What is the
Emerging Markets Program?
The Emerging
Markets Program (EMP) provides partial funding for technical
assistance activities that promote, enhance or expand the export
of U.S. agricultural commodities to overseas emerging markets.
Technical assistance is defined quite broadly, and includes such
activities as feasibility studies, market research, sectorial
assessments, orientation visits, specialized training, business
workshops, and the like. Its resources are intended primarily
to support the market development efforts of the private sector,
but it may also be used to assist public agricultural
organizations as well.
The EMP is a
generic program: its resources may be used to support exports
of U.S. agricultural commodities and products only through
generic activities. Projects that endorse or promote branded
products are not eligible for the Program.
Activities that
support the export of another country’s product to the United
States, including sourcing of products overseas for export to
the United States, are not eligible for the program.
It is
administered by USDA’s Foreign Agricultural Service.
Is there a set
list of emerging market countries that are eligible?
No. We apply
the general definition in the legislation authorizing the
Program and additional administrative criteria to determine
which countries qualify as emerging markets. The most important
criteria is the World Bank’s income threshold for upper middle
income countries. Because this figure varies from year to year,
we have not cemented in a list of countries. Also, there are a
few countries which may be of interest to potential U.S.
exporters, but because of political sensitivities require
special consideration and consultation within the U.S.
government before any Program funds could be used. Details are
provided in the application announcement published annually in
the Federal Register.
How much money
is available under the Program?
The Program has
$10 million authorized annually from the funds of the Commodity
Credit Corporation. This amount is available automatically
every fiscal year from now through the term of the current Farm
Bill (fiscal year 2007).
What kinds of
organizations are eligible to apply for funding assistance?
The Program is
available to both private and government organizations in
agriculture.
All private
U.S. agricultural organizations--non-profit, for-profit, trade
associations, universities, consultant groups (under certain
conditions), etc.--may apply to the Program. Private
organizations must be able to justify a need for financial
assistance, which means that, as a general rule, the Program is
intended for small- to medium-sized firms. Also, proposals from
research and consulting organizations will be considered if they
provide evidence of substantial participation in and financial
support by the U.S. industry. For-profit entities are also
eligible, but may not use program funds to conduct private
business, promote private self-interests, supplement the costs
of normal sales activities, or promote their own products or
services beyond specific uses approved by FAS in a given
project.
State
departments of agriculture are also eligible but are considered
private sector for purposes of the application process.
Government is
defined as federal. Most federal agencies which receive
assistance from the Program are in USDA largely because of the
nature of the Program, i.e., agricultural exports and market
development. Other agencies outside of USDA may apply if the
objectives of an intended project match up well with the
Program’s legislative mandate.
Foreign
organizations, whether government or private, are not eligible.
Are there any
minimum requirements that must be met before a proposal is
considered qualified for Program funding?
Definitely.
There are, in fact, two things that every private sector
proposal must contain before it can qualify for funding under
the Program:
1. Cost-share.
This the amount of funding U.S. private organizations are
willing to commit from their own resources along with those of
the Program to seek export business in an emerging market.
No proposal will be considered without the element of
cost-sharing, regardless of the underlying value of a proposal
(the Emerging Markets Program complements, not supplants, export
efforts of the U.S. private sector). We don’t specify a minimum
or maximum of cost share. Rather, we use the degree of
commitment to a proposed project represented by the percentage
and type of private funding as a critical factor in determining
which proposals should be funded under the Program. We also
don’t specify the type of cost-sharing. It may be professional
time of staff assigned to the project, or actual cash
investment. But proposals in which private industry is willing
to commit actual funds, rather than in-kind items such as
existing staff resources, are given greater weight.
Contributions from foreign sources may not be counted as cost
share, but they may be included in the overall cost of any
proposal to the Program.
Cost-sharing is
not needed for government proposals, but it is required for all
other eligible entities, even when they may be party to a joint
proposal with a U.S. Government agency.
2.
Justification for Federal Funding. This is a clear explanation
as to what specifically could not be accomplished without the
funding assistance of the Program and why participating
organization(s) are unlikely to carry out the project without
such assistance. What specifically could not be accomplished if
the funding were not provided?
Format and
additional details that should be included in each application
are provided in the annual announcement soliciting proposals to
the Program for funding assistance published in the Federal
Register.
How are
projects and activities funded?
Funding is on a
project-by-project basis. Funds are provided though one of
three channels:
1. Central
Fund. This is the principal means of funding private sector
proposals. An open solicitation period, available once a year,
is announced in the Federal Register and on the Program’s
Internet web site. Proposals received by the deadline stated in
the announcement undergo a multi-level review to determine
qualifications, quality and appropriateness, project budgets,
etc.
For government
proposals, this may be done at any time during the fiscal year,
subject to the availability of funds.
There are also
two specialty funds established for particular needs which may
also be used for approved projects depending upon circumstances:
2. Quick
Response Marketing Fund. This fund is used to address priority
marketing problems that arise because of unforeseen events
(market conditions in emerging markets are often less
predictable than in more developed countries). It allows
improved responsiveness to time-sensitive marketing
opportunities, such as the lifting of a sanitary or
phytosanitary trade barrier; a change in an import regime or the
removal of a trade embargo; an unexpected, significant purchase
of a commodity; an unusual change in the political or financial
situation in a country; or a significant change in crop
conditions--any of which may have an immediate impact on the
access of particular commodities to specific markets. Proposals
to the Quick Response Marketing Fund must identify specific
market access issues which also face time constraints. Timing
concerns in and of themselves do not justify use of the Fund.
3.
Technical Issues Resolution Fund. This fund is reserved for
addressing priority sanitary or phytosanitary trade issues such
as plant quarantine, animal health, food safety, and other
technical barriers to U.S. exports based on unsound or
incomplete scientific information. Priority issues are those
that are time sensitive and likely to achieve the desired
impact. Funding decisions are determined by a review process
that includes FAS and relevant regulatory agencies. Consult the
Program Regulations for further information; application
requirements are slightly different than for either the Central
Fund or the Quick Response Marketing Fund.
Are there any
priority subjects that are considered more appropriate for the
Program than others?
Actually, yes.
While we allow private industry to determine specific target
markets, priority commodities, or preferred export activities,
we place a higher priority on certain types of technical
assistance activities that are particularly appropriate for the
Program. For example:
-- Marketing
and distribution of value-added products, including new products
or uses;
-- Studies of
food distribution channels in emerging markets, including
infrastructural impediments to U.S. exports;
-- Projects
that specifically address various constraints to U.S. exports,
including food safety/sanitary and phytosanitary issues and
other non-tariff barriers;
-- Assessments
and follow up activities designed to improve country-wide food
and business systems, to reduce trade barriers, and to increase
prospects for U.S. trade and investment in emerging markets;
-- Projects
that help foreign governments to collect and use market
information and to develop free trade policies that benefit
American exporters as well as the target country or countries
(this is usually more appropriate for government agencies to
address);
-- Short-term
training in agriculture and agribusiness trade, including retail
training, that will benefit U.S. exporters, e.g., seminars and
training at trade shows designed to expand the potential for
U.S. agricultural exports by focusing on the trading system.
