Introducing: PSE Opportunities Tool

Private Sector Engagement (PSE) is about pursuing market-based approaches and investment as a means to address development or humanitarian challenges. PSE represents an opportunity for USAID to expand its impact and achieve development objectives in a scalable, sustainable way.

The PSE Policy  affirms USAID’s commitment to work hand-in-hand with the private sector to design and deliver our development and humanitarian programs across all sectors. 

In order to integrate PSE into our work, the Policy lays out a set of questions that USAID staff and implementing partners should consider every time we approach a development or humanitarian issue. These questions inform a set of considerations that we bring to bear across our work. These questions are presented in a sequence in the PSE Policy, but in practice, any question may take more or less prominence at any given point in evolving discussions.

These questions are:

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While these five questions are intentionally broad, that may make it difficult to use these questions as a guide towards identifying possible engagement strategies with the private sector. To help staff and partners implement these broad goals and integrate the questions into their work, USAID created the PSE Opportunities Tool. With this tool, analysts and activity designers can think creatively and strategically about different ways to collaborate with and leverage the private sector resources, assets, and skills, in order to tackle problems together that neither partner could address alone.

When to use the PSE Opportunities Tool:

The PSE Opportunities Tool is designed specifically to be used with the development of Country Development Cooperation Strategies (CDCS), at the strategic level, activity design, or at the partnership level (including for unsolicited proposals from the private sector). However, this tool is designed to be modular and each question can be visited at any point during the Program Cycle. Additionally, this tool is designed to help you identify private sector players that may be relevant for solving the development or humanitarian challenge, and therefore, you do not need to have a specific partner in mind. It is best to start using this tool when you have a specific development or humanitarian challenge identified and you are examining if and how to include PSE as one approach to addressing this challenge.

How to use the PSE Opportunities Tool: 

• PSE Opportunities Tool:  This three-page document interprets each of the five PSE Policy Questions and provides sub-questions to stimulate ideas, discussions, and creative approaches to solving the development or humanitarian challenge.
• User Guide: The User Guide provides detailed steps for analyzing all sub-questions, with specific data sources and stakeholders to speak with. This document also helps identify key constraints to the private sector (and how to diagnose them) as well as illustrative roles for USAID to play in any PSE opportunity that will help mitigate or alleviate those constraints.
• Use Cases: Three case studies, based on USAID PSE activities, have been compiled to demonstrate how you might approach each sub-question in the PSE Opportunities Tool. The illustrative cases describe a quinoa market development activity in Peru; the development of independent media companies in Serbia; and improved sanitation in a Kenyan refugee settlement.
• Response Template: Because the development of PSE activities is iterative and informed by context and opportunities, documenting the rationale and scope of activity is helpful. The PSE Opportunities Tool template provides space to record the data and analysis that was used to work through each sub-question.