Soil Test Center Project Remains Contentious

Amidst various unsettled issues including uncompleted projects and missed payments, the United Nations Development Program (UNDP) has floated another tender to hire a company to finalise the renovation work of the National Soil Test Center.

Though the UNDP has moved one step ahead to realise the project, which has been delayed for years, Digata Industries Inc, hired for the first phase of the project, has not yet handed over the project.  There is also the issue of unsettled payments of 271,00 dollars still owed to Digata by the UN agency.

The Ministry of Agriculture & Livestock formed a new committee to take over the project from Digata Industries, which has been working on the project for the past four years. State Minister of Agriculture & Livestock Kaba Urgessa (PhD), wrote a letter dated July 22, 2018, ordering the contractor, Digata Industries, to handover the project, and assigned experts from the ministry to work on the handover process.

While these unsettled issues are still swerving around, UNDP is searching for a civil engineering and architectural firm to renovate the main laboratory building. The project was initially launched in response to Japan’s refusal to import Ethiopian coffee, claiming that imported Ethiopian coffee beans were found to be contaminated with harmful chemicals.

The development of the Soil Test Centers was intended to perform soil analysis work and provide fertiliser advisory services to farmers.

The one-million-dollar  initial phase was launched in May 2014 after a tripartite agreement was signed between Sileshi Getahun, former state minister of Agriculture & Natural Resources, Samuel Bwalya, former Country Director of UNDP, and Girma Silasie, founder and manager of Digata Industries.

Digata had simultaneously conducted the feasibility study and prepared the proposal documents submitted to the UNDP, which funded the project in a no-bid process.

Digata Industries, a US-based company, was then hired to maintain an existing laboratory and supply new laboratory equipment to the testing center. Although UNDP provided the funds, the ministry handled the administration and management of the renovation contract.

The project award process did not follow the procurement law of Ethiopia, which involves a tender process or a waiver grant from the Ministry of Finance & Economic Cooperation.

“We are the ones who initiated the project, conducted the feasibility study and secured the funding,” Digata’s founder Girma told Fortune.

“It is within the  national priority context that UNDP agreed to provide the funding,” said Martha Mogus, communications director at the UNDP. “By the Government’s positive appraisal of the contractor’s performance in previous projects, we endorsed the ministry’s decision to award the company the project.”

Prior to phase one of the project at the soil laboratory, Digata Industries had established a coffee laboratory at the Ministry of Agriculture in Addis Abeba and renovated a laboratory in Holeta, 36Km west of Addis Abeba – both UNDP-funded projects.  The company has also built a medical laboratory for Food, Medicine, Health Care Administration & Control Authority.

In the current phase at the National Soil Test Center, Digata has constructed two warehouses and imported equipment costing over half a million dollars. During renovations of the centre, located behind the Oromia Regional State Administration Offices along African Avenue, approximately 50 out of 110 employees were relocated to different offices of the ministry, and portions of the main building and fences of the compound were demolished.

The project experienced various ups and downs concerning plan modifications, late settlements of payments and cost overruns that exceeded the original budget. Some equipment was also stuck at the port, as a result of delayed financial settlements for demurrage payments of nearly 50,000 dollars. The demurrage fees were finally settled by Digata.

Periodic audits on UNDP’s operations and programme conducted at the country level was another intervention in the process, which led to delays of payments and settlements.

As the costs exceeded the original agreement, UNDP conducted an independent technical assessment of the project to validate the status, which acknowledged the cost escalation and stated that the company had delivered relevant equipment and made good progress on the construction, according to Dimos Yigzaw, part of a three-member committee organised by the ministry to follow up on the project.

However, the project remains incomplete in a few key areas – inadequate space for handling and protecting sensitive soil samples, insufficient ventilation and drainage and poor access to important rooms, according to Martha.

“UNDP has pledged to finance the next phase,” said Kabba.

“We are working to ensure that the centre commences operations within a six-month period,” said Martha, “we are also working to make sure the facility meets recognised international standards within two to three years.”

Meanwhile, UNDP has floated a tender to hire a company to undertake phase two of the project.

“We have not been formally notified about the handover of the project or the formation of a committee to oversee the handover by the ministry,” Girma told Fortune. “Plus, we are the ones who initially came up with the concept for the project. The contract we entered in 2014 includes our proposal for phase two, entailing accreditation of the lab, creating a source of revenue and running the laboratory. ”

However, Kaba claims that the ministry is ready to settle the issues with the company. “Once we finalise the handing over of the project,” said Kaba, “the remaining payment to the company will be settled.”



Published on Aug 23,2018 [ Vol 19 ,No 956]



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