Project Financing

Question:

Discuss bout the Transport and Infrsstructure Development Project for Developing Countries.

The main reason why this report has been prepared is to help achieve peace in South Republic of South Sudan. This will contribute to the overall global goal of improving the welfare of every part of the world. The other secondary reason for developing this report is creation of job opportunities to both local and international companies because not all the projects can be done locally based on expertise and capacity required for successful delivery of the project. The companies which will be involved in this project will in turn employ both locals and international expatriates. The very limited policy and institutional framework and implementation capacity to turn around the situation it is facing. To come up with those entire requirements might take a lot of time and therefore detrimental to the peace being sought to that country. The project being analyzed involves upgrading of infrastructural projects to foster the main objective of this project proposal. Under this proposal only major roads and structures of high priority will be considered. This include major roads in the countries capital city Juba as well us other roads connecting various destination points with the Republic of South Sudan. The structures that will be considered involves administrative structures to help the new government get hold of the country so that lasting law and order can be achieved in the republic. The administrative buildings will be distributed across the country especially all the towns so that Sudanese people in the rural areas can easily access government services like obtaining relevant documents like identification cards and any other document that they may require from the government in order to go about their daily life activities smoothly. The structure of this project proposal will take the form of project management professional whereby target audience will be discussed in all aspects including why they are target audience and relevant information that they need to know. The paper will comprehensively discuss aspects of the project and will support these with relevant theories and figures and tables. The project will be implanted in two phases the first phase focusing on roads linking major destination points across the country i.e. the capital city and major towns and administrative buildings in those major towns which will be identified. The second phase will include major feeder roads mostly in rural areas to open up those rural areas for economic activities like commercial farming. The second phase will entail building of administrative structures in the rural areas to take government services closer to the people. The project implementation process will be subject to availability of funds. The first phase of the project will be implemented as an emergency case considering that it is the urgent basic need.

Background and environment of the project

The idea behind this project is not profit but rather a humanitarian project that aims at improving the welfare of the people in developing countries like the Republic of South Sudan in order to contribute to the overall well being of the all world in terms of development for sustainable peace. The project will also reduce number of refugees in the world when all South Sudanese return to their country. Largest refugee camps like one in Kenya called Kakuma will be less congested thereby easing logistical challenges associated with such camps e.g. management of diseases outbreaks and infiltration by terrorists in the name of refugees. The project sponsors are United Nations, World Bank African Development Bank and other development partners Government of Australia in conjunction with Government of Republic of South Sudan. The nature of the partnership will see the government of Republic of South Sudan take 40% of the total coast of the project and the rest 60% to be requested from development partners mentioned above. The funding may come inform of grants as well as cheap loans that the government of South Sudan will repay within agreed time. (Government extension to A guide to the project management body of knowledge (PMBOK Guide)–2000 edition, 2002)

Key Stakeholders

Audience and structure of the project

The target audiences for this project are sponsors of the project and the people of Republic of South Sudan. World Bank, African Development Bank and Australian government are the audience of the project because the proposal identified them as the sponsors of the project. Each sponsor will be given relevant detail of the project as per the request put fort before them. Each of these development partners will be presented with financials and figures of the parts of the projects they will be requested to assists. This shall not however be limited general information regarding the background knowledge of the project. The following is how financing will be solicited from the sponsors. Government of South Sudan 40% of the total project, World Bank 30 %, African Development Bank 20% and Government of Australia 10% of the total project cost. The total distance of the roads to be upgraded either by tarmacking or rehabilitated is 2,273.1 km and 1,000 pieces of Administrative buildings each measuring 500 sq feet.

The following roads will be tarmacked.

Aweil – Gogrial – Turalei – Mayom – Bentiu Road, A distance of 415.8 Km.

Abyei – Dilling – El Obeid – Rabak – Malakal Road , A distance of 1,423.2 Km

Juba – Mundri west- Madiri – Yambio, A distance of 1 km

The total cost of the road construction project will be $ 38,642,700.

The key stakeholders in the project will be requested funds as indicated below table named Table 1 in the list of tables.

The Pie chart in the list of figures named figure 1 show representation in terms of funding for the road construction

Administrative Buildings

1,000 units of houses each of 500 sq feet will be constructed across the country. The total cost of the construction will add up to $ 993,600. The following table named Table 2 indicates how the funding will be distributed.

The Pie chart named figure 2 show representation in terms of funding for the administrative building construction.

The administrative houses will be spread across Republic of South Sudan in accordance to with needs assessment done by the Sudanese government.

The whole part of the plan of this project will be available to the government of South Sudan because it’s the owner and the implementer of the project.

For the World Bank the part of the plan that will be made available to them is actual distance of the road and the number of administrative units the 30% funding required from them for the whole project will cover. The details as to where exactly the road or the building will be constructed can not be pointed at because the funds will be a pool fund and as long as the total amount of funds used for road and building construction tally with the total amount of funds collected at any given point then the project will be above board.

The rest of the stakeholders will also receive project plan to the extent of the percentage request asked from them. Each stakeholder will however be receiving monthly updates of amount of funds received, nature of work covered and any challenges experienced in the course of implementing the project. These periodic reports will be made through representative of the all stakeholders. (Genat, 1995)

Administrative Building

Structure of Project management professional (PMP)

According to project management body of knowledge guide a project proposal should be structured in following way. (Duncan, 1995)

Initiation

In this initial stage you give an overview of the project together with the strategy you’ll employ. At this stage you will appoint the project manager who will in turn select his or her team based on the experience she/he has. The members of the team selected will compliment the experience and knowledge of the project manager. (Francis and Horine, 2003)

Planning

This is the most important stage any project according to the guideline. During this stage a detailed breakdown and allocation of each assignment of the project from the begging of the process to the end. This stage will also include risk assessment and defining the structure needed for the successful completion of each assignment. In summary the project process is defined, stakeholders identified and the frequency of reporting as well as channel of reporting are put in place. (Solomon and Francis, 2006).

Execution and control

The third and the fourth steps involve actualization of the project. During the project management cycle the execution and control part is also very important. Here the project plans are properly executed. The solutions that were identified for the problem are implanted and controlled in order to ensure that the desired results are obtained. In case of product and system development the desired product is created. The outcome is measured by the prototypes, reviews and testing. At this point all the groups within the organization become deeply involved until when the desired product or service is obtained from the process.

Closure

At this point the manager of the project should be dealing with teething problem of the project implementation in order to make sure that the project is concluded successfully. The highlight of this stage is the submission of the written report which has the following elements; formal acceptance of the product by the client, a comparison between the initial requirements of the client and final output of the product, lessons learned from the project, resources of the project and closure notification to the board or the management higher on the hierarchy. The process is summarized by below flow chart figure 5.

Figure1

Prince2

According to prince 2 (Projects IN Controlled Environments) guide a project proposal should be structured in following way.

PRINCE2 is a procedure based methodology for overseeing ventures. It works out who is the best person required in a certain task and what is his/her part and obligations. PRINCE2 has an arrangement of procedures to work through and it discloses what data should be assembled. The technique is the most practiced project implementation procedure for task administration in the UK and is also practiced internationally. (Anbari, 2005)

Majority of organizations that desire to use PRINCE2 as their chosen project management tool begin with accredited training. This training is necessary because it involves numerous procedures.  The preparation will give everyone in the team necessary information they have to understand in order to execute respective parts. (Newell, 2002).

Project Management Professional (PMP)

This technique is very adaptable and can be used or applied to many forms of projects regardless of the size of the project. One interesting fact is even those projects that only last for few days can benefit from the procedure when it is applied selectively.

The prince2 methodology dictates that a project should have;

1. Organized and controlled start i.e. makes a proper organization and planning of the project before starting. (Sanghera, 2006).
2. Organized and controlled middle i.e. ensure that after the project as started in continues to be managed according to the plans and organization
3. Organized and controlled end i.e. when the project has delivered make sure to tighten up any loose ends.

This model has predetermined roles for every member of the team that oversees the project. The roles and responsibilities are as listed below. (Bentley, 2012)

Project manager

The work of the project manager is in charge of the project. He/she shall select people to be included in the team and will be responsible for timely delivery of all aspects of the project. The manager will draw up the project plan and indicate specific role of the team and when is the team expected to conclude the assigned tasks. (Indelicato, 2009)

Customer, User and Supplier

In this case the customer is the person paying for the project. Whereas the user is the person who is going to use the end product of the person whom the end results of the project will impact. Under this theory the specialist is the person providing the know–how on the aspects of the project. These people will need to be organized and well planned in order for the project to deliver the desired objectives within the stipulated time frame.  (Graham, 2008)

Project board

Every Prince2 project has project board. The board is made up of the customer, a supplier representative and a user representative. These people have special names i.e. customer, senior supplier and senior user respectively. (Tuttle, 2012).

The project manager reports to the project board regularly and informs them of the progress of the project as well us any other challenges that the Implementation of the project is facing.

The management techniques under the project include project assurance and project support. Under project assurance the project progress report is independently provided. There are three difference assurances namely the one provided by the user, business and specialist each representing the views or the interest of the three members of the board. The work of the assurance is about ensuring that that the project remains within viable limits of costs and benefits that is business assurance and ensuring that the user requirements are continually met that is user assurance and finally assurance regarding suitability of the project solution to the problem that is specialist or technical assurance. In some instances the assurance team is a separate group of people but in moist cases project board does the job of project assurance. (Chu, Altwies and Walker, 2005), (Managing successful projects with PRINCE2, 2009).

Under project support the administrative functions such as setting up meetings, informing team members of the relevant information about the project and keeping files is usually the work of the project manager. But in instances where a number of projects is being undertaken at same time then project support office is set up to oversee this functions. The figure below summarizes prince 2 process.

Initiation

Figure 2

Contrasts and Comparisons

There are a number of similarities and differences between the format of this project proposal and the above two theories discussed. We shall first draw the similarities and difference between the structure of this project and the structure of project management body of knowledge then followed by Prince2 structure.

Project management body of knowledge

Similarities

• Both share the initial stage of planning where a team is appointed to oversee the project.
• Both theories share the planning stage where the project is planed on all aspects e.g. the distance of the road to be upgraded.
• In both theories there is closure stage where the team that oversaw the project will have to give relevant reports to the authorities and project sponsors.

Differences

• Under this project there has to be wide consultation with the people to find out which area do they think is of high priority for construction of road whereas in project management body of knowledge structure the project manager may not be required to do thorough consultation with the people.

Prince2

Similarities

• There is the initial planning under the two theories which involves thorough feasibility studies to ensure that the project is viable.
• Both theories have periodic assessment of the project to ensure that it stays within the course of the objectives of the project.

Differences

• This project’s structure is always a major one there by logistics are always handled by a separate office as opposed to Prince2 format where the project can be small and all logistical issues are handled by the project manager.
• In this project major decision can not be made by one person as in the case of prince2 where the project manager has a bigger say. The decisions in this project are made by the government through the appointed committee.

Contents of the PMP sections

Project integration management

Under this section all the processes of the project that interact are identified, combined and co-ordinated to ensure smooth transitions during in the life-cycle of the project. Here communication is the most important aspect.

Project scope 

This section involves determining what work will be included in the project and what will not be include. It defines the boundaries of the project.

Time Management

This part deals with identifying the specific activities and schedules of the project and timelines within which various project deliverables have to be met.

Project risk management

The section entails deciding approach certain aspects of the project that are considered risky and mitigation measures that should be put in place in an event of the unforseen challenge.

Stakeholder management

Under this section entails coming up with appropriate ways of effectively engaging all stakeholders in the course of the project cycle.

Communication Management

The section involves planning and outlining channels of communication within the project team. Each member of team is adequately briefed on information necessary smooth running of the project.

Project cost management

Under this part and estimation of costs associated with the successful completion of the project is developed. The approximation has to be reasonable and the best way to come up with reasonable estimation is to use currently prevailing market prices for items or services required for the project. The cost of the project is aggregated to come up with the total cost of the project. Factors that influences cost in the project are varied to minimise on the cost while at the same time ensuring desired quality of the end product is maintained.

Project human resource management

Here staffing management organization is created. It involves identifying and recording project roles and responsibilities and hierarchy within the project team for reporting and management purposes. The team members’ competencies and interaction are continually enhanced to improve quality of the work.

Project quality management

The section entails finding out which quality standards are necessary for the project and determining of these standards are going to be met. The planned activities to ensure quality results are attained are implemented and specific results that are key to quality of the project are checked for quality standards. The processes that lead to undesired results are altered accordingly to achieve desired products.

Project procurement management

Here the right suppliers are identified following laid down procedures of the project financiers. Key to this section is supply of quality goods or services within the right time that will ensure key project deliverables are met for smooth running of the project.

Critical analysis and comparisons between this project and theoretical PMP

The most important part of this project is securing the funding and support from the identified development partners. The timelines within which this project must start and be completed vary for different regions under which the development is aimed at. Road construction in Abyei – Dilling – El Obeid – Rabak – Malakal must start around November and be completed by June to avoid heavy rainfalls this region expirence from July through November.

In this project procurement functions and regulations has to be based on the laws of Republic of South Sudan. Although there are a number of financiers in this project which according to theoretical knowledge have a say on the procurement process, the laws of the country will have to apply because the funds of the project will have to be repaid by the government of South Sudan.

Conclusion

In conclusion, infrastructural development is a necessary tool in stabilizing any country and indeed in tackling major problems facing the world today. When the productive areas of these countries are linked up with market people will start engaging in productive activities and makes the world a better place.

Recommendations

All the development partners identified must be engaged effectively by way of presenting clear proposals to them on how their funds will be utilized as well as the repayment plans put in place to ensure they get the funds back after the successful completion of the project.

List of Tables

Table 1

Table 2

List of Figures

Figure 3

Figure 2

References

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