THE ROLE OF TRANSPARENCY AND SUPPLIER SUPPORT

IN ENHANCING COMPETITIVENESS OF

LOCAL SUPPLIERS IN UGANDA'S OIL AND GAS SECTOR

BY

MORRIS MUGWIRI

J15M47/031

RESEARCH DISSERTATION SUBMITTED IN PARTIAL FULFILLMENT OF THE

REQUIREMENTS FOR THE AWARD OF THE DEGREE OF MASTER OF

BUSINESS ADMINISTRATION IN OIL & GAS MANAGEMENT OF UGANDA

CHRISTIAN UNIVERSITY, MUKONO

JUNE, 2016

i
 DECLARATION

I declare that this dissertation is my original work and has not been published or submitted to

any University or Institution of higher learning for any award.

Morris Mugwiri

Reg. Number: J15M47/031

Signature ……………………………………………………….

Date………………………...……………………………………

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 APPROVAL

This work has been done under my supervision and has met the research dissertation

requirements of Uganda Christian University and is now ready for submission.

Dr. Dan Ayebale

Signature ……………………………………………………….

Date………………………...……………………………………

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 DEDICATION

To my wife, Mrs. Molly Mugwiri, and my children Christine, Prosy, Mishael, Moses, Mark
and Godfrey.

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 ACKNOWLEDGEMENT

The journey towards producing this dissertation has received support from various individuals

and institutions that cannot go unappreciated. First of all, I would like to thank God almighty

for his mercies and favor upon my life throughout the entire period of my master’s studies.

Through the good times and bad times, the lord kept his promises to me and remained ever

faithful. Thank you father God.

Special thanks go to my supervisor, Dr. Dan Ayebale, who has been very supportive right from

the selection of the thesis topic to the final day. I am extremely grateful for the time, patience,

constructive criticisms and useful suggestions he provided. I am grateful to Patrick Ruharuza

the team leader at the Institute of Petroleum Studies Kampala. You allowed me to explore my

potential and for this am grateful. You made the master’s programme and our stay at the

institute wonderful.

Furthermore, I acknowledge the contributions of the various lecturers at Uganda Christian

University. Especially Mr. Vincent Kisenyi, Dr. Levi Kabagambe, Madam Elsie Nsiyona for

the great support through the various information meetings organized to make studies easy.

Special thanks to Lydia Azenga for availing time and support all through the study period. I

also pay special tribute to the Uganda Chamber of Mines and Petroleum for their opened doors

during the data collection period. I am also grateful for the executives of the 35 companies

included in the study who set aside their valuable time to share information utilized in this

study. Thank you all for your support, help and prayers.

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 TABLE OF CONTENTS

DECLARATION...........................................................................................................................i

APPROVAL.................................................................................................................................ii

DEDICATION............................................................................................................................iii

ACKNOWLEDGEMENT...........................................................................................................iv

LIST OF FIGURES...................................................................................................................viii

ACRYOMNS...............................................................................................................................ix

ABSTRACT.................................................................................................................................x

CHAPTER ONE...........................................................................................................................1

INTRODUCTION........................................................................................................................1

1.1 Introduction.............................................................................................................................1

1.2 Background of the study.........................................................................................................1

1.3 Statement of the problem........................................................................................................3

1.4 General objective....................................................................................................................4

1.5 Specific objectives..................................................................................................................4

1.6 Research hypotheses...............................................................................................................4

1.7 Conceptual framework............................................................................................................5

1.8 Justification of the study.........................................................................................................6

1.9 Scope of the study...................................................................................................................7

1.9.1 Content scope.............................................................................................................................................7
1.9.2 Geographical scope.....................................................................................................................................7
1.9.3 Time scope..................................................................................................................................................7

CHAPTER TWO..........................................................................................................................8

LITERATURE REVIEW.............................................................................................................8

2.1 Introduction.............................................................................................................................8

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2.2 Theoretical review..................................................................................................................8
2.2.1 Absorptive capacity literature.....................................................................................................................8
2.2.2 The relational embeddedness framework...................................................................................................9

2.3 Conceptual framework..........................................................................................................11

2.4 Transparency.........................................................................................................................11

2.5 Supplier support....................................................................................................................12

2.6 Competitiveness of the suppliers..........................................................................................13

2.7 The relationship between transparency and supplier competitiveness.................................14

2.8 The relationship between local supplier support and supplier competitiveness...................15

2.9 Summary of the literature review.........................................................................................16

CHAPTER THREE....................................................................................................................18

METHODOLOGY.....................................................................................................................18

3.1 Introduction...........................................................................................................................18

3.2 Research design....................................................................................................................18

3.3 Sampling frame.....................................................................................................................18

3.4 Sample size...........................................................................................................................19

3.5 Sampling technique..............................................................................................................21

3.6 Data collection method.........................................................................................................21

3.7 Data collection procedure.....................................................................................................22

3.8 Measurement of the study variables.....................................................................................22

3.9 Reliability and validity of the study......................................................................................26

3.10 Data analysis.......................................................................................................................27

CHAPTER FOUR......................................................................................................................28

PRESENTATION, ANALYSIS AND INTERPRETATION OF THE FINDINGS..................28

4.1 Introduction...........................................................................................................................28

4.2 Transparency environment faced by suppliers in the oil and gas sector..............................28

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4.3 Level of support available to suppliers in the oil and gas sector..........................................31

4.4 Level of competitiveness of suppliers in the oil and gas sector...........................................33

4.5 The relationship between supplier support, transparency and competitiveness of suppliers
in the sector.................................................................................................................................34

4.6 Regression analysis of the link between supplier support, transparency and competitiveness
of suppliers in the oil and gas sector...........................................................................................36

CHAPTER FIVE........................................................................................................................39

DISCUSSION OF THE FINDINGS..........................................................................................39

5.1 Introduction...........................................................................................................................39

5.2 The prevailing transparency environment faced by local suppliers.....................................39

5.3 The discussion of the findings in relation to local supplier support.....................................41

5.4 The prevailing nature of competitiveness of suppliers in the oil and gas sector..................43

5.5 The relationship between transparency and supplier competitiveness.................................44

5.6 The role of local supplier support and competitiveness.......................................................45

CHAPTER SIX...........................................................................................................................46

CONCLUSIONS AND RECOMMENDATIONS.....................................................................46

6.1 Introduction...........................................................................................................................46

6.2 Conclusion............................................................................................................................46

6.3 Recommendations.................................................................................................................48

6.4 Study limitations and future research areas..........................................................................49

REFERENCES...........................................................................................................................51

APPENDIX ONE: SURVEY INSTRUMENT..........................................................................58

APPENDIX TWO: LETTER FROM THE UNIVERSITY.......................................................62

APPENDIX THREE: LIST OF SUPPLIERS FROM CHAMBERS OF MINES AND

PETROLEUM............................................................................................................................63

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 LIST OF FIGURES

Table 1: Expenditure of International Oil firms in Uganda..........................................................3

Table 2. Characteristics of local suppliers and respondents included in the study.....................20

Table 3. Factor analysis..............................................................................................................24

Table 4. Reported level of transparency among local suppliers.................................................29

Table 5. Level of transparency...................................................................................................30

Table 6. Nature of support structure for suppliers......................................................................31

Table 7. Assessment of the role of different actors in providing suppliers with the necessary

support........................................................................................................................................32

Table 8. Competitiveness of local suppliers in the oil and gas sector........................................33

Table 9. Relationship between study variables...........................................................................35

Table 10. Regression results.......................................................................................................37

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 ACRYOMNS

E&P……………………………………………………Exploration and Production

KCCA………………………………………………….Kampala Capital City Authority

PWC…………………………………..............................Price Water House Coopers

R&D…………………………………..............................Research and Development

UMA…………………………………….........................Uganda Manufacturers Association

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 ABSTRACT

The study examined the nature of transparency and supplier support currently prevailing in the
oil and gas sector in Uganda. In addition, it also assessed how transparency and supplier
support are simultaneously linked to the competitiveness of local suppliers. Drawing on
evidence from a survey of 35 major active local suppliers to multinational companies in the
E&P sector in Uganda, the study reveals a number of insightful findings. In regard to
transparency, the findings of the study show that local suppliers perceive the level of
transparency in the existing business environment only to be moderate with the least favorable
evaluation made where information is to be obtained from Government and from the media.
Most favorable evaluation of transparency was in the case of the suppliers relations with
Multinational companies in the sector. In terms of support, the findings show that some level of
support for local suppliers exists. In the study, Multinational companies are earmarked as the
source of most of the support local suppliers receive vs. support received from media and
Government. Similarly, the currently emerging associations such as Chamber of Mines and
Petroleum together with insurance companies with tailored support to the sector were found to
be more supportive to the local suppliers compared to the traditional actors such as UMA and
Private Sector Foundation. Drawing on regression analysis, the study also supports the need for
transparency and supplier support as two important vehicles for enhancing the competitiveness
of local suppliers in the sector. With these findings the study makes a contribution of offering
empirical evidence that has been widely missing to guide the currently heated discussion
surrounding the issues of transparency, local supplier support and competitiveness in the oil
and gas sector.

Key Words: Transparency, local supplier support, Supplier Competitiveness

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 CHAPTER ONE

INTRODUCTION

1.1 Introduction

This chapter contains an introduction to the Study. In the chapter the background, statement of

the problem and objectives of the study are presented. The chapter also delineates the

conceptual framework, justification of the study as well as the study scope.

1.2 Background of the study

The oil and gas sector, and its role in supporting national development has continued to

dominate global discussions (Domjan, 2004; PWC, 2015). Central to these discussions has

been the failure of African oil producers to effectively benefit from their oil resource despite

the numerous opportunities in their favor (Musoke, 2015; Ongode, 2014). For example, most

of the Africa's reserves fit the category of high quality oil reserves given their low sulfur

content (Shinn, 2007).

The sector has also attracted key players who provide robust demand for the African oil.

Current indications, for instance, show that 22% of the China's oil imports are supported by

Africa's production. Similarly, U.S.A continues to be a majority importer of Africa's oil. The

dynamics and geopolitics in the global arena for oil business is of great interest to Uganda.

There is a dilemma for Uganda to fully understand the operations of the sector as it strives to

join other oil producing countries in the world (McClelland, 2013; Shinn, 2007).

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The discovery of Oil in Uganda occurred in 2006 and this followed a series of important

stages. The first efforts date back to 1925 when the first geological mappings were made

(Kavuma, 2009). This was later followed by minimal drilling activities between 1940 and

1980. The activities that followed especially during 1983 and 1992 led to identification of five

potential basins. In terms of volume, the current estimates put Uganda's oil reserves at 3.5

billion barrels (Ministry of Energy and Mineral Development, 2014). This estimate has since

been revised. By 2014, the Ugandan government estimated that there was 6.5 billion barrels of

oil in place, but recoverable oil is estimated to be between 1.8 and 2.2 billion barrels

(Henderson, 2015).

Oil production is expected to reach heights of between 200,000 and 250,000 bpd based on

current discoveries. This places Uganda in the position to be a mid-level African producer,

comparable with present day levels in Equatorial Guinea and Gabon. As a result, Uganda will

join the top 50 producing countries. Though still in the early stages, Uganda is already

benefiting from reasonable export gains from the sector. For instance, by 2009 estimates the

exports earnings from the sector stood at $36 million dollars. It is therefore upon this

background that the oil sector is anticipated to transform the country from a least developed

economy into the middle income country in a short space of time (Kavuma, 2009). But for a

number of stakeholders it is not clear how this oil resource can be utilized productively to

realize the anticipated benefits.

The key stakeholders have continuously called for transparency, local support and transparency

in the management of the oil resource (Musoke, 2015). While these issues have been discussed

in different fora in the country, there is still limited empirical evidence to guide these

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discussions or support the different claims advanced. This study seeks to address these issues

in the context of enhancing local supplier competitiveness. Lessons from developed countries

that produce oil such Norway, suggest that these are critical areas of consideration in the

attempt for any oil producer to benefit from its oil resources (Domjan, 2004).

1.3 Statement of the problem

The discovery of Oil and Gas in Uganda, has created a lot of excitement among the local

business community with anticipation of large business deals. Despite the legal and policy

framework in place to manage the oil sector such as the local content policy, very few local

companies have taken advantage of the existing opportunities and many have not done

anything to improve their potential to benefit from the sector.

The business presence of the local companies is still very minimal and lacking (Ongode, 2014).

This is evidenced by the records below from the Auditor General’s Office in 2015 which show

that from year to year, the local suppliers are not even earning 50% of the money being spent

by the international firms which have got the contracts to explore and refine the Oil.

Table 1: Expenditure of International Oil firms in Uganda

**Amounts in Millions of USD 2010 2011 2012 2013 TOTAL

**Amount Spent 131.95 265.61 381.37 392.89 1,171.83
**Amount Paid Ugandan Suppliers 32.78 62.17 128.50 106.44 329.89
% Paid Ugandan Suppliers 25% 23% 34% 27% 28%
**Amount Paid International 99.17 203.44 252.87 286.45 841.94
Suppliers
% Paid International Suppliers 75% 77% 66% 73% 72%
Source: Source: Office of the Auditor General, 2015

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Furthermore, local suppliers have been flouted on failing to meet standards and specifications

required by the Multinational Oil Companies. Transparency issues have also been discussed in

the local supplier demise in the oil and gas sector. Despite this interest in transparency, supplier

support and supplier competitiveness, there is scanty empirical research on transparency, local

supplier support and competitiveness of local suppliers in Uganda’s Oil sector. This study

seeks to address this problem.

1.4 General objective

The main objective of the study was to examine the role of transparency, prevailing levels of

local supplier support on the competitiveness of local suppliers in Uganda’s Oil and gas sector.

1.5 Specific objectives

This study was guided by the following specific research objectives:

i.) To examine the nature of transparency prevailing in the business environment

surrounding local suppliers in the oil and gas sector in Uganda.

ii.) To examine the nature of support prevailing in the business environment surrounding

local suppliers in the oil and gas sector in Uganda.

iii.) To examine the relationship between transparency and competitiveness of local

suppliers in the oil and gas sector in Uganda.

iv.) To examine the relationship between the various support opportunities and

competitiveness of local suppliers in the oil and gas sector in Uganda.

1.6 Research hypotheses

The research hypotheses included:

4
 i.) There is a positive and significant relationship between a business environment of

transparency and the competitiveness of local suppliers to Multinational Companies in

the oil and gas sector in Uganda

ii.) There is a positive relationship between support received from different players in the

oil and gas sector and competitiveness of local suppliers

1.7 Conceptual framework

The conceptual framework below highlights the variables and the hypothesized link between

the variables examined in the study.

Figure 1. Link between transparency, supplier support and competitiveness

TRANSPARENCY
Information Accessibility SUPPLIER COMPETITIVENESS
Information Relevance Process based competiveness
Information Predictability Market based competiveness
Technical based competitiveness

LOCAL SUPPLIER SUPPORT

Process-oriented advice,
Strategic advice,
Support of market entry
Financial support

The framework is based on existing scholarly works including but not limited to: Schnell (2015); McDermott and
Corredoira (2010); and Wagner (2006).

In the conceptual framework above, transparency and local supplier support are the

independent variables while supplier competitiveness is the dependent variable. The exiting

research studies indicate that if transparency is employed constructively, it should promote a

satisfactory level of Competitiveness among the local suppliers. On a related note, the local

5
supplier support is also expected to promote the competitiveness of the local suppliers (Zhao,

Xie, & Leung, 2002).

Transparency can have a positive effect on competitiveness since suppliers can easily use the

acquired and valid information to their advantage. With proper transparency, there arises an

opportunity for government to streamline the management of the oil resource with reference to

the existing or evolving regulatory infrastructure. It has been argued by writers that

transparency on the modern practices of working in the oil sector helps the local businesses in

the host country to develop a competitive edge and thereby ably benefit from the oil. This also

enables the local suppliers to offer services and standards rated as acceptable even at

international level (Sheng & Cheng, 2012).

1.8 Justification of the study

There are several reasons why this study is worth conducting in Uganda. First and foremost,

the oil and gas sector in Uganda is seen as the potential driver of the country's development yet

there is limited knowledge so far on the dynamics of this sector in relation to local supplier

development. Without this knowledge, there may be limited chances of local suppliers

benefitting from this sector.

Similarly, there has been scanty research done on the oil sector in Uganda at firm level.

Specifically, the studies in the oil and gas sector have not placed emphasis on the possibility of

the locals benefitting from this sector especially as a result of dealing with the multinational

companies which are given government contracts as well as other actors in the sector.

Therefore, this study suggests insightful strategies that can enable local suppliers to benefit

6
from the oil sector through partnerships not just with Multinational firms but also with other

players such as Government, fellow local suppliers, associations and institutions.

1.9 Scope of the study

1.9.1 Content scope

This study limited itself to transparency, supplier support, and competitiveness of local

suppliers in Uganda’s oil and gas sector. These are currently the key issues widely discussed in

the policy and political realm. It was therefore important to offer evidence to guide practice

and policy on these issues.

1.9.2 Geographical scope

The geographical scope was Kampala District where most of the service providers to the major

Multi-National Corporations in the Oil and gas sector in Uganda are headquartered.

1.9.3 Time scope

The study reviewed credible research documentation and scenarios over the period 2010-2016.

2010 was considered a benchmark, given that this is when the phenomenon under study started

to become vibrant.

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 CHAPTER TWO

LITERATURE REVIEW

2.1 Introduction

This section presents a review of the literature related to the study concepts and the research

objectives. The literature review in this study has been done by a careful consideration of the

works that have been done by other scholars regarding the variables in the study, that is,

transparency, supplier support and competitiveness of local suppliers in Uganda’s oil and gas

sector. In this chapter, the underlying gaps in the literature that the study intends to fill are

given.

2.2 Theoretical review

The theoretical background of this study is rooted in the learning literature and especially

literature on absorptive capacity, as well as relational embeddedness framework.

2.2.1 Absorptive capacity literature

Absorptive capacity constitutes an important concept in the learning literature (Levinthal &

Wesley, 1989). This concept provides important insights into how firms take advantage of the

current and future opportunities in their environment by systematically and proactively

developing their capacity to learn (Barton & Court, 2012). There are several definitions of the

concept of absorptive capacity. But more notably is the one given by Zahra and Gerard (2002).

According to these scholars, absorptive capacity is a set of organizational routines and

processes by which a firm acquires, assimilates, transforms and exploits knowledge to produce

a dynamic organizational capability. And as such, firms that are proactive in developing these

8
strategic areas can achieve better competitive position in the market. Scholars have particularly

identified such areas as R&D, market research and receipt of support from strategic actors in

the market to be a source of this advantage (Levinthal & Wesley, 1989).

In this study context the focus was on the last aspect which is support of the firm. The local

participation and competitiveness in the nascent oil and gas sector in Uganda can partly be best

achieved through collaboration and some form of support as a means to bridge the resource and

knowledge gap as well as the required huge capital investment that local suppliers do not have.

Drawing on the theoretical insights given in concept of absorptive capacity, in this study the

role of supplier support is regarded as a way of enhancing the local supplier's competiveness in

this nascent market through enhancing their absorptive capacity. Particularly this area of

theoretical advancement is used in the study to justify why local suppliers that receive or solicit

for support from a number of actors would more likely achieve higher level of competitiveness

in the oil and gas sector in Uganda.

2.2.2 The relational embeddedness framework

The framework of relational embeddedness pertains to the strategic actions that a firm

undertakes internally but with a consideration of the social environmental landscape so as to

improve its competitive position (Echols & Tsai, 2005). This often implies that the firm has to

develop and nurture strategic relationships which are capable of promoting trust and mutual

benefit for the firm and the other parties involved (Perks & Jeffery, 2006). Earlier writers such

as Aino, Halinen and Jan-Ake (1998) linked relational embeddedness to the quality and nature

of the relationships that a firm has with other firms that are relevant to its operations.

9
Gemünden, Ritter, and Heydebreck (1996) suggested that achieving trustworthy relationships

can result into competitiveness for it opens opportunities for collaboration. In such a

relationship, firms are more willing to share in a transparent way knowledge and experiences

so as to enhance among others their innovative edge, performance and consequently their

competitiveness (Blyler & Coff, 2003).

Scholars have advised that when firms have realized such trustworthy interactions with other

firms or institutions, they should always make it a point so as to employ these relationships to

their advantage (Bradley, Desai, & Kim, 1983; Calomiris & Ramirez, 1996). The firm officials

should use all the vital resources such as knowledge for enhanced competitiveness in the

company (Perks & Jeffery, 2006). This is consistent with the suggestions of Echols and Tsai

(2005, p. 221) who contend that a firm should make it a point to ensure that decisions made at

the firm level, take into consideration the potential consequences of such decisions on the

relationships that the firm has with other firms.

Essentially, in this study relational embeddedness theory is important given that information

flow and transparency in the oil and gas sector remain a contentious issue. This framework can

therefore provide insights into how opening these areas can enhance the competiveness of the

local suppliers. Ideally with regard to the embeddedness framework transparency especially in

information flow in any relationship suppliers are involved in can be a formidable competitive

advantage as they also minimize dishonest transactions and the loss of value to the firm in its

dealings with others. This notion is shared by other writers such as Blyler and Coff (2003) and

Koka and Prescott (2002).

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2.3 Conceptual framework

From the proceeding sections, the key aspects derived for empirical investigation are

competitiveness, transparency and supplier support. In this section, these concepts are

explained and their link highlighted.

2.4 Transparency
Scholars have argued that transparency is a complex concept that is sometimes linked to

accountability, unethical behavior among members in a certain setting (Sabrina & Eggert,

2003). Further, it is a concept that has attracted unique attention in the oil and gas sector

because of the sector's special link to national and global politics. According to the WTO

(2015) transparency can only be effective in the oil sector if three main and basic conditions

are catered for and these include: i) availing information on the regulatory infrastructure in an

economy, ii) communicating changes to the regulatory framework iii) Ensuring that laws and

regulations are administered in a professional, standard fashion (Bellver & Kaufmann, 2005).

From this view of the World Trade Organization, we can establish that for the oil sector,

transparency is not simply about sharing information but this should be information that is

critical to the administration of the oil sector. However, it is often narrowed down to simply

the release of information which is considered relevant for assessing different institutions. This

is indeed a narrow definition of the variable and as such, should be used with caution (Bauhr &

Grimes, 2012). Other writers such as (Vishwanath & Kaufmann, 1999) who concur with

Bellver and Kaufmann (2005) have described the concept as increased flow of timely and

reliable economic, social and political information, which is accessible to all relevant

stakeholders. Beyond information that is received from the government as a key player in the

11
competitiveness of oil and gas sector, there are several insights from prior research works

addressing transparency between firms. Drawing on these research works, it is also imperative

to look at the transparency attributes underlying not just in government- business relationship

but also between other actors in the sector. In this regard, transparency in the current study is

logically conceptualized as constituent of three separate dimensions and these are: information

accessibility, information relevance and information predictability.

Information accessibility pertains to making the information available to those parties that

really need it. This may sometimes call for compelling measures from the Government if

certain companies are to realize or disclose some information (Meijer, 2014). Information

predictability on the other hand, pertains to how the mindset of stakeholders has been shaped

given the previous experience in interacting with the other players. Given certain situations and

the information that all stakeholders have, the consequent decisions should be predictable by

all the involved parties (Heald, 2006). Finally, information relevance has more to do with the

suitability of the information for the current situation.

2.5 Supplier support

In order to ensure constructive mutual relationships between firms, there is often a need for

firms that are stronger, more established and renown to develop or support partners who are

perceived to be beneficial but weak relationship (Ananda & John, 2008). Supplier support,

which is expressed in developing the capacity of these firms will only translate into improved

potential for the supporting firm to meet its targets since this relationship involves mutual

benefits for all firms (Palmatier, Scheer, Houston, Evans, & Gopalakrishna, 2007). These firms

tend to reciprocate to each other. This helps them to meet their institutional goals.

12
However, in spite of the potential benefits of supplier support, there are very few firms that

make it a point to assess the value of supporting their suppliers in their efforts to meet

institutional goals. Many firms simply reject to support local suppliers believing that this is an

unnecessary expense (Krause, Handfield, & Tyler, 2007), and thus miss out on the benefits of

such an undertaking. Supplier support in this case has been described using the dimensions of

(Wagner, 2006).

2.6 Competitiveness of the suppliers

Supplier competitiveness involves the capacity to come up with novel capabilities with a view

to improve their competitiveness (Kannan & Tan, 2006). This variable has been conceptualized

in this study as consistent of four main dimensions and these are process competitiveness,

Product competitiveness, Business growth and Supplier competitiveness (Giuliani, Pietrobelli,

& Rabellotti, 2005). Process competitiveness is about efficiency in acquiring the desired

product or service from a given raw material or input. This may call for an introduction of the

latest technology. Competitiveness in this context, refers to introduction of advanced Service

lines so as to keep ahead of competition in a given sector (Song, 2002).

The work of Li, Ragu-Nathan, Ragu-Nathan, and Subba (2006), is indicative that with proper

supply chain management and support practices such as technical advisory services, it becomes

very easy for local suppliers in any country to quickly upgrade their capacity and thereafter

become more competitive. For the case of the oil and gas sector, fueling the local supplier

support should be promoted by the fact that the main or big players in the oil and gas sector do

not withhold critical information that local suppliers need to benefit from the revenues of the

oil and gas sector in their country (Marinagi, Trivellas, & Reklitis, 2015).

13
2.7 The relationship between transparency and supplier competitiveness

Transparency is a very important element when it comes to building a firm’s likelihood to

upgrade its capabilities and more importantly enhance its competitiveness. Competitiveness is

essential in transactions involving any two or more parties especially where mutual benefit is

anticipated (Takim, Shaari, & Nordin, 2013). All parties involved should therefore have their

goals and targets aimed at improving the level of transparency so as to be considered more

credible and therefore worth dealing with.

Transparency has been linked by scholars to integrity and in business relationships; it gives an

opportunity to others with whom one is dealing to be more open, open up to the other party and

therefore be more willing to adapt constructive advice. In the case of sectors such as the oil

and gas sector, this transparency will ultimately result into enhanced supplier competitiveness

(Gebel, 2012).

Transparency is expected to promote supplier competitiveness which pertains to the internal

capacity of the local suppliers in this case to improve their performance (Bauhr & Grimes,

2012). Transparency in the case of the oil sector, gives an opportunity to firms and other

parties involved in the transactions to be accountable for their actions. The positive note about

the effect of the transparency on the local supplier competitiveness is that the buying firm can

easily identify the weaknesses of the supplier firm and therefore help enhance the capacity of

the supplier firm to deliver standard services (Lopez, 2007).

Owing to the fact that the oil sector like many other sectors such as construction in the

developing world are usually characterized by corruption, it is important for the supplier firms

to ensure that their efforts are worth considering for long term relationships that would lead to

14
supplier competitiveness (Maarten, Willam, Henery, & Stangury, 2009). Supplier

competitiveness is key and essential to the future of any organization or firm and consequently,

if there are any opportunities that would help a firm attain this, these would be greatly

encouraged (Ortiz, Castells, & Sonnemann, 2009). Transparency is needed both within a buyer

firm and in its relationship with other firms such as suppliers. Without the transparency among

both parties in a transaction, there are increased chances of loss of resources and therefore,

even the supplier competitiveness may be eroded since honesty is necessary and required for

firms to develop their suppliers (Sultan & Kajewski, 2005).

Other scholars such as Kolstad and Wiig (2009) argue that there is a link between transparency

and supplier Competitiveness. When there is very limited transparency, it becomes very hard

for the firms to upgrade their capacity because they are not kept in the know of which

competences to develop. It becomes hard for the supplier to trust the buyer and reveal the

necessary weaknesses in the operations of the supplier. The link between transparency and

supplier competitiveness has not been examined among oil suppliers in the Ugandan context.

2.8 The relationship between local supplier support and supplier competitiveness

Local suppliers in emerging markets need various forms of support before they can develop.

Support of the firms in this case may consist of important dimensions such as process-oriented

advice, strategic advice, support of market entry and financial support (Wagner, 2006). Kwon

and Suh (2005) have revealed that sharing of strategic advice for instance, with local suppliers,

is likely to promote firm competitiveness among partners in different sectors. The possibility of

offering support to the local suppliers through communication is especially facilitated today by

the advent of the information and communication technologies.

15
This notion is shared by Simatupang,Wright and Sridharan (2004) whose study reveals that

support can enhance the local supplier capacity to upgrade their operations. This support for

the case of firms dealing with others in relationship where there is mutual benefit for all, there

would be a constant need for a constant relay of consistent, reliable and truthful information so

as to increase the possibility of promoting the firm’s performance, alignment of the supplier

firm strategy to meet the changing needs of the buyer firms (Abdullah & Abdullah, 2012).

Concurring with the aforementioned writers, Simatupang and Sridharan (2005) contend that

local supplier support if done in a timely fashion, will allow for adequate preparation especially

for the supplier firms. The supplier firms in this case, can have an opportunity to outsource

certain special skills if these skills are not present in-house. The benefits of supplier support

being numerous, it is imperative that its effect on the supplier competitiveness in a developing

oil economy is ascertained. This will grant the government and the main contractors a chance

to upgrade the local suppliers if the link is found to exist for Uganda’s sector as has been noted

for the more developed economies (Arshinder, Kanda, & Deshmukh, 2008).

2.9 Summary of the literature review

This section has focused on the review of the literature of the various writers who have done

work on the concepts of transparency, supplier support and competitiveness. The theories of

the Absorptive capacity literature and the relational embeddedness theory provide the

theoretical logic in understanding these concepts and have been reviewed to understand how

transparency and supplier support can be linked to the competitiveness of suppliers. Both these

theories are important in explaining learning and competitive advantage of firms.

16
The writings on the theories have been done by focusing on the works of Zahra and Gerard

(2002), Echols and Tsai (2005), and Blyler and Coff (2003). In addition, drawing on the

prediction of these theories a number of empirical studies are reviewed. In the review, the

claim as given in the embeddedness literature that transparency would enhance

competitiveness is widely supported. In the same vein, a number of empirical studies

demonstrate that support is critical in enhancing competitiveness. This study takes these

arguments to establish the relevance of firm support and transparency in building the local

supplier competitiveness. This study has potential to contribute to the existing literature given

that most of the literature reviewed focuses on other contexts as opposed to the developing

country context. And even then there is limited literature on suppliers in the oil and gas sector.

17
 CHAPTER THREE

METHODOLOGY

3.1 Introduction
This section presents an overview of the scientific and systematic steps that were taken so as to

collect and analyze the data. The section contains the research design, population and sample

of the study, data collection methods, measurement of the study variables, reliability and

validity of the study findings and data analysis.

3.2 Research approach

Qualitative or quantitative or mixed methods

Quantiative, then there are specific designs that work with quantitative:

3.2 Research design

In the study a cross-sectional research design was adopted. In this design data on all the

variables is collected at one point in time. While this design simply gives a snap short, it has

been widely accepted in the study of business management issues and found to be reliable. As

result cross-sectional, design is also utilized in this study. Nonetheless, in recommending the

results, the weaknesses of the design were clearly highlighted such as failure to give a

complete account of issues that involve a long time period.

Furthermore, the study was majorly explanatory, that is, it aimed at understanding and

explaining the influence of transparency and supplier support on the competitiveness of local

suppliers. Last but not least, the study was based on survey as opposed to case study so as to

get the average picture in the industry regarding the issues of interest.

18
3.3 Sampling frame

In the study, information from Chambers of Mines and Petroleum was the major source

utilized to establish the sampling frame of the study. This is a department in the Ministry of

Energy and Mineral Development responsible for suppliers and related activities in the oil and

gas sector. From the registry provided, the total number of local suppliers in the database were

64 firms (Appendix 3 gives a complete list of the suppliers in its database) but the active and

local suppliers willing to participate in the study were 30 suppliers. Other sources utilized

included individual databases of multinational companies operating in the Exploration and

Production (E&P) segment in the country. For these sources, 10 local suppliers were identified.

This effort yielded a total of 40 local suppliers that were invited and accepted to participate in

the study. Specifically, these were companies operating in a diverse areas of specialty

including but not limited to: engineering, waste management, logistics, clearing and

forwarding, security, leisure and hospitality, financial services and manpower management.

3.4 Sample size

Given that the sampling frame was small, the aim in the study was to collect information from

as many identified suppliers as possible. This was particularly important in order to conduct

meaningful statistics in the study. Consequently, all the 40 suppliers in sampling frame were

considered for the study. 5 suppliers failed to honor the appointment to meet with them as they

were constantly on the move bringing the total number of suppliers successfully contacted and

included in the study to 35. The response rate of the study was therefore 88% This was quite

high compared to other surveys conducted in similar contexts and on the study topic. Table 2

19
below shows the characteristics of firms included in the study and their respective areas of

operations.

Table 2. Characteristics of local suppliers and respondents included in the study

Categories Frequency Percentage

Size by employment 1-45 17 48.6
46-90 7 20.0
91-135 2 5.7
>135 9 25.7
Type of sector Logistics 10 28.6
Manpower 8 22.9
Engineering 10 28.6
Waste management 4 11.4
Hotel and 3 8.6
Hospitality
Age of the local supplier 1-7 4 11.4
8-14 14 40.0
15-21 11 31.4
>21 6 17.1

Number of major international 1 27 77.1

customers 2 3 8.6
3 2 5.7
Category of respondents Managing director 18 51.4
Manager 13 37.1
Supervisor 3 8.6
Team leader 1 2.9
Experience of Respondent in the 1-5 years 16 45.7
company in years 6-10 years 3 8.6
11-15 years 16 45.7
Source: Based on primary data

20
As can be seen in Table 2 above most of the local suppliers included in the study were majorly

small enterprises accounting for 48.6%. Firms that were with employment of over 100

accounted for 26%. In terms of the sector of the firm, majority of the local suppliers in the

sample were in logistics with 29% and engineering with also 29%. There was also a reasonable

number of those in manpower with 23%. Most of the firms in the sample had been in existence

for over 8 years. But had majorly one E&P customer. Lastly, majority of the respondents were

those that had experience with their company of over 2 years and were majorly at the level of

Manager or Managing Director.

3.5 Sampling technique

Convenience sampling was used in the study. This particular sampling procedure involves

identifying and selecting companies based on their availability for the study. In this particular

sector, that is, oil and gas sector, the potential respondents are difficult to get hold of and

constantly travelling. As a result, convenience sampling became the most valuable approach to

obtain a reasonable sample. Consequently, those companies included in the study were those

whose top executives were available to conduct the interview. For the 5 suppliers that were not

included in the study, it become difficult to find the most appropriate time to collect

information from them as they were continuously embroiled in the company activities and

failed to honor several appointments scheduled with them.

3.6 Data collection method

Survey data collection method was employed in the study. Specifically, a structured interview

method was utilized to administer a survey instrument. This structured interview guide was

developed following the recommendations by various scholars that include Kothari (2004)

21
Sekaran and Bougie (2010) and Saunders, Lewis, and Thomhill (2008) In some sections of the

instruments, there were questions that had predetermined answers. Other questions were open

ended. Given the flexibility of the method, it was possible to collect more in-depth information

underlying the issues under study. This qualitative information was also utilized in the

discussion part of the study to offer clarification of the quantitative data collected from the

closed ended questions.

3.7 Data collection procedure

Having received an approval of the research proposal, a letter of introduction from the

University was acquired so that the research study could not be mistaken for a non-academic

effort. This research letter was further to build the confidence of the respondents from the

supplier firms that their identity and opinions would not later on be used to follow them up by

other institutions such as the Uganda Revenue Authority. The research letter is included in the

Appendix 2. With the help of research assistants, the survey instrument was completed in form

of an interview with the respondent.

3.8 Measurement of the study variables

The variables were measured using items adapted from existing studies on transparency,

supplier support and competitiveness of suppliers. In the sections that follow, each of the

variable, its respective items and sources of the items is presented.

Transparency. In the study, the transparency variable was conceptualized along three

dimensions namely: information accessibility, information relevance and information

predictability (Schnell, 2015). Specifically respondents were asked to what extent they agreed

on a scale of 1 to 5 (1=strongly disagree and 5=strongly agree) to the following statements: (1)

22
our firm has benefited from access to detailed information about the valuable business

opportunities in the sector, (2) obtained timely information meant for suppliers, (3) benefited

from information that was freely shared in the sector, (4) obtained information highly relevant

to the business opportunities without hustle, (5) accessed relevant and valid information about

supplying the sector and (6) information that is specific to the business they engage in. This

scale demonstrated high level of reliability with a Cronbach Alpha statistic of 0.90, which is

above the widely used cutoff point of 0.70 as suggested by Nunnally (1978).

Supplier support: In the study, supplier support variable, was conceptualized to address the

support in training, financial support and process improvement support.

The items for these different dimensions were obtained from earlier existing study by Wagner

(2006).These included the extent to which the local supplier has received support in terms of:

(1) training of administrative personal and plant workers, (2) training of managerial,

professional and executive staff, (3) supporting the supplier to attend workshops to benefit

from oil business, (4) training the supplier in strategic planning for capacity support to exploit

opportunities in the oil and gas sector, (5) support to obtain credit facilities from the financial

institutions, (6) support in terms of getting referrals for financial support from financial

institutions, (7) support to develop the firm’s technology, techniques and innovation, (8)

support in process improvement and technology, (9) support in quality enhancement and (10)

support to meet quality standards.

These were evaluated by the respondent on a 5 likert point scale. Where 1 was for strongly

disagree and 5 strongly agree. The factor loadings and Cronbach Alpha statistic for the scales

of the different dimensions of the variable of supplier support are given in the Table 3 below.

23
Supplier Competitiveness: This variable was conceptualized in the study to constitute three

main dimensions as informed by existing literature (McDermott & Corredoira, 2010). These

include: process based competitiveness, market based competitiveness and technical based

competitiveness. Specifically respondents were asked to what extent they agree on a scale of 1

to 5 (1=strongly disagree and 5=strongly agree) with the following statements that cut across

the three areas of competitiveness evaluated: (1) our firm has taken important measures to

improve the skills of our labor force, (2) the quality department has increased its effectiveness

in improving the quality of our products, (3) the training and education of our employees has

been a priority, (4) our company has made important improvements in manufacturing/service

delivery processes, (5) we are at par in our performance with our major competitors, (6) in the

past years our level of supplying deals have grown, (7) our firm has made important

investments in machinery and equipment, and (8) our company made a substantive

reorganization of the productive systems.

Table 3. Factor analysis

VARIABLES AND THEIR MEASURES Factor loading

Transparency α=0.90
Access to detailed information about valuable business .878
opportunities
Obtaining timely information meant for suppliers .802
Benefiting from free sharing of information in the sector .852
Accessing high relevant business information hustle free .793
Accessing relevant and valid information about supplying .866
Obtaining information that is specific to the business they engage .769

24
in
Eigen value 4.112
Total Variance Explained 68.53
Kaiser-Meyer-Olkin (KMO) 0.83
Bartlett’s Test of Spherecity 172.54***

Supplier support
Training support, α=80
Training of administrative personnel and plant workers .81
Training of managerial, professional, and executive staff .80
Supporting the supplier to attend workshops to benefit from the oil .72
business
Training the supplier in strategic planning for capacity support to .52
exploit opportunities in the sector

Financial support
Support to obtain credit facilities from financial institutions 0.814
Support in getting referrals for financial support from financial 0.93
institutions

Process improvement support, α=83

Support to develop the firm’s technology, techniques and .72
innovations
Support in process improvement and technology .59
Support in quality enhancement .84
Support to meet quality standards .84
Total Variance explained 71.86
Kaiser-Meyer-Olkin (KMO) 0.72
Bartlett’s Test of Spherecity 225.35***

25
 Competitiveness
Process-based competitiveness, α=0.63
Our firm has taken important measures to improve the skills of our .638
labor force
The quality department has increased its effectiveness in improving .669
the quality of our products
The training and education of our employees has been a priority .860
Our company has made important improvements in manufacturing/ .677
service delivery processes
Eigen value 3.72
Market-based competitiveness
We are at par in our performance with our major competitors .766
In the past years our level of supplying deals have grown .742

Technical based competitiveness

Our firm has made important investments in machinery and .888
equipment
Our company made a substantive reorganization of the productive .742
systems

Total Variance Explained 69.22

Kaiser-Meyer-Olkin (KMO) 0.66
Bartlett’s Test of Spherecity 99.80***
N=35, ***p<0.00, **p<0.01, *p<0.05, α is Cronbach Alpha coefficient computed for scales
with three items and more.

3.9 Reliability and validity of the study

To ensure the quality of the research process, the research instrument was pretested on the first

three companies interviewed. This process did not reveal vagueness of the items in the study

26
instruments. There were minor changes suggested that were incorporated to ensure that the

instrument was accurate for the purpose it was intended.

All the items included in the study were based on earlier studies and thoroughly reviewed by

the supervisor before the data collection. In addition, a number of tests were conducted on

reliability and validity of the data. In the case of reliability, Cronbach Alpha coefficient for all

the variables was computed. With the exception of one scale for process -based

competitiveness with the Cronbach Alpha of 0.63, all the other scale had a coefficient of above

the cutoff of 0.70. In the context of validity, factor analysis was utilized. The factor loadings

for the items included in the study were above 0.5 threshold.

3.10 Data analysis

In data analysis, SPSS was utilized to conduct the statistical analysis. The 17.0 SPSS software

version was employed. In the software, a number of tests were conducted including but not

limited to: factor analysis, frequencies, mean, standard deviation, correlations and regression

analysis.

27
 CHAPTER FOUR

PRESENTATION, ANALYSIS AND INTERPRETATION OF THE FINDINGS

4.1 Introduction

This chapter deals with the presentation, analysis and interpretation of the study findings. The

chapter begins with the descriptive statistics of the study specifically on the local supplier

perception of the nature of transparency in the oil and gas sector, type of support they receive

in regard to exploiting the available business opportunities and the level of competitiveness of

these local suppliers in the sector. Thereafter, the relationship between the key variables of

interest, that is transparency, supplier support and competitiveness is presented. In the last

section, the regression analysis results are presented.

4.2 Transparency environment faced by suppliers in the oil and gas sector

In the current discussion on local content development in Uganda's oil and gas sector,

particularly in terms of local supplier development, issues of transparency have widely featured

with a lot of speculation. Table 4 below, presents evidence on how local suppliers included in

the study perceived transparency that they are faced with in the sector.

Specifically, the evidence collected focused on six areas namely: accessibility of detailed

information for a local supplier, access to timely information, extent to which information has

been freely shared with the supplier, ease of access to the relevant information, access to valid

information and obtaining specific information.

28
Table 4. Reported level of transparency among local suppliers

Nature of transparency Mean S.D

Access to detailed information about valuable business 3.79 0.999
opportunities
Obtaining timely information meant for suppliers 3.65 0.849
Benefiting from free sharing of information in the sector 3.46 1.069
Accessing high relevant business information hustle free 3.04 0.988
Accessing relevant and valid information about supplying in the 3.67 0.769
sector
Obtaining information that is specific to the business they 3.74 0.743
engage in
Note: These items were measured on a five point likert scale where 1=strongly disagree and 5=strongly agree. S.D
indicate the degree to which individual scores by respondents are far from the mean.

As shown in Table 4 above, the findings reveal that generally, local suppliers perceive

transparency on all the issues studied to be slightly above average on the scale of 1 to 5. It can

however be seen that there are notable variations on the various forms of transparency

evaluated. For instance, in terms of the extent to which local suppliers hustle to get information

relevant to exploiting business opportunities in the sector the score by the respondents was 3.04

with standard deviation of 0.988. In relation to all the other aspects of transparency this

constituted the least score.

The second lowest aspect with the mean score of 3.46 was the extent to which the local

suppliers benefit from free sharing of information. Those areas of transparency that were

relatively considered to be moderately favorable were access to timely information

(Mean=3.65, S. D=0.849) and access to relevant and valid information (Mean=3.67, S.

D=0.769). In the sample, the aspects were transparency was considered to be highest were

access to detailed formation about valuable business opportunities (Mean=3.79, S. D=0.999)

29
and obtaining information that is specific (Mean=3.74, S. D=0.743). Generally, the standard

deviation statistics are not very high indicating reasonable validity of the reported mean values.

In addition, given that in their transactions, local suppliers rely on different players on

information and access to opportunities, the level of transparency in their dealings with

different actors was assessed.

Table below 5 below shows how the local suppliers generally evaluate the transparency they

face in their relationships with different actors in the sector.

Table 5. Level of transparency

Actors Mean S.D

Relationship with Government on Oil and gas 2.39 1.201

opportunities
Relationship with fellow suppliers or local 2.69 1.294
actors
Relationship with Multinational Customers 4.04 0.721
Transparency of media information 2.85 1.215
Note: The mean and S.D was based on the item measured on a five point likert scale indicating the degree to which
their interaction with these actors was transparent

Evidence in the Table above shows that it is in their relationship with multinationals were they

observe the highest level of transparency (Mean=4.04, S. D=0.721). On the other hand, local

suppliers report the least occurrence of transparency when they are transacting with

government (Mean=2.39, S. D=1.201) followed by the business relations they have with their

fellow suppliers (Mean=2.69, S. D=1.294).

While the media has been very vital in the debate on transparency issues in the sector, the

evidence reveal that the information that the media provides is generally less transparent or of

value with the mean score for its value of 2.85 and standard deviation of 1.22.

30
4.3 Level of support available to suppliers in the oil and gas sector

Given that participation in the oil and gas sector requires a lot of resources, local supplier

support is very important for the Ugandan suppliers. Table 6 below gives evidence regarding

how the local suppliers perceived the support they have obtained in the different areas with

regard to exploiting opportunities in the oil and gas sector.

Table 6. Nature of support structure for suppliers

Nature of support Mean S.D
Training support
Training of administrative personnel and plant workers 3.11 1.184
Training of managerial, professional, and executive staff 3.13 1.115
Supporting the supplier to attend workshops to benefit from the 3.65 1.079
oil business
Training the supplier in strategic planning for capacity support 3.27 1.095
to exploit opportunities in the sector
Financial support
Support to obtain credit facilities from financial institutions 3.04 1.268
Support in getting referrals for financial support from financial 3.27 1.095
institutions
Process improvement support
Support to develop the firm’s technology, techniques and 3.00 1.193
innovations
Support in process improvement and technology 3.22 1.191
Support in quality enhancement 3.54 1.089
Support to meet quality standards 3.76 .970
Note: The respondents were asked to indicate the extent to which each of the following actors has been helpful in
providing support they need with regard to harnessing the opportunities in the oil and gas sector. The responses were
evaluated on the scale of 1 to 5 where 1=strongly disagree that it has received support from a particular actor and
5=strongly agree.

31
As shown in Table 6 above, in the area of financial support, the suppliers included in the study

reported most support to be in relation to receiving recommendations to the relevant financial

institutions to obtain capital with the mean of 3.27 and standard deviation of 1.095 verses

direct support from the financial institutions with mean of 3.04 and standard deviation of

1.268. When it comes to the area of training most support received is one that entail invitation

to attend workshops where vital information is shared with the mean score of 3.65 and standard

deviation of 1.079.

In the study, other related avenues in the area of training evaluated included training of local

suppliers in strategic planning with the mean score of 3.27 and standard deviation of 1.095,

training of lower level personal with the mean score of 3.11 and training of managerial and

professional executive staff with mean score of 3.13. In addition, to the degree to which

suppliers indicate they have received support, Table 7 below gives more information on the

source of this support and the significance of support from that source.

Table 7. Assessment of the role of different actors in providing suppliers with the necessary support
Source of support Mean S.D
Government as source of support that suppliers need 2.79 1.197
Associations as the source of support that suppliers need (e.g., 3.95 1.682
UMA, KCCA, Public Sector Foundation)
Banks as the source of support that suppliers need 3.57 1.208
Support from other actors 4.15 .801
Note: The respondents were asked to indicate the extent to which each of the following actors has been helpful in
providing support they need with regard to harnessing the opportunities in the oil and gas sector. The responses were
evaluated on the scale of 1 to 5 where 1=strongly disagree that has received support from a particular actor and
5=strongly agree.

As indicated in the Table 7 above most of the local suppliers perceive support they receive

from Government to be relatively low with mean score of 2.79 and Standard deviation of

32
1.197. The support from traditional associations was found to be relatively high vs.

Government and Media support with a mean score of 3.95 and standard deviation of 1.682.

Similarly, to some extent the results in the study show a reasonable level of support for local

suppliers coming from Banks (Mean=3.57, S. D=1.208). However, most support is suggested

to come from those sources that are more tailored to the oil and gas sector such as Chamber of

Mines and Petroleum development with a mean score for this category of 4.15 and standard

deviation of 0.801.

4.4 Level of competitiveness of suppliers in the oil and gas sector

In addition to assessment of the nature of locally available support and transparency issues

affecting local suppliers in the oil and gas sector, attention in the study was also given to the

actual competitiveness of suppliers. Table 8 below shows how local suppliers differ in their

competitiveness over various aspects that cover process competitiveness, market

competitiveness and competitiveness of the supplier in relation to the technical aspects.

Table 8. Competitiveness of local suppliers in the oil and gas sector

Nature of competitiveness Mean S.D
Process-based competitiveness
Our firm has taken important measures to improve the skills of 3.00 1.193
our labor force
The quality department has increased its effectiveness in 3.33 1.148
improving the quality of our products
The training and education of our employees has been a priority 3.22 1.191
Our company has made important improvements in 3.76 .970
manufacturing/ service delivery processes
Market-based competitiveness
We are at par in our performance with our major competitors 3.13 1.115
In the past years our level of supplying deals have grown 3.04 1.268

33
Technical based competitiveness
Our firm has made important investments in machinery and 3.65 1.079
equipment
Our company made a substantive reorganization of the 3.70 1.082
productive systems
Note: The mean and S.D was based on the item measured on a five point likert scale indicating the degree to which the
supplier is making effort in increasing its competitiveness in a particular area

From the table above it can be seen that local suppliers are making more effort to be

competitive in terms of investing in improved service delivery and manufacturing processes

(Mean=3.76, S. D=0.970) as well as in the area of reorganization of the productive systems to

meet the expected standards. The data reveal that local suppliers are less competitive in

attracting more deals in the sector (Mean=3.04, S.D=1.268) and are not heavily investing in

improving the skills of their staff (Mean=3.00, S. D=1.193). From the findings however, local

suppliers appear to be less likely in comparative terms to grow their business and to remain at

the same level of competitiveness with their rivals.

4.5 The relationship between supplier support, transparency and competitiveness of

suppliers in the sector

In the study, correlations were utilized to establish the relationship existing between the study

variables. The correlation was specifically helpful in order to get preliminary insights into the

link between competiveness and the various independent variables. Other variables were also

included in the relationship to show how they are correlated with the focal variables of interest

before inclusion in the regression analysis. For variables that included more than one

dimension, a composite score was obtained by summing the values of different dimensions and

divided by the number of the dimensions. Table 9 shows the study shows the relationships

between the variables based on Pearson coefficient statistic.

34
Table 9. Relationship between study variables

Variables 1 2 3 4 5 6

Type of industry (1) 1

Age of the firm (2) 0.14 1

Number of employees (3) -0.10 0.259 1

Transparency (4) 0.03 -0.35* -0.03 1

Supplier support (5) -0.01 -0.20 0.075 0.52** 1

Supplier's competitiveness (6) -0.02 -0.11 0.20 0.58** 0.68*** 1

N=35 ***p<0.001, **p<0.01, *p<0.05

The evidence as presented in Table 9 above shows that there is a significant relationship

between supplier's level of competitiveness and support received. This relationship is

according the Pearson correlation coefficient presented in Table 9 above to be 0.58 and

significant at P<0.01. The data also reveal that local suppliers that are in position where they

enjoy higher level of transparency are also those that on average with the highest level of

competitiveness (r=0.68, P<0.001). Other variables included in the matrix are those that have

been included in the regression analysis in the section that follow.

4.6 Regression analysis of the link between supplier support, transparency and
competitiveness of suppliers in the oil and gas sector

35
The regression analysis was also undertaken in order to determine how transparency and

supplier support can enhance the competitiveness of local suppliers in the oil and gas sector. In

this analysis Ordinary Least Square Method (OLS) of estimation was utilized and all the

variables: control and focal variables were entered in the model at the same time. But for the

regression analysis to give valid results some key assumptions have to be satisfied. In this

analysis, Variance Inflation Factor (VIF) was used to ensure that the assumption of reasonable

differences of the independent variables was satisfied.

These were all below the threshold of 10. In addition, the assumption of normality of residuals

was satisfied. And the residuals were normally distributed. It is also important that the

variables to be included in the model have reasonable correlation. The respective correlations

are given in Table 9 above. With the exception of firm type other variables have reasonable

level of correlation. The results of the regression analysis are presented in Table 10 below.

36
Table 10. Regression results
Variables β t VIF
Control Variables
Logistics sector .104 .438 3.12
Engineering sector -.071 -.275 3.67
Man power sector .042 .176 3.17
Waste management sector -.005 -.025 2.53
Age of the firm .113 .569 2.17
Number of employees .081 .512 1.39

Independent variables
Transparency .376 2.219** 1.58
Supplier support .525 3.005** 1.68

R2 .58
Adjusted R2 .44
F value 4.015**
N=35, **P<0.01, Dependent variable is Supplier's level of competitiveness

As shown in the Table 10 above, the model fits well the data with F value of 4.015 which is

statistically significant at P<0.01. In addition, based on the adjusted R 2, the results show that

the variables included in the model explain 44% of the variations of competitiveness existing

among suppliers, which is a reasonable level of influence.

37
Drawing on the coefficients of the variables included in the model, it is only Transparency and

supplier support that significantly influence competitiveness. Specifically, the contribution of

transparency is β = 0.38 at 99% level of significance. This means that a unit of improvement in

transparency would result into 38% improvement in the competitiveness of local suppliers. On

the other hand, when it comes to support, the findings of the study reveal even a much more

level of change in supplier competitiveness. The influence is given by β=0.525 at 99% level of

significance.

38
 CHAPTER FIVE

DISCUSSION OF THE FINDINGS

5.1 Introduction

In the earlier chapter the evidence regarding transparency, supplier support and

competitiveness was reported. In this chapter the discussion of these findings is given. The first

section gives the discussion of evidence related to the nature of transparency local suppliers

face in the oil and gas sector. This is followed with the discussion of the nature of support as

well as the discussion of the evidence with regard to the nature of competitiveness of local

suppliers. The last two sections address the discussion of the evidence with regard to the

influence of transparency and supplier support on the level of local supplier competitiveness.

5.2 The prevailing transparency environment faced by local suppliers

In the study evidence was provided regarding the key aspects underlying the business

environment local suppliers in the oil and gas sector specifically in terms of how transparent

this environment is in relation to securing and identifying business opportunities. Previous

studies in other contexts point us to access to information, validity and reliability of that

information, timeliness of the information and how easily that information is obtained and

extent of free sharing of information, among others, as some of the important areas in assessing

the level of transparency at firm level (Vishwanath & Kaufmann, 1999).

In the study, the evidence reveal that in the oil and gas sector in Uganda for each of these

aspects was perceived to be moderate ranging from 3.04 to 3.79 mean score with their

respective standard deviations showing limited variation of individual respondent score from

39
the mean. Within the current debate (Bellver & Kaufmann, 2005), this evidence seems not to

agree with the current picture mostly painted about the industry that there is no transparency in

the sector. This evidence suggests that though we observe moderate level of transparency in the

study this does not mean that there is completely no transparency. In fact, there seems to be

some reasonable progress recognized by the suppliers included in the study in areas of ability

of the suppliers to get detailed information and receiving specific information, which are some

of the important indicators of transparency.

These particular areas of transparency received the highest scores which included 3.79 and

3.74 respectively. Nonetheless, the modest score on the whole shows that there is still room for

improvement especially in the area of making it easier for the local suppliers to obtain the

necessary information about business opportunities available for them in the sector (Uzoigwe,

2012).

Further, the study shows that transparency in the sector varies depending on the actor that the

local suppliers are interfacing with. The findings in this line reveal that suppliers receive

limited transparent engagements with Government. This particular finding appears to support

the recent calls for the need of government to promote more transparent business environment

in the oil and gas sector if the country is to benefit from the oil resource (Ministry of Energy

and Mineral Development, 2014; Ongode, 2014).

The study findings also demonstrate a weak transparent regime in interactions local suppliers

have with other fellow local suppliers. This is not surprising given that firms in these contexts

where a weak regulatory environment exists are generally likely to fear loss of their secrets to

competitors (Ayebale, Nafunka, & Ayebale, 2016). Similar finding is also observed with

40
regard to information that is received from the media. This finding particularly brings into

question the current style of reporting the local media has developed where there is tolerance of

speculation and avoidance of provision of key information to help local suppliers. Where most

level of transparency is revealed is in the area of dealings with the Multinationals, that is, the

buyers. This is most likely to be the case because these are not their direct competitors and it is

in the interest of multinational companies to build a supplier base that can meet their expected

standards.

5.3 The discussion of the findings in relation to local supplier support

In the study three forms of support for the local suppliers participating in the oil and gas sector

were revealed: training, financial and process improvement support. The level of support in

these areas is however varied with most support given by the average score taking place in

process improvement followed by support in training personnel and with financial support

evaluated last. It does not come as surprise that there is limited financial support for local

suppliers in the sector given that there is a weak financial system in the country to finance

especially activities of the local suppliers in this new sector in the country (Kavuma, 2009).

The oil and gas activities generally require a lot of money which are in most cases outside the

borrowing capacity of local suppliers in a developing country context (McClelland, 2013;

Shinn, 2007). This particular challenge in exacerbated by the slump in the business worldwide

in the sector due to plummeting oil and gas practice (Henderson, 2015).

In the local setting, a lot of room has been left to speculation with Government delays to kick

start business activities in the sector in form of issuing licenses and other related permissions

for the oil companies to do business. It can therefore be conjectured that lack of financial

41
support is due to a number of factor including the existence of uncertain business climate in the

country that would make it difficult for financial institutions and other players to offer the

required support.

Given that the E&P sector is new, it is likely that local suppliers that are now new to the sector

would find even the slightest support in process improvement and related training to be of high

value. Indeed, most of the local suppliers engaged in the sector are those whose prior

experience was in the generic supply business with no such prior experience in supplying in the

sophisticated oil and gas sector. And to participate in this sector training and improvement in

process and technical competences is not only critical but a must.

In addition, this is an area were any initial support would be expected by all stakeholders

including Multinational companies themselves. Indeed, causal observation supports the

evidence in the study as most of the government discussions and activities posted in the media

appear to address this area of support for the local suppliers. But as we observe a number of

players mentioned in the discussion of the support for local suppliers, a key question that arises

is what is the support like from the different stakeholders?

In the study most of the respondents do not find government to be supportive in the industry.

Government has for some time emphasized its role in terms of providing security and

investment climate. In one interview one of the respondent highlighted the value of this

support. In this regard she noted that: "…the government has ably availed a good climate for us

to do our business well…" But from the perceptions of other suppliers what is apparent is that

the local suppliers expect more than this form of support.

42
Along similar lines, the study shows that the traditional associations such as UMA, Private

sector Foundation are not providing the expected support as is the case with those that are

tailored to the oil and gas sector such as Chamber of Mines and Petroleum. In the study it does

not come as a surprise that most of the support is noted by the suppliers to come from

multinational companies. This is specifically so given that multinational companies need

suppliers to upgrade in order to be of value to their business operations in Uganda.

5.4 The prevailing nature of competitiveness of suppliers in the oil and gas sector

The study reveals that there are varying levels of competitiveness observed among the

suppliers. This variation can be better explained in the three main areas identified in the study,

that is, process-based competitiveness, market-based and technical-based competitiveness. A

long these lines the evidence reveals that local suppliers are generally less competitive on all

these dimensions. It is important to note that the local suppliers score worse in the market-

based competitiveness area.

Clearly in this area suppliers generally report that they are not at par in performance with other

players and observe that their growth in getting business is with limited potential (Heald,

2006). This is not surprising though, given that local suppliers are new to the industry, and are

now in the process of transitioning from other sectors to this particular sector where they need

to build new competences to compete in market. This study therefore offers evidence to

understand areas and the extent of competitive disadvantage of the local suppliers.

43
5.5 The relationship between transparency and supplier competitiveness

In the study the role of transparency on supplier competitiveness was evaluated. The evidence

demonstrates that transparency is an important area of consideration in terms of enhancing the

competitiveness of local suppliers in the oil and gas sector, with the findings showing a

positive and highly statistically significant relationship. While transparency in this study was

addressed at the firm level, the current study findings support and resonates well with the

existing debate in the country calling for more transparency in the sector especially in terms of

contract awards and support for the local firms (Song, 2002). The study findings specifically

add uniquely to this area by suggesting that increased openness would contribute to better

utilization of the oil resource at national level, which is the focus of the current debate, and

support more effective and efficient local content development, which is the focus of the

current study (Kolstad & Wiig, 2009).

Specifically, the study shows that suppliers who are shriving in the sector demonstrated by

high level of competitiveness, are those that have the opportunity to collectively obtain valid

and reliable information regarding business opportunities in the sector; face limited hustle in

obtaining this information; have partners freely sharing information with them and this

information is availed to them on time. In the previous studies these are areas showing

transparency in the supplier business relations (Li et al., 2006). This evidence thus

demonstrates the strong need to building an environment of transparency among suppliers to

improve the extent to which local suppliers can compete in the oil and gas sector.

44
5.6 The role of local supplier support and competitiveness

The evidence coming from this study shows the need for direct support for suppliers if they are

to be competitive in the highly dynamic emerging oil and gas sector in Uganda. Particularly,

the evidence shows that suppliers who have received higher level of support are also those on

average that are reporting high level of competitiveness. Local suppliers in the country like

Uganda would need to compete with such support given that the sector is new to them and

therefore would need to be guided on how to compete in order to survive with external

competitors. In addition, the sector requires a lot of resources not only to enter but also to

sustain the business operations (Arshinder et al., 2008).

Given that this is a new sector, the kind of resources and standards required were previously

not in their earlier business engagements. Thirdly, support from the open market is not readily

available for local suppliers. Take the example of financial services in the country. The kind of

money involved is not money that local suppliers can easily access from the local financial

institutions unless they have strong backing to guarantee payment. With the evidence

emerging in the study, it becomes clear that in these early stages local suppliers’ survival

would depend on strong support.

45
 CHAPTER SIX

CONCLUSIONS AND RECOMMENDATIONS

6.1 Introduction

This chapter presents the conclusion and recommendations of the study.

6.2 Conclusion

The study sought to examine the role of transparency and supplier support in enhancing

competitiveness of local suppliers in Uganda’s oil and gas sector. The study examined different

dimensions of transparency, supplier support currently prevailing in the oil and gas sector and

examined how the existing state of nature impedes or enhances the local suppliers’

competitiveness. The study adopted survey methodology to address those issues. The data was

collected from local suppliers operating in different sectors namely: logistics, hotel and

hospitality, waste management, engineering and manpower.

Using a structured personal interview approach, data on the issues of interest were collected

from 35 respondents each coming from a unique company. The respondents were mainly those

that are in top management and middle management accounting for 97% of the respondents. In

the study these were purposively selected given that the questions required an individual with

vast knowledge on the issues of interest.

In the study analysis was done at different levels first with descriptive statistics, followed by

correlation and later regression analysis. In order to understand the nature of transparency and

supplier support, descriptive statistics were employed. The general pattern of the findings

46
revealed that there is some level of support available to local suppliers though limited and this

varies depending on the type of support required. Specifically, the study reveals that most

support is available more in the area of training, process improvement as opposed to financial

support. In the study, this is particularly the case because of the uncertainty that the financial

sector attaches to the capacity of local suppliers to manage their loan obligations. More

interestingly, in evaluating the support received from a number of actors, the study reveals that

Government and media are generally perceived by the local suppliers to be less supportive

compared to association and financial institutions.

Furthermore, the findings revealed that a sizeable level of support for the local suppliers was

coming from banks, insurance companies, and associations that are tailored to the oil and gas

sector. In the area of transparency, the study shows that transparency is also moderate on all

the dimensions investigated. And more generally, the respondents indicated lower levels of

transparency in the context of government dealings. The evidence also questioned the

transparency of media information as a basis of informing about the business opportunities in

the oil and gas sector in Uganda. Similarly, transparency concerns are observed from the data

regarding transactions that local suppliers themselves have with each other. Generally, the

evidence shows that when it comes to their exchanges or transactions with Multinational

company customers these interactions tend to depict the highest level of transparency.

To examine the link between transparency and supplier support the study adopted regression

analysis. Generally, the study revealed that both aspects are important in enhancing local

supplier competitiveness. The effect was not only positive but highly significant. With these

findings the study contributes to the highly debated area in the country as a number of

47
stakeholders eagerly watch on government policies to utilize the oil resource in enhancing

development (Stiglitz, 1999). In the prevailing discussion, there is a general atmosphere that

there is no transparency. Indeed, in terms of developing local content and more generally in

harnessing the oil resource for national development, this may be a problem. In the study

however, though it is revealed that transparency is generally low especially from the media and

government, this does not necessarily imply none existence of this important aspect in the

business environment prevailing in the sector in Uganda. Nonetheless, what is consistent with

the existing debate is the need for more transparent environment for local suppliers to achieve

high levels of competitiveness. Support is also revealed to be important for local supplier

competitiveness. From the study findings while some progress is made in other areas such as

process improvement and support in training, the local suppliers generally do not perceive the

financial support available to be adequate.

6.3 Recommendations

In the study it was demonstrated that transparency was moderate and government was

particularly identified to score low in relative terms in this area. In light of this observation and

given the importance that government plays in such a sector, it is important for Government to

enhance the level of transparency in the sector. Specifically, the study recommends

government to enhance transparency in the sector through establishment of a resource center

where the suppliers can be availed with the necessary information and support.

This can strategically, be established in the Uganda chamber of mines and petroleum. The

study also reveals the value for workshops in strengthening the capacity of local suppliers. This

medium can also be utilized to strengthen transparency among local suppliers. As revealed in

48
the data, the respondents revealed lower levels of transparency in dealing with each other.

Using the medium of workshops this is an area that can be addressed by deliberately starting

initiatives of educating suppliers on the value of free sharing of information with each other.

In line of this, the study recommends that such initiatives as monthly networking sessions

organized by chambers of mines and petroleum should be encouraged and facilitated.

One of the issues identified in the study was limited financial support for the local suppliers,

yet to participate in the oil and gas sector one needs a lot of financial resources. In regard to

this therefore, the study recommends that government through its mandate establishes a fund

through the central bank to take care of the financial needs of the local suppliers who cannot

have the kind of collateral required by commercial banks. Because of the nature of resources

required for the business deals in the oil and gas sector many local suppliers cannot afford and

as such loose out.

The government can specifically look into the security fund that is kept in the central bank as a

starting point for mobilizing finances for local suppliers. Similarly, the study recommends that

commercial banks can use syndicated financing arrangements and guarantees instead of the

traditional collateral arrangement when advancing credit facilities to the local suppliers.

6.4 Study limitations and future research areas

While the study has advanced a number of suggestions and made an attempt to offer reliable

evidence, the findings of the study should be interpreted in light of the following limitations.

First, the sample size was small. This is because of the current situation in the sector, where

business is not taken off to full capacity. Therefore, while the sample was small in this study, it

captures majority of the active suppliers currently in the sector.

49
Nonetheless, given that the statistics conducted require a large sample size, what was observed

was significant. It is likely that the significances observed would have even been much

stronger with a large sample size. Secondly, the study was cross-sectional. In interpreting the

results therefore it is important to understand that the process and mechanism underlying the

issues studied were not completely captured. Because everything could not be covered by this

study, further studies are specifically recommended in the following areas. Studying how

transparency can be strengthened in the oil and gas sector in Uganda is an interesting area for

future research. Furthermore, future studies can examine how sustainably local supplier

support can be built in the sector.

50
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 APPENDIX ONE: SURVEY INSTRUMENT

Dear respondent,

This is an academic study investigating transparency, local firm support and firm competitiveness

among the local suppliers of the oil industry. The study is conducted by Faculty of Business and

Administration, Uganda Christian University. Your responses shall be kept confidential and used only

for study purposes. You are hereby requested to spare some time and respond to this questionnaire.

SECTION A: BACKGROUND CHARACTERISTICS

1. Designation of the respondent_____________________________________________

2. Experience in the company in years_________________________________________
3. Ownership type (locally owned or joint venture) ______________________________
4. What is the nature of Service/ Product you supply? __________________________________

5. For how long has your firm been operational? ________________

6. How many employees are working in this firm? _____________________________

7. How long have you had business in the upstream oil and gas? _________

8. How many international oil companies are you supplying? _________

9. Out of these companies that you are supplying, which one is your biggest customer? ________

SECTION B: TRANSPARENCY

For this section, please indicate the extent to which you agree with the following statements with
respect to your company
Highest
lowest

1 In responding to the unique business challenges and opportunities in this 1 2 3 4 5

supplier business, our firm has benefited from access to detailed information
about the available business opportunities.
2 In responding to the unique business challenges and opportunities in this 1 2 3 4 5
supplier business, our firm has benefited from obtaining timely information
meant for suppliers.
3 In responding to the unique business challenges and opportunities in this 1 2 3 4 5

58
 supplier business, our firm has benefited from information that was freely
shared with us.
4 In responding to the unique business challenges and opportunities in this 1 2 3 4 5
supplier business, all information we needed could easily be obtained
without hustle
5 In responding to the unique business challenges and opportunities in this 1 2 3 4 5
supplier business, our firm has benefited from access to relevant and valid
information about supplying in the sector
8 In responding to the unique business challenges and opportunities in this 1 2 3 4 5
supplier business, our firm has benefited from reliable information about
business opportunities we engaged in.
9 We have benefited from having valid information about the necessary 1 2 3 4 5
requirements.
10. We have benefited from transparency by different actors we have engaged 1 2 3 4 5
with.

In reference to the benefits in the previous section, please indicate the degree to which you agree
with the following statements.

The benefits of depicted in the above section have mostly been

Highest
lowest
manifested:

1 In our business transactions with Government departments supposed to help 1 2 3 4 5

us as suppliers
2 In business transactions with our fellow local suppliers 1 2 3 4 5
3 In business transactions with our Multinational Enterprise Customers 1 2 3 4 5
4 Information obtained in Newspapers and other media 1 2 3 4 5
5 Others………………………………………………………………….. 1 2 3 4 5

SECTION C: SUPPLIER FIRM SUPPORT

Please indicate your level of agreement with the following statements in regard to your business
development effort in supplying multinational companies

Highest
Our firm has gained valuable support related to:
lowest

1 Training of administrative personnel and plant workers 1 2 3 4 5

3 Training of managerial, professional and executive staff 1 2 3 4 5
4 Credit facilities from financial institutions 1 2 3 4 5
5 Developing our technology, techniques and innovation 1 2 3 4 5
6 In terms of attending workshops to help us benefit from the Oil businesses 1 2 3 4 5
7 Support in regular service improvement 1 2 3 4 5

59
8 Support in process improvement and technology 1 2 3 4 5
9 Support in quality enhancement 1 2 3 4 5
10 In form of valuable occasional visitors in terms of helping us meet the 1 2 3 4 5
required standards.
11 Received advice on areas of strategic interest to meet required standards. 1 2 3 4 5
12 In the areas of strategic planning to enhance our capacity to compete 1 2 3 4 5
13 Referrals for financial support from financial institutions 1 2 3 4 5

In reference to the above support, please weigh how the following players have fared in the
support received (5 is the highest and 1 is the lowest)

1. Government 1 2 3 4 5 N/A

2. Associations 1 2 3 4 5 N/A

 Uganda Manufactures Association 1 2 3 4 5 N/A

 Kampala City Traders Association 1 2 3 4 5 N/A

 Private Sector Foundation 1 2 3 4 5 N/A

 Uganda Chamber of Mines & Petroleum 1 2 3 4 5 N/A

3. Banks 1 2 3 4 5 N/A

4. Others…………………………………….. 1 2 3 4 5 N/A

SECTION D: Competitiveness

Highest
lowest

Could you please indicate the degree of agreement or disagreement with

each one of the following statements about your company?

1 When we do not have the service, our customers are comfortable using our 1 2 3 4 5
competitors product or service
2 We are at par in our performance with our major competitors 1 2 3 4 5
3 In the past years our level of supplying deals have grown 1 2 3 4 5
4 1 2 3 4 5
Our firm has taken important measures to improve the skills of our labor force
5 1 2 3 4 5
Our firm has made important investments in machinery and equipment
6 The quality department has increased its effectiveness in improving the 1 2 3 4 5
quality of our products
7 1 2 3 4 5
The training and education of our employees have been a priority
8 The personnel of my firm were encouraged to innovate and try new and better 1 2 3 4 5
ways to do the job

60
9 1 2 3 4 5
Our company made a substantive reorganization of the productive systems
10 Our company has made important improvements in manufacturing/service 1 2 3 4 5
delivery processes

Could you indicate the degree of agreement or disagreement with each

one of the following statements about your company?
1 Our company increased the number of services offered that involve advanced 1 2 3 4 5
technical knowledge.
2 Our company began to design products that it did not previously offer 1 2 3 4 5
Please, identify (up to five) firms or organizations with which you had significant access to information
or collaboration on the following areas:
1 Product design and improvement
1……………………………………………
2……………………………………………
3……………………………………………
4……………………………………………
5……………………………………………
2 Process improvement and technology
1………………………………………………
2………………………………………………
3………………………………………………
4………………………………………………
5………………………………………………
3 Quality
1………………………………………………
2………………………………………………
3………………………………………………
4……………………………………………….
5……………………………………………….
4 Regulatory aspects
1……………………………………………….
2……………………………………………….
3……………………………………………….
4……………………………………………….
5……………………………………………….
Thank you very much for your time

61
APPENDIX TWO: LETTER FROM THE UNIVERSITY

62
APPENDIX THREE: LIST OF SUPPLIERS FROM CHAMBERS OF MINES AND
PETROLEUM

1 Pro Ride Ltd 33 Synergy

2 Weatherford 34 Halliburton International Inc.
3 G C C Services Ltd 35 Hertz
4 CIVICON 36 Traid-links
5 East African Chains 37 ATACAMA Consulting
6 Shlumberger 38 SPEDAG INTERFREIGHT U LTD
7 Specialised Welders 39 PAX MONDIAL
8 Strategic Logistics Ltd 40 CITY TYRES
9 Inerfreight Uganda Ltd 41 CITY LUBES
10 Pearl Engineering Company Limited 42 OGAS Solutions
11 Firemasters Ltd 43 G4s Security Ltd
12 ENGSOL - Engineering Solutions 44 SARACEN
13 Epsilon 45 MBW Consulting
14 East African Cranes 46 Farm Engineering Industries Limited
15 Moringa 47 Agility Logistics Ltd
16 Survesis 48 Ortec Group
17 BEMUGA 49 Deloitte U Ltd
18 RICHFLO 50 AIG Uganda Limited
19 M S L {Mineral Services} Logistics 51 Askar Security
20 SDV Transami 52 AON Risks Services
21 Seismic 53 Lloyds British Testing
22 EnviroServ Uganda Ltd 54 Integrated Logistics
23 Public Health Solutions 55 NPK Resources Ltd
24 Vivo Energy Uganda Ltd 56 Sefast Holdings U Ltd
25 Mercantile Car Rentals Ltd 57 Toyota U Ltd
26 CRACOW KRAKOW 58 Pricewaterhouse Coopers Limited
27 Traget Well Control Ltd 59 Victoria Motors Limited
28 Transtrac 60 Victoria Equipment Limited
29 Oriental Geog Physical Uganda Co. Ltd 61 Africa Ecoinvest.
30 Nabors Drilling International 62 Multilines International U Ltd
31 Baker Hughes 63 ABMAK Associates
32 Threeways Ltd 64 Semliki Rift Rrading Co.

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