Government Procurement Agreement Countries: Understanding the Basics
Government procurement is the acquisition of goods and services by federal, state, and local governments. Governments spend a significant amount of money on procurement, which makes it an essential tool for driving economic growth and development. The World Trade Organization (WTO) aims to ensure that government procurement is carried out in a fair, transparent, and non-discriminatory manner. One of the ways to achieve this is by signing the Government Procurement Agreement (GPA).
What is the Government Procurement Agreement?
The GPA is an international treaty that allows businesses to compete for government contracts in signatory countries. It commits participating countries to open their public procurement markets to foreign suppliers by providing equal treatment to all bidders, regardless of their nationality.
The GPA covers the procurement of goods, services, and construction work by public entities such as central government ministries, departments, and agencies, as well as regional and local government bodies. The agreement does not apply to procurement by the private sector or to specific sectors such as defense.
Which Countries are Covered by the GPA?
The GPA currently has 20 parties, including the European Union, which comprises 28 member states. Other parties are Australia, Canada, China, Hong Kong (China), Iceland, Israel, Japan, Liechtenstein, Montenegro, New Zealand, Norway, Singapore, South Korea, Switzerland, Chinese Taipei, Ukraine, and the United States.
The agreement covers a significant portion of the global economy. GPA parties account for over $1.7 trillion annually in government procurement, which is about 47 percent of the global market.
Benefits of the GPA
The GPA provides several benefits to businesses and governments. Firstly, it promotes competition by opening up public procurement markets to foreign bidders. This increases the number of potential suppliers, which can lead to lower prices, better products, and services, and increased innovation.
Secondly, the agreement provides transparency and fairness in government procurement. It ensures that all bidders are treated equally, regardless of their nationality, and that procurement procedures are clear and transparent.
Lastly, the GPA helps to promote good governance by reducing the risk of corruption in public procurement. It provides a framework for ensuring that procurement decisions are based on merit and value for money.
The Government Procurement Agreement is an international treaty that promotes fair, transparent, and non-discriminatory competition in government procurement. It covers a significant portion of the global economy and provides several benefits to businesses and governments. By signing the GPA, countries commit to opening up their public procurement markets to foreign suppliers, increasing competition, and promoting good governance.