Quiz 1

Question 1 of 6

The University of Mali has agreed to produce a study on the natural enemies of maize pests in the Koulikoro region for GIZ’s agriculture project. What is the right type of contract?

Contract for works and services
Financing agreement
Grant agreement
Local subsidy

Question 2 of 6

A research institute at the University of Toronto wants to produce a study on the natural enemies of maize pests in Mali under a cooperation programme with its partner university in the country. GIZ’s agriculture project in Mali is willing to support the study as it could help to achieve the project’s objectives. Which type of contract is suitable for the cooperation between GIZ and the Canadian university?

Grant agreement
Local subsidy agreement
Subsidy agreement
Financing agreement

Question 3 of 6

The NGO Together for Nature wants to produce a brochure. GIZ’s climate change project would like to assume 80% of the production costs. However, the project wants to receive 200 copies of the brochure that it can distribute itself. It also wants the NGO to include the GIZ logo on the brochure. Which type of contract is suitable?

Grant agreement
Local contribution
Financing agreement
Contract for works and services

Question 4 of 6

The Zambian Ministry of Education wants to commission a study on the structure (age, gender and qualifications) of Zambian teaching staff at the University of Lusaka. GIZ’s education project is willing to provide the ministry with the funds needed for the study. Which type of contract is suitable?

Financing agreement
Subsidy agreement
Contract for works and services
Local contribution

Question 5 of 6

A project wants to conclude a local subsidy with an institution. You think you have come across this institution before. On further examination, you see that the same GIZ project has previously entered into various contracts for services with the institution. What do you need to clarify? What would you decide? Is a local subsidy agreement possible?

A local contribution agreement is out of the question. The institution is already registered with us in CoSoft as a consulting firm and therefore cannot be granted a local contribution.
The project can draw up a local contribution agreement. We are already familiar with the institution and know that it delivers good results. Since we have always been satisfied with its performance up to now and this contract involves a large-scale study, we can’t afford to hold a competitive tender, so it makes sense to use a local contribution. After all, local subsidies are a direct contribution by GIZ.
We need to clarify whether the recipient should be treated in future as a financing recipient or as a contractor. The institution must be classed as one or the other – not both! As a contractor, the institution would have a competitive advantage over other bidders if it receives funds from GIZ as well as contracts for services. This would be contrary to the principle of equal treatment set out in procurement law. As long as the institution receives no further contracts for services from GIZ, it is OK to grant a local contribution.
It depends on whether the country’s laws allow non-profit organisations to provide services. In some countries, non-profit organisations are allowed to provide services if they invest the profits in their non-profit activities. They are not allowed to distribute the profits to their members. Once this matter has been clarified, GIZ must ensure that the institution demonstrates a clear separation between its profit-making and non-profit activities. In such cases, GIZ may grant the organisation’s non-profit division a local contribution provided that it does not constitute a hidden service.

Question 6 of 6

Which of the following criteria are used to distinguish between a local subsidy and a financing agreement?

Local contribution are used with organisations that do not yet have sufficient technical, organisational and commercial expertise to administer a measure independently.
Local contribution are used with organisations that do not yet have sufficient expertise or capacity to manage a financing agreement.
Local subsidies are used for all non-state organisations.
Financing agreements are only concluded with ministries.

Local Subsidies

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