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3 November 2011 | Angeline Albert
rand will be directed to South Africa’s manufacturers after public sector
buyers and a large number of businesses agreed to ensure 75 per cent of their
purchasing is local.
The Local Procurement Accord, signed on
31 October, commits businesses, public organisations, community groups and trade
unions that signed up to it to work towards this medium to long-term goal. A committee of representatives from these groups will meet every six
months to review progress.
Economic development minister,
Ebrahim Patel, who was present at the signing, said: “The accord brings
together the efforts of the public and private sectors and will direct billions
of rand to local manufacturers.”
unions and community groups agreed to develop purchasing strategies and analyse
their supply chains to identify where they can buy more from local suppliers.
The 84 largest companies agreed to drive localisation for the private sector
and will report annually on their targets. The companies also agreed to
eliminate collusive and unethical pricing practices in public tenders and
promote competitive pricing policies.
Meanwhile, as reported by SM, the South African government has
committed to increase its local procurement using regulations that come into
effect on 7 December. The
regulations will empower Department of Trade and Industry (DTI) to rule that
some products must be locally sourced. The
government said this would include buses, power pylons, railway rolling stock,
pharmaceuticals, television set-top boxes, uniforms and furniture.
DTI minister Rob Davies told SM: “We have a broad target of
increasing the amount of suppliers of locally made goods from the current 30
per cent to 40 per cent. We say to foreign companies: ‘You come here and
manufacture and you will be eligible for public sector contracts. You come here
and bring your goods by boat, you won’t.’”