FG to compel MDAs to patronise locally made goods, services

A proposed law is underway to compel government Ministeries Departments and Agencies (MDA’s) to patronise  local manufacturers and indigenous companies  in the procurement of goods and services as a way to curb the present huge job exports, cut down overwhelming unemployment levels and save the economy from collapse.

The Local Industry Patronage Bill 2015, sponsored by Senator Mohammed Lafiagi (APC, Kwara North)  which has passed first reading at the Senate, also seeks to prohibit the exclusion of locally produced goods in the procurement process.

Nigeria spends a fortune importing even goods and services that it can comfortably provide locally, including tooth picks and some 40 other items which the Central Bank of Nigeria (CBN)  earlier in the year denied access to foreign exchange in any of its funded windows.

Apart from the fact that a bulk of local industries have gone comatose, while some can no longer meet local demand on account of low capacity, there is also a greater concern on poor quality of locally manufactured goods, which discourages patronage.

To adress this, the proposed law provides that such locally produced goods or services must be certified to be of good quality.

It also provides that indigenous firms must be registered with government regulatory agencies like the Standards Organisation of Nigeria (SON), National Agency for Food, Drug Administration and Control (NAFDAC) as well as any other government recognised institution capable of determining quality standards.

In  an interview with BusinessDay, Tony Ejinkenoyen, President, Abuja Chamber of Commerce, Industry, Mines and Agriculture (ABUCCIMA), said the proposed law will have multiplier effect on the nation’s economy, particularly in terms of creating more employment for young Ngerians.

“It is a step in the right direction. You will agree to the fact that the most distorting factor hindering our economic development and growth may be what I term ‘over dependence on imported goods and services,” Ejinkenoyen stated.

However, Section 4 of the bill seen by BusinessDay, outlines certain conditions under which MDAs shall patronise foreign companies. These include: when such goods, works and services are not produced in Nigeria; they are not readily available in the stock of the local manufacturers or where they fall short of the approved standard by regulatory agencies.

Before being considered, such local firm, according to the bill, must have taken part in the tendering and bidding processes during the procurement exercise, in line with the Public Procurement Act.

The bill saddles the responsibility of ensuring compliance with the Economic and Financial Crimes Commission (EFCC), Manufacturers Association of Nigeria (MAN), Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) and Nigerian Association of Small Scale Industrialists (NASSI).

In addition, Section 8 of the bill proposes that: “Any officer involved in contravening this Bill, commits an act of economic sabotage and shall be liable on conviction, to: compulsory retirement where it involves a staff and dismissal for a political appointee and a term of imprisonment not exceeding three months or a fine not exceeding N500, 000”.

Recall that in his resolve to block the influx of foreign construction workers into Nigeria, President Muhammadu Buhari recently directed the Federal Ministry of Power, Works and Housing to urgently prepare and present for approval and implementation, a plan of action for the speedy revitalisation and expansion of the nation’s vocational training centres.

He gave the directive after being told at a meeting with the board of directors of Julius Berger Nigeria Plc, that because of a shortage of competent construction workers and artisans in the country, many construction companies were forced to bring in skilled workers from abroad.

“The bill will be far-reaching to place Nigeria in a strategic position in the comity of nations, as it is going to ensure that our local industries are being patronised and in turn, create more employment opportunities for Nigerians.

“The multiplier effect of the Local Industry Patronage Bill will be excellent and unprecedented if signed into law”, Ejinkenoyen further stated.

In data released by the National Bureau of Statistics (NBS), unemployment rate in the country increased to 8.2 percent in the second quarter of 2015 from 7.5 percent in the first quarter of 2015 and 6.4 percent in the last quarter of 2014.

The Bureau puts the economically active population in Nigeria within the age range of 15 to 64, at 103.5 million increasing from 102.8million in the last quarter of 2015, while the unemployed labour force stood at 74 million Nigerian youths.

Owede Agbjileke