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{
    "id": 204809,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/204809/?format=api",
    "text_counter": 41,
    "type": "speech",
    "speaker_name": "Mr. Kagwe",
    "speaker_title": "The Minister for Information and Communications",
    "speaker": {
        "id": 229,
        "legal_name": "Mutahi Kagwe",
        "slug": "mutahi-kagwe"
    },
    "content": " Mr. Speaker, Sir, I beg to reply. (a) The Government has already awarded the contract for services under Phase II of Kenya Rural Telecommunications Development Project to Huawei Technologies of China. This is not a new project but an expansion of an existing project (Phase I) based on an already signed memorandum of understanding between the Government of the Peoples Republic of China and the Kenya Government. (b) The detailed technical discussion of the scope of the project is under discussion between Huawei and the Ministry, through Telkom (K) Ltd. who are the implementing agency of this project. The original Rural Telecommunication Development Project had been estimated to cost US$64 million based on a detailed survey by Telkom (K) Ltd. However, the Chinese Government approved US$48 million. The exact amount for Phase II will be established on completion of the technical negotiations between Telkom (K) and Huawei Technologies of China. The agreed cost will then be subjected to approval by the Chinese Government. (c) The project is not subject to competitive bidding as it is an expansion of an existing project and does not require to undergo another procurement process. It was a single project that was split into two phases as Exim Bank wanted to review the progress of Phase I before making original additional commitment. The original Rural Project, as it has been said, was to cost US$64 million and the approved amount was US$48 million. In 2005, as part of Telkom (K) Limited, restructuring exercise, the Government commissioned the PKF Consultants to study the status of the company's network and its limitations to service delivery. The technical aspect of this consultancy was carried out by Alcatel of France. One of the main findings that this consultancy clearly brought out was the serious problem associated with multiple vendors in the network. To avoid these problems, the industry best practice is to select a strategic supplier for each sub-system in the network. The two mobile operators in Kenya, indeed, have done the same with one selecting Ericson and the other one selecting Siemens. Further, for CDMA Systems, the interface between Base Station Controller (BSC) and the Base Transceiver Station (BTS) is proprietary to the vendors and hence introduction of a new vendor in the network would require these systems to be duplicated, hence making it more expensive. Further, the same would have to be done for the Intelligent Network (IN) September 6, 2007 PARLIAMENTARY DEBATES 3737 platform that provides the value-added services, as the existing one is also from Huawei Technologies of China. Consequently, due to these issues, it is neither necessary nor prudent to tender for expansion of an existing system. Finally, the current practice in the industry is to adopt a procurement policy based on Total Cost Ownership (TCO), as we call it, of the network that takes into account of the operating costs instead of just the initial capital expenditure alone. (d) Phase I of this project involved the procurement of 107 BTSs covering approximately one-third of the population centres in rural areas. Currently, 57 out of the 107 base stations are already in service. The remaining base stations should be in service within the next six months. Phase II will cover two-thirds of the remaining rural population centres."
}