Fortune News | Feb 08,2020
Jan 18 , 2020
By SEBLE WONDEMAGEGN ( FORTUNE STAFF WRITER )
Agrocorp International Pte, a Singapore grain supplier, received an award letter to supply 200,000tn of wheat at a total cost of 44.44 million dollars.
The Public Procurement & Property Disposal Service awarded the company out of a total award of 400,000tn of wheat, which the Service planned to procure on behalf of the Ethiopian Trading Business Corporation for market stabilisation purposes. Agrocorp received the award letter on January 3, 2020, but did not sign the contractual agreement yet.
For the bid that was floated on September 14, 2019, under four lots, Agrocorp and Hakan Agro offered the lowest prices for two separate lots. Agrocorp and Hakan offered 43.28 million dollars and 44.44 million dollars, respectively. GemCorp Commodities Trading, which bid for all of the four lots, was the second-lowest bidder, offering 44.36 million for the first two lots and 44.78 for the remaining lots.
However, Agrocorp and Hakan were disqualified from the bid for not attaching a guaranteed assurance for aflatoxin requirements on the technical evaluation that was opened on November 25, 2019. GemCorp, which was found in compliance with the aflatoxin requirements, was later awarded on December 23, 2019, for all the lots.
Displeased with the decision, Agrocorp complained to the Service, stating that the bid document failed to put aflatoxin as a requirement. It also presented a document that shows it can meet the aflatoxin specification. The technical committee reviewed the document and awarded Agrocorp with the contract, cancelling the previous award given to GemCorp.
While awarding Agrocorp, the Service approached Hakan to present its aflatoxin specification to regain the award.
However, the company declined the invitation, reasoning the price validity date it offered had already expired, according to Worku Gezahegn, acting director of procurements at the Service, which procures goods and services for over 189 public institutions.
"Since the price of wheat in the global market varies," reads Hakan's letter, "the company can't provide the product at the prices it initially offered."
After Agrocorp was re-awarded for the supply of half of the wheat, GemCorp filed a complaint to the Service, which is currently reviewing the complaint.
“We'll respond to the company this week,” said Worku.
Andnet Abebe, a procurement team leader at Addis Abeba University's main campus, says the Service should adopt two envelope systems to avoid such problems.
“The technical and financial documents should have been submitted and evaluated separately in two different envelopes,” said Andnet.
In a press conference held at the end of last week, Tsewaye Muluneh, the new director-general of the Service since July, announced that the Service had cut the prolonged dates for a framework agreement, with which the Service procures items in bulk.
Tsewaye said that the pre-screening process used to take two weeks but has now been shortened to a week, while the period for technical evaluation was reduced to two weeks from the previous two months. Sample tests made at the Ethiopian Conformity Assessment Enterprise used to take three months but have been slashed to 20 days.
Property disposal used to take up to a month. Now it takes between a day and three days, according to Tsewaye, who also listed the foreign currency crunch, as well as issues in logistics and tax and duty clearance as additional challenges of her office.
“Such problems are causing delays in managing contacts,” said Tsewaye. “We're amending our bid document with the Office of the Attorney General.”
Out of the total government budget, 60pc of it is spent on procurements of different goods and services.
PUBLISHED ON Jan 18,2020 [ VOL 20 , NO 1029]
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