Fifteen Chinese and 12 local construction firms are vying to construct over 50 Silos to be used for food reserves with an estimated cost of two billion Birr.
Floated by the Public Procurement & Property Disposal Services (PPPDS) on behalf of the Strategic Food Reserve Agency (SFRA) on November 23, 2017, the bid aimed to hire a company that is going to construct three silos in three regional states.
On the opening that was held on March 6, 2018, only 27 companies submitted their financial and technical documents out of the 82 firms which had bought the bidding document.
For the first lot, which comprises of 19 stores and is located in Finoteselam in the Amhara Regional State, ten construction companies placed bids, half of them local. For the second one, which has 18 stores and is in Hosaena in the Southern Nations, Nationalities & Peoples’ Regional (SNNPR) State, however, only three of the 11 companies were local. There were only six firms that bid for the third lot in Qebridehar in the Somali Regional State.
The World Food Program (WFP) has been recommending the Strategic Food Reserve Agency to revise and update the grain food quality working procedures, with regard to its food quality management, pest control and local procurement.
The first two lots are chosen for their surplus production of grain, while the third was chosen for its susceptibility to drought, according to a source close to the case.
Some of the Chinese firms have been involved in projects in Ethiopia. China Communications Construction Company (CCCC) is engaged in the Bole International Airport expansion project, while the CGC Overseas Construction Group is taking part in the construction of the Ethiopian Electric Power (EEP) headquarters.
China Jiangsu International Group has been involved in the construction of United Bank’s headquarters, and China Gezhouba Group Company (CGGC) has had experience working on the Tekeze hydropower plant.
Of the local firms, Afro-Tsion, Rama, Tekleberhan Ambaye, Satcon, Yotek and Yirgalem construction companies are some of the well-known ones among those that are vying to construct the Silos.
“Reviewing the technical documents will take a week’s time, at which point we will send the companies a letter of notification on whether or not they passed,” said Assefa Solomon, public relations vice director of the Service.
Established in 1982 as a project within the Relief & Rehabilitation Commission (RRC), the Reserve Agency that was set up with the objective of maintaining and administering food reserves in Ethiopia plans to have a food reserve capacity of 1.5 million tonnes by the end of the second edition Growth & Transformation Plan (GTP II).
For Henok Abate, a lecturer at Bahirdar University’s Institute of Disaster Risk Management & Food Security, the construction of the Silos is a solution to a complex food insecurity problem that is akin to a poor drought reduction practice.
“It is better that the government tries to come up with ways of preventing droughts before they occur as opposed to just looking for means to cushion its effect,” he told Fortune.
As a result of the lingering effects of the 2015 to 2016 El Niño-induced drought and multiple consecutive droughts, an estimated 7.9 million people in Ethiopia require emergency food assistance, according to the United Nations Office for the Coordination of Humanitarian Affairs (OCHA).
An additional eight million chronically food-insecure people are supported by the Productive Safety Net Program (PSNP) that was launched in 2005. In addition, there are 901,235 refugees in Ethiopia.
A report by the Famine Early Warning Systems Network (FEWS NET), a provider of information and analysis on food insecurity, also notes that vulnerable households in south-eastern Ethiopia will continue to face crisis and emergency levels of acute food insecurity through mid-2018. Sustained, large-scale assistance is needed, particularly in the Somali region.