The Department of Trade and Industry (DTI) has announced a further set of product designations for local procurement by the public sector and has indicated that efforts will be stepped up during 2015 to improve compliance across all government departments and State-owned companies (SoCs).

Through the Preferential Procurement Policy Framework Act, Trade and Industry Minister Dr Rob Davies has the authority to direct government departments, agencies and SoCs to procure specifically selected products and services from local manufacturers, or providers.

Over the past few years a number of designations have been made, covering everything from transport and energy equipment through to canned-food products and uniforms.

The newest designations, which have been unveiled together with the latest Industrial Policy Action Plan (Ipap), cover transformers, power-line hardware and structures, steel conveyance pipes, mining and construction vehicles and building and construction materials.

In the case of the building and construction sector, the DTI had indicated that the “first round” of construction material designations include cement, fabricated structural steel, pipes and fittings, sanitary ware, glass, frames and roofing materials.

But Davies has also acknowledged that the designation instrument is only as strong as the level of compliance by departments and SoCs, which is currently weak.

Manufacturing companies have generally supported the designation concept, but have repeatedly questioned whether it is being implemented and enforced, with many even arguing that they continue to lose public-sector contracts to cheap imports.

The department insists that measures will be taken under the aegis of Ipap 2015 to ensure higher levels of compliance across all government departments and agencies.

Davies has outlined a three-pronged strategy to improve adherence to the designations, including making compliance an audit requirement. Detailed compliance guidelines are to be produced in collaboration with the National Treasury, which will guide the auditing and reporting frameworks.

Secondly, training and capacity building will be undertaken with institutions that lead public procurement and strategic sourcing and, thirdly, a monitoring and evaluation tool is to be developed for designated sectors.

“Across the whole range of Ipap interventions, local content requirements will continue to be strengthened wherever applicable – including in flagship success areas like the latest window of the Renewable Energy Independent Power Producers Procurement Programme,” Davies reports.

MINING & MANUFACTURING

Besides the infrastructure programme, where the aim is to leverage the 18 so-called Strategic Integrated Projects being overseen by the Presidential Infrastructure Coordinating Commission to accelerate industrialisation, the DTI is also turning its attention to private-sector supply chains.

The department is particularly keen for the “linkages and multipliers that exist between mining and manufacturing” to be further developed.

“This applies not only to upstream mining opportunities and downstream beneficiation projects but also to the significant work that has already taken place with respect to future gas-based industrialisation,” Davies explains.

The latest Ipap points to efforts to build working relationships with large mining companies, including collaboration on the development of new technologies to beneficiate the country’s mineral wealth.

Davies even argues that the revised black economic-empowerment codes will create the foundation for “working with mining companies towards building world-class engineering companies in the mining supply chain”, as the codes raise the score available for both small-business support and supplier development.