Ethiopia

• Issue: Procurement laws and regulations contain inconsistencies across different levels of government and sectors, leading to confusion and inefficiencies.
• Recommendations:
  • Harmonize procurement laws and regulations across federal and regional levels.
  • Establish a centralized online repository for procurement-related legal documents​.

Gaps in Sustainable Public Procurement (SPP) Policies

• Issue: Ethiopia lacks a comprehensive Sustainable Public Procurement (SPP) strategy, and existing legal provisions provide only high-level guidance.
• Recommendations:
  • Develop a national SPP strategy aligned with broader sustainability policies.
  • Provide detailed guidelines for integrating life-cycle costing and sustainability criteria into procurement decisions​.

Weak Regulation of State-Owned Enterprises (SOEs) in Procurement

• Issue: The procurement of SOEs is not adequately covered in the legal framework, creating risks of non-competitive practices.
• Recommendations:
  • Extend procurement regulations to explicitly cover SOEs and subject them to competitive procedures​.

Limited Capacity of Procurement Oversight Bodies

• Issue: The Public Procurement and Property Authority (PPPA) lacks sufficient resources, and its responsibilities overlap with the Ministry of Finance (MoF), leading to inefficiencies.
• Recommendations:
  • Strengthen the capacity of PPPA through increased staffing and financial resources.
  • Clarify the mandates of the PPPA and MoF to avoid duplication of responsibilities​.

Weak Procurement Planning and Market Research

• Issue: Procurement planning is not fully integrated with budget execution, and market analysis is limited.
• Recommendations:
  • Establish a standardized procurement planning methodology linked to budget cycles.
  • Conduct regular market assessments to align procurement planning with supplier capacity​.

Insufficient Sector-Specific Procurement Guidelines

• Issue: The water sector lacks customized procurement guidelines, resulting in inefficiencies in contract management and execution.
• Recommendations:
  • Develop sector-specific procurement manuals for the water sector.
  • Establish procurement guidelines tailored to the unique requirements of infrastructure and construction projects​.

Excessive Use of Non-Competitive Procurement Methods

• Issue: There is a high reliance on direct awards and other non-competitive procurement methods, reducing efficiency and value for money.
• Recommendations:
  • Enforce stricter controls on justifications for direct awards.
  • Promote competitive procurement practices through enhanced training and monitoring​.

Limited Private Sector Participation in Procurement

• Issue: The private sector, particularly small and medium enterprises (SMEs), faces barriers to participating in public procurement, including foreign currency shortages and payment delays.
• Recommendations:
  • Address systemic issues such as payment delays and improve access to foreign currency for suppliers.
  • Enhance dialogue between the private sector and procurement authorities to build trust and improve participation​.

Lack of Performance Monitoring for Contractors and Consultants

• Issue: There is no structured system to evaluate and monitor the performance of contractors and consultants in public procurement.
• Recommendations:
  • Introduce a performance evaluation system for suppliers and consultants.
  • Develop a contractor rating system based on quality, timeliness, and compliance​.

Weak Procurement Audit and Oversight Mechanisms

• Issue: Procurement audits are not systematically enforced, and corrective actions are rarely implemented.
• Recommendations:
  • Strengthen audit functions and ensure timely enforcement of corrective actions.
  • Improve coordination between audit institutions and procurement regulators​.

Limited Transparency in Procurement Data and Decision-Making

• Issue: Procurement information, including contract awards, is not systematically published or easily accessible.
• Recommendations:
  • Require mandatory publication of procurement data through an online portal.
  • Improve public access to procurement decisions to enhance transparency and accountability​.

High Risk of Corruption in Public Procurement

• Issue: Corruption risks in procurement include poor-quality construction, inflated costs, and lack of enforcement of anti-corruption measures.
• Recommendations:
  • Strengthen anti-corruption enforcement and increase transparency in contract execution.
  • Enhance whistleblower protections and establish clear mechanisms for reporting procurement fraud​.