International Labor Organization (ILO)- Request For Proposal For The Recruitment Of A Financial Service Provider To Support The Livelihood Of Smallholder Cocoa Farmer And Gold Miners As Part Of The Fight Against Child Labor In Ondo And Niger State

DEADLINE: 24TH OCTOBER, 2021 INTERNATIONAL LABOR ORGANIZATION (ILO) ACCELERATING ACTION FOR THE ELIMINATION OF CHILD LABOUR IN SUPPLY CHAINS IN AFRICA (ACCEL AFRICA) TERMS OF REFERENCE FOR THE RECRUITMENT OF A FINANCIAL SERVICE PROVIDER TO SUPPORT THE LIVELIHOODS OF SMALLHOLDER COCOA FARMERS AND GOLD MINERS AS PART OF THE FIGHT AGAINST CHILD LABOR IN ONDO AND NIGER STATE.

(1.0) BACKGROUND The International Labor Organization is implementing a project– “Accelerating action for the elimination of child labour in supply chains in Africa” (ACCEL Africa), funded by the Government of the Netherlands. The goal is to support on-going efforts by ILO and partners to eliminate child labour in Global Supply Chains in Africa. The ACCEL Africa project in Nigeria seeks to collaborate with civil society organizations as well as financial and non-financial service providers based in Niger and Ondo States for the execution of some of the project activities in cocoa and gold mining supply chains.

(1.1) Analysis of Problem (Global and National Context)

A total of 160 million children – 63 million girls and 97 million boys – are in child labour globally, accounting for almost one in ten of all children worldwide. Nearly half of those in child labour – 79 million children in absolute terms – are in hazardous work that directly endangers their health, safety, and moral development. With 86.6 million (23.9%) children aged 5 to 17 involved in child labour in Sub-Saharan Africa, the region stands out with the highest prevalence and largest number of children in child labour (ILO & UNICEF, 2021).

Globally, 70 percent of all children in child labour, 112 million children in total, are in agriculture. The practice of child labor has been widely documented in the cocoa and artisanal small-scale gold mining (ASGM) sectors. This is particularly so in Africa where cocoa cultivation and ASGM activities are characterized by low productivity; predominantly caused by the high use of labor, unmechanised farming/mining tools and techniques, lack of farm inputs, poor agricultural/mining practices, and lack of access to finance to fund productive activities. In addition to low productivity, the inability to access markets and sell more produce, with better quality and at higher prices, has resulted in low profitability and low income for cocoa farmers/ASGM miners. In cocoa farms, children are often involved in harvesting of pods, weeding, fermentation/drying of beans, bagging/weighing of beans, and mixing/spraying of agrochemicals. In ASGM, children are often involved in digging in pits and trenches, packing of materials into bags, transportation of materials using head pans, and washing of materials in streams. Children are also often exposed to hazardous chemicals such as mercury, lead, cyanide, and ammonium which are used in the site and disposed of haphazardly.

Child labour defined as work that deprives children of their childhood, potential, dignity, that is harmful to their physical and mental development; and/or interferes with their schooling, has been shown to further perpetuate the cycle of poverty within families and communities. Hence, child labor has been globally declared as unacceptable; with the Sustainable Development Goal (SDG) 8.7 commitment to eliminate all forms of child labour by 2025. With dwindling progress towards the achievement of this goal, the ILO subsequently setup the ACCEL AFRICA project aimed to accelerate the elimination of child labour in Africa, through targeted actions in supply chains. ILO Nigeria is looking to address child labour in Nigeria, with a focus on smallholder cocoa farmers and artisanal small scale gold miners (ASGM). The main activities will be to address the root causes of child labor in selected cocoa and ASGM communities, supporting local and vulnerable families to receive assistance enabling them to diversify and improve their livelihoods, and sensitizing cocoa and gold mining communities on child labor issues in order to bring about a positive change in the behavior of populations.

Two in-depth situational analysis commissioned by the ILO in 2020 identified poverty, low income, shortage of labour, high unemployment and lack of decent work opportunities, lack of alternative livelihoods, high cost of education, as well as cultural beliefs about the roles of children, as some of the root causes of child labour in the interested supply chains. Looking beyond these root causes, both studies also points to the lack of mechanized farming/mining tools and techniques, lack of farm inputs, poor agricultural/mining practices, lack of access to finance to fund productive activities, and inability to access markets and sell more produce, as the underlying causes. Hence, one of the recommendations from the study is that addressing poverty amongst smallholder cocoa farmers and ASGM miners requires increased and sustained access to both financial, non-financial and welfare services.

Subsequently, the ILO commissioned an assessment of the providers who currently serve the rural Nigerian population, and who the ILO could potentially partner in order to develop innovative financial and non-financial services with the potential to improve the livelihoods of smallholder farmers and ASGM miners. Providers widely agree with the recommendation from the earlier study; with demonstrated practice of bundling financial and non-financial services in at least 60% of providers sampled. However, specifically in the case of smallholder farmers and ASGM miners, it became clear that the available financing was predominantly done by the supply chain actors. For traditional financial service providers (FSPs), the business case for serving the target beneficiaries at market driven interest rates remains unclear. On the part of the supply chain actors who currently provide financial, non-financial and welfare services, the sustainability and scalability of these services remains low due to resource constraint. These studies therefore recommended certain drivers of sustainability in providing livelihoods support to the target beneficiaries:

Beneficiaries should be economically active poor. Preferably in existing cooperatives or already mature groups with significant social cohesion Serve clients in clusters with a range of holistic services Leverage technology in a way that allows multiple providers to ride on the platform to provide value -added services – a one-stop-shop Incorporate both digital and physical distribution channels that allow for quick adoption and access to market Ensure financing is focused on inputs, with repayments matched to cashflow and in accordance with market conditions in order to ensure the sustainability of the solution. The credits should not be seen as a grant by the beneficiary but as a loan to be repaid in accordance with market conditions in order to ensure the sustainability of the solution. Integrate the provision of training on good agricultural practices and good mining practices into the offerings, as well as awareness and sensitization on child labour Livelihood support services that address more holistic needs of the family in a way that reduces vulnerability and protects the household against shocks Stakeholder engagement and community sensitization must be embedded as part of the project design Concentrate the different actions of the project and the partners on the same beneficiaries with the same market approach to have more impact

PROJECT INTERVENTIONS In line with established project objectives and approach, four market sector development interventions necessary for addressing the root causes of child labour amongst smallholder cocoa farmers and ASGM miners, have been identified. These include

Livelihood support Bundled services Stakeholder advocacy and community engagement Stronger cooperatives Livelihood support is at the core of the ACCEL AFRICA social finance intervention. It involves facilitating access to financial (start-up capital, loans, savings, micro insurance) and non-financial (trainings on new cocoa farming/mining practices and alternative income generating activities (IGA)) services. This is expected to complement other livelihood support provided by the wider ACCEL project such as facilitating school enrollment of vulnerable children below the age of 15 years, skills acquisition training and support for children of 15 years old and above, and access to welfare services (health services, psychosocial support). With our approach to implement the intervention at the household level, the livelihood support will preferably be directed towards the spouse of the cocoa farmer/ASGM miner. Hence, while the farmers/miners will benefit from training on good agricultural/mining practices, access to finance, improved tools and inputs, the household can benefit from the livelihood support. This ensures that the household has an additional stream of income for improved livelihoods; but also help them cope with any shocks to the agricultural/mining activity, without increasing the risk of child labour.

QUALIFICATION AND EXPERIENCE REQUIRED

This call for tender is open to all licensed financial institutions in Nigeria, and which will meet the following criteria:

Legal status (exclusive criteria)

(a) The financial institution must be licensed to provide the required service and comply with the law.

(b) The financial institution must be able to prove at least two years of activity.

Management capacity

(a) The financial institution must be present in at least 80% of the project communities in each state where they choose to support the project (see list of communities in Annex 1) either through a physical presence or through a network of financial service agents.

(b) The financial institution must have in its portfolio a significant proportion of active rural clients (VSLA / VSLA groups, GCS, small farmers, cooperatives, etc.).

(c) The financial institution must already have products intended for farmers and / or women’s IGA (individual and group loans, individual and group savings, agricultural microinsurance

PROCEDURE FOR SUBMISSION OF EXPRESSION OF INTEREST Interested organizations should submit technical and financial proposals by email to the following e-mail addresses: kolawole@ilo.org and eke@ilo.org not later than 24 October 2021 at 6 p.m. (Nigeria time).

Any application submitted after the end date will not be considered.

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International Labor Organization (ILO)- Request For Proposal For The Recruitment Of A Financial Service Provider To Support The Livelihood Of Smallholder Cocoa Farmer And Gold Miners As Part Of The Fight Against Child Labor In Ondo And Niger State

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