Wednesday, July 30, 2014

Department of Trade and Industry (DTI): Designation of products and components for local production and content in the public sector procurement system

This Newsletter has previously reported (February 2013) on the designation by Minister of Trade and Industry, in terms of powers under the Amended Regulations of the Preferential Procurement Policy Framework Act, 2000 (Act No. 5 of 2000) (PPPFA), of valves, manual and pneumatic actuators, electrical and telecommunication cables as well as components of solar water heaters for local production and content in the public sector procurement system. At that time, sectors already designated for local production with minimum local content thresholds were rail rolling stock, power pylons, bus bodies, canned/processed vegetables, certain pharmaceutical products, furniture products, and the textile, clothing, leather and footwear sector.

A Dti official attended the AMEU Technical Committee meeting on 19 June 2014 to call for support for the designation process and advise that one of the next sectors planned for designation included `Transformers’. He also encouraged municipalities to procure as much of their material, product and services requirements locally, even if they are not on the list of designated products, by invoking Section 9.3 of the PPPFA Regulations which states:
  • Section “9. (3) Where  a product/ components /sector is not designated, an organ of state may include, as a specific tendering condition that,
    • only locally produced services, works or goods or locally manufactured goods with a stipulated minimum threshold for local production and content, will be considered ……..

This was followed by the Minister of Trade and Industry, Dr Rob Davies, announcing during his budget speech in Parliament on 22 July 2014 that `… the next designation of products for Government procurement includes’, inter-alia, transformers.

Copies of the presentation to the AMEU Technical Committee, the PPPFA Regulations and the speech by Minister Davies are available here.


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