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Transcript of Lecture 16 - Dev. of Small Scale Contractor Capacity.gp
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CROSS RIVER STATE RURAL
ACCESS AND MOBILITY
PROJECT (RAMP)CAPACITY BUILDING AND
TECHNICAL ASSISTANCE
TRAINING WORKSHOP ON
ROAD MAINTENANCECONTRACTING AND
TECHNIQUES FOR SMALL AND
MEDIUM SCALE LOCAL ROAD
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Development of Small Scale
Contractor Capacity for Rural RoadWork
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INTRODUCTION
Over the last fifty years road network construction and
expansion have been undertaken by governments of
developing countries.
Huge investments in road construction have been madethrough international funding agencies.
Unfortunately these governments did not allocate
sufficient funds to continue the investment in the
maintenance of their networks. This resulted in the new road network deteriorating,
sometimes into a series of muddy tracks, which are often
barely passable even in the dry season.
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INTRODUCTION
Although substantial progress is made in
setting the appropriate private sector strategy,
it is becoming increasingly difficult to
implement as problems associated with
contracting procedures and the industry
support framework are becoming more
apparent to both contracting organisationsand road agencies.
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The Need For A Framework To Govern
Private Contracting
There are 5 different types of contractingorganisation, which are capable of undertakingconstruction work Small builders and jobbers- these are small generally
one-man businesses who undertake building projectsor work for other larger companies.
Communal and Self help groups
State owned organisations
Private contracting companies
Foreign contractors
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The Need For A Framework To Govern
Private Contracting
small scale contractors in Nigeria are numerousand restricted, due to their size and resources, toundertaking small building work and occasional
minor civil engineering work. Many of these businesses are often small enough
to be invisibleto national construction statistics.
For road maintenance and construction to be
efficiently carried out in a competitive marketthere is a need for contracting firms of all sizes toundertake various sized projects
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The Problems Facing Small Scale
Contractors
For small contractors, like all small businesses, the main
problem is lack of access to and difficulty in obtaining
credit.
Compared to other small businesses, small construction
companies have a high financial turnover and hence a
larger need for short term working capital. This is due to
the amount of materials required, relatively large numbers
of staff wages and equipment purchase or hire costs.
They also need long term capital to cover the costs of
expanding the business and financing the purchase and
depreciation of equipment.
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The Problems Facing Small Scale
Contractors
Small scale contractors are dependant on regular payments to
retain staff, pay wages, obtain material supplies and maintain
a good relationship with their creditors.
Poor contract documentation is another problem experienced
by small contractors who are attempting to develop their
business in the road maintenance and construction sector.
Small contractors frequently complain of poor work
continuity. They may have a gap of many months between
contracts.
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The Problems Facing Small Scale
Contractors
Additional problems faced by small scalecontractors include: Difficulty in recruiting suitably trained labour and
supervisors
Poor availability and/or high costs of constructionmaterials
High capital cost of equipment and high loan interestrates
Lack of construction equipment for hire and difficultyin obtaining equipment spares
Poor on site supervision and availability of roadagency staff to address queries
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The Institutional Framework In
Developing Countries
Support framework for road works
Trade organisations: Consisting of material suppliersand manufacturers and work to promote to promotetheir products and services to contractors andconsultants.
Contractors / Consultants Associations:Organisations that assist in development of contractprocedure and national standards.
Learned Societies: They provide knowledge anddissemination to the whole industry, examine andcertify engineers and technical staff.
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The Institutional Framework In
Developing Countries
There are therefore two distinct institutional
problems, which must be addressed by
countries who are attempting to utilise the
private sector to undertake road constructionand maintenance.
The lack of a consulting engineering profession
The poor capacity within the support framework toassist the contracting sector.
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Institutional development of the
support framework
In order to achieve an institution framework forprivatisation it is necessary to initiate anddevelop organisations, which can provide support
framework. For example ASIST (Advisory Support Information Services and
Training) Supported by International Labour Office(ILO)
MART (Management of Appropriate Road Technology) Supported by DFID (Department for InternationalDevelopment)
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ASIST (Advisory Support, Information Services
and Training)
The overall objective of ASIST is to achieve awide-scale adoption of employment intensiveapproaches in national transport and
infrastructure investment policies andprogrammes.
The immediate objective of ASIST is to increaseuse and efficiency of labour-based methods to
carry out infrastructure, particularly road,construction and maintenance activities in SubSaharan Africa.
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ASIST (Advisory Support, Information Services
and Training)
In order to meet the immediate objective, theproject was divided into three components: advisory support (technical and policy advice, and
project backstopping),
information services (networking, technical enquiryservice, publications, research), and
training (international courses for engineers, seniortechnicians and trainers).
ASIST works closely and effectively along sidenational authorities, road agencies and projectstaff in its region providing the servicesdescribed above.
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MART (Management of Appropriate
Road Technology)
The Management of Appropriate Road
Technology (MART) initiative aims to reduce
the costs of constructing, rehabilitating and
maintaining road infrastructure, and vehicleoperations in developing countries.
It is based on a research project funded
principally by the British Department forInternational Development (DFID)
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MART (Management of Appropriate
Road Technology)
The current phase of the MART programme willinter alia draw together existing expertise inlabour and intermediate equipment-based
technology and the development of privateconstruction enterprises to produce a series ofguidelines on the four priority topics of:
Hand tools;
intermediate equipment;
private sector development and
institution building.
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MART (Management of Appropriate
Road Technology
The MART initiative is strongly research-based
Thus much of the output will be in the form of journalpapers and other formal publications suitable asreference material
The MART project therefore assists the supportframework by codifying international expertise fromdonors, consultants, projects and other researchorganisations and providing the information in a
more useable form for government agencies anddepartments and centres of learning such asuniversities and learned societies.
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Conclusion
This paper has discussed the development ofthe private sector in developing countries,particularly Africa and the frameworks
established in developed countries. It reviewed various obstacles encountered by
small private contractors to develop andexpand their business and highlighted theneed for framework to govern privatecontracting.
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