Government Procurement: International Trade Impact | European Commission Insights

1. Government Procurement - a regional and international perspective Georg Roebling European Commission DG Trade, 14 June 2005

2. Government Procurement basics • GP market: • World : 6,000 billion $ • 70% in public works • High risks of corruption • Opening-up brings 30% savings • Better Value (Quality / Price) for Money • Key element of competitiveness European Commission - DG Trade

3. Government Procurement Basics II • Government procurement has over the last 10 – 15 years become a bread and butter issue in international trade talks AND developmental policies. • Recognition: in-transparent and closed procurement markets are a key hindrance to economic development and growth European Commission - DG Trade

4. The WTO Agreement on Government Procurement (GPA) • Government procurement regulations have been kept out of key market-access rules undertaken by countries under both the GATT and GATS • Growing awareness of the trade-restrictive effects of discriminatory policies lead to the first GPA signed in 1979 (Tokyo round), greatly improved in 1994 (Uruguay round) European Commission - DG Trade

5. Canada, the European Union, Hong Kong China, Iceland, Israel, Japan, Korea, Liechtenstein, the Kingdom of the Netherlands with respect to Aruba, Norway, Singapore, Switzerland, the United States The 13 WTO member countries parties to the GPA European Commission - DG Trade

6. GPA Rules:, non-discrimination, national treatment and transparency • Each Party does not discriminate and give products, services and suppliers of any other Party « no less favourable » treatment than given domestically • Each Party do not discriminate/treat less-favourably locally-established supplier on basis of degree of affiliation or ownership, or on country of production of good or service • Transparency of laws, regulations, procedures and practices European Commission - DG Trade

7. Scope and Coverage • The GPA applies to tenders made by public entities above specific thresholds for goods, services and supplies (for the CE): • 154,000 € for central government purchases of goods and services; • 237,000 € for purchases of goods and services by sub-central government entities; • 474,000 € for goods and services for utilities; • 5,924,000 € for construction contracts. European Commission - DG Trade

8. Towards GPA III • New rules and procedures: simpler, easier to apply, and more DCs-friendly • Increase coverage by: • Bringing in new entities, new sectors, new services • Eliminating numerous exceptions and country specifics European Commission - DG Trade

9. Special rules for Developing Countries • GPA recognizes development needs of DCs and allows S&DT • Transitional measures with regard to: • Market access commitments (price preference, offset, higher thresholds, sectors exclusion) • Implementation of procedures European Commission - DG Trade

10. A case for a “Regional Procurement Agreement”? • Limited to 1 region; opens markets to suppliers from (only) within that region • Content: Procedural rules; transparency, non-discrimination, etc. • Effective tool for domestic economic policy AND a stepping stone for subsequent adherence to WTO procurement regime (same principles) European Commission - DG Trade

11. Thank You for your attention ! European Commission - DG Trade