Preference to Local Technology for Government Procurement – Strategic Initiative under Government ICT Roadmap.

The issue of government procurement for local products is a popular issue. This have been around for many years. You may have heard many comments and frustrations from local entrepreneurs.

” Why is my locally produced products not accepted by the government/GLC, yet my products are selling well overseas?”

” Why is my products financed by the government grant, yet when buying they buy foreign products?”

” Why the specification is like asking for Ferrari, knowing very well that the real specification required can  be handled by proton?”

The government procurement need to be tuned to support local IP. The government need to ensure preference is given to locally produced ICT products. The way it is done may result in success or failure:

1. If the GLC is given incentive to purchase local, such as tax deduction incentive or given matching grant, this could work.

2. If GLC is only given stick, probably it will not work. The GLC will always revert back to responsibility to shareholder tactic.

3. If the government managers are required to report local products procurement and foreign products procurement as part of their KPI, this could work. Incentive are given for those procuring local.

4. There must be feedback mechanism that will highlight the unfair tactic by the government managers. For example  specifying for high speed of 300 km/h when the real required speed is 120km/hr where most local can comply.

5. The availability of local products are published that government managers cannot claim that they are not aware  of the availability of local products, thus buying foreign.

According to the government target, the ICT contribution to GNI is targeted  to increase to 17%  in 2020. It is at 9.8% in 2010  This is almost impossible to achieve if government do not buy local products. We cannot expect our entrepreneurs to bring back billions of orders overseas while our own government buys foreign. We cannot expect ICT contribution to go up to 17% by depending on government spending, worse still if government spending is on foreign products.

I believe the local preference and go global initiative must go hand in hand. This will increase the chance that we are going to see the 17% target is achieved. Marketing initiative also need to be aligned. The relevant agencies need to align to this strategic initiative. Then we have fighting chance.

Your comment please.






About Ir. Aziz Ismail 66 Articles
Ir.Aziz Ismail is very active member of ICT economic cluster in Malaysia. As the (Past) President of TeAM ( Technopreneur Association of Malaysia) and Vice President II NEF ( Bumiputera ICT Entrepreneur Association) he is deeply involved in many strategies, activities and issues related to the industry. He is also a Director of Majlis Tindakan Ekonomi Melayu, an umbrella organisation of 47 national NGOs with 500,000 entrepreneur members.

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