Zambia’s economy has historically been dominated by copper mining, despite post-independence policies to industrialise and diversify the economy. Copper mining accounts for over 70% of the country’s foreign exchange earnings and contributed 14.6% to GDP in 2014. Total employment stood at 82,725 people in 2014. The industry consumes upwards of US$3 billion annually in input goods and services. While the services are significantly procured locally, almost all the goods are imported. Some estimates put the value of goods procurement at over US$ 2.5 billion annually. The share of domestic firms in the mining market is less than 4% while the market share of indigenous firms is less than 1%. It is clear therefore that localising a significant portion of the industry’s supply chain, through manufacturing linkages, would not only contribute to industrialisation and economic transformation but support greater welfare gains, thus directly alleviating the continuing high levels of poverty and inequalities.
In this regard, the Ministry of Mines and Minerals Development with the support of the African Development Bank carried out a study on input goods and services in the mining sector. The main objective was to evaluate the mining procurement value chain with a view to identify opportunities for localising input goods and services, in a manner that supports linkage formation with other economic sectors. The key findings of the study, revealed that:The estimated annual expenditure on the selected goods and services by the mining industry was about US$2.4 billion, out of which only 2.5% goes to Zambian firms. The main components are about US$1.3 billion in core mining goods and US$942 million in core mining services. The two categories make up 93% of total annual procurement and are hence the most likely targets for localization;
a) Identified opportunities are in the following sub sectors; metallic products, electrical goods, chemicals, explosives, industrial minerals (clay and sand) and services (haulage, catering, security and cleaning).
b) The study thus recommended among policy proposals to support implementation of the findings, a legal framework to introduce margins of preference for locally manufactured goods and services and to compel all large-scale mining companies to reserve a proportion of procurement for local goods and services.
In line with the recommendation, the Government of Zambia through the Ministry of Mines and Minerals Development intends to develop and issue a Statutory Instrument (SI) to enforce Section 20 of Mines and Minerals Development Act No.11 of 2019. The objective is localise a significant portion of the mining companies’ procurement expenditure.
2.1 The purpose of this consultancy is to work with the Ministry of Mines and Minerals Development, Ministry of Commerce, Trade and Industry, and other stakeholders to develop a Statutory Instrument in line with the Strategic Paper of the Promotion of Local Content to enforce Section 20 of the Mines and Minerals Development Act. The Statutory Instrument will be guided by the various reports on local content in Zambia and examples from other countries that have made headway in this matter.
2.2 The consultant will work closely with the Inter-ministerial Team, staff at the Private Enterprise Programme Zambia (PEPZ), and other key stakeholders. The tasks which the consultant will be responsible for:
a) Collecting and reviewing any other documents that might be considered as relevant in designing the Statutory Instrument. These documents could include but are not limited to: Reports on local content in Zambia; local content practices by mining companies in Zambia; and information on existing local content initiatives implemented in other countries such as Ghana;
b) Preparing the draft Statutory Instrument that is:
(i) Relevant to enforce Section 20 of the Mines and Minerals development and to increase participation of Zambians in the mineral value chain without constraining the industry;
(ii) Aligned with the Zambia – overall Government policy on local content;
c) Facilitating discussion of the draft Statutory Instrument at consultative and validation meetings;
d) Drafting report on the consultative process and finalizing the draft Statutory Instrument in line with comments and proposals from stakeholders.
3. Conduct of work
3.1 The consultant will work under the guidance of the Inter-ministerial team led by the Ministry of Mines and Minerals Development.
3.2 The consultant will facilitate a one day consultative meetings in five towns (Kitwe, Chingola, Solwezi, Kalumbila and Choma) and at the validation meeting in Lusaka. The facilitation includes planning the programme of the meetings, preparing meeting materials, facilitating the workshop and editing the draft Statutory Instrument based on the feedback received from the Inter-ministerial Team and at the consultative meetings.
3.3 The Consultant will present the draft Statutory Instrument at the validation meeting.
Food and agriculture: with a focus on streamlining logistics through investment in transport and storage, and value addition through processing;
Mining and mining services: focusing on promoting local manufacturing and value adding services for the mining sector; and
Tourism and hospitality: with a focus on investment in Zambia as an international tourist destination and on investment in the early development of domestic tourism and leisure opportunities.
The target date for completing the selection and contracting of the consultant is 16 December 2019, with a mobilization date of no later than 6 January 2020, and a target date for completing the assignment is 14 February 2020:
|Activity ||Start date||End date|
|Collecting and reviewing relevant documents, Draft SI, Review & recommend Procurement Reporting Mechanism and prepare briefing note for distribution to stakeholders||6 January 2020||24 January 2020|
|Consultative process to include 5 consultation workshops||27 January 2020||7 February 2020|
|Finalise SI report & other deliverables based on feedback received||10 February 2020||14 February 2020|
The Consultant will be required to commit to this timeline in their proposal.
5.1 A draft Statutory Instrument with accompanying briefing note, a report on the consultative process and a recommendation for the procurement reporting mechanism.
6. Budget and contracting arrangements
6.1 The Consultant will be contracted by PEPZ on a lump sum basis, the full amount to be paid on successful and satisfactory completion of the deliverables.
6.2 The costs of the consultative workshops will be covered by PEPZ directly and the Consultant should not include these costs in their proposals. The Consultant is responsible for all other reimbursable expenses.
6.3 Proposals and the eventual contract should be denominated in ZMW or GBP, no other currency should be used.
- K1: Team leader must have a minimum of a Master’s degree in supply chain management, economics or business administration. Must demonstrate having carried out at least two assignments in value supply chains in the extractive sector in the last five years. Proven experience in conducting Regulatory Impact Assessment (RIA) will be an added advantage. Must also demonstrate ability in analytical reporting.
- K2: must have a minimum of Master’s degree in law, with five years’ experience in legislative drafting.
- K3: Must have a minimum of a degree in mass communication with five years’ experience in facilitating consultative meetings. Must have good interpersonal and facilitation skills.
The assignment may be carried out by a firm or a consortium of consultants to ensure the availability of all the above competencies.
Applicants should submit a proposal in two parts:
- Technical proposal: Setting out the applicant’s understanding of the assignment, the methodology to be followed, and detailing relevant past work (at a firm level and/or in individual CVs of named consultants); and
- Financial proposal: Setting out the fixed price budget for the assignment (inclusive of all relevant taxes), split into fees and estimates for reimbursable expenses.
NB: Fees should be shown as a day rate, the number of days input and the total fees for each named consultant. Reimbursable expenses will be paid on actual receipted amounts up to a maximum value of the estimated budget included in the financial proposal.
9. Application Guidelines
a) Proposal development guidance:
Applicants should develop one technical proposal per initiative (no more than 15 pages, plus CVs of no more than 2 pages each) comprising:
- A statement of your understanding of the assignment;
- A summary of past relevant experience (citing specific assignments) and the particular aptitudes of the proposed Project Manager and Technical Expert relevant to the sector; and
- Up-to-date CVs of the proposed individuals and signed statements of availability.
b) Financial proposal development guidance:
- We invite financial proposals with a combination of daily inputs (i.e. daily fees) and results-based payments. The anticipated structure would be 20% mobilization, 60% daily inputs plus 20% results-based deliverables.
- Applicants should develop one financial proposal comprising:
- A table showing the named individuals and positions, daily fee rates, number of days of inputs and total costs; and
- A table showing the proposed monthly billing schedule, identifying the proportions of the total fees budget payable on 1) inputs basis, and 2) deliverables.
- Please note that the financial proposal should be for management fees and expenses only.
c) Submission deadline:
- Please submit all required application documents to [email protected] by 13th December 2019.