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

Page 2 Background: Tajikistan has experienced a variety of economic, environment and social emergencies in recent years. Harvests over the past four years ( ) have declined significantly over the last “normal yield” harvest in –Most recently, the harsh winter period (January – February 2008) and drought (March – October 2008) resulted in poor agricultural harvest, particularly in the mountainous areas with limited or no access to irrigation systems. In 2007, the food security situation of rural population markedly deteriorated due to the global rise in cost of basic foodstuffs. –In a “normal” year, 50 percent of basic food needs are already imported, rising in crisis times. –Rising fuel costs also added to higher transportation and, ultimately, consumer costs. In addition, locust invasions (April – June 2008) affected crops in much of the country and further stretched the capacities of rural households to feed their children, increasing food insecurity at the household level.

Page 3 Background (Continued) The available food stocks for many vulnerable households were projected to last only until November 2008 leaving a 7-month food gap, through the winter and spring planting season. The confluence of these factors propelled the country into a state of “compound emergency,” as described by the United Nations.  Need for Action: Already-vulnerable families were pushed to the limit and forced to assume difficult coping strategies that put health at risk, particularly women and children.

Page 4 Rapid Emergency Response The emergency food insecurity situation necessitated Save the Children (SC), in partnership with Mercy Corps (MC), to embark upon Local & Regional Procurement (LRP) of food commodities and distribution among vulnerable households, funded by USAID.

Page 5 Projected Vulnerable Households Targeted: A total 11,545 vulnerable household/families were targeted - 6 members per families/household. –SC to provide food to 8,045 families – 48,270 beneficiaries in the Khatlon region –MC to provide food to 3,500 families – 21,000 beneficiaries in the Sodhg region Outcome: The project aimed to provide food security for 7.5 percent of the most vulnerable population in each targeted district of the aforementioned regions, throughout the winter season.

Page 6 Selection Criteria of Vulnerable Population: Families with children under 2 Households with orphans, disabled children or adults Female heads of household and caregivers Vulnerable families without the support of foreign remittances

Page 7 Vulnerable Family

Page 8 Tender Process: Sealed bids were invited from suppliers registered in Tajikistan Qualification and Selection Criteria: Price Meeting the prerequisites by providing the following documents with sealed and notarized bids bids: Tajik passport (together with copy of place of residence) Copy of certificate from tax authorities Charter and registration of the enterprise, detailed bank information, and valid commercial license SC local lawyer verified the authenticity of documents prior to awarding the contracts. A total of 13 bids were received and opened in presence of all the bidders by the procurement committee comprising of SC, MC and USAID local representative. Three qualified local suppliers were selected to supply wheat flour, oil and lentils respectively. The contract was awarded with detailed procurement and delivery schedule with a deposit of 3 percent of total contract value as performance bond. One vendor dropped out and forfeited 3% performance bond Procurement Process

Page 9 Quality Assurance and Control Detailed specification of commodities was provided in the tender announcement, including unit weight and types of packaging. As required by Tajik law, a selection of all all commodities was randomly tested by the Tajikistan Government Quarantine Office to assure the quality of food commodities before releasing from customs to consumers. –A phyto-sanitary certificate must be received within two days from the date of collecting samples for lab-test. LRP commodities received phyto-sanitary certificates without problem and/or delay.

Page 10

Page 11 Commodity Loss Mitigation There was no commodity losses from the suppliers due to: Purchase contract clearly stipulating that that suppliers would be responsible for delivering and stacking commodities at the designated warehouses of SC and MC. All damaged, torn, under-weight and unfit commodities due to mishandling were under contract to be replaced by the suppliers at their own expense. No reconstituted bags were accepted.

Page 12 Cost Savings Vs. Quality of Commodities In this emergency, LRP proved to be a useful mechanism for delivering commodities to vulnerable families in a timely manner: LRP enabled food to reach beneficiaries in a much shorter time than shipments originating from the U.S. (thus better for responding to an unfolding emergency). However, while LRP presented some cost savings over Title II for the SYAP, the commodities are not directly comparable in terms of grade, enrichment, etc. Therefore it is not possible to measure and compare savings accurately and conclusively for sustained food aid programs or non-emergency situations.

Page 13 Timeline of LRP Activities Status of Distribution to Beneficiaries: –Food distribution was completed on March 31 st, 2009

Page 14 The PepsiCo Foundation Meeting March 31, 2008 Q&A