PROCUREMENT
Enhancing Transparency
In Procurement Crucial
For SME Growth
By Denis Mbau
I
n Africa and across the world, Small
Medium Enterprises (SMEs) play a
key role in the economy, contributing
significantly to the GDP of the countries
they operate in and creating about 80
percent of all job opportunities.
However, SMEs face unique challenges
in participating in fair processes to win
government business due to lack of
transparency, capacity to supply the needed
services and goods, finance to bid for
opportunities and knowledge on existing
business opportunities. At the same time,
large multi-national companies often have
trouble accessing high quality domestic
suppliers to meet their operational and
contracting needs.
In addition, corruption continues to be
a blight across Africa inhibiting SMEs
from participating in public procurement
markets. According to the World Bank,
USD $1 trillion is paid out in bribes in
Africa while USD $2.6 trillion is lost
annually through corruption. This is
equivalent to more than 5 percent of the
global GDP.
Partnerships between public and private
sector organisations are increasingly
being formed to promote transparency in
trade transactions and encourage greater
participation, particularly from the SMEs
in procurement.
The African Partner Pool (APP), launched
in April 2017 is an online technology
platform that directly connects buyers
to a pool of verified suppliers providing
diverse products and services. Since its
launch, the impact is already being felt
with over USD $3,340,000 worth of
business opportunities floated for the
over 950 SMEs on the platform. APP
simplifies the tendering process for
companies, generates exposure of tender
opportunities and reduces the cost and
time spent acquiring suppliers.
Lymies Engineering, a female owned
company based in Nairobi, Kenya has won
three tenders on the platform valued at
KES 6.7 million. This has enabled the firm
to consider expanding and recruit more
staff. “The APP Platform has allowed
Partnerships between public and private sector
organisations are increasingly being formed to
promote transparency in trade transactions and
encourage greater participation, particularly
from the SMEs in procurement.
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Public procurement that
provided the same level
of inbuilt assurance, sys-
temic checks and balanc-
es and strict measures
to ensure transparency,
zero tolerance on cor-
ruption, due process,
zero or minimal fees to
participate in tender in-
clusion and lower ten-
der requirements could
grow the SME sector in
Africa.
us to access business opportunities from
large businesses in the country, saving us
time and resources and giving us access to
business from companies we wouldn’t have
accessed through conventional tendering
processes,” said Millicent Maina, Director
of Lymies Engineering.
This increased transparency has enabled
more SMEs in Kenya and Ghana access
to business opportunities through levelling
the procurement playing field and open
contracting. The embedded transparency
ensures that bids are won through merit
and encourages entrepreneurship as
opportunities become more accessible.