PROCUREMENT IN BOTSWANA Private Bag 0014, Gaborone. Tel: 3957406 email:tgaboiphiwe@gov.bw

1. PROCUREMENT IN BOTSWANAPrivate Bag 0014, Gaborone. Tel: 3957406email:tgaboiphiwe@gov.bw Mrs T. Gaboiphiwe PRINCIPAL INDUSTRIAL OFFICER DEPARTMENT OF INDUSTRIAL AFFAIRS

2. From time to time the government of Botswana has been encouraging local procurement through a number of Presidential Directives. BACKGROUND

3. BACKGROUND CONT…. • In April 1997 the Local Procurement Programme (LPP) was introduced- Presidential Directive CAB 38/96 Rev 1 of November 27 • Replaced by Directive CAB 24/2001- reserved 30% of tender requirements by Centrat Government, Local Authorities and parastatal Organisations exclusively for local manufacturing enterprises and service providers to compete among themselves. 70 % being an open to international competition.

4. BACKGROUND CONT…… • In 2004 Presidential Directive CAB 25 (b) on the Use of Locally Manufactured Goods and Services (ULMGS). • Economic Diversification Drive per Presidential Directive 11 (A) of 2010. • is premised on the fact that the country has a huge import bill. ( P20 billion on average for the past 5 years.)

5. IMPLEMENTATION OF THE EDD The EDD has two components, the short term and the medium to long term strategy. • The following administrative processes have been put in place to facilitate implementation of EDD in the short term: a) Enterprises should register with Ministry of Trade and Industry for certification under EDD (forms can be collected from the Department of Industrial Affairs);

6. IMPLEMENTATION THE EDD CONT.. b) A suppliers directory is being compiled from BOCCIM website (www.boccim.co.bw) as commissioned by the EDD Technical Committee which is chaired by Hon. Minister of Trade and Industry. c) Publicity of the EDD programme is on- going (through forums such as this, TV and Radio are in the process of re-airing the registration campaign).

7. IMPLEMENTATION THE EDD CONT.. Promotion of procurement through turnover threshold and preference margins: Turn over thresholdMargins Up to P5 million 15% P5m to P19 999 999 10% P20m and above 5%

8. IMPLEMENTATION OF EDD CONT.. • LEA, BNPC, BOBS, NFTRC, BOTEC are working on modalities of how to improve local enterprise capacities to meet the required production and quality levels. • An enterprise audit will be undertaken to guide the intervention required for capacity building.

9. THE EDD ELIGIBILITY CRITERIA FOR REGISTRATION UNDER THE SHORT TERM STRATEGY All Manufacturers and Service providers are eligible to register under EDD provided that they are: • Operating in Botswana • Registered with the Registrar of Companies in Botswana • Posses a valid relevant license or registration certificate from a competent authority.

10. Requirements for registration Two copies of the application forms completed. A copy of certificate of registration or incorporation issued by the Registrar of companies. A copy of tax and / or VAT Registration. Most recent annual financial statements. New enterprises are allowed to submit projected financial statements provided.

11. TENDERING REQUIREMENTS • The Suppliers’ Directory will be used by the procuring institutions as a source of information on the availability of locally produced goods and services. • Procuring institutions should, in their Invitation to Tender request for the EDD certification. • Enterprises should always attach copies of valid EDD certificate which forms part of the tender evaluation process.

12. TENDERING REQUIREMENTS CONT.. • Enterprises that have the turnover thresholds of up to P5 million are required to use quality standards and quality manual. • Enterprises above P5m turnover require quality product certificate.

13. THE EDD IMPLEMENTATION CONCERNS • Government, Parastatals and Private sector continue to buy imported goods and services despite the programme that we have in place. • Consumers are reluctant to buy locally made goods and services. There is a perception that locally produced goods and services are of poor quality, expensive and supply is irregular or unreliable.

14. THE EDD IMPLEMENTATION CONCERNS • Limited range of locally manufactured goods and services. • Some companies which have been awarded tenders to manufacture products locally but instead import them, except where exemptions have been duly sought and granted will be blacklisted.

15. THE EDD IMPLEMENTATION CONCERNS • Procuring Entities continue to use brand names despite the call in the EDD guidelines not to do so. (except where exemptions have been duly sought and granted).

16. MEDIUM TO LONG TERM STRAGY • The second component of the EDD, is the medium to long term strategy which will focus on building productive capacity and competitiveness. (quality, cost, delivery and processes). • The draft strategy has been developed and was discussed at EDD Pitso held on 1st and 2nd November2010 • The draft final of the medium to long term strategy will be considered by stakeholders once ready.

17. CONCLUSION • Upon accomplishment of the objectives of the EDD intention is to “wean-off” the private sector from government support so that they can be compete openly in both the domestic market and globally. • We therefore request for your collaboration and partnership to make EDD initiative a success.

18. I THANK YOU FOR LISTENING