President Peter Mutharika has assented to the Public Procurement and Disposal of Assets Bill giving hope to Malawians of economic independence as they now have an assured market for their goods and services.
The enactment of the law means government ministries, departments and agencies are now compelled to award 60 percent of all their contracts and other related business to indigenous black Malawians.
National Assembly chief public relations officer Leonard Mengezi said Mutharika assented to the Bill recently after members of Parliament (MPs) passed it on June 28 2017.
Section 44 (10) of the Act reads: “A procuring entity shall ensure prioritisation of all bids submitted to give preference to 60 per cent indigenous black Malawians and 40 per cent others for national competitive bidding.”
The development has also excited some key players in the business sector who have applauded Mutharika for swiftly assenting to the Bill.
“Government needs to be applauded for this. The law has given hope to SMEs [small and medium enterprises] as government happens to be the biggest buyer of goods and services in the country,” said James Chiutsi, president of Small and Medium Enterprises Association of Malawi.
However, Chiutsi requested government to, concurrently, enhance other business support systems to avoid a scenario where SMEs will be said to lack capacity.
“These services include access to cheap financial capital such as low interest loans, technical skills to ensure production of quality products,” he said.
He added: “We also request government to ensure prompt payment for supplies received otherwise only those large corporations with adequate capital will benefit.”
In the absence of the law procurement entities within the MDAs were not mandated to give special preference to deserving local enterprises, a development that disadvantaged them.
The Bill was tabled in Parliament on December 12 2016 and referred to the Joint Committees of Budget and Finance Legal Affairs and Industry Trade and Tourism Committees for further recommendations and scrutiny before being passed.
Speaking in Parliament after passing the Bill, Minister of Finance and Economic Planning Goodall Gondwe described the legislation as a fundamental and crucial tool that would combat corruption in government.