SMEs to access 20% infrastructure development projects

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Stanbic Bank Zambia signed a Memorandum of Understanding with the National Road Fund Agency
Stanbic Bank Zambia signed a Memorandum of Understanding with the National Road Fund Agency

Local Small and Medium Enterprises can access up to 20 percent of infrastructure development projects under the Link Zambia 8000 initiative which has a capital outlay of US$5.3 billion over the next five years.
In 2013 , SMEs will access as much as US$1.2 billion in infrastructure projects but will be unable to deliver their projects on time or with expected quality due to various challenges including lack of access to appropriate finance, equipment, technical support and project management.
Stanbic Bank Zambia’s Chief Executive, Dennis Kennedy said that accessing contracts in Zambia’s infrastructure development will remain out of reach for local Small and Medium Enterprises (SMEs) until they build their capacity to deliver on projects.
Speaking in Lusaka when Stanbic Bank Zambia signed a Memorandum of Understanding with the National Road Fund Agency (NRFA) and the Road Development Agency (RDA), Dennis said that the participation of SMEs in the development of Zambia’s roads would see investment in infrastructure development flowing down to the rest of the population through job creation and empowering of Zambians through the transfer of skills and knowledge.
“Local contractors are unable to take on significant national projects due to their lack of capacity. This is because many do not have organizational structures that ensure technical support and project management,” said Dennis.
Under the MoU, local contractors will be able to access funds, acquire equipment and benefit from technical assistance in order to fulfil their contracts.  Stanbic Bank, in partnership with the RDA and NRFA will work towards the successful implementation of Construction Finance Initiative (CFI) by providing funding, arranging for supply of equipment through Vehicle and Asset Finance (VAF) and thereby building the capacity of local contractors.
“Local contractors will be able to obtain equipment using our Vehicle and Asset Finance offering from various suppliers of equipment.
Dennis added that through this MoU, the Bank will support local contractors participate in road development which will ultimately create opportunities for employment and capacity building for the Zambian SMEs.
The Link Zambia 8000 Project is an infrastructure development programme that will see the construction of about 2,290 kilometres of roads at an estimated cost of K7.9 trillion in the first phase. The second phase is expected to cover 3,049km of road network at an estimated cost of K11.25 trillion while the third phase is an upgrade of 2, 862km of road network at an estimated cost of K9 trillion
Meanwhile Transport minister Christopher Yaluma  noted with great appreciation which the Road sector agencies has combined initiative and innovativeness in tapping from the immense benefits of the unique public private partnership (PPP) frame work to develop small and medium scale contractors.