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Ethiopia abolish bidding of scrap metal

The government of Ethiopia is set to abolish metal industries having to go through bidding processes to source the products from government institutions.

The Ministry of Finance ordered that scrap metal products will be allocated at fed agencies citing critical foreign currency shortages for not enabling the industries to import inputs as needed. Shortage of foreign currency locally and drastic increase of metal prices in the global market had crippled the sector, leading to highest prices and scarcity to the end users.

In a circular the Ministry wrote to 78 government institutions on September 22, 2022, prices of scrap metals had been revised since it was previously set last June. Three months ago, steel scrap was to be sold at a price of 29 Birr, cast iron scrap 21 birr, aluminum scrap 108 birr, vehicle parts 21 birr and used vehicles for 31 birr a kilogram.

Revision of prices of scrap metal

Due to claims that the prices are lower for direct provision of the scrap metal, the Finance Ministry revised the prices of scrap metal. Accordingly, the steel scrap will be sold at a price of 64 birr, cast iron scrap 51.75 birr, aluminum scrap 120 birr, vehicle parts 51.25 birr and used vehicles for 51.25 birr a kilogram.

Signed by the Minister, Ahmed Shide, the circular addresses several offices including Office of the Prime Minister, 40 federal universities, and 21 ministry offices with the exclusion of Ministry of Defense. Last May, Takele Uma, Minister of Mines, discussed with officials of Ministry of Defense and institutions reporting to it.

The development had been communicated to the Ministry of Mines and Public Procurement & Property Authority, the two offices that will be facilitating the sale of items from government offices to the industries. The scrap will be allocated to the industries with the responsibility bestowed on the Ministry of Mines. For that and more issues, the Ministry is conducting meetings with management of the industries on Saturday, September 24, 2022.

The Authority on its part has been conducting studies and assisting in the drafting of pricing documents for the metal scraps available at government offices, according to Setegn Gelan, communications director at the Authority.

“The macro team had decided after the Finance Ministry proposed the idea. The industries had to go through the bidding processes to buy the scrap inputs,” Setegn said.

 

 

 

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