Attempts by federal officials to buy raw materials for garment and textile factories have gone awry for the second time in a week.

The volume of yarn and thread the Enterprise is attempting to procure covers 20pc of the quarterly demand of small and medium garment and textile companies operating nationwide. Annual demand from close to 3,000 of these manufacturers is estimated at around 12,000tn. The domestic market satisfies close to 80pc of the total demand.

Officials of the Ethiopian Industrial Inputs Development Enterprise (EIIDE) have not succeeded in buying 600tn of yarn and thread to be distributed to small and medium textile manufacturers. Although around a dozen suppliers responded to a public tender issued last November to procure these materials, only one submitted an offer on February 2, 2022. State procurement laws require the Enterprise to go on closed bidding.

Neither was their attempt to buy 10,000tn of cotton through an open bid process last week a success. They have rescheduled the bid for later this month.

The Enterprise is awaiting a list of suppliers from the Ethiopian Textile Industry Development Institute (ETIDI), according to Endeshaw Legesse, director of industrial inputs procurement.

The Enterprise has floated at least four tenders annually to procure cotton, yarn, and thread; it has yet to successfully buy raw materials through a closed bidding process.

Endashaw says the issue comes down to suppliers' requests for advance payments.

“They're paid in hard currency," he said. "Accessing it on time has been a challenge."

The Enterprise has repeatedly faced similar frustration in its attempts to buy raw materials for the textile industry over the past two years. It has been resorting to closed bids to complete the procurements, bound by laws that dictate public enterprises and federal agencies resort to other options when less than two bidders make an offer. There is a range of options for those in charge of public procurements, from open bidding to two-stage tendering and from restricted tendering to direct procurement and electronic bidding.

Addis Tsadik, an independent law consultant, says this is designed to safeguard the procurement process from unlawful practices and corruption.

“Unless the procurement is for a national emergency, changing the existing procurement process might expose it to more corruption,” he said.

Public procurement officials may obtain waivers from the Ministry of Finance to buy without competitive bidding when suppliers are limited to one, the goods or services to be acquired have urgency or national security or no more than two bidders appear when tenders are issued repeatedly. Nonetheless, in the aftermath of COVID-19, federal officials permitted public institutions to procure sanitary products without following the procurement procedures.

Officials say the latest procurement is an attempt to stabilise the price of raw materials in the local market, which are volatile. Previous procurements have been effective, according to Endeshaw. Packs of thread known locally as "Menen" were sold for 80 Br apiece a while ago, but prices dropped by more than half after imported thread was made available at the Enterprises' outlets. EIIDE operates 83 outlets across the country, where factories can buy raw materials on credit.

Located in Arba Minch town, 440Km south of Addis Abeba, Negat Chora Sewing Factory could benefit from the Enterprise's procurement. Established in 2007 with a registered capital of 24,000 Br, the factory faced challenges in buying thread and yarn from local markets, according to Ferew Ermias, one of the company's founding shareholders.