South African Metering Industry to benefit from government’s procurement directive

The National Treasury has made it a priority to support the designation of sectors in line with national development and industrial policies for local production.

Regulation 8 (2) of the Preferential Procurement Regulations 2017 prescribes that in the case of designated sector, an organ of state must advertise the invitation to tender with a specific condition that only locally produced services or goods or locally manufactured goods with a stipulated minimum threshold for local production and content, will be considered.

The chairperson of the South African Metering Industry Association (SAMIA), Edwin Sibiya, is pleased with this stance, he adds “The DTI has designated and determined the stipulated minimum threshold for the Residential Prepaid Electricity meter at 70% and 50% for smart electricity meters for local manufacturing, a further 40% prepaid water meters and 40% mechanical water meters up to 100mm. This gives the South African meter manufacturers an opportunity to regain the local market share which was lost to international companies, it further strengthens the South African metering industry by forcing non-compliant manufacturers to comply with our country’s regulation bodies. This designation of sectors gives us the strength to look after our industry by identifying and removing non-compliant meter products which contribute to false readings and bills.”

READ: Metering Industry Association launched in South Africa

If the quantity of materials and/or products required cannot be wholly sourced from South African based manufacturers and/or at the designated local content threshold at any particular time, bidders should obtain written approval from the DTI to supply the remaining portion at a lower local content threshold. The DTI, in consultation with the procuring organ of state, may grant such approval on a case-by-case basis.

The designating of sectors is aimed at growing and empowering the South African economy through supporting local businesses in the procuring of products and services. This will further reduce the unemployment rate which has reached an all-time high of 35.3% as from the 29^th of March 2022. It is up to the accounting officers and accounting authorities of all municipalities and municipal entities to ensure this mandate is effectively implemented in the procurement processes.