Government has finally responded to calls for the empowerment of citizen entrepreneurs as it will soon bypass the tendering process and procure from local companies provided their prices are competitive.
In his State of the Nation address last Friday, President Ian Khama said the Ministry of Trade and Industry and the Citizen Entrepreneurial Development Agency (CEDA) have been instructed to prepare a list of companies that produce goods locally so they can be empowered.
"If the pricing is competitive, central Government, local authorities and parastatals will be instructed to procure from such companies with immediate effect," he said.
He said this should empower citizens and local companies and help towards growing the manufacturing sector.
However, Khama said, while the government looks upon the growth of the private sector, they are concerned about inflated cost of public projects both at tendering and implementation stage.
This practice, he said, is consistent with a wider attitude of self-entitlement towards public resources, and threatens to undermine the principle of self- reliance.
"Where evidence warrants it, government will not hesitate to blacklist those whose private greed undermines the ability to deliver for the greater public good," he said.
CEDA Chief Executive Officer (CEO) Dr Thapelo Matsheka recently called for legislation and an agency that can address the issue of citizen economic empowerment.
"There is a need for deliberate legislation and for an agency that can speak authoritatively about issues that concern citizen economic empowerment because right now we are just playing an advocacy role," Matsheka said at a media briefing held a few months ago.
He said they are currently engaging government to improve access to procurement for Small, Micro and Medium Enterprises (SMMEs), through change in legislation and other means.
"There are a few directives in place to promote citizen participation, but they are not enough to help our people play a meaningful role in economic development," Matsheka said.
Currently, local procurement is still low as cross boarder competition prohibits local companies from getting government tenders, as locally produced goods and services continue to be as characterized with poor quality, unreliable delivery time frames and higher prices.
With over P2 billion CEDA loans, equity and credit guarantee schemes have so far assisted 3,608 local businesses with employment creation projected at 27,820.
Most of these businesses are struggling to remain viable due to lower business volumes.This has also led to a high repayment default on CEDA loans, which has in the past gone as high as 60 percent.
However, in the past, there have been concerns regarding a legislation that favours citizen manufacturers as it might impede business growth and the government has been advised to carry out an impact assessment study before formulating such a law.
The Livestock and Meat Industries Act of 2008 was one example of a retrogressive legislation as it had a negative impact on off-take and increased feeding costs for farmers.
Source: newsroom - meattradenewsdaily.co.uk
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