This component expands technical assistance to 80,000 microenterprises to enhance their knowledge and capacity in climate-resilient Resource Efficient and Cleaner Production (RECP) practices. It will adopt a more institutionalized approach by conducting assessments on technical resource efficiency, environmental and climate adaptation technologies, and environmental impacts. This process will help select and prioritize climate-resilient RECP practices and develop environmental and financial digital tools to support business plan development, particularly in the context of climate hazards. The component will support two types of MEs: those launching new green businesses and those willing to transition existing businesses to more climate-resilient models by introducing digital tools and climate-resilient RECP practices. Additionally, this component aims to enable MEs to adopt changes in their current business practices while raising awareness about critical environmental issues.

This sub-component provides grants to Partner Organizations to enhance MEs’ technical knowledge and capacity, identify areas for improvement, and promote skills development to increase climate resilience. The sub-component will support two RECP assessments: an initial Rapid RECP Climate-Resilient Assessment and a subsequent Detailed RECP Climate-Resilient Assessment after the selection of participating POs and MEs. The Rapid Climate-Resilient RECP Assessment will offer guidelines for PKSF in selecting POs and MEs. This assessment will identify general environmental issues, evaluate climate-change vulnerabilities, and develop technical recommendations for MEs and ME clusters. Following the selection of POs and MEs, a Detailed RECP Climate-Resilient Assessment will be conducted with the selected MEs by a firm that will provide support to PKSF and POs. The assessments will identify opportunities for MEs and ME clusters to re-engineer their business models for climate-resilient RECP, improving individual practices and implementing climate-change adaptation measures without disrupting ongoing business operations. The recommendations will be both appropriate and cost-effective. The firm will also offer capacity-building initiatives to increase MEs’ technical knowledge and promote the adoption of RECP practices. The activities will include awareness-raising campaigns to ensure the project’s sustainability and encourage behavioral change. Through these assessments, simplified and customized environmental assessment tools for MEs will be developed.