Southern Mexico Generating Employment and Sustainability Project Quarterly Performance Report FY2023 Q1

The project's primary objectives are to increase incomes through sustainable market systems, catalyze investments in sustainable productive and natural ecosystems, and improve the policy and regulatory environment for sustainable public and private investments. SURGES held a Collaborative Start-up Workshop with key market actors, including local subcontractors Fundación Proforest and Instituto Mexicano para la Competitividad (IMCO), and US woman-owned small business subcontractor Nextrade. The workshop aimed to establish strategic partnerships and set foundations for the annual workplan. The project's core leadership and management team were established, and in-country operations were started up, with systems deployed and relationships developed to facilitate effective activity implementation. The project is designed to foster sustainable economic opportunities, promote investment, and generate sales and jobs in south-southeast Mexico while mitigating climate change. SURGES will be implemented using a primarily facilitative and catalytic approach, working through local actors across the market system to achieve its objectives. The project has three primary objectives: increased incomes through sustainable market systems, catalyzed investments in sustainable productive and natural ecosystems, and improved policy and regulatory environment for sustainable public and private investments. To achieve these objectives, SURGES will form strategic partnerships with progressive market actors and put in place a Project Activity Facility (PAF) to catalyze new partnerships, leverage private sector co-investment, and incentivize behaviors for more inclusive market systems. The PAF will have three windows aligned with the objectives: anchor firm/market partnerships window, capital mobilization window, and issue-driven partnerships window. The project's implementation progress is reported according to the mobilization and startup timelines included in the Rapid Mobilization Plan submitted to USAID on September 27, 2022. The structure of this first quarterly report largely follows the structure of the Rapid Mobilization Plan, with section headings aligning to the major operational and technical startup tasks outlined in that plan. Future reports will follow the structure of the approved Annual Work Plan. The project's start-up team was designated by Palladium upon award, with the Home Office (HO) team including the Project Director, Project Manager, and other key personnel. The team conducted initial project kick-off and orientation activities, including stakeholder engagement and engagement with the private sector, value-chain selection ground-truthing report, activity monitoring, evaluation, and learning plan, and collaborative start-up workshop. These activities laid the foundation for the project's implementation and established the core leadership and management team.