Government Cites Weak Local Contractors for Lost Public Tenders

Government officials in Uganda have pointed to a range of internal weaknesses among local contractors as the primary reason they are losing out on significant public infrastructure tenders to foreign companies. Despite legal provisions aiming to reserve a portion of government contracts for indigenous businesses, concerns are mounting over poor project management, a lack of compliance with procurement regulations, and financial indiscipline.

During a recent supplier conference in Kampala, held under the Greater Kampala Metropolitan Area Urban Development Programme (GKMA-UDP), officials from the Ministry of Kampala Capital City and Metropolitan Affairs and the Public Procurement and Disposal of Public Assets Authority (PPDA) highlighted these issues. They noted that while local contractors often excel in the bidding process, their performance during project implementation frequently falters.

Monica Edemachu Ejua, undersecretary at the Ministry of Kampala Capital City and Metropolitan Affairs, stated that many local companies divert advance payments meant for projects into other businesses, leading to delays and substandard work. “Once we have advanced monies to our contractors, they remove the money and go and do another business,” she explained, adding that while opportunities are created for local firms, they are not always reciprocated with strong delivery.

Sophia Nassali Masagazi, a legal officer at PPDA, further elaborated that a recent survey revealed many local bids fail at the preliminary evaluation stage due to incomplete documentation and poorly structured joint ventures. “The biggest gap identified was from the joint ventures,” Nassali said. “Many of the bids fail because of preliminary issues that really just need bidders to properly organise themselves.”

These shortcomings contrast sharply with the capabilities of many foreign, particularly Chinese, firms which often possess stronger financial backing and technical expertise. The GKMA-UDP, a major infrastructure initiative, has consequently seen an increasing reliance on these foreign entities. Officials also raised concerns about the environmental, occupational safety, and social safeguard compliance among some local companies. The PPDA is urging contractors to prepare for the upcoming mandatory rollout of Uganda’s electronic government procurement system, a move expected to enhance transparency and efficiency.

This conference was organized to bolster the capacity of local suppliers, contractors, and consultants, aiming to equip them for increased competitiveness and adherence to procurement standards in future government projects. The identified weaknesses underscore the need for local businesses to strengthen their operational frameworks and compliance mechanisms to effectively compete for and deliver on major national development projects.

Source: https://www.monitor.co.ug/uganda/news/national/govt-blames-weak-local-contractors-for-loss-of-major-public-tenders-5474456