29 January 2013

Rwanda: Lack of Law, Poor Infrastructure Hinder Electronic Procurement

The lack of a specific electronic procurement law is delaying efforts to introduce e-tendering, which could go a long way in curbing corruption in the sector.

Although the current public procurement law provides for the public procurement to be handled using ICT law, to address issues of infrastructure and capacity would be a welcome development, Augustus Seminega, the Rwanda Public Procurement Authority (RPPA) boss, said.

Seminega, however, noted that the e-procurement law was before Parliament, adding that soon a ministerial order to implement it would be issued. He said that implementation also needed the right infrastructure to be put in place and the capacity of the government officials and contractors improved.

E-procurement can greatly curb corruption in public procurement, is a faster and efficient way of handling the tendering process. Using the Internet makes it easier, faster and less expensive for businesses to buy goods and services as they do not have to travel abroad, especially suppliers, to make purchases.

With electronic procurement, situations, where an employee over rates or understates the firm's bill for items to be procured are much less likely to occur. E-procurement makes it easier to track all purchases since the company managers can easily discover who made which purchases on the Internet without having to wait to receive a monthly invoice.

Also, e-procurement saves time. Buyers simply go online and place their orders or apply for tenders. And, because suppliers receive the order, almost immediately, they can also deliver faster than with the old procurement methods, where paper transactions are involved.

Although the benefits of e-procurement are many, there are obstacles that can arise in implementing this type of public procurement. Due to the high levels of computer illiteracy in Rwanda, many entrepreneurs do not know how to carry out electronic commerce.

"It is true that today a small number of local firms conduct their businesses online. E-procuring is a new system that we aren't used to, but Rwandans are always eager to learn, which confirms my optimism that with e-procurement, our country is on the right track," said Dan Ntagugura, a consultant with KPS Associates.

Ntagugura said because e-commerce is at its infancy in Rwanda, the lack of Internet-related law protecting e-procurement in both the public and private sectors is a big obstacle.

Other reasons are the culture of Rwandans being accustomed to manual paperwork compared to an Internet-based system. Costs involved in setting up the system, lack of human resource, especially the computer literate, the ever changing software for e-procurement and lack of common database to access the suppliers electronically are the other challenges.

This could, however, end as the public procurement watchdog is pushing for the enabling laws to be passed soon.

"Once all IT infrastructure and other requirements are in place, a ministerial order will be made and the law passed," noted Seminega.

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