Causes Of Project Implementation Delay: The Case Of Development Bank Of Ethiopia Financed Projects
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Date
2018-06-07
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Addis Ababa University
Abstract
The Development Bank of Ethiopia is a specialized financial institution established to
promote the national development agenda through development finance and close technical
support to viable projects from the priority areas of the government by mobilizing fund from
domestic and foreign sources while ensuring its sustainability. While financing development
projects, however, the bank faces different, in their nature and causes, kinds of problems. One
of these problems is delay in project implementation resulting cost overrun, repeated
additional loan and loan repayment rescheduling request. The purpose of the study was to
assess the causes for project implementation delay. This study investigates the causes of
delay in project implementation for DBE financed projects to determine the most
important according to the key project participants; internal (bank and project owners) and
external factors. The research identifies and analyses whether the major causes of project
implementation delay are attributed to project owner related factor or the Banks related factor
or whether delay is attributed to some external factors such as government, supplier and
contactor related factors like poor customs clearing, infrastructure problems, delays in the
procurement machineries and materials required for the projects., rework due to design errors
etc.
The target populations (projects) for the study were selected from DBE Head Office financed
projects and 68 projects were selected as sample for the study purpose. For this study 136
respondents from DBE and different Projects were selected. The study used both primary and
secondary data collection methods. The primary data was collected using questionnaires and
interviews. Secondary data was derived from the project’s files, recorded documents by bank
and different documents such as annual reports, journals, articles, various books, websites,
other published and unpublished sources and relevant documents. The data from the completed
questionnaires was studied, re-coded and entered into the computer using the Statistical
Package for Social Sciences (SPSS) version 24. Descriptive statistics were employed to analyze
quantitative data. The descriptive statistics included standard deviation, means and
percentages. The quantitative collected data was analyzed by establishing the regression tools
of the various factors identified as causes for project implementation delay.
The results of the study showed that project implementation is negatively affected by owners,
bank and external related causes. As a result if project implementation delay is occurred and
continued, the bank will not be able to collect its loan on time which ultimately may lead to loss
in the operation of the bank
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Keywords
Project Implementation Delay, Internal Factors, External Factors