The Chairman of the Committee on Government Procurement, Mr Krzysztof Trepczynski of Poland, cited extremely positive developments in regards to Moldova’s accession bid and reported that most GPA parties indicated they were ready to recommend acceptance of Moldova’s “final offer” to their authorities. He asked that the WTO Secretariat circulate a draft decision for adoption on the accession of Moldova and said all signs indicate the country’s accession could be adopted at the Committee’s meetings in June.
Moldova secured observer status in the Committee in September 2000 and submitted its first offer for accession in November 2008. The fourth and “final” offer was circulated to GPA parties on 30 January.
Mr. Trepczynski also noted positive comments from GPA parties on Ukraine’s GPA accession bid. Ukraine’s second offer was submitted in October and Kiev confirmed it will circulate shortly a third revised offer reflecting its most recent discussions with parties. On this basis, Ukraine and several GPA parties expressed hope that the country’s accession could also be concluded in the near future.
Ukraine was accepted as an observer in February 2009 and submitted its first offer in March 2014.
Parties reviewed China’s 5th revised offer at their 11 February meeting. China submitted the offer 22 December, which contains important improvements such as the reduction of thresholds for contract coverage to levels close to those of existing GPA parties, expansion of coverage to new procuring entities as well as to procurement in 5 new provinces, and expanded coverage of new services sectors and construction services.
The chairman said parties expressed due appreciation for the improvements and the efforts China put into preparing the new offer. At the same time, they said a number of significant gaps remain to be filled in the offer before China’s accession could be concluded. Emphasis was also placed on the need for China to advance work on reform of its procurement legislation.
China said it would be it difficult or impossible for it to make significant further additions to entity coverage but that it was ready to continue discussions on proposed exceptions. The chairman said both sides should not lose sight of the benefits at stake in the negotiations. He urged the Chinese delegation to go back to its capital to seek new flexibility while calling on GPA parties to remain pragmatic in their expectations and approach to the negotiations.
In regards to other pending accessions, Tajikistan announced it would soon circulate its application for accession to the GPA, together with its initial offer. The Kyrgyz Republic also reported on significant work under way in its capital which will facilitate renewal of its GPA accession negotiation.
GPA parties admitted Pakistan as an observer to the committee. Pakistan outlined progress in bringing its procurement system in line with the GPA’s principles and cited its determination to work toward accession to the Agreement, which parties strongly welcomed.
Note: Mr John Newham (Ireland) will take over as chairman of the committee from the beginning of March through to the end of 2015.
Government procurement accounts for 15-20 per cent of gross domestic product (GDP) in developed and developing countries. Only a part of this is currently covered by the Agreement on Government Procurement. The aim of the Agreement is to open up as much of government procurement as possible to international trade and competition, while ensuring appropriate transparency and a commitment to good governance.
Accession to the GPA requires, in addition to the existence of GPA-compliant national procurement legislation, the reaching of agreement on the terms of participation by each acceding WTO member. This is achieved through negotiations with the existing parties to the Agreement.
The schedule of each party setting out terms of participation contains several annexes which define the party’s commitment with respect to four dimensions of coverage:
- the procuring entities covered by the Agreement
- the goods, services and construction services covered by the Agreement
- the threshold values above which procurement activities are covered by the Agreement
- exceptions to the coverage.
Recently, the GPA was revised to modernize certain aspects of its rules and to expand its scope. The revised version of the Agreement came into force last April.
The GPA is a plurilateral agreement within the framework of the WTO, meaning that not all WTO members are parties to the Agreement. Currently, it covers 43 WTO members: Armenia; Canada; the European Union, with its 28 member states; Hong Kong, China; Iceland; Israel; Japan; Korea; Liechtenstein; the Kingdom of the Netherlands with respect to Aruba; Norway; Singapore; Switzerland; Chinese Taipei and the United States. The accession terms of Montenegro and New Zealand were approved on 29 October, 2014 and are awaiting domestic ratification.
Other WTO members that have started the process of acceding to the Agreement on Government Procurement are Albania, China, Georgia, Jordan, the Kyrgyz Republic, Moldova, Oman and Ukraine. A further five members — the Former Yugoslav Republic of, Mongolia, the Russian Federation, Saudi Arabia and Tajikistan — have provisions regarding accession to the Agreement in their respective protocols of accession to the WTO.