How TradeMark East Africa set regional procurement record

What’s a trillion dollars? Its a thousand billion and in writing, it is one, followed by 12 zeros; by rough estimates, a trillion dollars can fill five large master bedrooms, stacked in $100 bills of $10,000 bundles; thats the amount lost annually to fraud and corruption globally. A huge percentage of those trillion dollars are lost in the long and technically jargonized chain of procurement and supply by public and private entities as money exchanges hands between procurement managers and tender applicants in bribes and kickbacks for huge contracts. The trillion dollar anecdote is a favourite of André Coetzee, Managing Director of Chartered Institute for Procurement and Supply (CIPS), Southern Africa region and he used it to start his 46-slide presentation at the recent East African procurement forum. CIPS is the world’s largest procurement and supply institute with a membership of over 65,000 entities that operate in over 150 countries; its courses are also accredited in over 40 universities. Rwanda has about 50 CIPS members; Kenya and Uganda have 2,055 and 1,015 members, respectively while Tanzania has 205 CIPS members and only two for Burundi. On Wednesday in Nairobi, Coetzee used the trillion dollar anecdote again, not in a long PPT presentation but at a brief award ceremony where he crowned Trade Mark East Africa (TMEA) with the prestigious CIPS Corporate Certification for excellent procurement standards. The CIPS corporate certification is an internationally acclaimed recognition for organisations that have a proven and excellent procurement system and TMEA, which has only been in existence for five years became the first organisation in East Africa to get it. It joined a small group of distinguished, century old and rich organisations including UK’s Royal Mail formed in 1516, London based Metropolitan Police established in 1829 and the multi-billion dollar rich Qatar Foundation. Other Corporate Certification award holders are Johnson Controls, Aviva, National Health Service (NHS), WorleyParsons and Orlen Upstream. “This is an achievement of which we are very proud of, joining a group of elite organisations in the world, we are definitely in good company,” said Ken Jones, TMEA’s Chief of Operations. Jones added that the award means TMEA investors can have confidence in the organisation to achieve good value for money and services that transform lives across the region. No easy feat TMEA, which is a donor funded non-profit organisation spends over US$130 million every year in funding activities aimed at growing prosperity in East Africa through improving trade facilitation in the region by working closely with EAC governments and the private sector. Most of the organisation’s money is spent on its behalf through service providers executing huge supply contracts and other procurement needs and in the last five years, Jones said TMEA has dispensed over US$400 million on over 130 projects in the region. According to John Bosco Kalisa, TMEA-Rwanda Senior Programmes Manager, over US$60 million has been spent to fund 27 regional integration related projects in the country since 2010. Clyde Castelino, TMEA’s Procurement Advisor said: “We are the first institution in East Africa and only the second in Africa to get this award and for an institution that’s only five years old, that is no easy feat”. Castelino was referring to an in-depth assessment process that measures several elements of an organisation’s procurement systems; the process reportedly involves passing an examination of over 100 complex questions, a feat that TMEA has been undergoing since early last year. “Today’s award means we have satisfied all the requirements involved in the process and although we are very proud of this achievement, it’s also a challenge to uphold these standards,” Castelino added. Procurement for change Frank Matsaert, TMEA’s Chief Executive Officer, said he hopes the award will contribute to the improvement of procurement standards and ethics in the region. “In the context in which we all operate, there are huge challenges, but it’s important we stay dedicated to doing the right thing and doing it well,” he said. According to Matsaert, TMEA has grown from managing an annual budget of US$10 million in 2010 to currently US$130 million, a growth that has been very difficult to manage, at times. “I can’t underline how critical procurement is for what we do; we are trying to be agents of change by helping trade blossom and transform millions of lives of East Africans in this region, that is our mission, we are passionate about it and procurement has a critical role in that,” he said. Matsaert’s organisation has operations in Kenya, Uganda, Rwanda, Burundi and Tanzania and most recently spread to South Sudan handling tens of millions of dollars in contracts. “That can be very challenging and I am proud of my team that has adapted and managed to deliver,” Matsaert said. CIPS André Coetzee chose to be philosophical pointing out that TMEAs achievement in only five years means Africa doesnt have to wait for three hundred years to get things done. “Procurement is at the centre of developing this continent, if we did things right, the impact on transforming people’s lives such as reducing poverty would be huge,” Coetzee said. Coetzee added that the trillion dollars lost every year, mainly through procurement related inefficiencies and unprofessional conduct, can be significantly reduced if organisations worked on aligning their systems to international standards. New board unveiled A day before being awarded with the corporate certification, TMEA had unveiled a new Board of Directors dominated by well known entrepreneurs in the private sector across the region. The new eleven member board that will be advised by former World Trade Organisation boss will be chaired by Tanzanian entrepreneur and philanthropist Ali Mufuruki, proprietor of Infotech Investment Group limited. Addressing the press in Nairobi on Tuesday, Mufuruki said his board will ensure that TMEA management delivers on its mission to transform East Africas trade and called on the press to keep them under pressure for accountability. Two Rwandans, Rosette Chantal Rugamba, Managing Director of Songa Africa Ltd and Anthony Masozera, CEO of Burundi based Econet Wireless, are among the eleven member board who emerged out of over 500 applications by East Africans. In an interview with Sunday Times, Rugamba, who also doubles as a Special Advisor to the Secretary General of United Nations World Tourism Organisation on sustainable tourism in Africa, said she was honoured to serve as a director on the TMEA board. “TMEA has been instrumental in enhancing the business environment in Rwanda and indeed other East Africa countries and as a member of the private sector in Rwanda, I have experienced first-hand the benefits that have come from TMEA’s partnership with both the private sector and the government,” said Rugamba. She added that easing congestion at the ports of Mombasa and Dar es Salaam and supporting 24hour operations has meant that goods destined for Rwanda take much less time to clear which has translated into reduced costs. “I look forward to achieving many more results that will positively impact Rwanda and the East Africa region during my tenure,” she said. Matsaert says TMEA expects to spend between US$500 and US$700 million in its next phase starting after 2016 of which investors have already committed over US$150 million. TMEA gets funding mainly from United States, Denmark, Belgium, Sweden, Netherlands, Finland and United Kingdom, which is the largest sponsor.

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How TradeMark East Africa set regional procurement record