1. CONTRACTING WITH LOCAL CONSTRUCTION FIRMS Afternoon, Monday 22 November

2. Contracting: sector problems  Force account no longer really possible (donor opposition, very inefficient, but feasible if it could be properly managed)  Must develop small construction and maintenance enterprises located outside the capital to do small jobs in remote areas  These can be small informal ones for labour supply for maintenance or to sub-contract to larger formal equipped ones for spot improvement works  Decentralisation of management trained in contract management also necessary  But sustainability of a rural construction sector difficult because conditions for survival are not there

3. Contracting: contractor difficulties  Demand for construction weak and variable so firms must have access to working capital and be polyvalent  Jobs are small so firms must be also  Firms must minimise fixed investment: rather rent equipment and stick to labour-based works  Contractors can be predatory and not always competent. Good contract management and training must be provided  They suffer from slow disbursement procedures: contract administration must be efficient  Good trained ones cannot invest in a basic equipment package: need credit as part of a training programme

4. Contracting: advantages  Provides a rural work base from which firms can expand to other types of construction  A major contributor to rural employment and poverty reduction (maximise multiplier effects)  And with the necessary programmes, a promotor of gender equality  Guarantee road sustainability  Construction sector is vital to rural development

5. Contracting: what to do  Provide multi-level assistance to potential entrepreneurs (classroom and on-the-job training, guarantees of future work, credit to buy basic equipment package)  Implement simplified contracting procedures  Make sure payment procedures are efficient and rapid  Finance rural infrastructure (roads, clinics, schools, etc.)  Provide effective contract supervision, sanction corruption and incompetence

6. Links to other modules  Maintenance  Labour-based works  Environment  Gender  Poverty reduction  Corruption

7. References

12. Contracting: references  Local contractor development Local contractor development  Small enterprise support Small enterprise support  Capacity-building in the construction sector.pdf Capacity-building in the construction sector.pdf  Private sector implementation Private sector implementation