GPA Accessions: Australia Nears Finish Line, Revised Offer from China Forthcoming

26 October 2017

Efforts continue underway to bring on new parties to the WTO’s Government Procurement Agreement (GPA), with Australia soon set to submit a final offer for consideration, amid expectations of another revised offer from China.

Parties to the GPA met last week at WTO headquarters in Geneva to review the status of accession processes, discussing Australia, China, Kyrgyzstan, Macedonia, Russia, and Tajikistan, according to a Geneva trade official.

The WTO’s GPA is a plurilateral deal among 19 parties which together include 47 WTO members, given the EU’s 28 member states. The accord commits parties to ensuring transparency and non-discrimination in awarding public contracts, including treating bids by suppliers from fellow GPA parties as well as local providers on an equal footing.

While the original version of the GPA entered into force in 1996, negotiations to update the accord concluded at the WTO’s Eighth Ministerial Conference in Geneva in 2011. The revised GPA entered into force in 2014, expanding the accord’s coverage to new government entities, along with additional goods and services, while incorporating new provisions with a focus on environment and anti-corruption. (See Bridges Daily Update, 16 December 2011, and Bridges Weekly, 10 April 2014)

Australia joining in 2018?

Australian trade officials announced two years ago that Canberra would begin negotiating to join the GPA, citing their interest in competing “on an equal footing” when pursuing bids for public contracts in other GPA parties. They highlighted their particular interest in what this could mean for competing in large government procurement markets, such as the European Union. (See Bridges Weekly, 11 June 2015)

Indeed, Australia and the EU are due to soon begin negotiating a trade deal, and have spent months doing the necessary preparations to launch formal talks. Public procurement market access is expected to play a major part in those negotiations, and has been termed as a key area of the two sides’ larger trade ties.

The European Commission’s proposed draft mandate for those trade talks cites Australia’s GPA accession process as something that will help set a benchmark going forward, and will need to be accounted for as Brussels and Canberra negotiate “comprehensive and improved access to public procurement markets.”

This includes using the GPA as a starting point when it comes to “procedural commitments” in this area.

Canberra has already submitted a series of offers for consideration to GPA parties. This includes an initial offer, as well as two revisions. Australia is due to table a final offer, which sources say could be considered in time for the Government Procurement Committee’s next meeting in March 2018.

China, Russia, Kyrgyzstan process updates

Parties also reviewed the processes of two large emerging economies with massive government procurement markets – China and Russia – last week, according to a Geneva trade official familiar with the meeting.

Once completed, China’s accession is slated to open up a market valued in billions, potentially trillions, of dollars, which has been touted by both GPA parties and other acceding countries as a powerful draw.

China began negotiations to join the GPA a decade ago, while Russia launched its own bid to join this year. To date, Beijing has put forward various offers, which GPA parties have welcomed as progressively improving, while still in need of providing greater coverage. Russia submitted its initial offer earlier this year, and has pledged to circulate answers to a “checklist” from GPA parties by December.

An initial offer is also expected from Macedonia by next March, and Tajikistan is also preparing its own revised offer for consideration.

The prospect of expanding the GPA’s membership was touted as one of the big potential gains from revising the deal, potentially adding billions of dollars to its existing coverage, given that the revised GPA features better transitional measures to facilitate the accession of developing country members, along with a wider coverage and updated rules.

ICTSD reporting.  

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