How locals lose out to foreign players in mega projects

Monday July 30 2018
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Dar es Salaam. The absence of an appropriate local content policy (LPC) regarding implementation of mega construction projects causes local operators to lose almost every which way to their foreign competitors in the construction business.

Currently, Tanzania’s LPC only applies to oil and gas exploitation, and stakeholders are already calling for it to be extended to other sectors of the economy in general, and construction in particular.

The Engineers Registration Board (ERB) chairman, Prof Ninatubu Lema, says locals are involved only to a small extent in the construction industry, with the biggest portion going to foreign constructors.

Speaking in an exclusive interview with The Citizen, Prof Lema was of the view that locals can perform wonders if they are suitably promoted.

“We have a huge number of engineers who are ready and anxious to participate in construction projects, and all they need is recognition and support from their government, in terms of policy and regulations,” he said.

According to Prof Lema, ERB is pushing for foreigners-cum-locals partnerships in all big projects whereby Tanzanians can learn from, and adopt the skills of, their colleagues from abroad.


“We need a policy that encourages empowerment of young engineers by participating in domestic projects. This will be a major relief,” the ERB boss argues.

That view is echoed by the executive director of the Tanzania Private Sector Foundation (TPSF), Mr Godfrey Simbeye, who said the Foundation would request Prime Minister Kassim Majaliwa to look into the possibility of introducing a policy on local content in the construction business. Mr Simbeye expressed optimism that the proposed policy would benefit locals in terms of skills transfers, and also make a portion of the project budget to remain in the country, ‘earned’ by Tanzanians.

According to the TPSF chief, domestic projects must benefit domestic experts and the country at large, he said, stressing that this agenda will be presented to the prime minister for his action as appropriate.

“The Tanzania National Business Council (TNBC) will sit in September this year – and that is when we will ask the prime minister, who will chair the meeting, to consider our request,” Mr Simbeye told The Citizen in an exclusive telephone interview.

President John Magufuli’s administration also seems to be walking the talk with regard to promoting local companies. It was in 2016 when the President Magufuli government proposed amendments to the Public Procurement Act (Cap. 410 of the Laws of Tanganyika) to provide for the engagement of local firms in procurement along with foreign firms.

According to the Commissioner for Public Procurement Policy at the ministry of Finance and Planning, Dr Fredrick Mwakibinga, the amendments sought to add new sections to the Act (Sections 55A, 55B, 55C and 55D). These would promote the use of domestically manufactured goods and related services in international competitive tendering, as well as build the capacity for local firms in procurement undertakings.