Abstract
This chapter investigates the contractual dynamics of the railway concession between Kenya and the Rift Valley Railways (RVR) Consortium. The chapter reveals political factors such as procurement-related patronage and electoral violence that prevent full implementation of reform. The chapter reveals political factors such as procurement-related patronage and electoral violence that prevent full implementation of the Public Procurement and Disposal Act (PPDA) of 2005. The problems identified in the railroad concession granted to the RVR Consortium in Kenya, however, go beyond political capability to regulate.
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Notes
- 1.
Other terms that are closely related to outsourcing are contracting out, leasing, and government procurement. However, unlike in the case of government procurement, the private firms concessionaires are usually given a more free hand in government outsourcing.
- 2.
Financial News. “Kenya Requires Sh200 Billion to Finance Infrastructure” http://todayfinancialnews.com/trade-and-investment/1759-kenya-requires-sh200-billion-annually-to-finance-infrastructure (accessed 6/14/2014).
- 3.
In 1997, a World Bank-sponsored study known as Country Procurement Assessment Review found several defects in the prevailing procurement system. The culmination of this study was the launching of the Public Procurement Reform Program in 1998, which was followed in 2001 by the issuance of Public Procurement Regulations under the Exchequer and Audit Act. It was in view of the limitations still inherent in the use of these regulations that PPDA was passed in October 2005.
- 4.
The opening speech by Mr. Robinson Githae, the Minister for Finance, during the PPP Workshop held on 12 February 2013 at the Crowne Plaza Hotel, Nairobi.
- 5.
The records of the Rift Valley Consortium. “Our History” at http://www.riftvalleyrail.com/content-layouts.
- 6.
The Port of Mombasa serves Kenya and Uganda (the co-parties to the RVR Concession agreement), and also Northern Tanzania, Rwanda, Burundi, Eastern Democratic Republic of Congo (DRC), and South Sudan. Furthermore, with the completion of the LAPSSET project, a road construction from Kenya to Ethiopia underway, Mombasa will likely serve a good part of this northern corridor.
- 7.
TransCentury “Why is TransCentury in Rift Valley Railways?” http://www.transcentury.co.ke/userfiles/Why%20Is%20TransCentury%20In%20Rift%20Valley%20Railways%281%29.pdf (no year of publication).
- 8.
Sheltam is an affiliate of the Sheltam Grindrod Group, which also includes Comazar (Pty) Ltd, the biggest private railway operator in Africa with links to South Africa’s largest transport and logistics enterprise, Transnet. It is also active in Burkina Faso, Cameroon, and Madagascar.
- 9.
PPIAF (2010), “A PPP Against the Odds: The Kenya-Uganda Rail Concession Fights for Survival.” March 2010. http://www.ppiaf.org/sites/ppiaf.org/files/publication/Kenya-Uganda%20Rail%20Case%20Study.pdf.
- 10.
The Parliamentary Debates, 5 August 2008.
- 11.
Railways Africa: The Authoritative African Railway Publication, 12 February 2010.
- 12.
Kenya Times Online, Wednesday 20 August 2008.
- 13.
Business Daily, 17 July 2013.
- 14.
All $ are in US dollars.
- 15.
Business Daily, 17 July 2013.
- 16.
It will be remembered that the Uganda civil war between 1979 and 1986 had even a more devastating effect on the operations of the Uganda Railway Corporation, the predecessor to the RVR (Uganda).
- 17.
Among other things, the Public Investment Committee (PIC) noted that authenticity of documents provided in support of prequalification such as evidence of proof of management of a railway line, employment of more than ten experts) were not verified. These findings suggest the RVR never featured in the prequalification process. Railways Africa: The Authoritative African Railway Publication, 12 February 2010.
- 18.
Parliamentary Debates, 15 August 2008.
- 19.
The Standard, 30 May 2014, 61.
- 20.
According to the World Bank (2014), among the indicators of governance are indicators such as transparency and accountability in public finance, government’s capacity to formulate and implement public policies, and respect by the citizens and leaders of the institutions that govern economic and social life (World Bank Institute’s Worldwide Governance Indicators 2014).
- 21.
Some authors have chosen to limit its meaning only to those operations by a firm that go beyond its interests and the requirements of the law (McWilliams and Spiegel 2001: 1), whereas others choose to construe it broadly as socially and environmentally friendly business practices by a private firm (Crowther and Aras 2008).
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Amadi, H. (2016). The Governance of Concessionary Assets: A Review of the Partnership Between Kenya and the Rift Valley Railways Consortium. In: Nyeck, S. (eds) Public Procurement Reform and Governance in Africa. Contemporary African Political Economy. Palgrave Macmillan, New York. https://doi.org/10.1057/978-1-137-52137-8_14
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