THE HIGH LEVEL FORUM ON PUBLIC PROCUREMENT REFORMS IN AFRICA

1. THE HIGH LEVEL FORUM ON PUBLIC PROCUREMENT REFORMS IN AFRICA Progress, Challenges, and Lessons Learnt from Reforming Public Procurement Systems in Africa Vinay Sharma Procurement and Fiduciary Services Department

2. Since the end of the 1980s, most African Countries have embarked on reforming public procurement systems: • As part of the global reform of pubic sector financial management; and • Also from need to improve governance and ensure delivery of development results Background

3. Anglophone countries have developed and enacted laws following UNCITRAL model law Francophone countries have adopted public procurement code by reference to French legal framework and IFI models There has been crucial role played by Regional Organizations – COMESA and WAEMU in developing and adopting regional directives and models Legislative and Regulatory Framework 3

4. However Government’s efforts at compliance with internationally accepted practices have been hindered by: • Loopholes • Exclusions from the scope of the laws • Deficiencies in implementation • Irregular practices Procurement as a vehicle for regional integration has also been hindered by discrepancies between local economies Legislative and Regulatory Framework 4

5. No linkages between procurement management and PFM Systems, except for few countries Limited use of E-procurement technologies Annual procurement planning even when imposed by legislation, is not properly executed leading to delays in payment and weakening participation of private sector in the reform process Institutional Framework and Management Capacity 5

6. At the Institutional Level: Principle of separation of functions now generally recognized – but framework mostly lacks clarity and independence Establishment of institutions in charge of monitoring and regulating procurement has been hampered by conflict of interests, control by the executive branch and poor human and financial capacity Institutional Framework and Management Capacity 6

7. At the Institutional Level: The absence of capacity building strategies has led to development of unrealistic processes of decentralization The procurement function has also suffered from • Lack of status, • Lack of motivation; and • High levels of rotation of procurement specialists have affected the stability of the system. Institutional Framework and Management Capacity 7

8. Adhesion of the private sector to the reform process has generally been reduced due to many factors: • The absence of a proper legal framework favoring the development of SMEs in public bids • Various obstacles such as access to credit; delayed payments • Unfair competition from public companies, international majors and even public officials Procurement Operations and Market Practices 8

9. Review shows that: • The public procurement control function has not been properly targeted leading to poor location of “watchdogs” • Review and appeal mechanisms suffer from a lack of independence and the fear of private sector to launch complaints • No or limited legal framework for civil society to intervene at the various levels of the procurement chain or in the management of contracts • Poor record of proceedings and sanctions • Proposed responses for detecting fraud and corruption totally inadequate to compact the level of corruption reached Integrity and Transparence 9

10. The limited results obtained through reform have been a consequence of lack of political will Reform has also been hampered by the development of corruption which has reduced the impact of any efforts Insufficient recognition of the links with other components of the reform programme such as PFM and Audit which prevented the prioritization of the reform programme to address deficiencies leading into question the assessment methodologies and the pertinence of their indicators Integrity and Transparence 10

11. The lessons learnt so far, point to the fact that: • The public procurement system should be analyzed from a more global perspective, taking into consideration the broader political and economical context of the reform – the reform process was probably too focused on legislative reforms • Serious mismanagement of public finances have impacted on public procurement as a tool for development, which has been reduced by: • The impoverishment of the African continent • The importance of domestic and international debts; and • The abuses in the exploitation of natural resources Identification of Key Reform Issues 11

12. The lessons learnt so far, point to the fact that: The lack of success with public procurement has transmitted bad signals for the overall legitimacy of the procurement system; The corruption factor is a systemic challenge; and 5. The capacities of the procurement system should have been one of the priorities of the reform process. Identification of Key Reform Issues 12

13. The new performance agenda should comprise: The taking into consideration of interrelationships between all the components of the reform and country specificities Integration of reforms within a more global an comprehensive framework linked to the new governance agenda Incorporation of powerful management systems in which procurement, budget and finance are interconnected Capacity building strategies used as a tool for sequencing of reforms The Way Forward - A New Public Procurement Performance Agenda 13

14. The new performance agenda should comprise: Donor coordination and coordination between donors and government is key to the reform process The control function should be considered as a production function Specific tool – a mechanism for systematic project follow-up The Way Forward - A New Public Procurement Performance Agenda 14