Influence of Procurement Policies on Local Content Growth in Rwanda’s Construction Industry: A Case of NPD Ltd

Ndayambaje Bernard and Joseph Akumuntu
University of Kigali
https://orcid.org/0009-0003-2372-778X
Email: ndayambajebernard213@gmail.com

Abstract: This study examined the influence of procurement policies on local content growth at NPD Ltd in Rwanda’s construction industry. The four dimensions were procurement planning policy, supplier selection policy, contract management policy, and risk management policy. Guided by the Resource-Based View, Agency Theory, Institutional Theory, and Transaction Cost Economics, the research employed descriptive and correlational designs using quantitative questionnaires and qualitative interviews. The population comprised 224 NPD Ltd employees, from whom 144 respondents were selected using Slovin’s formula, stratified sampling, and simple random sampling. Of the questionnaires distributed, 129 were returned complete (89.58%). Instrument validity was supported by a content validity index of 0.862, while overall Cronbach’s alpha was 0.869. Data were analyzed using SPSS version 29, Pearson correlations, and multiple regression. The four procurement-policy variables were positively associated with local content growth (r = 0.792, 0.898, 0.741, and 0.805, respectively; p < 0.001). The combined regression model explained 87.8% of variation in local content growth (R² = 0.878; F = 221.600, p < 0.001). Supplier selection policy showed the largest standardized coefficient (β = 0.486, p < 0.001), followed by procurement planning (β = 0.233, p < 0.001), contract management (β = 0.211, p < 0.001), and risk management (β = 0.126, p = 0.046). All four null hypotheses were rejected. NPD Ltd should improve local-supplier evaluation, procurement forecasting, contract monitoring, and supply-chain risk mitigation to strengthen local content growth.