Global Procurement Initiative - Understanding Best Value

Introduction

Welcome to the Global Procurement Initiative: Understanding Best Value website. This initiative is dedicated to assisting public officials in emerging economies to better understand the total cost of ownership for procurement of goods and services related to infrastructure projects.

The Global Procurement Initiative: Understanding Best Value (GPI) is designed to educate public procurement officials in emerging markets about how to establish procurement practices and policies that integrate life-cycle cost analysis and best-value determination in a fair, transparent manner. Adopting these practices and standards will improve governments' capacity to make better informed decisions that take into account all relevant costs of goods and services over their entire life-cycle. This will not only lead to smarter, longer-term investments with overall savings to the government, but will also level the playing field for U.S. firms in international tenders.

Procurement: A Key Driver for Development and Trade

The establishment of sound procurement policies and practices is fundamental to ensuring a fair and level playing field in international tenders. Transparent procedures for awarding contracts for goods and services establish accountability and encourage the cost-effective use of public funds, which creates dependable, stable and efficient markets. This is particularly important for public sector procurement in developing countries, where government spending can account for up to 20% of GDP.

Nevertheless, throughout many emerging economies, low-cost procurement policies pose an impediment to fair competition and to sustainable economic growth. By relying on low-cost as the determining factor for award, governments often fail to consider the benefits that can be gained from high-quality products and services that include warranties, maintenance agreements and reliable customer service. These policies also prevent firms from offering high-quality, innovative goods and services in order to keep their bidding price low.

In order to address these issues, the U.S. Trade and Development Agency launched the GPI in August 2013.

Supporting Organizations

The GPI is developed in partnership with the Government Procurement Law Program at The George Washington University Law School. Established in 1960, it is the only degree-awarding program in North America that focuses on the law of government contracts. The GPI's curriculum is guided by the internationally recognized faculty of the Government Procurement Law Program, led by Associate Dean Daniel I. Gordon.

Taking into account the importance of multilateral bank financing in developing and middle-income countries, the GPI seeks opportunities wherever possible for collaboration with the major development banks, including the World Bank, the Asian Development Bank, the Inter-American Development Bank, the African Development Bank, and the European Bank for Reconstruction and Development.

Global Procurement Initiative Fact Sheet Global Procurement Initiative Fact Sheet