A new certification scheme launched by the South African Bureau of Standards (SABS) on October 14, intends to harmonise local content and local production for producers and manufacturers, levelling the playing field and cutting out those who seek to cheat the system.
The SABS – a statutory body entrusted with developing, promoting and maintaining South African National Standards (SANS) – said the Local Content Certification Scheme seeks to address the shortcomings of its predecessor, the Local Verification Scheme.
“Product certification is a large portion of our quality assessment business and our ability to [provide] domestic producers with a combined product and local content certification will enhance their selling opportunities in the public and private procurement system,” SABS said in a statement.
“In turn, this will strengthen the quality of goods and products bought throughout the supply chain. This will increase the demand for quality locally-produced products.”
Out with the old
Previously, manufacturers and suppliers – particularly those bidding for work in the public sector – were only required to sign a declaration form stating that their products met SABS product specifications.
The declarations would only be verified, if ever, once bidders had passed certain levels in the procurement process.
Through the new scheme, local producers and manufacturers will be able to get their products audited and certified up front, before they bid for procurement opportunities.
Producers and manufacturers whose products meet local production and content standards will be issued with a certificate that will be valid for five years, subject to annual checks.
“This initiative enables procuring organs, both private and public sector, to implement their preferential procurement practices with ease as far as local content requirements are concerned,” SABS said.
Government’s local investment drive
The upgrade by the SABS, which has been approved by the Department of Trade, Industry and Competition (dtic), comes as the government looks to stimulate economic growth by supporting local businesses.
Read: Godongwana commits to reforms and removing red tape to boost economy
Deputy Minister of Trade and Industry Fikile Majola said in a statement on Thursday that the new scheme supports government’s ambitions to use public procurement strategically to reindustrialise South Africa and create more jobs.
“We believe this to be important because, pragmatically, each time we – whether as government, citizens, businesses or communities – buy a product which is imported, we gift potential jobs, tax revenue, [GDP] and our industrial capabilities to our trade competitors,” he added.
“Localisation means that we can assist the productive sectors of our economy to continue to manufacture locally and the more the country moves towards localisation, the more decent jobs are created.”
Earlier this month, National Treasury announced that the use of imported cement on government-funded projects will be banned from November 4.
According to the dtic, cement joins a list of 27 products designated for local content and production in the public procurement system.
Read: Treasury bans use of imported cement on all government-funded projects
Already on the list are:
- Steel conveyance pipes;
- Plastic pipes;
- Textile, clothing, leather and footwear;
- Canned or processed vegetables; and
- School furniture.
Southern African Plastic Pipe Manufacturers Association CEO Jan Venter tells Moneyweb that although he cannot speak to the individual experiences the association’s members may have had with government’s localisation policy, the industry welcomes such moves.
“We do however firmly believe in preferential procurement and the protection of local industry and therefore appreciate the work that is being done in this regard,” he says. “In general, it [can] only be beneficial to local investment.”