Sunday, April 14, 2024
BusinessRebar procurement draws complaint from manufacturers

Rebar procurement draws complaint from manufacturers

Corporation cancels bid process

A recent procurement bid for reinforcement bars, issued by the Ethiopian Construction Works Corporation (ECWC), has infuriated industry players as the state run corporation imports thousands of tons of metal products, while only intending to buy a few kilograms of rebar, locally.

The “Standard bidding document for the procurement of goods and related services for national competitive biddings,” which the corporation issued a few weeks ago, indicated that the corporation is willing to purchase reinforcement bars that can be utilized for the construction of public service administration offices located at Yeka, Gullele, Jemo and Akaki sub-cities.

On July 2020, the corporation invited local manufacturers to supply reinforcement bars with diameters ranging from eight mm (millimeter) to 20 mm. However, problems started to arise once it was realized that the intended purchase was not in bulks but rather in kilograms.

 A total of 1118.3 kilograms of reinforcement was to be procured from local suppliers, while the corporation floated an international bid to buy more than 15 million tons.

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Furious about the disparities between the local and international bid, a group of metal manufacturers have filed complaints against the corporation.

Solomon Mulugeta, general manager of the Ethiopian Association of Basic Metal and Engineering Industries recently told The Reporter about the incident and said “It is simply a humiliation to local industries.”

Currently, local industries have achieved an annual capacity of producing some five million metric tons of reinforcement bars. However, the demand for it is limited to be around 3.5 million metric tons, suggesting a 1.5 million metric ton of surplus in production. That, however, did not satisfy the corporation which has currently acquired a whapping 20.7 billion birr worth of projects.

The bulk shipment of the reinforcement bars, according to Tinfu Muche, public relations director of ECWC, will serve a two year worth of construction needs. He said there is nothing wrong with purchasing massive bulks from external suppliers, since buying from local manufacturers, has contributed to delays in delivering projects on time, due to the shortages of forex and raw materials.

Tinfu said that there are 15 projects that have been behind schedule for nearly six years. Avoiding such practices now, has become an urgent matter for the administration, and imports of bulky shipments were authorized when some seven local manufacturers failed to win a bid in the process.

However, one thing has been skewed for Solomon and the members of the association, in favor of importers. They have the access to forex, to buy finished products, while local industries wait for months to access forex to import raw materials.

It is to be recalled that the corporation has spent some 500 million birr to purchase 15 million tons in addition to the previously spent USD 8.5 million to import rebar. With growing criticisms and complaints, the corporation has cancelled the local procurement bid. According to Tinfu, the bid was cancelled due to faulty technical requirements found in the bid document.

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Video from Enat Bank Youtube Channel.


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