Terms of Reference Conducting Diaspora Remittances Mapping in Ethiopia
Background of the Project
Swedish International Development Agency (SIDA) through its support to Pangea Trust launches a Diaspora fundraising project that seeks to increase deployment of diaspora remittances and networks to provide investment capital to Ethiopian MSMEs and startups. The process requires the creation of the conditions necessary for safe and seamless movement of capital and other resources from the diaspora to viable MSMEs and promising start-ups in a formal and structured manner.
Ethiopia Diaspora remittances are estimated to hit USD4 Billion in 2021 a significant amount, by any standards. While the amount of inflows and their countries of origin are well documented and well known, there appears to be no specific studies and data in the public domain on the uses to which the remittances are put, locally. The widely held view, however, is that such remittances are primarily directed at consumption and social support, which is not sustainable. The sums committed to investment, moreover, tend to be more destined for personal or family development with only a few resources set aside for business investment. Even then, diaspora investors are known to face challenges relating to dearth of information on viable investments and the little information available is often insufficient to prevent losses due to lack of proper due diligence, professional services and investment appraisal because of unstructured engagement.
In partnership with SIDA, diaspora influencers and other stakeholders, Pangea will use a comprehensive, coherent and integrated approach to achieve the project’s key objectives of activating diaspora remittances and networks as a sustainable source of financing and capital for MSMEs and start-ups in Africa generally and specifically in Kenya, Ethiopia and Somalia.
To activate diaspora remittances and networks as a sustainable source of financing and capital for start-ups and MSMEs in Ethiopia to drive job creation and enhance entrepreneurial capacity and opportunities
The above objective is to be achieved through innovative approaches beyond today’s development collaboration. This will include innovative financing solutions such as diaspora fund, Matching fund, challenge fund, accelerator fund guarantee fund etc with catalytic eﬀect to support SMEs and startups to create sustainable jobs.
Diaspora mapping report
This assignment intends to develop a mapping report to analyze diaspora remittance to Ethiopia, by identifying how remittance is being allocated in terms of consumption, investment and other areas. The mapping report will be developed to provide better insight to the development sector and other stakeholders in how the diaspora can play a bigger role in supporting SMEs.
The proposed Assignment.
Ethiopia Diaspora remittances are estimated to hit USD 4 Billion in 2021 a significant amount, by any standards. While the amount of inflows and their countries of origin are well documented and well known, there appears to be no specific studies and data in the public domain on the uses to which the remittances are put, locally.
This constrains the potential of this resource for the facilitation of access to finance, especially for MSMEs and start-ups who greatly need the same, and as an engine for sustainable development. At the heart of the problem is information asymmetry and the absence of a structured market for the deployment of diaspora remittances for investments. There is no formal mode of engagement in Ethiopia to link the diaspora, and activate its networks and remittances, with viable local businesses that require investment capital to scale.
- In view of the above, Pangea, with support from SIDA is therefore looking for a consultant to conduct a diaspora data mapping of inflows of the remittance, identify diaspora segments driving the remittance from the country of origin, documenting the factors fuelling the remittance. Detail the uses to which the remittances are utilised locally in Ethiopia, indicating what sums are committed to investment in the start-ups and MSMEs businesses. The analysis to cover opportunities and challenges limiting remittances investment in startups and MSMEs in Somalia.
Scope of Work
The assignment will involve the following;
- A detailed review of secondary information and literature on diaspora remittances
- Development of research methodology and data collection tools and inception report.
- A detailed analysis of inflows of the remittance from country of origins, disaggregating sender’s data including sex, age and average amounts.
- Development of a research protocol for submission to the ethics and review board if needed
- A clear determination of the extent/scope of diaspora segment driving the remittance from the country of origin, documenting the factors fuelling the remittance.
- A detailed analysis of inflow of the remittance from Islamic communities, factor driving remittances and guiding framework.
- A clear analysis of diaspora applicable channels of remittance such as western union, world remit, banks transfer providing a comparative examination factoring volume of transfers, associated costs of transfer for each, with clear conclusion on potential approach that is most preferred and why, for this project to enhancing level of value, usefulness, affordability and trust which are pillars of this project.
- A clear analysis of diaspora knowledge, attitudes and believes appertaining to remittances use, their potential roles and opinions appertaining to how diaspora investment can be structured.
- A clear determination of cultural, economic, social and political causes that drives diaspora remittances and usage and establishes primary use of such remittances including Islamic communities, indicating what sums are committed to investment in the start-ups and MSMEs businesses.
- A detailed analysis of the extent of COVID-19 impact on diaspora remittances, capturing opportunities and challenges
- A detailed examination of country specific policy processes guiding diaspora remittances in Ethiopia.
- A map of stakeholders including public, private and civil society or non – state actors including Islamic communities in Ethiopia and their involvement in diaspora remittance space, and all ongoing interventions relating to activating diaspora remittance to fund startups in Ethiopia. Including beneficial partnership covering financial service providers and Telco and their interest partnering with payment platforms.
- A detailed examination of the progress made so far, achievements of such interventions and gaps and or challenges including the Islamic communities.
The following are the specific tasks for the consultancy:
- Review existing secondary information and literature on diaspora remittances
- To develop and present an inception report with data collection plan and design.
- To develop all data gathering tools required for quality data collection in close consultation with the Pangea and SIDA project team and pretest them.
- Develop a research protocol and submit the same to the ethics and review board
- Train, manage and supervise data collection teams
- Organize and implement the survey to ascertain the levels of diaspora remittances inflow, identify diaspora segments driving the remittance from the country of origin, document the factors fuelling the remittance. Detail the uses to which the remittances are utilised for locally in Ethiopia and establish primary use of such remittances, indicating what sums are committed to investment in the start-ups and MSMEs businesses.
- Compile and collate the data collected, both qualitative and quantitative.
- Incorporate COVID-19 impact on diaspora remittance findings as key part of the report.
- Prepare and present a report of the survey with inputs from Pangea, Ethiopian Embassy and SIDA team.
- Participate in the dissemination of the findings to SIDA, Ethiopian Embassy and Pangea and key stakeholders.
- Inception report: detailing the objectives of the study, key questions that the study will address and how the study will be conducted, including timelines and workplan
- Analytical methodology and approach
- Draft report
- Desk review report
- Workshop and workshop materials- I suppose the consultant will organise a small workshop to run us through their findings
- Final report
- Blog/article, and PowerPoint presentation of findings etc.
The intellectual property generated out of this engagement will be passed on exclusively to the contractor.
Interested consultant(s) and/or agencies Must provide the following information –
a) A statement on consultant’s or firm’s capabilities including:
- Consultant(s) or agency profile outlining areas of expertise.
- Evidence of undertaking similar assignments in the recent past.
- Any direct or relevant past experience of undertaking similar initiatives.
- A brief 3 pages proposal of the understanding and interpretation of the TORs and the scope of the work, outlining the approach and plan to accomplish the assignment.
- Names and CVs of the professionals who will be involved in the study
- A proposed timeline indicating activities/sub-activities to be undertaken and the corresponding outputs.
The bids will be weighed against criteria drawn from consultant’s expertise and experience, evidence of conducting similar assignments in the past, consultant understanding and interpretation of the subject matter, scope and suitability of the proposed approach and plan and the budget.
Competencies and qualifications of the consultant
- Proven ability to demonstrate innovative thinking and previous experience working innovative financing for SMEs and startups and digital platforms.
- Contextual knowledge and understanding of Ethiopia diaspora remittances trends and expertise to critically analyze data into evidence to discover key insights.
- Substantive knowledge of the financial sector and landscape with keen interest in diaspora remittance as a thematic area.
- Ability to work independently to strict timelines
- Ability to contribute to and comfortably work in a multi-disciplinary setting
- Excellent planning and facilitation skills
- Substantive knowledge of Islamic finance process and tools.Cultural awareness and sensitivity and contextual knowledge of diaspora remittance as a thematic area
- Strong interpersonal teamwork and communication skills
- Excellent written and spoken English skills and sound reporting skills.
- A minimum of a Masters’ degree in any other related field.
- 7 years’ experience in conducting research (particularly in this kind of research)
- Proven understanding of the innovation ecosystem in particular innovative financing, and diaspora remittances.
Interested consultant(s) and/or agencies should provide an estimated daily rate for the proposed assignment based on the timelines provided.
The Consultancy is expected to take a maximum of 60 days and shall be undertaken between the months of June and 31st July 2021.
Submission of applications
On or before 27th May 2021, through email@example.com email reference being “Diaspora Remittance Mapping”