Beyond Price Control, PRAZ,NCC Introduce Procurement Price Index

By Shaleen Mahammed

In a groundbreaking move, the Procurement Regulatory Authority of Zimbabwe (PRAZ) and the National Competitiveness Commission (NCC) have joined forces to propel Zimbabwe’s economic development. The two organizations recently signed a landmark Memorandum of Understanding (MOU), paving the way for enhanced transparency, accountability, and competitiveness in public procurement processes.

The partnership’s primary objective is to develop a market price index for commonly procured goods and services, empowering procuring entities to make informed decisions that achieve value for money. This innovative approach is expected to strengthen public procurement processes, foster a conducive business environment, and attract local and foreign investors.

At the signing ceremony, PRAZ CEO, Clever Ruswa, emphasized the strategic importance of public procurement in driving socio-economic growth. “Public procurement can be leveraged as a strategic socio-economic policy lever to drive economic development,” he noted. “This partnership will promote transparency and accountability in public procurement processes, contributing to Zimbabwe’s economic growth.”

NCC Executive Director, Phillip Phiri, echoed Ruswa’s sentiments, highlighting the critical role of competitiveness in determining a country’s ability to generate income, foster development, and enhance welfare for its citizens. “This partnership will enable us to create a more conducive business environment, attractive to local and foreign investors,” he said.

The Permanent Secretary in the Ministry of Industry and Commerce, Thomas Wushe, applauded the initiative, noting its alignment with the ministry’s vision to promote vibrant, sustainable, and globally competitive industrial and commercial enterprises.

The partnership’s timing is particularly significant, as Zimbabwe navigates economic challenges, including a depreciating local currency and fluctuating exchange rates. Economic analysts caution that the move will primarily impact the public sector, which is advised to make payments in local ZWG currency. Zimbabwe’s journey to economic revival isn’t without its challenges. The local currency is losing value, and exchange rates continue to fluctuate in the market, given that the country does not manufacture but rely on importation of goods from outside the country.

However, PRAZ, Ruswa, clarified that the market price index is not a price control mechanism but rather a baseline for procurement departments to make informed purchasing decisions. He emphasized the need to justify figures and prevent forward pricing and distortions in public procurement processes.

As Zimbabwe strives to regain economic stability, this historic partnership between PRAZ and NCC marks a crucial step towards promoting transparency, accountability, and competitiveness. By fostering a conducive business environment, Zimbabwe can unlock its full potential and achieve sustainable economic growth