Impact of procurement on economic growth
Published On December 28, 2015 » 2565 Views» By Bennet Simbeye » Features
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By JOSHUA BANDA –

•Government and statutory bodies procure goods and services in large quantities.

•Government and statutory bodies procure goods and services in large quantities.

ZAMBIA has in the recent past been facing economic hardships which have seen major foreign currencies appreciating by bigger margins against the local currency.
Prices of goods and commodities have since sky rocketed.
The effect has been felt by every sector of the economy and the leadership of the country is aware of this problem.
The Government and statutory bodies procure goods and services in large quantities.
The procurement unit is responsible for handling these purchases.
Therefore, how should this unit handle tax payers’ money, especially this time when the economy is recovering?
How much value should this unit add to the entire procurement process?
The Government is not short of human capital in this area who are qualified and are able to understand the principles of procurement especially public procurement.
The country has embarked on a series of developmental projects not limited to the Link Zambia 8000, Pave Zambia 2000, L400 road project in Lusaka and C400 Road Project on the Copperbelt.
The rehabilitation of rural roads countrywide, health infrastructure development, rehabilitation and construction of water supply and sanitation, are some of the projects the Government has embarked on.
The other projects include implementation of housing development programmes, rehabilitation of prison infrastructure, construction of police stations and posts.
The expenditure for these capital projects is huge and calls for prudent procurement to safeguard tax payers’ money.
According to the 2016 Budget, the Government proposes to spend K754 million for the procurement of drugs and medical supplies, K468.8 million for water sanitation and the list goes on.
This is the time for the professionals mandated to undertake public procurement to exhibit professionalism and save public funds.
Looking at the economic status of the country now, there could be no better time than this for procurement professionals to specifically use ”Do It Right The First Time” principle to ensure quality procurement of goods and services and obtain value for money.
When a project such as building a school in areas such as Shang’ombo is undertaken, a reliable and capable contractor should be engaged.
The consequences of engaging unreliable contractors are hash as this could deprive the people of such areas the right to education and better health facilities because of failure to complete the projects.
Such a scenario has the potential to cause retendering of the procurement process which would cost the Government time and money.
Undoubtedly, this could be avoided if only procurement professionals do what they do best.
This is the right time for procurement practitioners to stand up and be counted.
Section 25 (1) of the Public Procurement Act No. 12 of 2008, stresses that public procurement must achieve Value for Money (VfM) and promote
competition. This objective can only be achieved when procurement practitioners define what VfM is.
According to the World Bank, VfM can also be defined as “perceived value for a perceived product.” Do not spend too much for too little.
Now is the time to exercise effective supply chain risk management to mitigate the risk of paying too much for too little as a result of being reactive as opposed to being proactive.
Register with Zambia Institute of Purchasing and Supply (ZIPS) and make meaningful contribution by practicing legally because this is the right time to rise and shine and make savings for the companies you are serving.
In the case of public procurement, this is the right time to allow private sector participation through competitive public procurement.
The country needs you now more than ever before. Some suppliers, locally and internationally, would genuinely price their merchandise while others will unrealistically quote exorbitantly at the pretext of depreciation of the Kwacha.
As procurement professionals you should be alert and do your market intelligence diligently and lend a hand in improving the economy of this country.
Procure goods and services at the most cost-efficient price.
Especially if you have a symbiotic relationship with your suppliers, ensure you reap the benefits by putting to use your problem solving skills. Avoid “Muda”.
This is a Japanese philosophy meaning waste.
Huge servings have a positive impact on the social-economic status of the country.
Whereas bad procurement practices such as corrupt practices and fraudulent practices have the potential to sabotage the economy.
Put to good use the codes and laws, ethics, integrity, values and morals which you have acquired to serve and save Zambia.
The author is a procurement         practitioner and Supply Chain Expert

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