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BusinessForex shortage forces city to bend procurement rule

Forex shortage forces city to bend procurement rule

Woredas to procure stationary directly

As the result of the recurrent foreign currency shortage, the board of Addis Ababa Public Procurement and Property Disposal Agency has given permission to Woreda administrative offices to directly procure their own stationary materials, bending its procurement procedure to execute all such purchases through the Agency.

Meriko Birilew, contract administration director at the Agency, told The Reporter that the move by the City administration came following a gap in stationary items supply.

This gap was created mainly as the result of foreign currency shortage where the suppliers struggled to import the items.

The current shortage of foreign currency is also affecting the whole economy. Its impact is also reflected in the formal and parallel currency trading markets. For the past couple of months, the rate of exchange between the two markets has shown a significant difference where, for instance, one USD is traded for up to 34 birr in the black market where as in formal channels is traded at 27 birr.

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Most of the suppliers who have been working with the Agency have waited for more than one year to get foreign currency. This has also restricted them to import large quantities of items from abroad which resulted in a shortage of stationary items in public offices.

So far, the usual procedure was that every stationary item distributed to all public offices within the city jurisdiction, which falls under the category of common user items, has been procured by the Agency in a framework arrangement. The Agency, which has the mandate for procurement of common user items and nationally strategic items, has been purchasing as per the demand of each office and distribute it. This is mainly to create a centralized procurement system.

After looking into the issue, the Board of the Agency chaired by Abate Sitotaw, Deputy Mayor of Addis Ababa has given woredas the mandate to procure their own stationary.

This transfer of mandate to all woredas estimated at 200 will stay till July 6, 2018.

  

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