Foreign firms to buy more Kenyan products in tender proposal

Foreign firms that win government tenders will be forced to source more products and services from Kenyans if a Bill currently under MPs’ scrutiny becomes law.

In fresh amendments to the Public Procurement and Assets Disposal Act, 2015, foreign firms will be required to source 60 per cent of supplies from citizen contractors up from the current 40 per cent.

The Bill seeks to amend section 157(9) of the Public Procurement and Assets Disposal Act, 2015 that require all foreign tenderers participating in international deals to source at least 40 per cent of their supplies from citizen contractors prior to submitting a tender.

“Section 157 of the principal Act is amended in subsection (9) by deleting the word “forty” and substituting therefor the word “sixty” the Bill states.

Thika Town MP Patrick Wainaina, who sponsored the Bill said the changes are aimed at increasing the amount that international tenderers must source supplies from Kenyan businesses.

The aim is to promote local industries and create jobs by ensuring that foreign firms source substantive supplies locally in the execution of the tenders.

Kenya has become an attractive destination for foreign contractors in recent years, especially those from China who have bagged many multi-billion shillings road and construction jobs. The Bill comes after a House team blocked attempts by an MP to stop foreign firms from taking part in public tenders below Sh1 billion and jobs Kenyans can do.

The National Assembly’s Finance and National Planning committee rejected the Bill sponsored by Mathira MP Rigathi Gachagua that proposed changes to the procurement law.

Mr Gachagua wanted the limitation to promote local industries with the external firms only getting tenders if Kenyan firms lacked capacity.

He noted that the amendments will protect local jobs and curb repatriation of profits by the foreign companies that are increasingly taking up construction works.

A number of Central Kenya MPs have raised concerns over the heavy presence of Chinese contractors in the economy.