The government has launched a new policy which aims to prioritise procurement of its products and services from youth, women, Micro, Small and Medium Enterprises (MSME) and local manufacturers.
This is contained in the Code of Good Practice on Preferences referred to in Sections 71 and 72 of the Public Procurement Act unveiled by Finance and Public Enterprise Minister Ipumbu Shiimi on Tuesday.
Shiimi said the Code of Good Practice seeks to grant exclusive preferences to local suppliers as defined in the recently Amended Public Procurement Act through the reservation of certain procurement of goods, works and services.
The Minister added that these preferences will be applied by the Central Procurement Board (CPBN) and Public Entities to the procurement of certain goods, works and services.
“For procurements that are subject to national preference, a margin of up to 10% price preference will be given to suppliers meeting the nationality requirements in section 71(3) of the Act and the qualification criteria specified under the Code, for different procurements,” he said.
He also noted that the nature of procurements in Annexures 2, 3 and 4 of the Code are reserved exclusively for procurement from local (Namibian) suppliers who have met the nationality requirements in section 71(3) of the Act and the local content requirement as determined in the Code.
Shiimi further said by granting these two forms of preferences, Namibian suppliers will be given a competitive advantage that will help build their capacity and greatly enhance their ability to compete against multinational corporations.
Furthermore, the Minister shared that the Code of Good Practice allows for preferential treatment for the procurement of raw meat of cloven-hoofed animals north of the veterinary cordon fence.
“This preferential treatment particularly gives effect to Resolution No. 10 of the Land Conference, 2018, which resolved that there should be special arrangements for the Northern Communal farmers’ produce through the public procurement system,” he explained.
Shiimi urged Namibians to embrace this policy as an effort to boost the empowerment and developmental policies of the Government and warned opportunistic enterprises against attempting to play the system.
“The Code should therefore be viewed as an opportunity to empower local businesses who aspire to the growth and sustainability required for the industrial and social advancement of Namibia.
“I warn that the Code of Good Practice should not be seen as a window for trials with opportunistic enterprises, therefore public entities should assume high responsibility at all times and ensure that awards are made to legitimate businesses with credentials to guarantee that the public sector and Namibia, in general, enjoy value for money that it so highly deserves,” he said.
He emphasised that youth should optimise this opportunity as “youth is an important resource which has the potential to propel our economy onto a competitive and sustainable growth path.”
“The implementation of this policy instrument will also enhance the achievement of Goal 2 (Enhancing Productivity of Priority Economic Sectors) of Pillar 2 (Economic Advancement) of the Harambee Prosperity Plan II. Therefore, it is imperative that the Government makes deliberate efforts such as the granting of preferential treatment in the public procurement system to create opportunities for the youth as well as other targeted categories of Namibian suppliers through the issuance of the Code of Good Practice on Preferences,” he added.
This comes as public procurement is increasingly recognised as a strategic function that plays a key role in using public funds for sustainable development outcomes and fostering economic growth, job creation, and social welfare.
Thus, the government as one of the largest single buyers of goods and services in the country, often with expenditure estimated at 20-30% of the GDP, is mandated to promote, facilitate and strengthen measures, such as the “code of Good Practice” to implement the empowerment and Industrialisation policies of the Government, said Shiimi.
“Based on this economic reality, the Government of Namibia resolved to use a portion of its expenditure in redressing socio-economic imbalances through the granting of preferential treatment or preferences in the public procurement system. Although, preferences are an exception to the competitive supply principle in that public entities do not exclusively buy from the cheapest bidder, they have to be applied in an equitable manner without compromising the transparency and value for money principles,” he explained.
Preferences are special interventions aimed at empowering certain targeted categories of Namibian suppliers with a view to enhancing their participation in the mainstream economy and achieving specific objectives such as economic inclusivity and the creation of employment.
