Agreement on Government Procurement Parties

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• Jan 23, 2023
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When it comes to international trade, one of the most important agreements is the Agreement on Government Procurement Parties (GPA). This agreement governs the procurement of goods and services by governments of member countries, ensuring that the process is transparent, fair, and open to competition. In this article, we will take a closer look at the GPA, what it entails, and its benefits.

What is the Agreement on Government Procurement Parties?

The GPA is a plurilateral agreement, meaning that it is an agreement between a group of countries rather than a global agreement. It was negotiated under the auspices of the World Trade Organization (WTO) and entered into force in 1981. The agreement aims to promote transparency, fairness, and non-discrimination in government procurement, as well as to open up government procurement markets to competition.

Currently, there are 20 GPA parties, including the United States, the European Union, Japan, Canada, South Korea, and Hong Kong. Collectively, these parties represent about 47% of global trade in government procurement.

What does the GPA entail?

The GPA sets out rules and guidelines for government procurement, including the process of bidding, the evaluation of bids, and the awarding of contracts. It applies to procurement by central government entities such as ministries and agencies, as well as to sub-central entities such as local governments and state-owned enterprises.

Under the GPA, government entities must publish procurement notices and make them available to companies from all member countries. They must also evaluate bids on the basis of objective and transparent criteria and award contracts to the most qualified bidder. Additionally, the GPA prohibits discrimination against foreign bidders, ensuring that all companies have an equal chance to compete for government contracts.

What are the benefits of the GPA?

The GPA provides several benefits to its parties and to the global economy more broadly. First, it promotes transparency and fairness in government procurement, which helps to prevent corruption and ensure that taxpayers get value for money. Second, it opens up government procurement markets to competition, which encourages innovation and efficiency and can lower costs for governments. Third, it fosters stronger trade relationships between GPA parties, as they have access to each other`s government procurement markets on equal terms.

For companies, the GPA provides access to government procurement markets that might otherwise be closed off to foreign bidders. This can create new business opportunities and help companies to diversify their revenue streams. Additionally, the GPA provides a level playing field for companies, reducing the risk of discrimination or unfair treatment in government procurement processes.

In conclusion, the Agreement on Government Procurement Parties is a valuable agreement that promotes transparency, fairness, and non-discrimination in government procurement. Its parties benefit from access to new markets and stronger trade relationships, while companies benefit from increased business opportunities and a level playing field. As such, the GPA represents an important step towards a more open and fair global economy.