Justification & Approval for other than Full and Open Competition - Financial Sector Reform (FSR)

Background
This document is a Justification and Approval (J&A) for Other Than Full and Open Competition under the Expedited Procedures Package (EPP) for Ukraine, Belarus, and Moldova.

It requests approval to modify USAID/Ukraine Contract No. 72012122C00002, originally titled Financial Sector Reform (FSR) and implemented by DAI, to increase its total estimated cost (TEC) from $33,053,758 to $93,300,000 and to change the activity name to Investment for Business Resilience Activity (IBR).

The modification is driven by the urgent need to rapidly expand assistance to Ukraine’s financial intermediaries and small and medium enterprises (SMEs) in response to economic disruption caused by Russia’s invasion, supporting U.S. foreign policy objectives for economic stabilization and recovery.

Work Details
- Increase the total estimated cost by $60,246,242, including:
• $12,000,000 increase for grants under contract to financial institutions
• $48,246,242 for matching grants to enterprises, technical assistance, labor, other direct costs, and indirect costs

- Convert the contract from Cost Plus Fixed Fee (term) to Cost Plus Fixed Fee (completion) to tie fees to specific results

- Revise the scope to raise targets and add new sub-objectives under five components:
1. Market Regulation and Supervision
2. Financial Infrastructure
3. Private Sector Intermediaries and Facilitators
4. Transparency and Communications
5. Firm-Level Assistance (new): cost-share grants and buyer-led technical support

- Deliver minimum additional life-of-project results:
• Creation of at least 20,000 new verified Ukrainian jobs
• Generation of $250 million in new exports or domestic sales

- Achieve expanded outcomes including:
• Strengthened capacity of private-sector finance providers
• Expanded use of non-bank financial services
• Improved financial institution regulation, supervision, and transparency
• Coordinated workplans with parallel programs to avoid duplication

Period of Performance
Continues under the existing contract which commenced July 13, 2022, and remains in effect until completion of the modified scope of work and achievement of life-of-project deliverables as defined in the contract’s completion-based structure.

Place of Performance
Ukraine

Bidder Requirements
Sole source award to the incumbent contractor, DAI, under EPP authorities.

The contractor must have:
- Demonstrated wartime operating capacity in Ukraine
- A proven track record managing grants and technical assistance in Ukraine’s financial sector
- Existing relationships with Ukrainian stakeholders, USAID, and other USG implementers to ensure immediate, uninterrupted implementation.