Former Lusaka Province Minister Bowman Lusambo has challenged the New Dawn Government through the Minister of Finance Dr Situmbeko Musokotwane to publicly declare the full details of the Concession Agreement for the upgrading to Dual-Carriage-Way of 327 km of the Lusaka-Ndola Road.
The Concession Agreement for the Public Private Partnership (PPP) Project for upgrading to Dual-Carriage-Way of the road, including rehabilitation of 45km of Luanshya-Fisenge-Masangano Road, was signed on 28th February, 2023 in Ndola.
Dr. Musokotwane, MP, who is also the Chairperson of the PPP Council of Ministers, signed on behalf of the Government with E Shangfa signing on behalf of Macro Ocean Investment Consortium.
The consortium consists of the famous AVIC International project engineering company, Zhenjiang Communications Construction Group Limited and China Railway Seventh Group Limited.
Mr. Lusambo has since officially written to the Minister of Finance Dr Situmbeko Musokotwane demanding full disclosure of the Ndola-Lusaka road project.
The former Kabushi Member of Parliament has demanded to know among other things when the feasibility study was done, who did the study, the financiers of this project and why the Minister of Finance signed the agreement without parliamentary approval as demanded by the PPP Act.
“We have today officially written to the Minister of Finance Dr Situmbeko Musokotwane demanding full disclosure of the Ndola-Lusaka road project.Ndola-Lusaka Road Project: Demand for Full DisclosureWe have today officially written to the Minister of Finance Dr Situmbeko Musokotwane demanding full disclosure of the Ndola-Lusaka road project. The letter has been written in public interest for the sake of transparency and open governance,” Mr. Lusambo stated.
“Some of our key demands are;-In line with the requirements of the PPP Act, when was the feasibility study done and who did the study? If available, kindly release it to the public immediately. Who are the financiers of this project, kindly list ALL of them and their level of investment. Why did your office proceed with signing the agreement without parliamentary approval as demanded by the PPP Act? Release details of the beneficial owners of ALL companies participating in the project. With the current traffic volumes on the Ndola-Lusaka road, what projected revenue will the concessionaire generate in the 25 years the entity will run and operate the toll gates. Release details of the revenue sharing models (in percentage terms) that the Government of the Republic of Zambia has agreed to in this agreement. We have requested that this information be made public immediately by the Hon. Minister Sir has been availed with such. Our decision to write to the Minister of Finance has been prompted by the vagueness and opaque nature in which the signing ceremony was communicated to the Zambian people,” he wrote.
Meanwhile, the Ministry of Finance has released some details of the agreement in an apparent response to queries over the multi-million deal.
Below are the highlights from the details released by the Public Relations Unit of the Ministry of Finance.
HIGHLIGHTS
1. To overcome constraints imposed by limited financial resources, the new dawn Government will build or rehabilitate high traffic roads using the Public Private Partnership (PPP) financing model.
2. The PPP procurement process is premised on principles of competition, transparency, fairness, equity and cost-effectiveness, through a Government negotiation team.
3. For the Lusaka-Ndola and Luanshya-Fisenge-Masangano Roads, the solicited PPP mode was adopted to enhance competition, transparency, fairness, equity and cost-effectiveness.
4. The call for Expression of Interest (EOI) was published in the PRINT MEDIA on 16th February, 2022.
5. Following 3 above, seven (7) proposals from interested firms were received by March 11, 2022.
6. The received proposals were evaluated from 4th March to 21st March, 2022.
7. Two (2) firms were responsive to stipulated evaluation criteria and were thus shortlisted after evaluation.
8. In line with the Public Private Partnership Act, the requests for proposals (RFP) were issued to the shortlisted firms on 5th May, 2022 for submission by 1st July, 2022.
9. A second stage of evaluation was conducted by the contracting authority (GRZ/Ministry of Infrastructure and Urban Development), within July 2022.
10. Following evaluation of proposals and negotiations in line with provisions of the Public Private Partnership (PPP) Act no. 14 of 2009 (as amended), the Government agreed to enter into a CONCESSION AGREEMENT with the successful bidder for project execution on design, finance, build, maintain, operate and transfer basis.
11. After establishing the technical, financial and legal capacity of the preferred bidder, the Government awarded the concession agreement to MACRO OCEAN INVESTMENT CONSORTIUM (AVIC International Project Engineering Company, Zhenjiang Communications Construction Group Limited, and China Railway Seventh Group Limited).
12. Scope of the project shall mean and include, during the concession period: performance and execution by the concessionaire of all design, engineering, financing, procurement, construction, completion, operation and maintenance of the project infrastructure as follows:
a) Construction of a 327 km DUAL CARRIAGE-WAY from Lusaka to Ndola;
b) Construction of Kabwe and Kapiri Mposhi BY-PASSES;
c) Rehabilitation of 45 Km Masangano-Fisenge Luanshya road;
d) Construction of two (2) new toll plazas;
e) Construction of two (2) weighbridges; and
f) EXPANSION AND IMPROVEMENT of existing bridges.
13. The concession period will be twenty-five (25) years split into (a) three (3) years construction; and, (b) twenty-two (22) years operation and maintenance.
14. The total project cost is USD 649, 976, 167, broken down as follows:
a) USD 577, 383, 758.00 (US$ 577.38 million) is the total cost of construction;
b) USD 1, 000, 000 for working capital;
c) USD 1, 849, 500 for finance costs; and
d) USD 69, 742, 909 (USD 69.74 million) for interest during the construction period.
15. The Government will not spend any ngwee or provide any sovereign guarantee for the project.
16. For the WHOLE CONCESSIONAL PERIOD, the Government will not spend any money on maintenance of the road.
17. For the WHOLE CONCESSIONAL PERIOD, the Government will be receiving a share of the generated revenues and applicable taxes.
18. SPECIFIC BENEFITS OF THIS PROJECT INCLUDE THE FOLLOWING:
a) Travel times for locations between Lusaka and Copperbelt Provinces, will improve due to the anticipated continuous traffic flow;
b) Enhanced safety as a result of road dualization;
c) Citizens trading and living along the project corridor will benefit from traffic volumes to be generated from the rehabilitated road;
d) Implementation of the project will serve as a springboard for various youths in the country, as it will result in the creation of about 3, 000 direct jobs during construction and many more in the project area during the operations and maintenance phase; and,
19. BY LAW, ANY CONCESSION ON A PPP PROJECT is mandated to reserve more than 20% of the works to Zambian contractors. This shall be enforced without any compromise.
20. Local contractors along Lusaka to Chibombo, Chibombo to Kabwe, Kabwe to Kapiri-Mposhi, Kapiri-Mposhi to Masaiti and Masaiti to Ndola; and, the Masangano-Fisenge Luanshya road TO GET READY FOR SUB CONTRACTS.
