But when it comes to participation in the economy, young people are at the tail end with youth unemployment stubbornly remaining double-digit for decades despite impressive economic growth rate of 7 per cent before Covid-19 pandemic.
Development stakeholders now recommend that apart from private enterprise initiatives, preferential public procurement can be used to integrate youth into the job market, combat poverty and promote inclusive economic growth.
Presenting a paper last weekend in Dar es Salaam during a Policy Forum breakfast debate which explored challenges faced by youth-owned businesses, Werner Hillary from Tanzania Youth Coalition {TYC} said that investing in youth-owned businesses pays dividends in terms of job creation and development.
TYC is a consortium of more than 120 youth non-governmental organizations and community-based organizations (CBO), 249 youth enterprise groups (YEGs) and 100 youth individual members in Tanzania Mainland and Zanzibar.
She said that increasing youth participation in the procurement process will lead to stronger competition, better prices, increased quality and timely delivery of procured goods or services.
Public procurement refers to buying, purchasing, renting, leasing or otherwise acquiring any goods, works or services by public bodies and any other bodies, or units established and mandated by government to carry out public functions.
It includes all functions that pertain to obtaining of any goods, works or services. That is, description of requirements, selection and invitation of tenders, preparation and award of contracts.
Public procurement stimulates the economy by providing opportunities to micro, small and medium enterprises (MSMEs) especially those owned by youth, Hillary said, arguing that MSMEs are at the center of job creation and economic growth in the world, accounting for nearly 80 per cent of jobs worldwide.
“Increasing MSMEs competitiveness increases their likelihood of success, expansion and job creation,” she said.
Public procurement in Tanzania is governed by the Public Procurement Act of 2001 (PPA) which regulates all procurement financed by public funds except the local government procurement which is regulated by the Local Government Finance Act.
The PPA sets out a public procurement system for fairness, openness, transparency, accountability and competitiveness. It also provides for creation of a sound economic climate in Tanzania and increasing participation by the private sector.
In 2016, PPA of 2011 was amended to cover participation of youth, women, elders and people with disabilities (PWDs) as special groups in public procurement since they were observed to have a great impact on the economy of the country.
Thus, all procuring entities are required to set aside 30 per cent of their annual procurement volume for the special groups whereby youth are supposed to get 10 per cent, PWDs (10 per cent), women (5 per cent and elders (5 per cent).
Gilbert Kamnde, Acting Manager in charge of Training and Advisory Services at Public Procurement Regulatory Authority (PPRA) said the regulator in collaboration with the National Economic Empowerment Council (NEEC) is working on capacity building and awareness raising programmes on all matters relating to public procurement to be relayed to the public through different platforms.
He said that the PPA offers opportunities to youth and other special groups to benefit in public procurement.
“These changes in the legislation have necessitated the authority to develop guidelines for participation of special groups in public procurement,” he said.
“Honesty in public procurement has the potential to benefit the country immensely because overall, the government is the biggest single spender.”
According to him, over 70 per cent of the government’s national budget goes to procurement.
He however said that the major challenge for many Tanzanians is mistrust hence difficulty in working together and qualify for big government tenders.
“Many Tanzanians don’t like to form joint ventures and that is a big hindrance to success in business,” he said.
Kamnde has advised youth and other special groups to pool resources together, register legal business entities for them to be able to bid for and win government tenders.
Minael Kilimba, Empowerment Officer at NEEC, said there are lots of opportunities available for Tanzanians, especially for the youth and other special groups if they understand and properly utilize public procurement.
She said that a total of 769 tenders were offered to different bidders in the ongoing Standard Gauge Railway project between January and December 2020 out of which 708 tenders were exclusive for Tanzanian companies.
According to her, the tenders offered to Tanzanian companies during the said period were worth 349.020bn/- while those offered to foreign companies were worth 349.666bn/-.
According to a contractual agreement entered between the government and implementers of the project, the contractor is required to use local raw materials of high standards available in the country.
Some of the local companies which benefited from this arrangement include Kamal Steel Ltd, Lake Steel Ltd, Lodhia Plastic Industries Ltd, Nayan Enterprise, and Puma Energy Tanzania Ltd.
Kilimba said that lack of proper skills and experience in implementing major projects has remained a major challenge to some Tanzanians. Another challenge is lack of employable soft skills and proof of international standard capacity for some Tanzanian bidders and service providers.
Insufficient goods and services that meet the required standards and some policies that don’t give priority for participation of Tanzanians in major projects in certain sectors are also a challenge, she said.
Thus, in different projects being implemented, the issue of local content is being coordinated by contracts only. And women participation in these major projects is still very low, she added.
Judith Sando, Independent Consultant on financial inclusion, gender and advocacy said more awareness on public procurement is needed for youth and other special groups to benefit from public procurement.
“Most of the youth are unaware of public procurement guidelines. These guidelines must be made public and user-friendly for them to be understood and used,” she said.
