Kenyan manufacturers were yesterday still waiting for a clear roadmap to their share of the multi-billion shilling tenders for second phase of the standard gauge railway project that President Uhuru Kenyatta is expected to launch this morning.
Kenya Association of Manufacturers chief executive Phyllis Wakiaga said local industrialists expect the government to enforce the law that reserves for them at least 40 per cent of the Sh153 billion SGR contracts.
That means local contractors are entitled to at least Sh62.1 billion of the total budget for Phase Two of the project that covers the Nairobi-Naivasha segment of the railway line.
“We expect that the government will, in addition to this, institute a thorough monitoring and evaluation process to ensure that the contractual obligation is actually met during this phase of the project,” Ms Wakiaga said.
The manufacturers have been unable to get their share of the first phase of the railway project priced at Sh327 billion despite numerous calls to the Chinese contractor to reserve 40 per cent of the supplies to locals — a quest that was made difficult by the fact that the policy had not been formalised into a legal obligation.
Transport secretary James Macharia said the government has contractually tied the Chinese contractor to procuring at least 40 per cent supplies from local manufacturers in the second phase of the project — a promise industrialists are hoping to mine throughout the construction period.
“This time we have put an addendum, which is part of the contract that the contractor must meet the 40 per cent threshold so it is a contractual obligation,” Mr Macharia said, adding that the requirement was in the past merely a gentleman’s agreement.
Mr Kenyatta, who initiated the ‘buy Kenya build Kenya’ scheme that gives priority to locally manufactured goods, is expected to launch the Phase Two of the SGR project at Embulbul, Narok County after earlier plans to have the event in Nairobi aborted in the wake of intense opposition by activists who went to court blocking its passage through the Nairobi National Park.
The 120km stretch from Nairobi to Naivasha will consume large volumes of steel and other raw materials as it has 74 bridges and 7 tunnels passing through the rugged terrain of the Rift Valley.
Devki Group, the Kenyan conglomerate that makes steel, roofing sheets and cement, welcomed the minister’s revelation that the Chinese contractor is now legally required to buy a certain amount of inputs from local manufacturers.
The company’s founder, Narendra Raval, said the involvement of local manufacturers has been lacking in the first phase of the railway project, minimising the mega project’s contribution to the Kenyan economy.
“This is a rare opportunity for us to finally benefit from this project. If the 40 per cent rule is kept, we will be able to expand our production and employ more people and it is not that we cannot meet the standards or the quantity needed,” said Mr Raval, adding that all the manufacturers need is full disclosure of what is required to adequately prepare for it.
Ms Wakiaga asked for proper involvement of local industrialists in the preparations for the upcoming project in order to thrush out outstanding issues such as quality standards — a contentious loophole the Chinese contractor has used to deny locals supply tenders for the Sh327 billion first phase of the project.
“There is need for consultations among stakeholders to establish the quality and specifications of the products needed for this phase to make it a mutually beneficial arrangement,” she said.
Credit: Business Daily