Consultancy on Producing Financing (Re)integration: Area-Based Financing Pathways in the East, Horn and Great Lakes Regions of Africa Report International Position

Founded in 1956, the Danish Refugee Council (DRC) is a leading international NGO and one of the few with specific expertise in forced displacement. Active in 40 countries with 9,000 employees and supported by 7,500 volunteers, DRC protects, advocates, and builds sustainable futures for refugees and other displacement-affected people and communities. DRC works during displacement at all stages: In the acute crisis, in displacement, when settling and integrating into a new place, or upon return. DRC provides protection and life-saving humanitarian assistance; supports displaced persons in becoming self-reliant and included in hosting societies; and works with civil society and responsible authorities to promote the protection of rights and peaceful coexistence.

About ReDSS

ReDSS is a secretariat working on behalf of 14 international and national NGOs working on forced displacement in the Horn of Africa. We were established in 2015 in response to a desire by the NGO community to be more proactive in shaping durable solutions policy and programming in the region. Our team works at both a regional and a country level and focuses on the translation of evidence and research into policies and programmes that can better deliver for displacement-affected communities. We do this through a range of activities, including convening key stakeholders at multiple levels to produce consensus around collective actions that can be taken; supporting new evidence generation through commissioning and undertaking research and analysis; and building the capacity of key actors through delivering training and developing tools and guidance. We do not implement programmes directly, and by maintaining this distance are better able to play a neutral role across the system. Since ReDSS was established in 2015, we have played a critical role in shaping durable solutions narratives in the region, building on our initial work in Somalia and expanding to Ethiopia and Kenya which has allowed us to work on a wide range of policy and programming processes.

The purpose of this study is to generate practical, evidence-based insights on how to finance sustainable (re)integration outcomes for forcibly displaced populations and host communities at the local level in the East, Horn, and Great Lakes (EHAGL) region. While national policies and frameworks for durable solutions have advanced, there remains a critical gap in understanding how these commitments can be effectively financed and implemented within specific municipalities and communes where displacement is experienced and solutions are delivered.

The study will adopt an area-based approach, focusing on selected sites in Ethiopia, Somalia, and Burundi, namely Jigjiga City, Baidoa City, and Rumonge, to examine how different financing sources interact within local systems. These locations reflect diverse displacement contexts, including urban, protracted, and returnee settings, and provide a basis for comparative analysis across varying institutional, economic, and financing environments.

Specifically, the study aims to:

• Assess how financial resources including domestic public financing, humanitarian and development assistance, diaspora remittances, and private sector investmentsare mobilized, allocated, and utilized within displacement-affected localities;
• Identify gaps, misalignments, and bottlenecks in the flow and coordination of financing at the municipal and commune level;
• Analyze the extent to which financing is aligned with local priorities, systems, and capacities, including planning, budgeting, and service delivery mechanisms; and
• Develop practical, area-based financing pathways that demonstrate how different sources of financing can be better aligned, sequenced, and leveraged to support sustainable (re)integration outcomes over time.

By grounding the analysis in specific local contexts, the study seeks to move beyond high-level policy commitments and provide actionable recommendations for governments, donors, and partners on how to finance durable solutions in practice. The findings are intended to inform more coordinated, predictable, and system-aligned financing approaches that can be scaled and adapted across the region, ultimately contributing to more sustainable and resilient outcomes for displaced populations and host communities.

Durable solutions for forcibly displaced populations in the East, Horn, and Great Lakes (EHAGL) region face a growing risk of becoming fragile, partial, or reversible. While national policies and frameworks have advanced, the realization of sustainable (re)integration outcomes ultimately depends on how these commitments are financed and implemented within specific municipalities and communes where displaced populations live. The scale and duration of displacement are expanding faster than the capacity of existing financing systems to support place-based, long-term outcomes. Without more resilient, aligned, and diversified financing approaches that reach the local level, progress toward self-reliance, inclusion, and stability is unlikely to be sustained.

First, needs continue to outpace response capacity, particularly in displacement-affected localities. The number of forcibly displaced people in the EHAGL region has grown steadily due to ongoing conflict, climate shocks, and chronic insecurity. By the end of 2024, the region hosted approximately 26.3 million forcibly displaced people, many living in specific urban, peri-urban, and rural areas where services, infrastructure, and economic systems are already under strain. In these locations, displacement is experienced as a localized pressure on housing, labour markets, and basic services, contributing to protracted conditions of economic precarity and limited opportunities. This places increasing pressure on financing approaches to support area-based service delivery and economic inclusion, rather than repeated short-term responses.

Second, displacement is concentrated in highly fragile and unevenly resourced environments. Within countries such as Somalia and Ethiopia, and in returnee-affected areas of Burundi, fragility is not uniform but spatially concentrated, with certain municipalities and communes facing overlapping crises, including insecurity, environmental degradation, and weak service systems. These localized conditions increase both the complexity and cost of delivering services and investing in recovery, while also heightening risks for public and private investment. As a result, the feasibility of durable solutions is shaped as much by local conditions as by national policy frameworks.

Third, domestic public financing for solutions remains limited, particularly at the subnational level. Governments hosting large displaced populations operate under severe fiscal constraints, and local authorities often have limited fiscal autonomy, unpredictable intergovernmental transfers, and weak budget execution capacity. While national policies increasingly promote inclusion and self-reliance, these commitments are not consistently translated into adequate, predictable financing at the municipal or commune level, where services are delivered and integration occurs. This disconnect constrains investments in infrastructure, service expansion, and local economic development in displacement-affected areas.

Fourth, international financing remains constrained and insufficiently grounded in local systems. Declining and uncertain Official Development Assistance (ODA), coupled with a continued emphasis on short-term, project-based humanitarian funding, limits the availability of predictable, multi-year resources. Moreover, external financing is often not aligned with subnational planning and budgeting systems, and is frequently delivered through parallel mechanisms that bypass local institutions. This reduces the effectiveness and sustainability of investments in displacement-affected areas and weakens the link between financing and long-term outcomes.

Fifth, alternative sources of financing remain underutilized at the local level. Diaspora remittances, private sector activity, and informal financial systems play a significant role in many displacement-affected areas, yet these flows are rarely aligned with local development priorities or integrated into structured financing approaches. The absence of mechanisms to connect these resources to place-based investments in livelihoods, services, and infrastructure limits their potential to contribute to sustainable solutions.

In response, several countries in the region have developed national policy frameworks and action plans to advance durable solutions. These frameworks provide an important strategic foundation. However, implementation has been uneven because financing is not effectively translated into coordinated, place-based investments at the municipal and commune level. In countries such as Ethiopia and Somalia, national solutions frameworks offer a strong entry point, but their operationalization depends on how financing reaches and is managed within specific localities. In Burundi, the ongoing returnee reintegration process presents an opportunity to embed area-based financing approaches from the outset, linking national planning with local implementation.

Objective

Research Questions

Proposed Data Sources

Objective 1: Estimate financing gaps for priority actions at municipal / commune level

1. What priority actions in municipal (Somalia & Ethiopia)andcommune (Burundi) solutions or development plans most contribute to financial autonomy, livelihood stabilization, and prevention of re-displacement?
   2. What is the estimated cost of implementing these priority actions over 3–5 years at the subnational level?
   3. What portion of these costs is covered by local government budgets, devolved transfers, and externally funded projects implemented locally?
   4. Where are the largest funding shortfalls across municipalities/communes, sectors, or displacement-affected populations?

• Municipal development plans, urban resilience strategies, and commune-level plans
• Subnational budgets, fiscal transfer data, and local treasury/expenditure reports
• Project-level financial data from NGOs/UN operating in specific municipalities/communes
• Donor disbursement data with geographic tagging (where available)
• KIIs with municipal/commune officials, local implementers, and community representatives

Objective 2: Assess alignment of financing with subnational priorities and systems

1. To what extent do domestic transfers, humanitarian, and development financing support municipal/commune-level priorities?
2. How are funds channeled at the subnational level (through local government systems vs parallel project structures)?
3. What coordination mechanisms exist (or are absent) at the municipal/commune level for integrating financing streams?
4. Are financing flows predictable, multi-year, and aligned with local planning and budgeting cycles?

• Municipal/commune budgets and planning document
• Intergovernmental fiscal transfer frameworks
• Local coordination platforms (area-based coordination, cluster systems, municipal forums)
• Donor and UN project portfolios mapped to specific locations
• KIIs with local authorities, NGOs, UN field offices, and donors with field presence

Objective 3: Identify fiscal, institutional, and political constraints at the subnational level

1. What fiscal constraints limit municipal/commune-level resource allocation to solutions (e.g., limited own-source revenue, unpredictable transfers)?
2. What institutional barriers exist at the subnational level (planning capacity, budget execution, coordination with the central government)?
3. How do local political dynamics shape financing decisions and prioritization?
4. What bottlenecks prevent multi-year and system-integrated financing at the municipal/commune level?

• Subnational PFM assessments, decentralization policy documents
• Municipal/commune budget execution reports
• KIIs with local officials, regional authorities, donors, UN/NGO field staff
• Secondary literature on decentralization and local governance

Objective 4: Analyze opportunities to mobilize diaspora, private sector, and DFI financing at the local level

1. What is the scale and spatial distribution of diaspora remittances and local financial flows at municipal/commune level (including informal systems and mechanisms such as Zakat where relevant)?
2. Which local private sector actors and markets could support economic inclusion and solutions?
3. What instruments/incentives could mobilize financing into specific municipalities/communes (e.g., matching grants, blended finance, municipal bonds where applicable)?
4. How can these resources be aligned with local development priorities and delivery systems?

• Local financial ecosystem mapping (banks, MFIs, SACCOs, mobile money data where available)
• Diaspora association networks linked to specific localities
• KIIs with local businesses, chambers of commerce, financial institutions
• DFI and donor programs with subnational targeting
• Case studies of place-based financing models

Objective 5: Develop and validate practical subnational financing pathways

1. What municipality-/commune-specific financing strategies can realistically support implementation of priority actions?
2. How can financing streams (local, national transfers, humanitarian, development, and alternative sources) be sequenced and layered at the subnational level?
3. What delivery mechanisms (e.g., municipal budget lines, area-based programs, pooled funds, delegated financing) are most viable?
4. How do local stakeholders validate feasibility, ownership, and sustainability of proposed pathways?

• Synthesized findings from Objectives 1–4
• Validation workshops at municipal/commune level (not only national)
• Engagement with local authorities, community representatives, and implementers
• Comparative analysis of subnational financing models

Geographic Scope: Three countries in the East, Horn, and Great Lakes (EHAGL) region: Burundi, Ethiopia, and Somalia.

Within each country, the study adopts an area-based focus, centered on selected municipalities and communes as primary units of analysis:

• Rumonge Commune (returnee and reintegration context)
• Jigjiga City (urban, regional capital context)
• Baidoa City (protracted displacement and humanitarian hub)

Temporal Scope: Within 8 months with a timeline of 1st June 2026 to 31st December 2026.

Methodology

Overall Approach:

• Mixed-methods, qualitative-heavy, with selective quantitative elements for cost and financing gap estimation.
• Comparative, area-based case study design, focusing on municipalities and communes in Burundi, Somalia, and Ethiopia.
• Analysis anchored in place-based systems, examining how financing flows, governance structures, and markets interact within specific locations, and how national policies translate into subnational outcomes.

Objective

Methodology

Objective 1: Estimate financing gaps for priority actions at municipal / commune level

• Review of municipal/commune-level plans, as well as relevant national plans and costing frameworks
• Mapping of priority actions within selected municipalities/communes that support livelihoods, financial autonomy, and reduced re-displacement
• Analysis of subnational budgets, fiscal transfers, donor reports, and project-level data to estimate current financing flows into each site
• Estimation of costs and financing gaps at the municipal/commune level, with aggregation to the national level
• Interviews with local authorities, government planners, donors, and implementing partners operating in selected sites

Objective 2: Assess alignment of financing with subnational priorities and systems

• Document review of municipal/commune plans, subnational budgets, and intergovernmental fiscal frameworks, alongside national policies
• Mapping of how financing flows reach (or bypass) local systems, including on-budget vs off-budget channels at the subnational level
• Analysis of alignment between external financing and local development/solutions priorities
• Interviews with municipal/commune authorities, ministries, donors, and UN/NGO actors at the field level
• Assessment of predictability and multi-year characteristics of financing at the local level

Objective 3: Identify fiscal, institutional, and political constraints at the subnational level

• Semi-structured interviews with municipal/commune authorities, subnational administrators, national policymakers, donors, and implementing partners
• Analysis of local fiscal constraints, including revenue generation, intergovernmental transfers, and budget execution capacity
• Examination of institutional and coordination bottlenecks affecting financing at the subnational level
• Review of secondary literature on decentralization, governance, and political economy, with attention to place-specific dynamics

Objective 4: Analyze opportunities to mobilize diaspora, private sector, and DFI financing at the local level

• Interviews with diaspora actors, local private sector stakeholders, financial institutions, and DFIs with engagement in selected municipalities/communes
• Analysis of remittance flows and local financial ecosystems, including informal mechanisms (e.g., Zakat, where relevant)
• Identification of market-based and blended finance opportunities linked to specific locations
• Case studies of place-based financing models from comparable contexts

Objective 5: Develop and validate practical subnational financing pathways

• Synthesis of findings from Objectives 1–4, grounded in municipal/commune-level analysis
• Development of area-based financing pathways for each selected site, including sequencing and layering of financing sources
• Aggregation into national-level financing recommendations
• Validation workshops conducted at both subnational (municipal/commune) and national levels to test feasibility, ownership, and sustainability
• Comparative analysis of financing mechanisms and delivery models across sites

Data Triangulation:

• Systematic triangulation of data across:
  • National and subnational policy and financial documents
  • Project-level and geographically disaggregated financing data
  • Key informant interviews at national and local levels
  
  
• Cross-validation of top-down financial flows with bottom-up evidence from municipalities/communes to ensure accuracy and contextual relevance

The Consultant will submit the following deliverables as mentioned below, providing all documentation on email:

Expected deliverables

• Inception Report (with PowerPoint presentation) outlining the consultant’s understanding of the TOR, methodological approach, agreed analytical framework, and ethical considerations. The inception report will also outline the work plan and a list of individuals and/or types of organizations the consultant will be interviewing for presentation to the research technical committee.
• Based on desk review and stakeholder consultation, draft a report (30 pages maximum without annexes) including:
  • Table of contents, glossary of key terms, list of acronyms,
  • An executive summary (maximum 3 pages), introduction highlighting the objectives of the study, the rationale, methodology used, scope and limitations, theory of change
  • Outline of literature review and stakeholder consultation
  • Conclusions, and concrete recommendations based on findings – focusing on the HOW
  • Annexes including but not limited to list of key interviews, bibliography, documents reviewed
  • A short PowerPoint presentation highlighting the key questions, methodology, key findings and recommendations (15 slides maximum)
  
  
• Summary notes from of key informants’ interviews
• Learning event with key stakeholders to present key findings and develop recommendations collectively
• Final revised report and PowerPoint presentation based on inputs received from key stakeholders and the technical committee.
• Participation in report launch and uptake discussions

Phase 1 – Inception & Design

(15% of total payment)

Month 1

• Inception report including methodology, initial stakeholder mapping (national and subnational), and literature review
• Client confirmation of approval via email or review meeting
• Minutes from kick-off/inception meeting showing agreement on methodology and sites

Phase 2 – Data Collection

(35% of total payment)

Months 2–4

• Municipal/Commune Financing Profiles.
• KIIs / in-depth interviews with municipal/commune authorities, local implementing partners, donors, and DFIs
• Collection of subnational budgets, donor/project data, and relevant financial documents
• Completed interview logs and attendance sheets
• Signed consent forms from KIIs
• Data spreadsheets and financial documents submitted
• Client confirmation that data collection is complete

Phase 3 – Draft Report & Analysis

(35 % of total payment)

Months 5–6

• Draft report integrating:
  • Analysis of financing gaps
  • Alignment with national priorities
  • Fiscal, institutional, and political constraints
  • Alternative financing opportunities
  • Municipal/commune-level pathways
  • Country-level synthesis
  
  
• Draft subnational validation briefs
• Draft report submitted to client
• Client feedback/comments received
• Draft validation briefs shared with stakeholders

Phase 4 – Final Report & Dissemination

(15% of total payment)

Months 7–8

• Final report incorporating client feedback
• Subnational validation workshops and briefs (municipal/commune level)
• National policy briefs
• Regional synthesis report (EHAGL)
• Supporting annexes: datasets, KIIs summary, financing tables
• Final report and briefs submitted and approved
• Workshop agendas, attendance sheets, and signed validation notes
• Email confirmation from client approving final deliverables
• Final datasets and annexes submitted

The duration and payment schedule of this consultancy is indicated in sections 5 and 6 above. The consultant(s) will report to the ReDSS Regional Solutions Manager and be guided by a Study Advisory Committee, made up of key experts in the subject matter identified by ReDSS. The consultant shall be prepared to complete the report no later than the end of December 2026, with uptake expected within the same time frame.

Role

Qualifications & Experience

Scope

Team Lead / Senior Researcher & Financial Analyst (1)

Advanced degree in economics, public policy, development finance, or related field; 10+ years of experience in displacement/solutions financing, public financial management, and multi-country research; strong quantitative and modelling skills

Provides overall technical leadership and quality assurance; leads financing gap estimation, cost modelling, and alignment analysis across countries; develops standardized analytical frameworks; ensures cross-country comparability; synthesizes findings into final outputs; leads high-level engagement with governments, donors, and development finance institutions

Country Researchers / Analysts (3 – 1 per country)

Advanced degree in economics, public finance, or social sciences; 7+ years of experience in displacement, decentralization, or local governance; strong in-country networks and experience with subnational systems

Lead municipal/commune-level research design and execution; manage site selection (2–3 per country); conduct and supervise KIIs; analyze subnational budgets, fiscal transfers, and locally implemented projects; leadstakeholder engagement and validation processes at both subnational and national levels; contribute to country-level synthesis and inputs to financing pathways

Field Research & Coordination Officers (3 – 1 per country)

Degree in social sciences, statistics, or related field; 3–5 years of experience in field research, data collection, and coordination; strong organizational and communication skills; familiarity with local contexts and languages preferred

Support field-level data collection across municipalities/communes; coordinate KIIs, logistics, and access to local authorities; compile and clean budget and project-level data; support transcription, coding, and data management; assist in preparation and execution of validation workshops; provide cross-country coordination support to ensure consistency and timeliness

ReDSS is looking to contract qualified firm whose collective experience should clearly demonstrate:

• 10+ years of experience in displacement/solutions financing, public financial management, and multi-country research; strong quantitative and modelling skills
• Proven track record of delivering complex consultancy services in sustainable financing, social policy, or development programming within the last 10 years.
• Proved experience working with international development partners
• Demonstrate experienceDesign and Implementation of Area‑Based Financing Models Worked on financing frameworks that target specific geographical or thematic zones (e.g., reintegration zones, urban/rural transformation spaces, climate‑vulnerable regions).
• Familiarity with place‑based financing, results‑based financing, blended finance structures, impact investing, and social impact bonds.
• Advanced degree in economics, public policy, development finance, or related field;
• Reintegration & Social‑Economic Development Practical experience in programs that support social and economic reintegration.
• Experience advising governments, institutions, or consortiums on sustainable development financing, public finance management, or institutional strengthening.

The selected team should consist of a Team lead, Country researchers and Field location researchers with the preferred qualifications outlined below

The selected consultant/s will work under the supervision of the ReDSS Regional Solutions Manger and Solutions Coordinator with support and guidance from ReDSS members and partners.

The study will cover all the locations indicated in section 5.

There is a possibility for travel during the delivery of this work to facilitate workshops and meetings. The travel will be approved and facilitated by DRC according to the DRC laid down procedures. Where required, meals and accommodation will be provided according to DRC laid down procedures.

Administration Evaluation

A bid shall pass the administrative evaluation stage before being considered for technical and financial evaluation. Bids that are deemed administratively non-compliant may be rejected. Documents listed below shall be submitted with your bid.

Technical qualification

For the award of this project, the evaluation criteria below will govern the selection of offers received. The evaluation is made on a technical and financial basis. The proposed offers by bidders will be evaluated using, inter alia, a weighted criteria as described below:

Based on the initial screening, DRC will invite selected bidders for an interview.

The financial offer will then be weighed against the technical offer. The total cost of the financial offer including tax should be mentioned in the DRC Bid Form annex A.2, with the budget breakdown separately.

Note: DRC is a VAT Withholding agent appointed by KRA

Financial Evaluation

All bids that pass the Technical Evaluation will proceed to the Financial Evaluation. Bids that are deemed technically non-compliant will not be financially evaluated.

Requirements

1. Financial proposal – should be itemized where possible. Also note that the total cost of financial offer will be indicated in annex A.2 form, and the fees should be quoted in USD and should account for 20% withholding tax for non-residents and 5% withholding tax for Kenya residents

Proposals failing to meet the above minimum requirements will not be considered further.

DRC will conduct reference checks from at least 2 previous works as an additional mandatory requirement.

Confidentiality

All information presented, obtained, and produced is to be treated as DRC’s property and is considered confidential for all other purposes than what is outlined in the ToR. Upon signing the contract, the selected consultant will be required to sign a confidentiality agreement. The material prepared by the consultant cannot be sold, used, or reproduced in any manner (partially or in full) by the consultant without prior permission from DRC.

How to apply

Interested Firms that meet requirements should requests bidding documents from procurement.ken3@drc.ngo email address.

And

Send their proposals and other required documents electronically to the email address tender.ken@drc.ngo on or before 20th April 2026 at 1700hrs EAT.

Please indicate ‘Financing Sustainable (Re)Integration: Area-Based Financing Pathways in the East, Horn, and Great Lakes Region of Africa’ in the subject line of your email application.

Tagged as: Agriculture, Food Security and Livelihoods