Tanzania: State Supports Local Contractors

President John Magufuli has urged local contractors to be patriotic; promising that his government will give them priority in public-funded projects provided they meet required conditions.

Dr Magufuli made the remarks yesterday when opening a twoday Contractors' Registration Board (CRB) Annual Consultative Meeting that has drawn more than 1,000 contractors, consultants and other stakeholders in the construction industry.

"I will give directives to all ministers to emulate the Ministry of Works, Transport and Communication, which ensures that a big percentage of public funded projects go to local contractors.

But you also must discuss problems that lead to you failing to get government projects," he advised. President Magufuli noted that there were many challenges facing the construction sector; some of which were caused by the contractors themselves, including failing to enter into joint ventures to win major government tenders.

He said most local contractors provide unrealistic estimates that make it difficult for the government to favour them. The president cited an example of estimates provided by local contractors to tenders announced by the Judiciary, which had a budget of 24bn/- and wanted to build primary and district courts. In the estimates, one building cost no more than 200m/-.

"One of the contractor had an estimate amounting to 1.4bn/- while the one with the least estimate came up with 670m/-. Even if the government wants to favour you, it would be impossible," he explained.

The president said that contractors must have the desire to work for the benefit of the country for the government to be able to help them. "Patriotism must be above all else. Provide viable estimates; get a small profit and build your reputation in the industry," he advised.

He called on contractors to report any government officials asking for bribe during tendering processes, noting that this could also be one of the reasons why the contractors are providing higher project estimates.

He also noted that late payment for the projects by the government could also be another reason. Dr Magufuli introduced the Director-General of the Prevention of Combating Corruption Bureau (PCCB), Mr Valentino Mlowola, to CRB as the contact person when reporting corrupt government officials and if the contractors felt they could not trust other PCCB officials.

"I trust Mr Mlowola. I know you did not invite him here but I brought him along with me because I know the degree of corruption in the sector. If you feel you don't trust the other PCCB officials, go straight to him," he advised.

On the late payments for the projects, the president said that the shortcoming is now history. "My government has started paying what it owes in the construction projects. We have already paid 650m/- and another 460m/- from the Road Fund.

We will clear all outstanding debts in the sector," he pledged. The president urged the contractors to discuss how they can access opportunities from major economic projects, including the 1,410km Uganda Oil Pipeline from Hoima to Tanga, 1,200kmcentral corridor standard gauge railway line that will link Mwanza, Kigoma, Burundi and Rwanda.

Dr Magufuli expressed shock when the CRB indicated that they did not have the agenda on major projects expected to begin in the next financial year up for discussion on how local contractors can access the opportunities that will come along with the projects.

The president said the government has set aside funds in the national budget for construction of 100km of the 1,200-km central corridor Standard Gauge railway line, wondering how local contractors are planning to access the opportunities. Other funds will be provided by China in the construction of the 1,200-km Standard Gauge railway line.

He urged them to put aside their differences and work together in joint ventures, Public Private Partnership (PPP) projects and help each other when filling tender documents and get the right budget estimates, to be in a better position to get major projects in the country.

"What are your plans in ensuring that local contractors play a major role in the construction of these major projects that my government has worked tirelessly to acquire? I will be very sad if there will not be any local contractor in these major projects even to supply water, sand or gravel," he said.

He noted that corruption was a major stumbling block in the construction industry, which made young people to shun the profession. Currently, the ratio in the country is 1 contractor to 6,000 Tanzanians while in other countries like Japan it is 1:50.

He promised to employ more young men and women in his government who have shown him that they loathed corruption and did not waver in upholding the country's laws. "I have noted a major impact where youth are involved.

I will employ more youth because many of them do not like bribes. They loathe corruption. We, the elderly, are the ones who were destroying this nation," he noted.

President Magufuli vowed to fight corruption in the country, noting that in the few months he has been in office he has noted an increase in the number of international investors showing interest to invest in the country, citing a German investor, who is investing in fertiliser industry in Kilwa that will be the largest in East and Central Africa.

"I have seen major changes and I will not stop... those who thought that I will slacken my resolve are in for a surprise. This is just the beginning. It is because of God that I am the President of Tanzania and not anyone else so I will not fear anybody.

I am ready to sacrifice my body for the people of Tanzania," Dr Magufuli stressed. Works, Transport and Communications Minister Professor Makame Mbarawa promised that public-funded projects will go to local contractors who will meet the required conditions, stressing, however, that all projects must be implemented as per contract agreements.

Source: Tanzania Daily News