The Federal Government of Nigeria has recently come out with an executive order titled “Presidential executive order for planning and execution of projects, promotion of Nigerian content in contracts and science, engineering and technology”
The Order’s Preamble gives background information as to the essence of the Order. The preamble reiterates Federal Government of Nigeria’s recognizes that entrenching Science, Technology and Innovation (STI) in everyday life is key to achieving the National Economic Development goals across all sectors of the economy.
Consequently, the FGN, under the prevailing National Science, Technology and Innovation Policy (NSTIP), has collaborated with relevant Ministries, Departments, Agencies (“MDAs”) and Organizations, to promote the application of science, technology and innovation in all sectors of the Nigerian economy to increase the quantum of value created in Nigerian economy through increased Nigerian content in public procurement.
The take home points in the Order are captured below:
- Preference of indigenous companies and content
The prominent message in this Order is that indigenous companies and content are to be preferred over their foreign counterparts.
Going forward, procuring entities are to give preference to Nigerian companies and firms in the planning, design and execution of national security projects and award of contract, in line with the Public Procurement Act 2007. It is only where Nigerian companies lack the expertise, that procuring entities can give preference to foreign companies or firms and in doing so, only firms who have demonstrable and verifiable plan for indigenous capacity development will be considered. Where Nigerian companies or firms with valid practicing license enters into a Joint Venture relationships or agreements for any consultancy services relating to law, Engineering, ICT, Architecture, Procurement, Quantity Surveying and so-on, such Nigerian Company will be lead in the consultancy services. The MDAs are forthwith expected to adopt local technology to replace foreign ones, where they meet set standards and goods manufactured locally are also to be preferred to foreign goods.
This rationale of preference extends to human resource. Consequently, the Order provides that the Ministry of Interior must not give visa to foreign workers whose skills are readily available in Nigeria.
2. Accreditation and proper registration
By this Executive order, the MDAs are to ensure that all professionals practicing in Nigeria are duly registered with the appropriate regulatory body in the Nigeria. Similarly, agreements involving any Joint Venture and Public Private Partnership (PPP) between a foreign firm and a Nigerian firm, pertaining to technology acquisition are to be registered with the National Office for Technology Acquisition (NOTAP) otherwise; such contracts will not be signed by any MDA.
For the foreigners, their foreign professional certificate must be domesticated with the relevant professional bodies before being considered for any contract award, employment, or otherwise in Nigeria
3. Contract Award
Prior to the award of any contract, Nigerian counterpart staff must be engaged from the conception stage to the end of the project. Solicitation of offers, bids, or quotations for the supply or provision of goods and works documents shall forthwith obligate bidders or potential manufacturers, suppliers, contractors and consultants to provide a verifiable statement on the local content of the goods or services to be provided.
4. Capacity Development
To ensure that this new order transcends this administration, the FGN has projected the followings to ensure that generations to come are prepared and able to meet the requirements of this Order:
- The Federal Ministry of Science and Technology shall, in the next two years, establish Centres for Acquisition of Technology in the six Geopolitical Zones of the Country for the promotion of technology utilization, strengthening of technology management capability and information system to promote Research and Development in all sectors of the economy.
- MDAs are now mandated to take steps to encourage indigenous professionals in Diaspora to return home and use their expertise to develop Nigeria and promote mutually beneficial Public Private Partnership (PPP) by encouraging direct collaboration in production and manufacturing ventures of products.
- The National Information and Technology Development Agency (NITDA) is to review the status of ICT in all MDAs and standardize its effectiveness.
- The Federal Ministry of Education is to encourage the inclusion of Public Procurement Process in the Secondary school curriculum to inculcate in the students transparency, value for money and accountability.
- The Federal Government is to provide intervention funds to improve existing training programmes in Nigerian Universities, Polytechnics, Technical Schools and Trade Centres, and establish new programmes to cope with the demands of emerging technology.
- The MDAs shall work with the organized private sector (OPS), in consultation with the relevant government agencies both at the Federal and state levels to achieve sustainable personnel Development, Training of Nigerian professionals, contractors, and technocrats contractors.
5. Disqualification from an award
Thanks to this new Order, year of incorporation shall no longer be a basis for disqualifying a Nigerian company or firm from an award of contracts by MDAs. Rather, award of contracts shall be on the basis of qualification, competence and experience of the management in the execution of similar contracts.
6. Database of Experts
The National Office for Technology Acquisition and Promotion (NOTAP) is to develop, maintain and regularly update a database of Nigerians with expertise in Science, Engineering, Technology and other fields of expertise.
7. Expatriate Quota
The Order precludes the Ministry of Interior from giving visa to foreign workers whose skills are readily available in Nigeria.
Where there is need for expatriate, the Ministry of Interior shall ensure that Expatriate Quota for projects, contracts and programmes are granted in line with the provisions of the Immigration Act and other relevant laws. And in determining the ideal expatriate quota, the Ministry of Interior is to take into consideration the manpower data base of NOTAP and other related MDAs in determining the availability of local skilled manpower in Science, Technology and Innovation.
The Ministry of Interior may, where necessary, create a special immigration classification to encourage foreign expatriates, particularly from African countries, with skills that are not available in Nigeria, to reside and work in Nigeria for the purpose of sharing knowledge with Nigerians.
8. Tax Incentives
The Federal Inland Revenue Service and the Federal Ministry of Finance are to ensure that existing machine tools companies, including foundry, machine shop, forge shop, and indigenous artisans are granted tax incentives to boost production of their products.
The Federal Ministry of Finance and Federal Inland Revenue Services may also give tax Incentives by way of tax rebate to SMEs and foreign firms for the utilization of local raw materials, after same have been authenticated by the Raw Materials Research and Development Council (RMRDC).
9. Punishment for Violations of Executive Order
The punishment for violation of this Executive Order is as stipulated by the Public Service Rules and relevant laws governing Public Procurement and Professional Practice in Nigeria, etc.
This Executive order, coming at a time when crude- our major source of revenue has lost its market value is a welcomed development. The proper usage of Nigerian content and development of our science, engineering and technology may be the way to our economic prosperity. It is hoped that this Executive Order will be given full implementation.
Tell us what your opinions are about this Executive Order in the comment section below.
Good, Lawpavilion has always been in the forefront.
Good details but I need something related to Semi Govt Contracts. Is there any opportunity for contractors to contribute in these projects? and from all the world or this is only for Nigerian contractors?