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Kasukuwere wants mandatory 50% local procurement quotas

by Business reporter
27 May 2013 at 14:08hrs | Views
The Minister of Youth Development, Indigenisation and Empowerment Saviour Kasukuwere has said his ministry would soon gazette a statutory instrument to give effect to the 50% local procurement clause as spelt out in the Indigenisation Act.

The Indigenisation Act under chapter 3 (f) says all government departments, statutory bodies and local authorities and all companies shall procure at least 50%of their goods and services required to be procured in terms of the Procurement Act [Chapter 22:15] from businesses in which a controlling interest is held by indigenous Zimbabweans.

Kasukuwere told the Buy Zimbabwe Procurement Conference this morning that while emphasis has been and remains one that focuses on Zimbabweans taking a greater share in various enterprises, government has been blind to the requirement of a broad based empowerment programme that involves enterprise development and cuts across the entire value chain of industry and commerce.

He said the country cannot continue sidelining its local business persons when more sophisticated economies like South Africa and Australia have mandatory local procurement quotas.

"By not procuring from our own local industries we are in fact channeling scarce financial resources towards creation of employment in other countries."

Kasukuwere said it was disheartening to note local companies such as Willowvale are on the verge of collapse while government, a shareholder in the same company is buying vehicles from abroad.

"The 'foreign is better' mindset in our institutions, retailers and regrettably some of our people have created a situation in which those of our that have sought to become more competitive, better packaged and less pricey are also stigmatized."

He said instead of celebrating success stories, like Mazoe and Buttercup; the nation believes that all that comes from local industry must play second fiddle to foreign made-products.

However analysts say that for the procurement policy to be effective there was need first to revive and raise the capacity in the industry and government can do this by creating supportive industry networks and  introducing protectionist measures.

But Kasukuwere said protectionism has its limits and can only work for a short period. "What is key is to invest in becoming more competitive, more market savvy, more respectful of the local consumer and more insightful."

Source - financial express