Stringent local content regulations come into force

Governments across Africa are implementing increasingly stringent local content regulations in an effort to protect their local economies, according to Arne Fayd’herbe de Maudave, Panalpina vice president: head of Panprojects Africa. “We are seeing it become law in many countries, with remote countries like Libya for example also now pushing for more local content,” he said. Maudave said the increase in projects across the continent was spurring the drive. “We see it more and more in Africa where the impact of development is visible to everyone. As the projects increase so does the call for local content and therefore there is an impact on local companies and people,” he said. “Transmitting knowledge is a key element if local content is to be successful.” He said while it was a law in most countries to employ large numbers of local people it was also an obligation of business entering an economy. According to Mahendra Dedasaniya, Worley Parsons TWP head-global procurement and outsourcing, the first objective of most governments when calling for local content is to increase the value-add to local business and in doing so directly increase the GDP of the economy. “Secondly, critical skills are being transferred to the local workforce and employment is increased which plays a direct role in reducing poverty on the continent.” Dedasaniya said various governments were employing various rules and regulations to benefit from local content. “In Angola there is a policy that if an Angolan company tenders within a certain percentage of a bid one is obligated to award the contract to them, while in Equatorial Guinea any corporate awarded an oil and gas contract has to spend a certain amount of money on training the ministry of oil’s staff,” he said. But the issue of local content has also raised some serious questions as it can be ambiguous at times, said Deanne DeVries, vice president Africa, Agility Project Logistics. “In Uganda recently there were big question marks around what is considered local when a British man, who also had a Ugandan passport, was not considered to be local. “ Despite these ongoing challenges the drive to see more locals employed in Africa is gaining momentum with Ghana having set a target of 90% local content by 2020, while Nigeria has implemented processes to evaluate contracts and to meet a 75% local content target. INSERT While it’s a law in most countries to employ large numbers of local people it’s also an obligation of business entering an economy.