Boniface Muhegi
Financially crippled local contractors that were for many years
alienated from the lucrative construction business can now execute huge
multibillion-shilling projects through unity.
"It's no longer time to complain-let local contractors, small as they
might be, unite and bid for state funded projects," Contractors
Registration Board (CRB) Registrar Boniface Muhegi told the 'Daily News'
in Dar es Salaam over the weekend.
He said the government has
deliberately resolved to support local contractors with the view of
enhancing their growth and participation in the construction sector,
which remains the monopoly of foreign contractors."The government is very receptive of united contractors-it would like to award big projects funded by domestic resources to local contractors who unfortunately are still lacking in capacity," Mr Muhegi said, urging small, medium and large contractors to form joint ventures.
He invited those interested to unite to consult his office which boasts of highly skilled and experienced experts in forming joint venture agreements.
Mr Muhegi also asked procuring entities to repackage the huge projects into manageable sizes to attract small contractors, "A project for the construction of a 200-kilometre road, for instance, can be repackaged into stretches of between 30 and 50 kilometres."
Foreign contractors, though constituting hardly three per cent of all contractors on CRB list, perform over half of all construction works in the country, leaving less than half of the works for local contractors who constitute over 97 per cent of all registered firms.
The construction sector, with annual turnover of about 3trn/-, chews a whopping 70 per cent of the government annual budget, according to the Public Procurement Regulatory Authority.
But, industry analysts say that the country's huge spending on construction has had little impact on the national economy due to foreign dominance. Unlike their local counterparts who reinvest their profits, albeit little, foreign companies uplift all the profits to their home countries.
And, due to payments in foreign currencies, foreign contractors exert unnecessary pressure to the country's foreign reserve and destabilise the shilling. Unless local players who lack some or both of capital, technology, equipment and management skills unite, foreigners will remain the sector dominators.
Source: The Daily News,http://www.dailynews.co.tz, reported by Masato Masato
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