João N. Veiga Malta Electronic Government Procurement Program Coordinator

1. João N. Veiga Malta Electronic Government Procurement Program Coordinator Inter-American Development Bank JOAOVM@iadb.org Multilateral Development Bank e-GP Harmonisation

2. Contents • What is e-GP • Why is e-GP important? • Goals of MDBs • Why harmonise? • Journey • Results • Future Directions

3. What is e-GP • e-GP is the use of electronic information technology (especially Internet) by governments in conducting their procurement relationships with suppliers for the acquisition of works, goods and consulting services required by the public sector. • Management leadership and good Procurement Processes rather than Technology is the key to a successful sustainable implementation. • It is, however, important to differentiate between the holistic approach of an e-GP solution and the more narrow approach of a system.

4. What is e-GP • Solution Vs System • A “system” is usually associated with the technical side. • A “solution” takes into account other factors (the whole procurement process, human resources, legislation, organisations and management) needed to create an e-GP vision solid enough to make it successful. • Simply applying IT to an inefficient procurement process only increases the inefficiency and risks of the process.

5. Why is it important • Government as a driver/enabler for: • e-Commerce • Standards • Economic Growth • Building digital roads of the future – trade routs of the past

6. Goals of MDBs e-GP OBJECTIVES ECONOMIC DEVELOPMENT Business development Competitiveness Technological Enablement Market Access GOVERNANCE Transparency Accountability Integrity Public Confidence EFFECTIVENESS Efficiency Informed Management Value-for-money Quality Outcomes Capacity-building in e-GP targets three key donor objectives for one third of government expenditures

7. Governance e-GP Enhances Governance • E-records → Stronger audit trails & capabilities • Online processes → Civil oversight • Online access → Business oversight • Policies online → Transparency of process • Contract awards online → Transparent results e-GP is sometimes resisted by individual businesses for precisely these reasons

8. Efficiency e-GP Efficiency Potential in LAC • LAC GDP in 2002 approx. $ 2 Trillion (US) • Government procurement > $ 200 Billion • 10% saving = $ 20 Billion • 20% saving = $ 40 Billion • Public Health expenditure $ 100 Billion • Public Education expenditure $ 76 Billion e-GP generates price savings of 10%-30% e-GP generates transaction cost savings of 25%-90% e-GP generates outcome savings through reduced corruption

9. GDP Government Procurement Government Procurement - Reality Procurement Average 15% . 80% transactions < $500

10. Benefits of e-Procurement (MARKETPLACE) • Reduces price of goods & services • Implementation stage 5% - 10% • Expected to stabilise at 10% - 30% • Reduces transaction costs 25% - 90% • Reduces cycle time to purchase • Strengthens fraud control • Strengthens policy compliance • Industry benefits • Increases in productivity – LAC Government driven

11. Business Community Government Portal Financial Management System Efficiency Systems Integration e-Procurement Asset Disposal Gov Payments Shared Infrastructure

12. Regional Trade Domestic Trade Global Trade Economic e-GP Promotes e-Commerce • Domestic Trade • Regional Trade • Global trade • Underpinned by: • ICT adoption • Common international standards (Authentication & Codification) • Regional Cooperation

13. Inconsistent e-GP methodologies Inconsistent e-GP policies Country confusion Duplicate work programs Scarce resources dissipated Common knowledge base and lessons learnt Demand from client countries Pooled planning & resourcing Integrated work programs Disparate e-GP programs of MDBs dissipate effectiveness of capacity-building Consistent advice, policies, strategies, pooled resources - more effectiveness in capacity building Why Harmonise? Independent Programs Harmonised Programs

14. Initial Processes Program Development Program Execution Program Execution Policy Review Process and Policy Development E-GP Working Party formed HOP discussions Initial MDB discussions Development of joint policy areas Development of work program Release of E-GP Introduction for Executives Release of E-GP Standards Tel conf on policy development Release of E-GP Strategic Planning Tel conf on International Conference Launch of shared online facility Launch of shared online forum Release of Self Assessment tool Launch of Roadmap Tel conf on security and audit Tender threshold policy review Revision of reverse auction policies Revision of e-GP deployment factors Joint MDB e-GP International Conference Authentication policy development Review of MDB vs client country policies Strategic Planning 2005 Development of e-GP Harmonisation THE FIRST 18 MONTHS

15. e-GP Working Party Implementation Strategies: Planning Tools & Materials Legislation Leadership Business, etc Efficiency in Policy Guidance: Objectives Standards Ownership Solutions Designs, etc • Enhanced Aid Effectiveness: Institutional Management Country Program Design Joint Materials Communication Strategies, etc Lessons Learnt: HR Strategies Business Plans Costs Timelines Infrastructure Signatures, etc Pooled Capacity: MDB Budgeting MDB Program Planning Joint MDB Projects Joint Policy Development & Research etc Scope e-GP Harmonisation Methodologies Policies Vision Knowledge Resources

16. e-GP Roadmap e-GP - A Self Assessment Questionnaire e-GP - A Guide to Strategic Planning e-GP – Standards Strategic e-GP – An Introduction for Executives Shared online facility www.mdb-egp.org Shared online forum Revised & harmonised e-tendering rules Consistent strategic planning guidance and review Costings and e-GP development Business case models and pooled experiences Results & Activities Guides & Toolkits Online Education All Developed or Delivered Jointly In-Country Advice Professional Development & Networking International e-GP Conference e-GP Tutorials Strong positive responses from client countries

17. e-GP Road Map e-GP Strategic Overview e-GP Strategic Planning Guide e-GP Readiness Assessment Requirements Use of e-GP Tendering e-GP Authentication e-GP Standards Framework e-GP Toolkit – Documentswww.mdb-egp.org

18. ADBG WB Harmonisation IDB NDF ADB

19. EU EBRD WB Harmonisation IDB ADB

20. Future Directions • Requirements for the use of country e-GP systems: • Tendering • Purchasing • Reverse Auctioning • Acceptance of country e-GP systems for MDB financed operations • Buyer/Supplier activation Guide • Regional workshops - Key issues Authentication, Codification • Continued alignment with other international organisations EU & UNCITRAL

21. João N. Veiga Malta Electronic Government Procurement Program Coordinator Inter-American Development Bank JOAOVM@iadb.org Multilateral Development Bank e-GP Harmonisation Thank You