Parliament seeks to amend section 157 (8) of the public procurement and Asset Disposal Act, 2015 to bar foreign contractors from government contracts that are below Shillings 20 billion, so that such tenders are left to the local contractors. This is supposed to unlock billions of shillings from foreign to local contractors, and advance the government’s agenda of offering more tenders to Kenyan young entrepreneurs and other local contractors. On one hand, local contractors are accused of lacking the necessary capacity; while on the other hand, local contractors cite delayed payments and limited support to undertake such projects. These twin challenges can be addressed through the following ways.
The advent of devolution and the growth of the Kenyan economy means that more funds will be spent in infrastructure and other contraction jobs and opportunities. The importance of the construction industry to socio-economic development is monumental. This is because the sector comprises many activities and products, and many stakeholders are involved – from those in charge of funding, planning, design, procurement and supervision of the various works and projects. One public sector should establish and maintain an enabling environment for local contractors. This should be done through regular flow of funds, streaming procedures for administration and disbursement process, ensuring strong managerial capacities of local firms, streaming procedures for contract award, certification and making of payments. It should also include capacity building in negotiations, finances and documentation. Other capacity building activities could include contractor identification, mapping and development of a database for detailing and targeted trainings and capacity development, targeted procurement, and merging of smaller contractors with others to form bigger and effective contractors.
Secondly, there is need to enhance financial and technical capacity development and implementation of mechanisms to ensure they are state-backed and guaranteed of reliable resources. National and county governments can build contractors for enhanced job and employment opportunities creation. Once their capacities are built and financing guaranteed, such firms should be exported to countries in the region from which they can repatriate funds and jobs back to the economy. The Chinese contractors have been able to penetrate the continent because most of them are state-backed and repatriate profits back to the country. In the 1990’s it is Europe and the American construction companies took over 85 percent of construction jobs in the African continent Dr. Mutegi Giti, Urban management, Public Private Partnerships (PPPs) & Environment Specialist. mutegigiti@gmail.com, @danielgiti.l
Dr. Daniel Mutegi Giti 