13. Procurement Under International Financial Institutions PDF

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Warning: TT: undefined function: 22TOPIC THIRTEEN13. PROCUREMENT UNDER INTERNATIONAL FINANCING INSTITUTIONSLearners being able to:- a) Describe principles governing international institutions procurement procedures and other donors agencies. b) Describe procurement methods for goods, works, and serv...

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BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

TOPIC THIRTEEN 13. PROCUREMENT UNDER INTERNATIONAL FINANCING INSTITUTIONS Learners being able to:a) Describe principles governing international institutions procurement procedures and other donors agencies. b) Describe procurement methods for goods, works, and services under IFI and other donor agencies. c) Describe IFI procurement procedures and other donor agencies. d) Apply IFI procurement guidelines and other donor agencies. Procurement for Donor Funded Projects The principles of procurement for donor funded projects are the same as those of the Public Procurement(Amendment) Act, 2016: •

Need for economy and efficiency in use of funds.

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Providing for the fair and equitable treatment of all suppliers and contractors

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Equality of participation

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Probity and ethics

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Transparency

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Equity

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Value for money

International Financial Institution (IFI) •

Is a financial institution established (or chartered) by more than one country, and is subject to international law.

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Owners or shareholders are national governments, international institutions and other organizations.

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The IFI offers financial support to private sector projects in developing countries.

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IFI includes World Bank, International Monetary Fund IMF, the International Finance Corporation and the European Investment Bank.

Methods of Procurement Most of the international finance institutions (IFI) have similar guidelines for procurement for projects to which they are providing funding. •

International Competitive Bidding

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Limited International Bidding

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

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National Competitive Bidding

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Shopping

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Framework Agreements

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Direct Contracting

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Force Account

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Procurement from Specialized Agencies

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Procurement Agents

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Inspection Agents

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Procurement in Loans to Financial Intermediaries

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procurement under BOO/BOT/BOOT, Concessions and Similar Private Sector Arrangements

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Performance-Based Procurement

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Community Participation in Procurement

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Procurement under Disaster and Emergency Assistance

International Competitive Bidding (ICB) •

Under this method all eligible prospective bidders are allowed to participate in tendering process irrespective of their nationality

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Invitation of tenders is advertised in international newspapers and publish information on UNDB online.

Limited international bidding (LIB) It is a direct invitation of bids without open advertisement. It is appropriate method of procurement where: •

there is only a limited number of suppliers,

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the amount of the contract is not large enough to attract foreign suppliers and contractors

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Other exceptional reasons may justify departure from full procedures.

Domestic preferences are not applicable in the evaluation of bids under National Competitive Bidding (NCB) Is a competitive bidding procedure used for public procurement within the country of recipient of donor funds. The method is appropriate where:

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

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It is unlikely to attract foreign competition because the contract values are small, works are scattered geographically or spread over time, works are labor intensive

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the goods or works are available locally at prices below the international market.

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where there are advantages over ICB

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Advertising may be limited to the national press or official gazette, or a free and open access website.

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Bidding documents may be in a national language

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Local currency will be applicable Shopping

Method of procurement based on comparing price quotations obtained from several suppliers, contractors and services providers minimum of three. It is an appropriate method where: •

Materials are readily available, off-the-shelf or standard specification of small value, or

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Simple civil works of small value.

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Quotations may be submitted by letter, facsimile or by electronic means.

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The evaluation of quotations follows the same principles as of open bidding.

Framework Agreement (FA) •

is a long term agreement with suppliers, contractors and providers of non, consulting services which sets out terms and conditions under which specific procurements (call offs) can be made throughout the term of the agreement.

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Prices may be either pre agreed or determined at the call off stage through competition or a process allowing revision of price without further competition

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FAs may be permitted as an alternative to the Shopping and NCB methods for goods that can be procured off the shelf or are of common use with standard specifications

Direct contracting Is contracting without competition (single source) It appropriate where: •

Additional requirement on ongoing project

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Standardization of equipment or spare parts, to be compatible with existing equipment

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Proprietary and obtainable only from one source.

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natural extension of contract

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

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Exceptional cases, such as in response to natural disasters Force account and Procurement from Specialized Agencies

Force Account: •

Is construction by the use of procuring entity own personnel and equipment

Procurement from Specialized Agencies: This refers to procurement directly from specialized agencies, acting as suppliers, complying with their own procedures. It is appropriate way of procuring: •

small quantities of off-the-shelf goods, in fields of education and health;

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specialized products

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Limited number of suppliers dealing with special products such as vaccines or drugs.

Procurement Agents •

Engaging procurement agent to undertake procurement due to lack the capacity, resources, and experience

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The agent is required to follow all the procurement procedures provided for in the financing agreement and the Guidelines.

Performance based procurement (output-based) procurement •

Refers to competitive procurement processes (ICB or NCB) resulting in a contractual relationship where payments are made for measured outputs instead of the traditional way where inputs are measured.

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Technical specifications are defined based on desired result or output which satisfy quality, quantity and reliability.

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Payments are made based on outputs delivered

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Performance based procurement may be applicable for provision of services, design, supply, construction (or rehabilitation, design, supply, construction (or rehabilitation)

Use of Country Systems (UCS) •

Refers to the use of domestic procurement procedures and methods that have been determined to be consistent with developing partners Guidelines

Procurement Procedures for Donor Funded Projects •

Recipient of funds from donors are responsible for procurement management

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IFI/Donors plays oversight role to ensure terms and conditions of agreement and Procurement Guidelines are complied

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Financiers reviews and approves all critical stages of procurement process from initiation up to award and completion of project

Types of Review Prior review •

For large contracts the financier/donor reviews all critical stages procurement. “No objection” to borrower if is satisfied with procedure.

Post review •

The donar/Bank carries post review for contracts not covered under prior review.

If it established that the procurement was not carried out in accordance with loan agreement may declare mis- procurement and shall not finance that procurement Guidelines for Procurement •

Donors provide guidelines on carrying out procurement. It is important to comply with their directives otherwise financing may be withdrawn.

The World Bank Guidelines: •

Selection and Employment of Consultants by World Bank Borrowers January 2011

Procurement of Goods, Works, and Non-Consulting Services under IBRD Loans and IDA Credits & Grants January 2011 Donor Funded as per PPA 2011 •

Donor funded projects are required to be undertaken in accordance with PPA 2011.

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Where government enters in agreement which favors' external financier the procurement made through government contribution will be undertaken through national firms

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Insurance shall be placed with companies registered in Tanzania

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Local transporters shall be contracted

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Preference will be offered to local firms

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PEs shall seek clearance from the internal approving authority before external authority.

Where there is a conflict between the two the external clearance shall prevail

BY ABUBAKARI MRISHO/ O717 58 14 04/ [email protected] KP- PROFESSIONAL SERVICES (KPS)

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