Keynote speech by ADB Vice-President Bruce Davis at the Inaugural Conference of Asia Pacific Public Electronic Procurement Network held 5 October 2015 in ADB headquarters, Manila, Philippines.
Good morning to you all and welcome to Manila.
It is my pleasure to open the inaugural conference of the Asia Pacific Public Electronic Procurement Network which aims to build the capacity of countries in Asia and the Pacific in implementing e-Government Procurement and to enhance the transparency of public procurement.
I would like to acknowledge the attendance of all the speakers and delegates who have travelled to share their experience and good practices over the next couple of days.
Government procurement typically accounts for about 15-20% of a country’s Gross Domestic Product (GDP). Even a small improvement in procurement performance can result in significant savings for the Government and improve efficiency of public sector management. The adoption of technology is a key measure to enhance efficiency and transparency in Government Procurement. In Asia, the implementation of e-Government Procurement (e-GP) systems started over a decade ago with eGP solutions in Malaysia and in Republic of Korea.
Strengthening public procurement is a key concern for ADB as we work with our member countries on development programs, many of which are linked to specific procurement packages.
The vast amounts of money flowing through the government procurement system can create an improper incentive, when procurement systems are weak, not integrated and lack transparency and accountability. European research shows that “proper use of e-Procurement helps reduce costs, improve efficiency and destroy barriers that ultimately result in savings for the taxpayer”.
In Asia and the Pacific region, ADB has actively supported procurement reform initiatives, providing 9 Technical Assistance projects, facilitating knowledge transfer through sponsoring a previous regional e-government procurement conference in 2011, commissioning 4 Case studies on eGP implementation, e- GP surveys and the publication of an E-Government Procurement Handbook. ADB is also a founding member of the Multilateral Development Banks Working Group on electronic procurement.
ADB places significant emphasis on the use of technology to drive more transparent and innovative development solutions as well as greater efficiency in project implementation. Procurement is at the center of such initiatives as it directly impacts service delivery to the end beneficiaries, and therefore outcomes of the projects financed by ADB. We have identified support to e- Procurement as one of the areas to help ADB meet the challenges of transforming Asia and Pacific.
Encouraging the adoption of Information and Communication Technology (ICT) amongst DMC’s to streamline business processes and reduce transaction costs is also a key strategic priority for the ADB.
ADB has recently developed a comprehensive e-GP Strategy to promote the adoption of e-GP. Key outcomes envisaged in the eGP Strategy are to:
- Increase adoption of e-GP systems in ADB financed projects
- Actively support and guide Developing Member Countries (DMC) in implementation of e-GP
- Define indicators to measure procurement performance based on spend data recorded in e-GP systems, and
- Facilitate regional dialogue on e-GP to enable knowledge exchange
This conference has grown from a seed sown at the 2011 Asia-Pacific e-GP conference in Indonesia. The need to exchange knowledge, create and add value through collaboration and cooperation was recognized then.
We wish also to acknowledge the catalytic role of our joint Secretariat partner – The Public Procurement Service of Republic of Korea in working with us to take the lead in organizing the network.
In 2011, ADB conducted a baseline survey of its member countries to take stock of e-GP implementation status in the Asia and Pacific region. At that time, 11 out of the 27 surveyed countries had embarked on implementation of e-GP. In 2014, ADB completed a survey of 29 countries in the region taking stock of e-GP development. This follow up survey shows that 19 out of the 29 surveyed countries had initiated implementation of e-GP.
The establishment of an Asia Pacific Public Electronic Procurement Network is a key initiative by the ADB to encourage adoption of e-GP. This seeks to strengthen the ability of public procurement agencies to implement e-GP solutions through knowledge sharing, cooperation and collaboration.
In the next couple of days, we will learn from our member countries on challenges of implementing eGP solutions and rewards of achieving efficiency, effectiveness, transparency and public trust gains.
Electronic procurement has vast potential for the integration of procurement markets, contributing to increased levels of trade and employment. It shortens distances, provides equal access to information about tenders and encourages wide participation. It is true in the context of a single country, e.g. we have seen evidence of wider supplier participation in the Philippines and India. It becomes even more relevant in the context of Trade agreements, such as the WTO GPA and the Trans-Pacific Partnership Agreement (TPPA), currently being negotiated.
For this conference, ADB has reached out to the World Trade Organization to inform our member countries on recent revisions of the WTO Government Procurement Agreement specifically addressing electronic trade. I am looking forward to discussions on policy implications for the 11 ADB Member countries in respect to their obligations as signatories of WTO GPA. At present, 10 more WTO members are in the process of acceding. Among those are 5 ADB member countries. Five other WTO members including 1 ADB member have undertaken commitments, in their WTO accession protocols, to initiate accession to the GPA.
ADB is also starting an exciting pilot of shared electronic procurement solution for countries which has not yet tried using eGP. This pilot is currently tendered out and 3 out of 4 shortlisted firms will be on hand tomorrow to do the live demonstration of their “off-the-shelf solution” and take your questions. One of the shortlisted firms will join the demonstration remotely through video- conference facility. We hope that this session will provide good insight in different business models of Software-as-service provisions.
Though procurement principles are broadly the same, the manner of their implementation tends to vary from one country to another and depend on the level of ICT development, legal framework, size of economy and market conditions. For example, publishing estimated value of a contract in the tender notice would be mandatory in some countries whereas in others it could be optional or entirely disallowed.
An e-GP system offered as a unified platform for several countries should be adequately flexible to address different requirements yet standardized at the general level for achieving transparency, fairness, efficiency and effectiveness. At the end of this conference, we would like to formally establish the Asia Pacific Public Electronic Procurement Network as a leading eGP community of practice.
We plan to host network conferences annually. In between conferences, we would like to keep collaboration going through work in thematic working groups and through an online knowledge management portal.
Let me conclude by thanking the ADB team, development partners and delegates for your enthusiastic commitment to improving public procurement in your respective countries.
This conference and other events to be sponsored by the Network will provide the opportunity to speed up the public procurement transformation journey from a transactional to a strategic function of the government. I encourage you to form lasting working relationships with your colleagues throughout the region.
I hope you will find next two days in Manila productive and professionally stimulating.
Thank you very much.