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Daniel Ivarsson, SIGMA expert, third regional conference on public procurement for ENP East countries, Tbilisi, 6 November 2019


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Presentation by Daniel Ivarsson, SIGMA expert, on access to procurement for small and medium sized enterprises in the ENP East region – an overview, at the third regional conference on public procurement for ENP East countries, Tbilisi, 6-7 November 2019.

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Daniel Ivarsson, SIGMA expert, third regional conference on public procurement for ENP East countries, Tbilisi, 6 November 2019

  1. 1. © OECD 3rd regional conference on public procurement for ENP East countries Access to procurement for small and medium sized enterprises in the ENP East region – an overview Daniel Ivarsson, SIGMA expert Tbilisi, 6-7 November 2019
  2. 2. SME Policy Index 2020 • Outcome of Small Business Act for Europe assessments in EaP countries during 2019 • Part of EU4Business: From Policies to Action • Benchmarking tool to monitor and evaluate progress in SME support policies • Identifies strengths and weaknesses, allows comparisons, gives evidence base for reforms • Covers responsive government, access to finance, access to markets, entrepreneurship, productivity, and business environment 1
  3. 3. Pillar D: Access to markets – section on public procurement • Regional trends and developments since 2016; country chapters • Regulatory and institutional framework • E-procurement • Contracting authorities • Supply markets / economic operators • Challenges and recommendations 2
  4. 4. Regulatory and institutional framework • On-going alignement with EU standards in Georgia, Moldova, Ukraine, recent developments also in Armenia and Azerbaijan; still gaps in SME provisions • Institutional capacity still often weak and developing slowly; provision of training and guidance improving, but from a low level; monitoring remains ineffective 3
  5. 5. E-procurement •Expanding use of e-procurement, with systems in place or (AZ) being introduced •Potential of e-procurement to support SME participation developing only slowly; restrictive or biased specifications and qualification requirements a disincentive •Award criteria mostly limited to price; sequence of steps not optimal 4
  6. 6. Contracting authorities •Knowledge, skills and experience of contracting authorities and their staff often limited, especially with regard to support for SME participation, but improving •Practices improving but only slowly; tendencies remain to circumvent or avoid procedures; selection and award criteria sometimes badly defined and applied; frequent shortcomings in planning, preparation and contract management 5
  7. 7. Supply markets / economic operators •Disillusions after initial enthusiasm about e- procurement; low trust in the system •Lack of skills and resources for participation •Competitive behaviour too often based on relations with officials rather than on quality, price, conditions •Market structure issues remain: too many or too few, too strong or too weak competitors 6
  8. 8. Main developments: Armenia New public procurement law adopted late 2016 •Alignment with EU Directives, incl. regarding SMEs •New government, new policies since mid- 2018 On-going development of e-procurement •Revised system in place since 2018 •Increasing availability of information and training 7
  9. 9. Challenges: Armenia •Encourage use of other award criteria than price, make selection criteria proportionate •More competitive procurement: open up e- procurement, reduce use of direct agreement •Improve data quality, access, and analysis •Improve the independence of the review body 8
  10. 10. Main developments: Azerbaijan Public procurement law amended late 2018 •Extensive e-procurement provisions introduced •Measures to raise transparency and improve integrity On-going development of e-procurement •System development is being carried out •Strong time pressure, little transparency 9
  11. 11. Challenges: Azerbaijan •Make SME related policies and practices more realistic and useful •Reduce the share of procurement not following PPL principles and procedures •Improve data quality, access, and analysis •Ensure the success of e-procurement development 10
  12. 12. Main developments: Belarus Amendments to the public procurement law •Explicit provisions for division into lots for favouring SME participation, for items on a list •Shorter time limits for submission •Shorter time limits for complaints Increased penetration of e-procurement •Comprehensive publication of plans, notices •Two e-auction sites up and running 11
  13. 13. Challenges: Belarus •Widen the range of measures in favour of SMEs, e.g. requiring timely payments •Review the suitability of the new time limits •Simplify and clarify procedures, make procedures, requirements and criteria more proportionate to SME capabilities •Enhance data quality and analysis to allow evidence based improvements of regulations and practices 12
  14. 14. Main developments: Georgia Revisions to the public procurement law •Successive alignment with EU Directives, including regarding SMEs •Attention to the review of complaints On-going development of e-procurement •Widening range of procedures available •Increasing availability of information and training 13
  15. 15. Challenges: Georgia •Reduce procurement falling outside the PPL, raise participation levels •Simplify and harmonise e-procurement procedures •Raise skills and integrity of contracting authorities and improve their practices •Improve monitoring and review, raise the effectiveness of enforcement 14
  16. 16. Main developments: Moldova New public procurement law since 1 May 2016 •Division into lots for favouring SME participation •Provisions on preliminary market consultations •New complaints review body On-going development of e-procurement •New MTender site •Comprehensive e-procurement pilot (small contracts) 15
  17. 17. Challenges: Moldova •Align e-procurement policies and systems with EU Directives and public procurement law •Simplify and update forms and procedures •Raise skills of contracting authorities •Raise the effective level of transparency •Enhance data quality and analysis 16
  18. 18. Main developments: Ukraine New public procurement law effective in 2020 •Improved alignment with the EU directives •Widened range of award criteria •Procedures for low value contracts •Rules for market consultations •Guidance on the negotiated procedure •More specific rules on selection criteria On-going development of e-procurement Review body overload 17
  19. 19. Challenges: Ukraine • Ensure proper application of requirements for proportionality and for adequate (but not excessive) qualifications • Promote the use of wider and more specific award criteria than price only • Strengthen and focus the monitoring and review functions, and render them more effective and efficient • Raise the knowledge and skills of contracting authorities, including aspects relevant for SMEs 18
  20. 20. Thank you for your attention 19