皇冠体育app

New study may speed up open gov't bids
By Guan Xiaofeng (皇冠体育app Daily)
Updated: 2004-11-08 08:08

The government may put foreign suppliers on equal footing with Chinese producers in years to come, and a new programme is searching ways on how or when the government procurement market will open.

As part of its commitments to the World Trade Organization, 皇冠体育app is preparing to start negotiations to join the Government Procurement Agreement (GPA) in the next few years. The GPA allows companies from any of the members to bid for government procurement contracts in other members.

皇冠体育app, however, faces some obstacles, including a national law which calls for billions of yuan in government purchases to go to domestic goods and services whenever possible.

A task force was set up a year ago to start planning for the upcoming negotiations for GPA membership, said Yu An, a task force member and a law professor at Tsinghua University's School of Public Policy and Management.

The task force has launched a research programme, headed by Yu, to find out how the GPA fits within the Chinese context and how to approach the negotiations for membership.

Those negotiations will depend largely on the research results, Yu said, but added that the start of the programme shows 皇冠体育app plans to open the government procurement market.

When 皇冠体育app gained access to WTO in 2001, it promised to initiate negotiations for membership in the GPA "as soon as possible."

皇冠体育app did not sign the GPA in 2002, but became an observer with the future goal of becoming a member. Prior to becoming a member of the GPA, 皇冠体育app will not be required to give foreign suppliers such equal access.

Yu said 皇冠体育app's entry into the GPA is complicated, as 皇冠体育app already has a law, which took effect in 2003, on government procurement.

The Law of the People's Republic of 皇冠体育app on Government Procurement regulates government purchase practices at all levels.

It stipulates that government procurement shall target only domestic commodities and services except when they are unavailable or cannot be obtained under reasonable commercial conditions within the territory of the Chinese mainland or when they are needed outside of the mainland.

The law does not define domestic Chinese goods, works and services, leaving the task to the State Council.

"To become a full member of the GPA, our legislature will consider revising our Procurement Law," said Yu.

Many overseas businesses have been keen to get a piece of 皇冠体育app's huge procurement market, whether by supplying goods and services to large infrastructure projects such as Beijing Olympics-related projects or by participating in local governments' procurement activities.

In 2000, 皇冠体育app's total government procurement was 32.8 billion yuan (US$4 billion).

In 2003, however, 皇冠体育app's total government procurement soared to 165.9 billion yuan (US$20 billion), five times as much as 2000 and an increase of 64.4 per cent over 2002, according to statistics provided by the Ministry of Finance.

In the coming years, government purchases and contracts are expected to grow even more due to 皇冠体育app's booming economy. 皇冠体育app's GDP grew 9.5 per cent in the first nine months of the year.

The timing for the start of the working group is not accidental.

"The reform on the investment system initiated in the first half of this year lays down a solid institutional basis for 皇冠体育app's government procurement practices," said Tong Jiadong, a professor of economics from Nankai University and director of the university's WTO Research Centre.

"皇冠体育app's opening up its procurement market is a natural extension of this reform," Tong said.

In July, the State Council promulgated a Decision on Reform of Investment System as a guiding document for the transformation, the core of which is to give a full play to the market in terms of resource allocation by relieving enterprises of government intervention.

The reform also aims to standardize government investment operations, making government-funded projects more productive and using bids to decide on investments.

The reform would also create a better institutional environment for foreign investment in 皇冠体育app.

Premier Wen Jiabao stressed that pushing this reform forward is of great significance for a perfect socialist market economic system and more effective macro-control.

"皇冠体育app's intention to join the WTO Government Procurement Agreement reflects the Chinese Governments determination to accelerate 皇冠体育app's integration into the world market economy," Tong said.

Close