This video lays out Domestic Preference and the types of conditions for when borrowers can introduce it into the bidding process.


What is domestic preference?

Domestic preference refers to the margin of preference given to local companies or individuals, and to locally made products , in the procurement of goods, works, consulting services, and nonconsulting services for ADB-financed projects.

If allowed by ADB, the borrower indicates in the bidding documents the margin of preference that will be granted to qualified local suppliers and service providers when evaluating bids.

What are the benefits of domestic preference?

Domestic preference can support capacity development of private sector firms as well as individual consultants in the borrower’s home country, which may provide economic and social benefits such as increased jobs, income, and tax revenues for developing member countries .

Domestic preference affords borrowers flexibility, but its use must always align with ADB’s core procurement principles and with the goal of delivering value to local communities.

How is domestic preference applied to ADB projects?

For goods and works, a margin of preference in terms of percentage points is granted to local suppliers during bid evaluation.

For consulting services, ADB revised its criteria for evaluation, which now includes the “use of national experts for key positions,” to allow the borrower to evaluate consulting firms based on the amount of local expertise or output that will go into the project.

ADB’s Guidance Note provides more information on Domestic Preference and how it can be applied in procurement.