Why favouring local tenderers crucial

TANZANIA: A cross-section of economic analysts has supported the government’s move to prioritise locals in various tenders, noting that it will boost the national economy.

They believe that investing in locals to help them build businesses that drive positive change has enormous potential in an era where social responsibility and local engagement are increasingly important for creating a sustainable tax base.

According to these analysts, empowering locals by giving them tenders for development projects will promote the country’s development by increasing the circulation of money within the country, rather than giving it to foreigners.

On Tuesday, Minister for Finance Dr Mwigulu Nchemba stated that it is important to trust Tanzanians and give them tender opportunities through the private sector in order to boost the national economy.

He made these remarks in Arusha during the opening of the 14th annual conference of procurement and supply experts for the year 2023.

Dr Mwigulu explained that 70 per cent of the government’s budget is directed towards procurement and supply, so it is important to make patriotic decisions by giving tenders to Tanzanians for the growth of the national economy.

He added that giving tender opportunities to foreigners instead of locals burdens the poor citizens with taxes, and in order to ease this burden, it is necessary to create as many rich Tanzanians as possible with strong companies that will pay taxes and provide jobs.

Dr Mwigulu also emphasised the importance of strengthening the private sector to attract more Tanzanians.

He stated, “Since independence, we have never had more than 600,000 civil servants. Tell me what miracles should we do for the graduates who come out of colleges every year to get jobs? The private sector must be strengthened to absorb them.

According to Dr Mwigulu, President Samia Suluhu Hassan has ordered a review of the procurement law to address the issue of money losses.

Commenting on Dr Mwigulu’s directives, economist and investment banker Dr Hildebrand Shayo said that empowering locals to unlock opportunities is the vital role that corporate Tanzania plays in achieving the Sustainable Development Goals (SDGs).

He explained that businesses in Tanzania are realising that their responsibilities and potential for economic development go beyond financial gain. With the right business environment, locals can make a significant impact in every sector of the economy.

Dr Shayo also stated that people must change their mindset if the government is to invest in its citizens.

He said, “Only when everyone, especially the youth and business millionaires, understand what their government truly intends to accomplish, can we collectively move the wheel of development forward for the good of the country.”

Professor Humphrey Moshi, an economics lecturer at the University of Dar es Salaam (UDSM), believes that giving tenders to locals will build the country’s capacity and credibility with regional communities in implementing development projects.

He explained that using locals will reduce the burden of paying foreigners in foreign currency, particularly US dollars, which are becoming increasingly scarce. Instead, locals will be paid in local currency, which will remain in the country.

Prof Moshi also advised that tenders without Tanzanian experts should form joint ventures with foreigners to acquire knowledge that can be used in future projects.

The Manager of Vertex International Securities, Advisory, and Capital Markets, Ahmed Nganya, stated that awarding tenders to locals will increase employment opportunities for young Tanzanians instead of enriching foreigners.

He also believes that it will increase currency circulation and reduce the government’s cost of paying in foreign currency.

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