The Uganda National Roads Authority (UNRA) on 19 August issued a Preliminary Information Memorandum for the Kampala-Jinja Expressway public-private partnership (PPP). The memorandum was prepared by the International Finance Corporation (IFC, part of the World Bank Group, which has been working with since 2014 as lead transaction advisor for the structuring and implementation of a successful tender process.
According to the African PPP project memorandum, the payment will be based on availability and Government will take the risk on usage. “This innovative approach, the first of its kind in Sub Saharan Africa will provide the necessary incentives for performance both for the public and private sector.” A request for proposals will be issued to prequalified bidders. UNRA says it is looking for proposals that provide for “extremely quick delivery” and “alternative funding structures.. to lower the cost of capital”.
The deadline for request for bidder conference call is 9 September, with the calls on 12-16 September, and deadline on 16 September for indicative interest. The Request for Prequalification (RFQ) will be in October.
The project will be to select a private concessionaire to design, build, finance and operate the greenfield limited-access 77 km Kampala-Jinja tolled highway, with an option to include an 18 km Kampala Southern Bypass. The PIM is available here . It will be in 2 phases.
UNRA, operational since 2008, is the project sponsor and the road is a top priority. The road is expected to create up to 1,500 jobs during construction and 200 jobs in operation. It is expected to cut the journey time to Jinja by 70 minutes. UNRA Executive Director Allen Kagina comments: “We want to see an expressway which is responsive to the needs of the travelling public across the region and for this to happen, we need a partner with vision, a long term plan and the best team to deliver it.”
The IFC is a public-private partnership specialist and has been involved in this African PPP project since 2014. According to the IFC website “IFC assistance will cover all project pre-investment activities including due diligence review, transaction structuring, marketing and promotion, contract preparation and development of bid/tender documents, as well as supporting the client during the bidding process up to the award of the concession contract. “The IFC will manage US$2million of donor funding to be utilized in the project.”
UNRA comments “In developing this project, UNRA has been very keen to take into account views of investors, contractors and operators in developing the project structure, which is explained in this PIM. In order to ensure value is preserved and affordability maintained, our proposal is to tender this project as a design, build, finance, operate and maintain, contract where toll revenue risk will be taken by UNRA, supported by the Ministry of Finance. We recognize that a contract, where payments are linked to the availability of the expressway, presents the best option for a robust competition and attaining value for money.” It says it is the first
These benefits are expected:
Vehicles are increasing fast in Uganda, in line with economic growth, and the PIM says the current journey time on a 24km stretch is 102 minutes. “If capacity is not improved, by 2037 there will be a complete breakdown in transport reliability”
The previous IFC documents on the African public-private partnership (PPP) read: “The IFC is supported by a team of international and local consultants with proven experience in the roads sector. Ashurst (UK) and MMAKS (Uganda) are providing legal counsel, SPEA Autostrade (Italy), Panteia (Netherlands) and Prome (Uganda) are the technical/traffic advisors and IMC Worldwide (UK) and Air Earth Water (Uganda) are the environmental advisors.”