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The Addis Abeba City Roads Authority (AACRA) has
signed yet another contract with CRBC Addis
Engineering Plc for the construction of the left
side of the Megenagna Ring Road Roundabout - Ayat
Village road.
The agreement on the more than 224 million Br worth
construction of the road, which had been awarded to
MIDROC Construction before it was snatched because
of an alleged poor performance in previous projects,
was signed last Thursday, May 14, 2009 at AACRA's
head office. Fekade Haile (Eng.), and Wen Ying Zheng,
general managers of AACRA and CRBC, respectively,
signed the agreement.
The about 25m wide and the more than eight-kilometre
long road, whose budget comes from the coffers of
the city government, is expected to be completed in
14 months time.
CRBC Addis included,
three construction firms had contended for the
project following AACRA's tender announcement more
than eight months ago.
Saba Tidhar Construction, a joint venture between an
Israeli and an Ethiopian construction firm, offered
to construct the road for more than 245 million Br,
while Daniel Mammo Construction (DMC) offered more
than 281 million Br.
Engineers' estimation of the cost of the
construction had been about 235 million Br and AACRA
estimated the road would be constructed at an
expense of about 245 million Br, while CRBC came up
with an even less construction cost of more than 224
million Br.
The construction of the right side of the same road,
which had been going on since 2005/06 by the same
Chinese company, was completed about eight months
ago; it cost 115 million Br. The more than 100
million Br difference in the cost of the
construction of the two sides of the road, similar
in length, width and standard, is a result
inflation, according to AACRA's management.
"This shows the inflation rate of the local and
global market in the period between the times the
two roads were awarded," said Fekade.
AACRA had signed
another contract for the construction of the same
road about 10 months back with MIDROC, a local
construction firm, which already has business deals
with the authority after winning bids for the
construction of three roads in the city posted in
the 2007/08 budget year. The authority decided to
snatch the contract away from the local construction
firm when its Board of Directors met on October 20,
2008, alleging that MIDROC had bad records in the
three road constructions.
"The cancellation of the contract with MIDROC was
instigated by the performance the firm had showed in
other contacts with the authority and for the burden
that the firm would have faced due to the contract
commitments it had already been in with the
authority," reads the press release prepared on the
signing of the agreement.
At the same meeting, the authority also decided to,
and has subsequently taken back the project for the
major facelift on African Avenue from Eneyi
Construction, another local private firm, for the
same reason.
"Sometimes, taking back contracts and issuing other
tenders is necessary to keep the quality of
constructions we are undertaking," said the general
manager of the city's roads authority.
Fekade believes that
such an action makes local firms realize what it
takes to be a good competitor. In this specific
case, however, CRBC caught the authority's because
of the lower construction costs that former had
presented, he added.
CRBC and AACRA are not
new business partners. CRBC is the Chinese
construction firm that is undertaking the nine-kilometre
long and 40m wide road that runs from Meskel Square
to Kality ar a cost of about 295 million Br. CRBC is
also in charge of another more than four-kilometre
long and 30m wide road that runs from Winget Ring
Road Roundabout to the Entoto area, otherwise known
as Gojam Ber at a total cost of more than 326
million Br.
Other than the eight projects that had to be
transferred to the next budget year due to financial
reasons, AACRA currently runs about six road
construction projects.
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