promote sustainability through local actors;

• Enabling TMS to identify and explore external contextual factors and/or shocks/stressors that have significant effects on beneficiaries and testing internal TMS monitoring ‘triggers’ and systems to understand these factors that emerge and the responses by local market actors.

Learning theme Learning Questions

Diagnosing Honduran market systems

What drives job creation by enterprise in Honduras? What are the variables that make up the foundation for broad-based, long-term economic growth in Honduras?1 Are Honduran market systems changing to become more (or less) competitive, inclusive and/or resilient?

TMS contribution through co-creation to changes within partners

Did TMS make a difference in the patterns of behavior of our partners through its co-creation processes, other than what would have happened in the absence of TMS support? Did the activity intervene and deliver co-creation as planned? Is there evidence underlying the assumptions of the theory of change for co-creation? Do stakeholders agree with the story (causal links) of the contribution of TMS via co-creation? What are the weaknesses and alternative factors in the story?

Exploring enterprise resilience capabilities to extortion

How does the system of extortion work in Honduras? What differential affects does extortion have on the performance outcomes of business (sales, jobs)? What are the potential areas of intervention to improve enterprise resilience capabilities in response to extortion?

1. DIAGNOSING HONDURAN MARKET SYSTEMS

1 Note: The foundation for broad‐based, long‐term growth was interpreted as the patterns of behaviors and market structures that result in increased sales, job creation, strengthened recovery and the hiring of persons from vulnerable groups thus combining systemic thinking with competitive/inclusive/resilient (C/I/R) framework.



2019

49

Learning Question(s) What drives job creation by enterprise in Honduras? What are the variables that make up the foundation for broad-based, long-term economic growth in Honduras? Are Honduran market systems changing to become more (or less) competitive, inclusive and/or resilient? Why was the question prioritized? Markets are complex – the factors that drive economic growth in one country are not necessarily the same that drive economic growth in another. There was a request by the USAID Honduras for understanding what these factors are and a method to assess system-level change in Honduras. Existing methods to measure these changes relied on secondary data or expert evaluations. The challenge with these approaches is that even with these data sources, different experts or audiences interpreted the data differently and there is little consensus on which variables mattered, much less how to influence those variables. In this context, TMS formed a partnership with a local university – the National Autonomous University of Honduras – and the leading private sector chamber – the National Council of Private Enterprise of Honduras – to establish a solution that would meet the needs of USAID as well as key Honduran public and private policy stakeholders which became the MSD. How was the data collected? In the quantitative section, TMS surveyed a sample of 616 enterprises from a population of micro, small, medium, and large enterprises across 9 departments in Honduras within the value-added agricultural and tourism sectors (95 percent confidence and <5 percent margin of error). The sample frame was representative across the enterprise functions (1) agroindustry (2) distribution (3) lodging and (4) tourism services. The critical functions for the sample frame were selected based on whether changes in behaviors or structures by those respondents would signal broader changes in the market system. In the qualitative section, TMS co-hosted a series of focus groups in 5 municipalities for 20-25 individuals from different profiles of business and government from the municipality. Participants were distributed in tables of 4-7 individuals to answer open-ended questions related to C/I/R such as “What factors have enabled your company to… hire more youth … recover after a shock, etc.” Participants were encouraged to provide stories of actual experiences they have had to relate to responses. Facilitators probed from a list of pre-identified variables from the quantitative survey, to dig into specific responses. How was the analysis conducted? In the quantitative section, linear and logistic regression models were used to assess the significance and predictability of different independent variables on job creation in Honduras. The statistical process applied was to test first for the strength in relationship between each variable using Spearman’s rank correlation. Variables that were statistically correlated were added to the regression model. A stepwise selection process was followed to remove redundant variables and identify the regression model with the highest fit (R-squared for linear regression or pseudo R-squared for logistic regression). In the qualitative section, all focus groups discussions were transcribed, and a code book of variables developed. Responses for coded based on dependent variable (C/I/R), independent variable (e.g. business confidence, access to services, etc.) and their relationship (+/-/?) and level of agreement. Codes were added for enterprise type, geographical location and sex of respondent. Additionally, recurrent groupings of independent variables within responses were identified. Data analysis was done in Excel. In both sections, TMS, COHEP and UNAH conducted the analysis together. To support this, TMS supported capacity building to these institutions in regression analysis, qualitative coding, etc.



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What were the key learnings? The quantitative analysis was able to identify 17 distinct variables that were predictive of competitive, inclusive and resilient market system results. The qualitative analysis was able to validate these 17 variables and find qualitative evidence for another 6 variables that were tested in regressions but had not proven statistically significant of results. In addition, the qualitative analysis revealed another 21 variables that were not tested in qualitative analysis but appear to be predictive. The qualitative analysis further revealed groupings of variables that may form part of structural dynamics but would need to be tested with different modeling techniques. The online, interactive PowerBi dashboards and published reports for the quantitative analysis are available on-line at http://cohep.com/sistemasdemercado/. The qualitative analysis report is forthcoming in January of 2020 and will be available at the same website. MSD variables related to business strategies emerged as the most evidence predictors of performance and include ICT adoption, the level of investment, business confidence, capacity utilization and the percentage of sales from product or service innovations. Cooperation indicators were correlated, but, surprisingly, not predictive of market system performance in quantitative analysis. Cooperation variables such as supply chain alliances and illegal competition from competitors emerged in the qualitative analysis, and thus need to be formulated as indicators and tested. Diversity indicators including enterprise size, enterprise age, rate of sales growth, ownership by persons from vulnerable groups, and the degree of confidence in finding alternative buyers in the event of a shock proved predictive in the quantitative analysis. Only one new diversity variable emerged in qualitative analysis. Connectivity indicators include the number of service types accessed by enterprises, capacity utilization and the percentage of external finance from the quantitative analysis. New connectivity variables emerged in qualitative analysis related to transport, municipal services (water, sanitation, etc.) and to skilled/trained workforce. Power/rule of law indicators such as change in market price and the number of government institutions interacted with by enterprise proved predictive in quantitative analysis. The most, new variables that emerged in qualitative analysis were related to power/rule of law; including, private sector representation in policy process, pequeñismo, investment climate, time/cost of regulations, tax rates, cost of energy, the image of the country and a variety of informal social norms related to women, youth and other vulnerable groups. How were these key learnings shared? TMS held a virtual launch of the diagnostic which included a live press conference and social media campaign featuring dashboard and the whitepaper. News features about the diagnostic have been shared in La Prensa, La Tribuna, TN5 and digital platforms such as Twitter, Facebook and institution websites. UNAH featured two town hall meetings with economics students and professors in Tegucigalpa and La Ceiba. The qualitative workshops featured a presentation of quantitative results in 5 municipalities. The diagnostic has been presented in two international conferences including the 2019 SEEP Annual Conference and the 2019 Market Systems Symposium. How was the learning used? First, the learning process itself has been used to reactivate the cooperation accord between UNAH and COHEP, for UNAH to test a new structure and gain credibility in economic investigation, for COHEP to facilitate dialogue with regional chambers (and their members) and to gain experience in investigation. The results of the learning have been used for at least one research product to date by UNAH on pricing power and a forthcoming study on ICT solutions for enterprises. COHEP has published the learning to their own website and used it in media pieces on issues affecting enterprises e.g. extortion/crime, etc. Efforts are underway to align this study with the ILO/Sustainable Enterprise Program and gather broader set of data to influence the strategic vision and align goals with COHEP and other partners. For TMS, this learning is used to update its theory of systemic change and generate evidence to validate its intervention areas. It should be noted the diagnostic is an iterative and adaptive

http://cohep.com/sistemasdemercado/



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process, with each year expected to yield new learning that will continue to influence and facilitate adaptation by the project. 2. TMS CONTRIBUTION THROUGH CO-CREATION TO PARTER-LEVEL CHANGES Learning Question(s) Did TMS make a difference in the patterns of behavior of our partners through its co-creation processes, other than what would have happened in the absence of TMS support? Did the activity intervene and deliver co-creation as planned? Is there evidence underlying the assumptions of the theory of change for co-creation? Do stakeholders agree with the story (causal links) of the contribution of TMS via co-creation? What are the weaknesses and alternative factors in the story? Why was the question prioritized? In TMS’s theory of change, the ‘how’ is as important as the ‘what’ because only by intervening in a way that is consistent with TMS guiding principles, is it hypothesized that broader systemic change i.e. more competitive, resilient and inclusive market systems that sustainably increase economic opportunities, etc. can happen. TMS has designed a co-creation partnership process to encourage a set of reactions and behaviors among partners – influential stakeholders in the system - that will in turn lead to improved market system performance. The question was prioritized to evaluate TMS’s contribution to those behaviors by partners as a result of co-creation. This was intended to help TMS plausibly associate the outcomes at the level of our co-creation partners with TMS’s adherence to its implementation principles and to help TMS adapt its co-creation processes to better achieve its performance results. How was the data collected? TMS conducted in-depth interviews with 30 individuals from 19 organizations that are currently co-implementing 18 different initiatives with the TMS Activity. The interviews followed an open line of inquiry to try to get the real story about how working with TMS has influenced their organization, and the prospective for the intervention, however early-stage, to generate desired results. Respondents –

• Described in general terms the intervention from their perspective, noting any key objectives, activities or other relevant and basic information about the intervention,

• Established a timeline for when the organization first began thinking or planning the intervention to when it engaged with TMS and a timeline of significant milestones or changes over this period,

• Identified the specific actions taken with TMS as part of the initiative,

• Identified whatever changes (if any) that have been observed within the organization, with partners and among beneficiaries as a result of this intervention,

• Specified what external or alternative factors contributed to those changes

• Identified a level of agreement or disagreement that TMS’s support made a difference How was the analysis conducted? All interviews were recorded and transcribed in their entirety. The codebook was broken down in five categories each with a specific objective for the qualitative coding and analysis –

1. Identify which forms of assistance were received by the partner from TMS 2. Identify changes which occurred in the activity or initiative 3. Identify evidence to support additional assumptions in the logic model 4. Identify level of agreement by partner that TMS contribution made a difference 5. Identify alternative factors and explanations and strength relative to contribution case

What were the key learnings?



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The technical assistance most frequently referenced was related to the design of methodologies, monitoring and management systems or other forms of ‘technical accompaniment’ as opposed to one-time technical trainings or workshops. The outcomes most associated with this assistance related to learning and adaptation - or in other words the ‘realizations’ that partners had that had material impacts on the ways they thought about the initiatives and went about their work. This finding reinforced a key intuition of the technical teams of the importance of helping partners to experiment and discover solutions on their own, providing them with the support (and flexibility) to iterate and adapt over time. Another area of contribution that came across as impactful was at the level of alliances. The more significant contributions from TMS is that it came as a neutral party, communicator and convener that was able to exercise influence in bringing different, and sometimes at odds, parties together around a shared agenda. This finding reinforced an emerging theme in TMS’s understanding of co-creation modalities in which multi-stakeholder alliances were showing signs of more systemic or impactful change and the importance of emphasizing the process of bringing on multiple parties (private firms, donors, public institutions and industry bodies) together around a shared problem with shared actions. The importance of confidence building emerged as a key factor for success. More effective co-creation involved intensive communication between a TMS technical support team that had expertise and know-how to add-value to the activity. The resulting trust with TMS underlie many of the partnerships and reported willingness of partners to try something different and take risks. This is notably distinct from the idea that co-creation and partnerships are about simply funding. Instead co-creation is reframed as a strategy to create value through customizable support depending on the needs of the partner. Factors noted external to TMS referenced were largely contextual; including, crime and security, migration, political instability, a decelerating economy, government inefficiency, a broad sense of public apathy, negative image of the country, etc. In almost all cases though, the partner perceived their intervention as part of the solution to these external factors with nearly all partners expressing a sense of hope and commitment to be part of the solution with TMS and address these external issues. Specific issues noted by partners related to funding constraints, partner networks, sub-awards processes, scope of interventions, and regularity of contact with TMS. How were these key learnings shared? The learnings of the study were shared in the TMS annual report for FY2019 and the 2019 Partnerships Report. Internally, the findings were shared with the technical and management team. TMS presented on the learning on co-creation in the Marketlinks Seminar: Realities of Co-Creating with the Private Sector in sharing emerging lessons and evidence of ‘what works’ in USAID’s private sector engagement approach. How was the learning used? Based on the study, TMS proposed a set of remedial actions based on reported challenges and the broader contribution findings. One such action was the need to strengthen networks between TMS partners and better leverage its position as a ‘convener’ to align diverse stakeholders around a common agenda. The first meeting to facilitate such an initiative was held in December with TMS’s partner COHEP with the intent to bring in CNI, AMHON, CCIT and other Chambers into a discussion on a prioritized set of business enabling environment reforms. THEME 3. ENTERPRISE RESILIENCE CAPACITIES TO EXTORTION



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Learning Question(s) How does the system of extortion work in Honduras? What differential affects does extortion have on the performance outcomes of business (sales, jobs)? What are the potential areas of intervention to improve enterprise resilience capabilities in response to extortion? Why was the question prioritized? Through the Honduran market system diagnostic (MSD), TMS identified extortion as a stressor within the market system that was having a significant, yet underreported effect on enterprises. The MSD statistic identified that while extortion was the least frequently reported shock, enterprises that did report it had the lowest rates of recovery. As part of TMS’s post-shock monitoring system, TMS launched a study to better understand this stressor, the effects extortion was having on beneficiary enterprises. How was the data collected?

, a graduate student from University of California, Berkeley was brought on under a volunteer assignment to help us understand this issue. has researched extortion extensively in El Salvador, as well as in other Latin American countries. Given the sensitivity of this topic, the use of a confidential format of key informant interviews was selected for data collection. and the TMS Learning Specialist conducted in-depth interviews with members of law enforcement agencies, municipal representatives and diverse enterprise profiles most affected by extortion e.g. transport, etc. How was the analysis conducted? The data analysis was qualitative and exploratory. Given sensitivity of responses, it was not possible to record or transcribe responses. Instead, a summary report was developed by the volunteer and Learning Specialist, which was socialized in iterations with the TMS team and USAID. Several exercises were used to help the TMS think through the issue. This included a design thinking exercise (called Round Robin) to explore different aspects of the system of extortion and identify potential levers for intervention. What were the key learnings? There are geographic patterns to extortion. Within large cities, gang-controlled zones are specific to specific neighborhoods. Depending on which gangs controlled which zone, the systems of extortion also functioned differently and had differential impacts on different profiles of businesses. Larger enterprises tended to report more detailed information on these patterns of extortion in different zones and were able to proactively manage the risk of extortion, by either avoiding these zones or accounting for payments for war taxes’ as part of their product pricing (note: consumers tended to bear these costs). The law enforcement and judicial processes that are intended to prevent and stop extortion are reportedly not functioning as needed to effectively stop or slow extortion. That said, the perception about the capability of law enforcement capabilities appeared to be worse than reality. The difference in perception was identifiably larger for small and medium enterprises than larger enterprises. The National Anti-Gang Force (FNAMP) had reportedly good arrest rates of denuncias made by larger businesses with which it had a direct line. Smaller enterprises tended to not report gang-related crimes. The analysis pointed that incremental reporting, if done in secure manner, could yield a reasonable response by key law enforcement agencies, such as FNAMP. Mechanisms existed for secure reporting including a direct hotline with FNAMP for anonymous phone tips. Challenges relate to the perceptions by smaller enterprises of the risk and reward of reporting and the challenge of having a ‘direct trusted line’ with a larger set of smaller enterprises. This required a change in networks that would help improve communication patterns and increase flow of reliable, actionable information on extortion.



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The analysis pointed to the need to resolve more structural issues around enforcement and prosecution of extortion crimes. Significant reforms are likely required for more law enforcement resources in gang-controlled neighborhoods. There is a systematic lack of visibility/constituency/political response around anti-extortion activities given the very real threats of stepping out to make denuncias. Further, without a functioning economic system that can provide alternative pathways for employment in high crime zones, and that will shift incentives away from gang engagement - any such enforcement approach would fail. How were these key learnings shared? A report was developed, and the findings were shared with USAID Honduras and the Bureau of International Narcotics and Law Enforcement Affairs at the U.S. Embassy in Honduras. How was the learning used? Extortion is a complex and resilient system - it is hard to diagnose where and how to intervene, and it is a very hard system to break. Further, there are substantial risks of unintended consequences that warrant a cautionary, yet deliberate, intervention approach. TMS developed an initial pilot for the creation of a security network of small enterprises in Choloma. Several initial meetings have taken places with the network, including a training by FNAMP on strategies for the prevention and reporting of complaints around extortion. Based on lessons of this pilot from Choloma, TMS will consider what additional actions are warranted and consider the replication of these activities in other urban areas e.g. La Ceiba.

SECTION 2: LEARNING PLAN 2020 In 2019 per Task Order No. 1, TMS funded a set of pilot interventions to address different aspects of the Honduran market system with potential to create jobs and build a foundation for broad-based, long-term growth. The overall strategy for 2020 is to move from affecting part of the system to the whole system (i.e. systemic change) which requires a paradigm change in scale, scope and depth of intervention. To facilitate this transition, the TMS technical team has identified four (4) archetype pathways for how systemic change happens. These archetypes are the basis for how the activities piloted in 2019 may be scaled in 2020. The function of this learning plan is to generate the evidence on the validity of these pathways Systemic change is defined as a transformation in the structure or dynamics of the market system – the underlying causes of market system performance – that leads to more effective functioning of the market system to generate competitive, inclusive and resilient results. The variables that define these structures and dynamics are identified through the market system diagnostic – an iterative system-level study. These variables are grouped into the domains of diversity, connectivity, power/rules of the game and mindsets. The 2020 TMS learning plans aims to collect evidence around distinct pathways to affect these domains.

Learning Theme Learning Questions

Introducing something new or different to create diversity

Which new product, innovations, behaviors or ‘novel’ practices are scalable in the Honduran market system? How effective is the competitive environment in creating pressures that lead to copying/imitation? How do mindsets around risk-taking influence this change pathway?

Changing network patterns to facilitate connectivity

How can networks be transformed to result in more effective patterns of communication and resource flows in the system? Which central or periphery actors are critical nodes for improved network structures? How do mindsets around trust/collaboration influence this change pathway?



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Collaborating on tough reforms to change the rules of the game

Where is there common ground among conflicting stakeholders to take steps towards key reforms? How are stakeholders able to connect and unify despite disagreement and having differing opinions, values or stakes in a reform? How do entrenched political interests affect this pathway?

Supporting feedback and learning to transform mindsets

What are the mental models or ways of thinking that are enabling (or preventative) of desired change processes? What experiences, methods or types of feedback and learning are effective at shifting mindsets? What common filters or biases stand in the way of these change?

Note that each of these pathways has its own set of assumptions, challenges and opportunities. The overall objective of this learning agenda is to generate evidence on these change pathways to inform the overall scaling agenda of TMS in 2020. It should be noted that other systemic change pathways likely exist, and part of this learning agenda involves identify and document emergent pathways. #1 INTRODUCING SOMETHING NEW OR DIFFERENT TO CREATE DIVERSITY Which new product, innovations, behaviors or ‘novel’ practices are scalable in the Honduran market system? How effective is the competitive environment in creating pressures that lead to copying/imitation? How do mindsets around risk-taking influence this change pathway? Why is this learning question important? This learning question will gather evidence on the first of four systemic change pathways prioritized by TMS in 2020. In this pathway a new idea or innovation is introduced into the system; partners adopt the idea or innovation into their business model; competitive forces result in others imitating and adopting it; and mass adoption at scale results in broader market response and change. How will data be collected, analyzed and shared?

Action Timeline Responsible

Data collection

• Technology adoption by direct participants is regularly monitored in the TMS database

• Shadow participants or those neighbors or partners who observe direct participants are identified by direct participants who adopt the technology

• Sample of shadow participants are surveyed for subsequent adoption of technology using both quantitative and open-ended questions

Jan – June June – Aug Sept-Oct

Partners Survey firm Survey firm

Data analysis

• Statistical and network analysis applied for quantitative data and qualitative coding for open-ended questions to evaluate copying/crowding-in

Nov-Dec Learning Specialist

Knowledge sharing

• Stakeholder forum for partners in sub-sector around the technology to generate lesson on scaling

• Report included in FY2021 Q1 Report

December Learning Specialist

Usage Inform adaptation for activities which theorize a diversity or innovation diffusion pathway and generate broader evidence on the validity of this pathway. It is expected this study may uncover issues related to predictability or control bias, social pressures towards conformity and incentives of risk versus reward (e.g. loss aversion). Further, it may result in tactics or strategies to accelerate change along this pathway including effective demonstration and buy-down strategies and how best to amplify or increase market response via different communications tactics, awards, etc.



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#2 CHANGING NETWORK PATTERNS TO FACILITATE CONNECTIVITY How can networks be transformed to result in more effective patterns of communication and resource flows in the system? Which central or periphery actors are critical nodes for improved network structures? How do mindsets around trust/collaboration influence this change pathway? Why is this learning question important? This learning question will gather evidence on the second of four systemic change pathways prioritized by TMS in 2020. In this pathway new or strengthened connections are created in a network; new network patterns improve communication and access to resources; actors self-organize based on changed benefits into new network or equilibrium; and improved distribution of resources, goods and services result throughout the market system. How will data be collected, analyzed and shared?


Data collection

• Network data on new or strengthened connections collected after TMS events in the database

• Direct participants are surveyed to determine resulting alliances from these connections and report new connections resulting through alliances

• Sample of actors within networks surveyed for subsequent flow of benefits and results using quantitative and open-ended questions

Ongoing Ongoing June-August

Learning Specialist Phone interviews Survey firm

Data analysis

• Network analysis including statistics including centrality, density, denseness and other metrics

September Learning Specialist

Knowledge sharing

• Stakeholder forum for partners in sub-sector to discuss network patterns and troubleshoot issues

• Finding included in FY2020 Annual Report

October Learning Specialist

Usage Inform adaptation for activities which theorize a connectivity or network pathway and generate broader evidence on the validity of this pathway. It is expected this study may uncover issues related to identity or small group loyalty, reciprocity (win-lose norms), signaling and trust in networks. Further, it may result in tactics or strategies to accelerate change along this pathway including which central or periphery actors are key influencers in networks, new network patterns that incorporate periphery actors and strategies to facilitate common goals or agendas within networks of actors.

#3 COLLABORATING ON TOUGH REFORMS TO CHANGE THE RULES OF THE GAME Where is there common ground among conflicting stakeholders to take steps towards key reforms? How are stakeholders able to connect and unify despite disagreement and having differing opinions, values or stakes in a reform? How do entrenched political interests affect this pathway? Why is this learning question important? This learning question will gather evidence on the third of four systemic change pathways prioritized by TMS in 2020. In this pathway dialogue is established between parties with interests and perspectives at odds; through this engagement actors experience conflict but also connect and unify; actors discover, one step at a time, what works and then takes another step forward; and new possibilities emerge through this creative process to change the status quo.



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How will data be collected, analyzed and shared? Action Timeline Responsible

Data collection

• Each of reforms as part of agenda is monitored according to stage of passage into law, resource commitments and frequency of participation in meetings is tracked in monitoring system

• Participants in reform process are interviewed iteratively on the basis on their attitudes and beliefs towards the reforms from the baseline

• Poll or survey collection to gauge broader opinions of key constituency to proposed reform(s)

Ongoing Ongoing June-August

ME Specialist ME Specialist Survey firm

Data analysis

• Basic descriptive analysis of results with potential for narrative analysis around beliefs and attitudes

Ongoing ME Specialist

Knowledge sharing

• It is expected that results will be immediately shared back in stakeholder forum as a method for rapid feedback into the process and where others sit


Usage Inform adaptation for activities which theorize a collaboration on tough reforms pathway and generate broader evidence on the validity of this pathway. It is expected this study may uncover issues related to enemification in stakeholder engagement, hierarchical and control biases, illusions of ‘only right answer’ expert bias and requirement for consensus/agreement to move forward. Further, it may result in tactics or strategies to accelerate change along this pathway including the need to reinforce respect on legitimacy and value of viewpoints, importance of scenario planning and letting stakeholders decide and to allow space for stakeholder to learn together.

#4 SUPPORTING FEEDBACK AND LEARNING TO TRANSFORM MINDSETS What are the mental models or ways of thinking that are enabling (or preventative) of desired change processes? What experiences, methods or types of feedback and learning are effective at shifting mindsets? What common filters or biases stand in the way of these change? Why is this learning question important? This learning question will gather evidence on the fourth of four systemic change pathways prioritized by TMS in 2020. In this pathway information or experiences generate new ways of thinking about reality; changed ways of thinking improves realizations and comprehension; personal assumptions are fixed and mental models updated to better sync with reality; social and institutional learning processes result in the transfer of these new mental models to peers, family and others. How will data be collected, analyzed and shared?


Data collection

• Interviews with selected partner and beneficiary organizations to assess changes in ways of thinking and the events and realizations that led to it,

• Incorporate Likert questions gauging into annual surveys to gauge relevant mental models specific to intervention systemic change pathway

Ongoing June-August

ME Specialist ME Specialist



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Data analysis

• Inferential statistical and qualitative analysis of open-resources to code for beliefs and attitudes


Knowledge sharing

• Pause and reflect with implementing partners to understand affects of way of thinking on results

• Finding included in FY2020 Annual Report


Usage Inform adaptation for activities which theorize a shift in ways of thinking as a result of feedback and learning and generate broader evidence on the validity of this pathway. It is expected this study may uncover cognitive biases related to anchoring, (re) action bias, conforming/bandwagon mentality, confirmation bias, among others. Further, it may result in tactics or strategies to accelerate change along this pathway including the need to promote organizational cultures that foster innovation, experimental instructional methods and ‘learning by doing’ and framing issues from the inverse or opposite to prevent mental shortcuts.

U.S. Agency for International Development

1300 Pennsylvania Avenue, NW

Washington, DC 20523

Tel: (202) 712-0000

Fax: (202) 216-3524

www.usaid.gov

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