Purchasing locally produced goods and materials could be up to 40 percent cheaper than those imported from overseas markets if the imputed value of logistics and transportation costs are included, said a senior official of Qatar Development Bank (QDB) referring findings of several studies.
“We have conducted several studies to understand the cost-benefit analysis of producing locally and importing the same items from outside markets for many goods. From the studies we found that companies can save up to 30-40 percent when they buy locally produced goods,” Abdulaziz Al Mannai (pictured), Executive Director of Advisory Services at QDB told The Peninsula.
Explaining it further, Al Mannai added: “Apparently prices of some goods in Qatar may be higher than the prices of similar items, or their close substitutes, in the neighbouring countries, but if a company sources the items from other GCC countries markets it will incur a lot of extra costs, such transportation, logistics, customs, storage, handling and other costs.”
He noted that with the opening of iconic Hamad Port and start of direct shipping lines with many strategic ports in some of Qatar’s major trading partners, such as India, Pakistan and Turkey, imports of raw materials and goods for the construction and manufacturing sectors are becoming much more cheaper than the prices Qatari customers traditionally afforded by sourcing them from neighbouring countries.
“Throughout our various event and meetings and exhibitions, we have found that several companies and government agencies are very serious about procuring local products. For instance, Ashghal (Public Works Authority) and Kahramaa (Qatar General Electricity and Water Corporation) have particularly shown overwhelming response. They are very committed to the aims and objectives of the Government Procurement and Contracting Law, and other initiatives of QDB to support local SMEs,” said Al Mannai.
QDB in the recent past few months alone organised a series of events to support the development of indigenous industries, empower the local private sector and diversify the economy, including exhibitions for home-based products and ‘Made in Qatar’ expo, and several editions of ‘Buy Local Products’ exhibitions.
Kahramaa, which partnered with QDB to host the third edition of ‘Buy Local Products’ exhibitions announced that it has already spent QR5bn to promote the local products and similar or more amount will be invested in this sector in the next five years.
Kahramaa is keen to play its national role as the country’s premier energy and water services provider.
QDB will also be hosting the third-edition of Government Procurement and Contracting Conference and Exhibition (Moushtarayat 2018) from April 23 to 25.
The upcoming event is expected to offer huge business opportunities for SMEs, which is estimated to be to the tune of billions of dollars. The previous two editions of Moushtarayat expo offered contract opportunities for SMEs with an estimated cumulative value of over QR5.5bn.
QDB, as part of its long terms strategy in line with Qatar National Vision 2030, is committed to providing all the needful support to local companies, especially the SMEs and startups, to achieve economic diversification.
The government agencies in Qatar, including the QDB, also encourage overseas suppliers and companies to find local representatives and establish partnership to ensure that they get the right kind of support.
Industry analysts suggest that establishing local partnership can also be helpful for participating in government tenders as most of them are announced in Arabic languages, except Ashghal and Kahramaa tenders.
