Stakeholder Management in Public Procurement: Rethinking the Engagement Strategy for Co-Financing in Rivers State, Nigeria

In Nigeria, there are many cases of failed public procurements resulting in undue delay or abandonment of projects, especially those wholly funded by the government, even in projects under co-financing arrangements with the Multilateral Development Institutions (MDIs). This anomaly is prevalent whenever an opposition party takes over the government because the political elites who originally support the projects lose interest or power. These failed projects represent a monumental loss to the public.

The MDIs, recognizing these political elites as stakeholders and understanding the intricacies of governance within the Nigerian context, apply their stakeholder engagement guidelines to engage this category of stakeholders to ensure that the government fulfils its obligations and responsibilities assigned in projects under co-financing arrangements. Sadly, the implementation of these guidelines is not monitored and evaluated on an ongoing basis within the procurement life cycle of these projects. Ideally, the guidelines for stakeholder engagement and management should be implemented from conceptualization to delivery of the project. Additionally, these guidelines do not anticipate the complex dynamics associated with changes of government, when existing priorities and policies are altered because of shifting interests. Often these interests affect the commitment of the government to carry out its obligation under these projects, particularly in cases where the government is required to provide counterpart funding, pay compensation, and provide other resources – and so the changes frustrate project implementation. Oddly, it may appear as though the MDIs, regardless of the time spent operating in Nigeria, do not anticipate political interference and policy inconsistencies whenever there is a change of government, for the MDIs have not adapted their stakeholder engagement strategies sufficiently to meet the ever-present political risk.

To meet these challenges, rethinking the stakeholder engagement strategy has become critical so that development projects will be delivered in a timely manner for the people’s benefit. The political risks that lead to abandoned projects mean that MDIs should increase the level of monitoring and evaluation and move away from co-financing agreements with the Nigerian states unless such co-financing arrangements allow for counterpart funds to be sourced directly from the Federal Government, which is also a principal party in financing agreement between states and the MDIs and which could mitigate project political risks at the state level.