| Overview : TERMS OF REFERENCE Formulation of Kiribati’s Coconut Sector Development Strategy 1.Beneficiary The project beneficiary is the Ministry of Commerce, Industry and Cooperatives (MCIC), Kiribati. 2.Contracting Authority The United Nations Development Programme, Suva Fiji will be the Contracting Authority. 3.Background and Context Kiribati is an island republic in the Central Pacific with 811 square kilometres of land area largely in atolls and islets. The population of the country as per 2015 census is 110,136 and the nominal GDP is US$167 million ($1592 per capita). The country is position 137 in the 2017 UNDP global human development index. Kiribati is a “Small Island Developing State” and a “Least Developed Country” according to the UN Classification. A GDP growth in 2015 was 7.5 %, compared to 25% in 2014 and 5.8% in 2013 and 5.2% in 2012. The higher GDP growth rate of 7.5% was attributed to increase in construction, wholesale & retail trade industries, transport, storage, and financial intermediation activities. The public sector accounts for two-thirds of formal employment and about half of GDP. Only a small proportion of total labour force depend on salaries. The rest of the population work in subsistence farming or fishing. The outer islands remain economically underdeveloped, with limited economic activities. 80% of the population from the outer island depend on income revenue from Copra. While crop farming is limited in Kiribati, coconut remain to be the main dominant crop especially for livelihood of the community living on the outer Islands. The coconut production contributes about 46.3 percentage to Kiribati’s National Export Earnings. The total production is recorded at 54.6 million nuts equivalent and 9,134 (MT) as copra equivalent. Coconut export value for Kiribati now stands at US$4,516,000 and showing revenue earnings as US$9,764,000. Export volumes comprising of coconut oil at 2,939 (MT), copra at 1,332(MT) and copra meal at 216 (MT)[1]. Despite the contribution of coconut to export earnings and income for the country, the sector is constrained by limited products and lack of integrated strategy to enhance policy and institutional coordination. There is low-income revenue to farmers due to overdependence on limited primary coconut products, with low returns across the sector value chain. The sector development is further constrained by limited participation by the private sector especially the SMEs in the value added products. The sector faces future threat in terms of foreseen lack of raw materials due to limited coconut replanting programmes. The Government through its 20-year vision development plan (KV20) seeks to develop economic activities on the outer islands, through creation of new industries and improved trade with the view of enhancing inclusive growth, sustainable development and poverty reduction. Achieving the KV20 calls for a strategic approach in exploiting opportunities in few sectors where Kiribati has a comparative advantage. While fisheries and tourism sectors are the main priority sectors in the KV20, coconut remains to be one of the complementary sectors that can support the realization of the KV20 vision, given its linkages with tourism sector and the cultural capital component of KV20. In the short term, the Kiribati Development Plan 2016-19 seeks to develop value-added products through the formulation and effective implementation of a Coconut Sector Development Strategy (SCDS).The product diversification through value addition is envisaged to foster income generation and improve livelihoods of the people in the outer island. The Trade Policy Framework (TPF) adopted by the government in 2017 recognizes the importance of the sector in stimulating trade development given its potential impact on the smallholder farmers and producers. The TPF recommends the need to develop a CSDS in order to enhance product and export diversification, sustainability and revenue maximization across the coconut value chain. The Government of Kiribati through this consultancy seeks to address these challenges confronting the development of the sector as a matter of priority, through the formulation and effective implementation of the CSDS. This consultancy comes under the “Enhancing Inclusive Sustainable Economic Development through Coconut Sector Development project” funded by India, Brazil and South Africa (IBSA) Facility. The project commenced in March 2018 with the aim to support the development of the Coconut Sector Strategy ,build the capacity of the relevant stakeholders and to finalize the roadmap to engage the smallholder coconut farmers through the identification of commercially viable value adding opportunities along the coconut value chain. As part of the project, UNDP, as the Main Implementing Entity, is seeking the services of a qualified contractor or a firm with institutional expertise and experience on policy issues related to coconut farming, production and processing to formulate a Coconut Sector Development Strategy for Kiribati. 4.PURPOSE AND EXPECTED RESULT Overall objective Purpose Expected Result to be delivered by the contractor 5.SCOPE OF THE WORK Assignment Description The primary objective of the assignment is to formulate a Coconut Sector Development Strategy (CSDS). The strategy will to provide a holistic and coherent approach, with key recommendations on policies to be implemented in order to address policy constraints across the value chain with significant focus on developing value added and income generating opportunities for the community and general beneficiaries in the coconut sector value chain. The assignment will start with the examination of the overall macro-economic environment in which the CSDS is being formulated. This will involve analysis of the socio-economic setting and national development strategic framework .The external factors affecting the sector performance including climate change and environment sustainability will be analysed. Further analysis should look into the contribution of the Sector to GDP and employment across the coconut value chain by gender.The contractor is expected to analyse the level of women participation, type of economic activities and employment in the coconut sector and make policy recommendations. The Contractor is required to further undertake the following key tasks: Analyse the current coconut industry situation in the global market ,market trends and possible implicationsonmaximisation of income and revenue for Kiribati; Analyse the industry situation in Kiribati taking into consideration the coconutproduction trends ; production actors and the value chain system; Analyse and identify various policy constraints including the overall business environment, current business regulatory framework, Investment incentives for SMEs,farming practices and constraints, processing technologies , affecting the value chain actors ranging from farmers ,traders ,processors and exporters in the industry and make policy recommendations; Identify and prioritise in consultation with the key stakeholder’s possible value added products that can be developed in selected outer Islands in the medium term in order to maximise revenue across the value chain; Review the existing coconut sector related support institutions, organisations and national consultative mechanisms, identify gaps and make policy recommendations; and Review relevant Government policies like Trade Policy Framework, National Quality Policy etc, related to Coconut Sector development; Identify gaps and make policy recommendations.
The contractor will work with MCIC but it is expected to consult and involve all other relevant ministries, agencies, community, coconut producers and processors. The consultations will be carried out in Kiribati (Tarawa and two Outer Islands Islands) through meetings, focus group discussions and interviews by using a questionnaire developed by the experts to collect relevant elements and inputs. Once the assessment and consultation phase is concluded, the contracted will start drafting the CSDS. The document will be circulated by email and two consultative meetings will take place in Tarawa to disc the draft CSDS before it is finalised. Comments on the draft CSDS will be shared via email .It is also expected that the contractor will facilitate the two consultative meetings in Tarawa. The Action Plan for the CSDS implementation will also be prepared and discussed during these meetings. Finally, a meeting with Coconut Sector Development Committee will be organized in Tarawa to validate the CSDS and its implementation plan. [1] Asian and Pacific Coconut Community, November 2017 Update www.apccsec.org/apccsec/country-profile | 
