Consultancy Services to Assist in Establishment of Commodities Exchange Trading Platform in Kenya. (Consulting Services-Firms Selection) (Closed)

ADDENDUM No. 1: This is to inform you that the submission deadline for the Request for Proposals listed below has been extended to 21st December, 2016 at 11.00 AM East African Time

pdf Download Request For Proposal for Consultancy Services to Assist in Establishment Commodities Exchange Trading Platform (PDF, 800KB)

RFP NO. MIT&C/SDT/Cons.01/2016-17

IFMIS NO. 362478

1. Background

The Government of Kenya through the Ministry of Industry, Trade and Cooperatives, State Department of Trade is in the process of establishing a National Commodities Exchange. The commodities exchange will materially impact on the livelihoods of millions of Kenya’s smallholder producers and other actors in both agricultural and non-agricultural commodity value chains. In addition, the exchange will provide an appropriate tool for providing farmers and traders with much needed credit opportunities; reducing farmer vulnerability by allowing farmers to sell produce at a time when prices are attractive; reducing post-harvest losses attributed to poor commodity storage practices; and provide employment opportunities along the exchange ecosystem. To facilitate the establishment of the commodity exchange, the State Department undertook a study on the feasibility of establishing a commodity exchange in Kenya. The feasibility study revealed that there exist appropriate business environment for successful establishment of a commodity exchange in Kenya and sufficient support from stakeholders. The study also provided an implementation plan towards the establishment of the Commodities Exchange. The Ministry therefore wishes to hire a long term consultancy firm to provide technical assistance in establishing and operationalizing Commodities Exchange Trading Platform in Kenya.

2. The scope of the assignment will include but not limited to:

a) Develop project implementation plan;
b) Propose Policy, Legal and Regulatory framework for the Commodities Exchange;
c) Develop a framework for collateral management operations and Infrastructure;
d) Develop Commodity Exchange trading/clearing and settlement operation guidelines and system specifications;
e) Develop ICT systems specifications;
f) Carryout out training and Capacity Building of stakeholders;
g) Carryout business development and outreach programs; and
h) Develop a funding model for the establishment and sustainability of the commodity exchange ecosystem.

3. The services are expected to be carried out tentatively over the duration of twenty four (24) months.

4. The State Department now invites eligible consulting firms to submit their proposals in providing the Consultancy Services. Interested firms should provide information demonstrating that they have the required qualifications and relevant experience to perform the Services. The eligible consulting firms are also referred to Terms of Reference under section V of the Request for Proposal (RFP) document for a detailed scope of the assignment and qualification requirements.

5. Consultants may associate with other firms in the form of a joint venture or a sub consultancy to enhance their qualifications. The nature of association, whether it is a joint venture or a sub consultancy, should clearly be stated. In case of joint venture the firm leading the joint venture should be mentioned.

6. Eligibility criteria, establishment of the short-list and the selection procedure shall be in accordance with the Quality & Cost-Based Selection (QCBS) method set out in the Public Procurement and Asset Disposal Act, 2015 which is available on the Public Procurement Regulatory Authority website: and The National Treasury portal:

7. Interested Consultant may obtain further information at the address below during office hours from 1000 to 1600 hours East African Time (GMT + 3). The Request for Proposals can be accessed using the IFMIS tender portal no. 362478. The RFP can also be downloaded here.

8. Completed Technical and Financial Proposals documents MUST be submitted through the online IFMIS tender portal no. 362478 and one hard copy enclosed in plain sealed envelope marked with proposal number MITC/SDT/Cons.02/2016-17 containing both Technical and Financial Proposals (separate envelopes as per ITC 2.5.3) to be deposited in the Tender Box at the Department headquarters, Telposta Towers 17th floor or be addressed to:-

The Principal Secretary
State Department of Trade
Telposta Towers 17th Floor, Kenyatta Avenue
P. O. BOX 30430- 00100

E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.  and This email address is being protected from spambots. You need JavaScript enabled to view it.

So as to be received on or before 21st December, 2016 at 11.00 AM East African time both through Supplier portal and one hard copy as per ITC 2.5.3.

9. Proposals will be opened immediately thereafter on the same date in the presence of the applicants or their representatives who choose to attend at Telposta towers on 18th floor, boardroom. All documents shall be in English and late Proposals shall be rejected automatically by the system.

Head- Supply Chain Management Services
For: Principal Secretary

Response to Request for Clarification

Qn1: We would request you to let us know that whether the Kenyan government is self-financing the project or it has tied up with some external agencies?

Answer: The Government of Kenya is working with the Private Sector in funding the project. The Government will pay for the services of the firm supporting the establishment of the exchange while the privates sector and other Development Partners (who we may not mention at this point) will fund the other components.

Qn2: Whether, as a result of the pre-feasibility study or otherwise, there are any specific products which the authorities have in their minds or which are preferred to be listed/traded on the proposed commodity exchange?

Answer: The study recommended that the exchange starts trading the following agricultural commodities mentioned below and later move to other commodities depending on volumes of the commodities available. In addition, the study recommended that the exchange starts trading non-agricultural products when its fully operational.

Stage I- Maize, Wheat, Sorghum, Millet, and Coffee
Stage II- Tea, Cow Peas, Dry Beans, Ground Nuts and Pigeon Peas

Qn3: Will the “commodity futures & options”, which are incumbent for hedge transactions, be an integral part of the product mix on the exchange platform?

The “commodity futures & options” will be traded on the exchange in the long run. A spot exchange will be launched first and then futures to be introduced at a later stage.

Qn4: Under which task (out of 9 expert tasks) this activity can be defined? Are we expected to develop funding model, draft Information memorandum, identify capital investors, prepare for due diligence process and define the funding contract?

Answer: Business Development/Outreach Expert. The expert will be required to develop a funding model, recruit and identify potential players who include members, traders (buyers & sellers), clearing banks and strategic partners/investors.

Qn5: Section II: Information to Consultants, Para 2.3.3 (v) on page 7 - Preparation of Technical Proposal.
Whether 2 experts can be deployed for one task?
In case of ICT Services, we would like to deploy 2 experts, though their staff months will total to 8 months. One resource will play primary role and other resource will play a supporting role.

Answer: You are allowed to deploy two experts for the same task provided that its within your budget.

Qn5: Section II: Appendix to Information to Consultants, Para 2.3.3 (iv) Table of Staff months and minimum Professional Experience

Whether Co-Project leader can also play a role of an Collateral Management Expert?

Answer: It is important that the Co-Project leader have Collateral Management Expert working under him. Therefore we do not recommend that the Co-Project leader to also play the role of Collateral Management Expert.

Qn6: Section V: Terms of Reference, Page 40 - Co-Project Leaders In the beginning of the page, Co-Project Lead (Trading Operations) and Project Leader (Exchange Operations) are mentioned. But in a table on the same, Co-Project Lead (Trading Operations) and Co-Project Lead (Collateral Management) are mentioned.

Answer: The Co-Project leaders are supposed to be two: Co-Project Lead (Trading Operations) and Co-Project Lead (Collateral Management)


For: Principal Secretary


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