business opportunities seminar - austrade

Business Opportunities SeminarBidding on ADB Financed ProjectsRafael Nadyrshin, Procurement Specialist Outposted in PNGMelbourne, Brisbane, Sydney, Adelaide, 30 September-4 October 2019

Why pursue ADB-Financed Contracts?

8 October, 2019 ADB Business Opportunities Seminar 2

Gateway to new opportunities in fast growing emerging economies across multiple sectors

Availability of funds is assured

Internationally accepted procurement procedures

Risks related to transparency, fairness and integrity of procurement processes mitigated through ADB oversight

Relationships


• The Borrower (Executing Agency) is responsible for procurement of goods and works

• ADB (under TAs) or Borrower select and recruit Consultants

• ADB reviews the procurement activities of EAs to ensure that proceeds of its financing are used in accordance with the bank’s rules

ADBSUPPLIER

CONTRACTOR

CONSULTANT

EXECUTING AGENCY

Financing Agreement

Loan and Grant funded Bidding,

Evaluation and Contracts

No Contractual Relationship except for

TA.For loans, ADB may

disburse payment directly on behalf of EA

Business Opportunities - Consulting


For the 3-year Period: 2016-2018

Average No. of Contracts per Year

Average Total Value of Contracts Awarded per Year

($m)Average Contract Size ($m)

Firms Individuals Firms Individuals Firms Individuals

Technical Assistance 201 2,432 124.49 95.43 0.62 0.04

Staff Consultants 19 1,028 4.82 25.98 0. 24 0.03

Loans 477 369.04 0.77

Grant 404 99.55 0.25

Total Contracted in 2018 = $696m

Project PreparationFeasibility Studies, Preliminary Design, ADB Safeguard Policies, Capacity Building, Procurement

Project ImplementationSurveys, Detailed Design, Construction Supervision, Project Management, Capacity Building, Procurement

Knowledge ProductsStudies, Capacity Building, Knowledge Sharing

Staff ConsultantsAdministrative Assistance to ADB Operations

Types of Engagement

Business Opportunities – Consulting in Pacific Region


For the 3-year Period: 2016-2018

Average No. of Contracts per Year

Average Total Value of Contracts Awarded per Year

($m)Average Contract Size ($m)

Firms Individuals Firms Individuals Firms Individuals

Technical Assistance 16 174 11.15 12.18 0.75 0.09

Loans 33 23.79 0.72

Grant 60 20.18 0.33

Project PreparationFeasibility Studies, Preliminary Design, ADB Safeguard Policies, Capacity Building, Procurement

Project ImplementationSurveys, Detailed Design, Construction Supervision, Project Management, Capacity Building, Procurement

Knowledge ProductsStudies, Capacity Building, Knowledge Sharing

Staff ConsultantsAdministrative Assistance to ADB Operations

Types of Engagement

Australia – Top 5 Consultants


Business Opportunities – Goods & Works


Supply of Goods

Machinery

Equipment

Computers

Furniture etc.

Civil Works

Roads

Railways

Bridges

Irrigation Canals,

Schools, etc.

Turnkey

Power Plants

Pump Stations

Water Treatment Plants

Solid Waste Treatment Plants

Airports, etc.

Loans and Grants for the 3-year period: 2016-2018

$100,000 < $1m

$1m < $20m

> $20m

Average number of contracts per year

1,967 959 147

Average Contract Size ($m) 0.28 3.69 29.03

Total Contracted value of Goods and Works in 2018 = $8.9bn

Business Opportunities – Goods & Works in Pacific Region


Supply of Goods

Machinery

Equipment

Computers

Furniture etc.

Civil Works

Roads

Wharves

Bridges

Medical Centers,

Airports, etc.

Turnkey

Hydro Power Plants

Pump Stations

Water Treatment Plants

Solid Waste Treatment Plants

Airports, etc.

Loans and Grants for the 3-year period: 2016-2018

$100,000 < $1m

$1m < $20m

> $20m

Average number of contracts per year

56 53 11

Average Contract Size ($m) 0.33 3.38 28.23

Total Contracted value of Goods and Works in 2018 = $426.74 million

Australia - Top 5 Contractors/Suppliers


What deters Australian contractors to more actively bid under ADB projects?

• Lots of work in the backyard (in Australia), so no capacity to stretch and export the works to other countries

• Security concerns with regard to certain countries (PNG, Afghanistan, Pakistan, Bangladesh…)

• Complex and difficult logistics due to remoteness of the project sides.

• No data base for local subcontractors.

• Our prices may not be competitive vis-a-vis low prices suggested by other Asian competitors.

• Others….


ADB’s Policy for the Procurement of Goods, Works and Services

2017 Procurement Policy

2017 Procurement Regulations


Core Procurement Principles


Economy

Efficiency

Fairness

Transparency

Quality

Value for moneyNew

Existing

Procurement Framework


ADB Procurement Policy (Goods, Works, Nonconsulting and Consulting Services)

Procurement Regulations for ADB Borrowers (Goods, Works, Nonconsulting and Consulting Services)

Staff Instructions• Procurement; ADB Administered Consulting Services; EA

Administered Consulting ServicesStandard Bidding Documents and User Guides

• 8 SBD and 9 User Guides

Guidance Notes

• 24 Guidance Notes

New Provisions/Flexibility in Bidding Documents


Abnormally Low Bids (ALB)

•Can Accept, Mitigate (increase performance security), Reject

•Due diligence required by Borrower (Identify, clarify, decide)

•ADB no objection always required before rejecting.

Standstill Period

•Used to allow unsuccessful bidders to challenge the intended award.

•10 days recommended

•Use is optional

Use of expertise of Parent Companies and other Affiliates

•Affiliate Company Guarantee allows bidders to use experience and resources of others to meet the qualification requirements on tenders

More Flexibility in Evaluation Criteria

•Evaluation criteria can now used a points system (weighted scoring), not limited to pass/fail

Historical Non-performance

•Non-performance in past contracts can now be a qualification criteria

Main Changes – Consulting

8 October, 2019

ADB Business Opportunities Seminar 15

Shortlisting rules improved

• No longer a limit on the shortlist of 6 consultants

• No longer a requirement to select a maximum of 2 consultants per member country

• No longer requirement for consultant from a developing Member Country

Selection Method

• No value threshold related to use of either FTP, STP or BTP

• Based only on nature and complexity of assignment

Consultants Experts*

• For EA Administered Services, firm may propose team members that are not from ADB member countries

Evaluation

• Some limited minor clarification of bids is permitted

*Not applicable for Individual Consultant Selection (ICS) or ADB administered Consulting Services

User Guides & Standard Bidding Documents

• Goods

• Works

• Works (Small Contracts)

• Plant - Design, Supply & Installation

• DBO Contracts for Water & Wastewater Greenfield Infrastructure Projects

• Information Technology Products and Services

• Selection of Consulting Services for Borrowers

• Prequalification of Bidders

• Guide on Bid Evaluation


PNG Portfolio and Business Opportunities


Australian Firms in PNG under ADB projects

Figures as of 14 June 2019

Name Project Contract value Completed/Ongoing

Works

JV Australian Maritime Systems Group

Pty Ltd

MWSP (NMSA)

L2978

Ongoing

Australian Maritime Services Ltd MWSP (NMSA)

L2978

Completed

Indra Australia Pty Ltd CADIP T2

L3069/3070

Ongoing

Consulting Services

Cardno MWSP (NMSA)

L2978

Ongoing

GHD PTY LTD Pom GRID

L2998/2999

Completed

SMEC (Consulting firm) TEIP 1

L2713/2714)

Ongoing

Non-Consulting Services

Fugro Lads Corporation Pty Ltd MWSP (NMSA)

L2978

Completed

Furgo Surveys Pty Ltd MWSP (NMSA)

L2978

Ongoing

Gamma Solutions Pty Ltd CADIP T2

L3069/3070

Completed

Total $34.5 million

ADB Active Portfolio in PNG

Transport, 67%

Energy, …

Finance, 1%

Public Sector Management,

2%,

Health, 18%,

Sixteen Active Projects (USD$1.57 billion)

$1.03 billion-Transport

$280 M-Health; $191 M- Energy; $32 M-Public

Sector Management$21.3 M-Finance


ADB Projects in PNG

ADB Funded Projects


Executing Agency (EA)

GoPNGPortion (USD $ Million)

ADB Financing (USD$ Million)

Total (ADB+ GoPNG) USD$ Million

Transport ($1.03 billion)

1 Highlands Region Road Improvement Program-Project 2 (HRRIP 2): L

DoW 63.6 105 169

2 Highlands Region Road Improvement Program-Project 3 (HRRIP 3): L+G

DoW 13 129 142

3 Sustainable Highlands Highway Investment Program, Tranche 1 (SHHIP T1): L+G

DoW 314 44 358

4 Bridge Replacement for Improved Rural Access Project (BRIRAP) :L

DoW 10 83.7 93.7

5 Civil Aviation Development Investment Program, Tranche 2 (CADIP T2): L

NAC 40 128.6 168.6

6 Civil Aviation Development Investment Program, Tranche 3 (CADIP T3): L

NAC 27 248 275

7 Maritime and Waterway Safety Project (MWSP): L NMSA 6.8 38 44.8

8 Building Resilience to Climate Change in PNG: G CCDA 0.64 7.9 8.6

Health ($280 million)

9 Rural Primary Health Service Delivery Project: G+L DoH 10 66.6 76.6

10 Health Service Sector Development Program: L DoH 9.5 195 204.5

ADB Active Portfolio in PNG

cont..ADB Active Portfolio in PNG


Executing Agency (EA)

GoPNGPortion (USD $ Million)

ADB (USD$ Million)

Total (ADB+ GoPNG) USD$ Million

Energy ($191 million)

11 Town Electrification Investment Program, Tranche 1 (TEIP 1): G+L

PPL 14.3 57.5 71.7

12 Town Electrification Investment Program, Tranche 2 (TEIP 2): L

PPL 15.7 61 76.7

13 Improved Energy Access:G PPL 1 2.5 3.5

14 Port Moresby Grid Development Project: L

PPL 16.3 65.5 81.8

Public Sector Management ($32.2 million)

15 Building Resilience to Climate Change in PNG: G

CCDA 3.6 32.2 35.8

Finance ($21.3M)

16 Microfinance Expansion Project: G+L BPNG 3.09 21.3 24

Water and other Urban Infrastructure Services ($0.8 million)

17 Water Supply scheme for TeteSettlement: G

Eda Ranu/PNG Water?

0.13 0.8 0.93


PNG Country operations business plans


Prepare a strong proposal

Follow the instructions in the RFP/bidding documents

Review the mandatory qualification criteria

Understand the basis on which the bid will be evaluated

Study the Terms of Reference (TOR)/Employer’s requirements

Associate or JV with other firms to meet requirements

Provide tailored submission; avoid generic templates (quality, not quantity)

Do not add conditions to your offer

Ask Questions; contact ADB if not receiving a response


Common Mistakes - Consulting

Firm or associates/experts not from ADB member countries*

Proposal received late: insufficient time afforded to enter a proposal into CMS

Non-compliant proposal (e.g. number of person-months or inclusion of non-nationals for

national expert positions)

Failure to respond to Client requirements

Failure to disclose conflicts of interest, e.g. employees from an EA in a proposal

Exceeding budget where RFP indicated a Maximum Budget amount

Inclusion of conditions in proposal


*2017 Procurement Policy: Firms engaged on Borrower Administered Consultancy services may use team members from non-ADB member countries

Common Mistakes – Goods and Works

Bids not signed

No Bid Security or Bid Securing Declaration (if required)

Insufficient Amount of Bid Security, incorrect validity period

Lack of Supporting Documents

Incomplete Bids / Partial Bids

Absence of test reports if required

Conflicts of interest not disclosed

Inclusion of financial offer with technical offer where bid conditions require

them to be separated


Failure to provide a Signed letter of Bid, a correct Bid Validity Period and the required Bid Security or Bid Securing Declaration and PricedBOQs are grounds for immediate disqualification of the Bid.Minor omissions to the documents required by the Bidding Documents may be clarified. Multiple minor omissions may add up to a majoromission and if clarified would give the Bidder an unfair advantage

Debriefing and Complaints

Debriefing:• Unsuccessful bidders may request debriefing from

Executing Agency (EA). If they are not satisfied, they may contact ADB directly.

Complaints:• Bidders may file complaint directly with ADB and may copy

ADB on correspondence with Executing Agencies (EAs). www.adb.org/forms/complaints

Anticorruption and Integrity:• www.adb.org/site/integrity/main


This Photo by Unknown Author is licensed under CC BY-SA

https://www.adb.org/news/adb-steps-anticorruption-efforts-enhance-asias-development

https://www.debriefnow.com/images/DebriefNow_cg_men_intersection.jpg

http://www.adb.org/forms/complaints

http://www.adb.org/site/integrity/main

https://slidewiki.org/deck/86957-1/slide/490902-1/490902-1:9/view

https://creativecommons.org/licenses/by-sa/3.0/

https://www.adb.org/news/adb-steps-anticorruption-efforts-enhance-asias-development

Thank you.

Rafael NadyrshinProcurement Specialist Outposted in PNGProcurement, Portfolio and Financial Management [email protected]


mailto:[email protected]

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