The Roads Authority (RA) has said the country can do better in the construction sector if local companies are entrusted with projects which have for long been monopolised by multinational construction firms.
Currently, the RA faces a challenge in the implementation of its roads programmes as it has to outsource a majority of its works and services to an industry dominated by the small and medium-scale contractors (SMCs).
In an interview with Malawi News Agency, RA chairperson Joe Ching’ani said on Monday the authority wants more local players to take part in construction works.
He said: “Malawian construction entities should have a major share in the national cake in as far as the construction industry is concerned because you are sure [when they are engaged] they will employ [other] Malawians.”
He said by engaging more local firms government will be able to raise enough domestic tax to fund national development.
“Not only that, if you accord construction business to local firms, you are sure of having a widened tax base and you are assured that they will not externalise foreign exchange,” said Ching’ani.
He further said Malawi could close the wide gap between the rich and the poor if locals are not empowered.
Ching’ani said there are three issues that have also proved to be stumbling blocks in the RA’s executions of duties.
He said the vetting process by other government agencies, including Anti-Corruption Bureau, trust for foreign firms and the Integrated Financial and Management Information System (Ifmis) have led to the stagnation of many flagship road projects.
“Indeed because of Ifmis, some contractors spend three months on the construction site before any penny is given to them. How can they pay workers and where can they get money to buy construction materials,” Ching’ani said.
Last month, the Deputy Minister of Transport Nancy Mdooko assured RA that the ministry will have discussions with other departments at the ministry to resolve the issues dogging the sector.
However, government hopes the introduction of the Small and Medium Enterprises (SMEs) Order gazetted in December last year will be the game-changer for SMEs and SMCs.
The order will enable SMEs to find adequate space to do business with government by way of procurement in line with Section 36 (2) of the Public Procurement and Disposal of Public Assets (PPDA) Act.
In an earlier interview, Minister of Trade Sosten Gwengwe told The Nation that the gazetting of the SME Order will facilitate a conducive business environment for SMEs to enjoy doing business with the government.