“HIRING
A CONSULTANT TO DEVELOP A POSITION PAPER ON CHALLENGES FACED BY TRANSPORT
SECTOR IN RWANDA”
I. Context and Background:
In recent years
Rwanda, like many other countries, has implemented considerable economic
reforms. In transport-related matters, these reforms have undoubtedly increased
the role of private sector in provision of transport services, and related
facilities. Following the recognition, by private operators, of the importance
of this sector owing to a constant and gradual improvement of the road network;
public transportation (specifically by road) has increased significantly, and
continues to expand and gain prominence, especially in the private sector.
Transport operators
perceive the sector not only as the source of their business, but also as a
strategic sector for t
he country. They are also of the perspective that
transport not only contributes considerably to poverty reduction and economic
growth, it also serves as a strong support mechanism to other sectors of the
economy. 012 that note, there is a strong and justified belief that both the
problems and challenges encountered could create major constraint hinder doing
business for the actors in that sector, and when taken into account could
impede Rwanda’s short, medium, and long term development goals.
It is therefore of
great importance to recognize the fact that economic growth tends to make the
constraint brought about by the transport sector more complex, and the
complexity will inevitably increases if the potential for these unexpected and
unwanted disruptions — with the field of transportation —is not effectively and
efficiently managed.
II.
Rationale of the Study:
Like health care or
education, transport is also considered to be a ‘public good’. This highlights
the fact that if it is rationed purely by “price” it will be possible
for ONLY the rich people to utilize it to the best and greatest extent, which
will create a wider gap within society and unfair disadvantages for specific
sections of the population.
On that note, it has
to be recognized that the mechanisms through which transportation operates
require public funds so as to serve the public by ensuring equal access.
Research reveals that even cities claiming to have well-performing transport
systems where operators claim to be self-supporting is not the case owing to
the fact that reaching that level of self-sustenance was brought about by
subsidiary strategies from the distant past.
Currently, a lot of
challenges are facing the sector, and a few of which are financial, technical
as well as policy handicaps. Some of those include; Excessive and Multiple
License Fees (Patent° fees for the Public Transport Sector), High rate of
Regulator’s fee paid by transport companies, Fares (Ticket Fees) do not reflect
the operating cost, nature and economic trend of the Public Transport business,
Bureaucracy as a bottle-neck in issuance of public transport vehicle stickers
(vignette), Lack of consultation of the private sector etc..
In light of the
above, the challenges faced by transportation companies in Rwanda is not only
of great concern in doing business, but it is also facing plummeting bus
ridership, decrease in cross border bus business penetration as well as long
distance trucks’ importation. This has been noticed in almost all public and
private transport companies due to the various issues some of which are
highlighted above, that have led companies to struggle to break-even, thus
sometimes creating unfair competition, hence leaving them with barely enough to
cover operating costs, and practically nothing left-over for capital upgrades
and sustainability.
In light of the
above, it is of great interest to the Private companies in Rwanda is not only
of great concern in doing business, but it is also facing plummeting bus
ridership, decrease in cross border bus business penetration as well as long
distance trucks’ importation. This has been noticed in almost all public and
private transport companies due to the various issues some of which are highlighted
above, that have led companies to struggle to break-even, thus sometimes
creating unfair competition, hence leaving them with barely enough to cover
operating costs, and practically nothing left-over for capital upgrades and
sustainability.
In light of the
above, it is of great interest to the Private Sector to find ways and means of
unraveling the challenges being faced in and around public and private
transportation, both inward and cross border especially owing to the fact that
transportation offers facilitation for many other sectors not only in the
private sector, but also for the national economy as a whole. In this regard,
PSF invites qualified and competent individual consultants to express their
interest in to develop a position a paper on the mentioned assignment.
The consultant is
expected to propose tangible recommendations to the above mentioned and many
other issues that will be identified during the study. The proposed
recommendations should address the issue of ease of doing business in the
sector as well fair to the consumers of the service.
III.
Objectives of the Position Paper
3.1. General
Objective
• To identify at
least a 5 year trend of business in transport business in Rwanda,
problems/issues that are encountered by the sector (public & cross border)
as well as cross border transport operators in Rwanda and suggest
recommendations for a return in investment into the transport sector
• To provide way
forward and policy recommendations that will be a basis for advocacy on behalf
of the transport sector
3.2.
Specific Objectives
1. To diagnose
problems related to costs of operation that specifically have to do with high
import duties and domestic taxation (fiscal laws), fees paid to the utility
regulator, and other operating costs.
2. To identify
problems related to the structural organization of public transport and related
issues surrounding this organization or lack of it.
3. To identify
issues regarding trade related costs (Tariff and Non Tariff Barriers) and
others faced by buses that are crossing the border to the EAC Partner States
4. To classify and
categorize implications brought about by the lack of organized markets not just
within the country (Rwanda), but also within the region (East Africa) as a
whole.
3.3.
Deliverables:
- Come
up with a Private Sector Position Paper that will be used for advocacy on
behalf of the Public and Cross Border Transporters, - To
identify at least a 5 year trend of business in transport business in
Rwanda, problems/issues that are encountered by the sector (public &
cross border) in Rwanda and suggest recommendations for a return in
investment into the transport sector taking into account the operation
costs. - A
clear analysis of the organizational structure of issues related to public
transport - Diagnosis
of the implications of the lack of organized market arrangements
nationally and regionally - Aline
statistical data that clearly reflects the problems associated with
“operational costs”, lack of an “organizational
structures”, and implications that come with the lack of
“organized market arrangements”, - Propose
clear policy recommendations in short, medium and long term for an
effective advocacy for the sector.
IV.
Methodological Approach:
4.1. Target
Population
The study population
or audience will comprise all registered public transporters, i.e., both inland
and cross border, and all financial institutions (including banks, microfinance
institutions, insurance companies..etc), clearing and forwarding agencies, both
Government and public institutions that are considered to be stakeholders
within the public and cross border transport sector (RURA, RRA, RBS, RDB
Immigration, etc).
4.2.
Concentration, Data Inclusion and Summation
It will require
statistical data that makes specific reference to the lack of an adequate
market model in Rwanda’s transport sector, which bring about (i) difficulties
in monitoring costs that underpins the sustainability of business owing to the
fact that operators carry out their business under art informa system, thus creating
difficulty to effectively monitor all costs incurred in the business.
It will also be
necessary to include data surrounding (ii) lack of vehicle financing, which
lacks appropriate market arrangement, which brings about increased uncertainty,
and makes it difficult for operators to practically demonstrate their cash flow
ability through which they are able to monitor and sustain their businesses.
It will also be
important to include (iii) other effects that arise from appropriate public
transport market arrangements, that bring about effects such as excessive
operating costs that result into failure(s) to renew fleets; lack of demand
forecast and corresponding capacity; failure of the service to respond to need;
and an increasing challenges for operators in the management of their
transportation assets through which they can invest further in their
network(s).
4.3.
Duration of the Contract
Upon signing of the
contract, the assignment is estimated to take a maximum of four weeks (i.e.,
one month).
4.4. Profile
of the Consultant
- The
assignment will be undertaken by an individual consultant; - Should
be a holder of at least a Master’s Degree in Business Management,
Economics qualification, Development Studies or other related fields; - At
least three (3) years demonstrated experience in related research,
especially in East Africa, but specifically Rwanda; - Proficiency
in English, and a working knowledge of French would be a great advantage; - Good
inter-personal, communication, and reporting skills.
V. Reporting
The Consultant will
work under the overall direction of the Chief Advocacy Officer of the PSF.
Within 1 week of the
beginning of assistance, the consultant will produce and Inception Report with
a preliminary analysis of the project requirements and the detail Work Plan for
remaining project period.
After 2 weeks from
the beginning of-exercise, the consultant will produce an Interim Report that
details the progress on the implementation of the Work Plan, challenges and
dilemmas The approval of the Interim Report will be important milestone for the
further advance of the assistance
The Draft Final
Report will be expected after 3 weeks from the beginning of the assistance. The
validation workshop will be organized at the end of the 3’° week of the
assignment. All Reports will be submitted Chief Advocacy Officer of the PSF.
VI.
Submission of Proposals
Interested
candidates requested to submit complete proposals (technical and financial in 5
copies) to the Head Procurement at Private Sector Federation not later than 4th August, 2014
at 10 am.
Attention
to: The
Chief Executive Officer of the Private
Sector Federation:
P.O. Box 319 Kigali, Gikondo. For more clarifications, please ‘contact Tel:
0788307165 or
0788306088.
Procurement
Unit
