Revised WTO Govt Procurement Deal between 43 WTO Members to Take Effect in April, India not a Signatory Yet

The revised WTO Government Procurement Agreement (GPA) will enter into force on 6 April 2014, trade officials confirmed this week. The changes to the pact are expected to generate US$100 billion in increased market access, in addition to the US$500 billion already covered by the existing deal.

The Government Procurement Agreement commits participants to certain core disciplines regarding transparency, competition, and good governance, covering the procurement of goods, services, and capital infrastructure by public authorities.

While under the umbrella of the WTO, the GPA only covers a subset of the organisation’s membership - specifically, those who sign onto its commitments. The deal’s current participants number at 15, with the EU and its 28 member states counting as one participant - effectively meaning that the group has 43 countries.

While the original government procurement deal entered into force in 1996, negotiations to streamline and modernise the Agreement - including by expanding its coverage - began just a few years later, and dragged on for over a decade. The talks were completed just minutes before the launch of the WTO’s Eighth Ministerial Conference in December 2011, marking one of the few concrete deliverables from what was otherwise a relatively quiet event.

The 2011 version of the pact adds new entities to its coverage, such as government ministries and agencies. The agreed-upon revisions also bring more services and goods into the Agreement. In addition, new and simpler rules on transparency and due process - designed to stymie corruption or protectionism - are included.

Since the 2011 ministerial, the parties to the Agreement have been working to ratify these changes domestically in order to bring them into force. To do so, ratification by two-thirds of the group was required, at minimum.

Sources say that the ten participants who have approved it were, in order of ratification, Liechtenstein, Norway, Canada, Chinese Taipei, the US, Hong Kong, the EU, Iceland, Singapore, and Israel.

“The fact this has been achieved so quickly shows the importance that the parties attach to the GPA and is further evidence, after the successful Bali Package, that the WTO is back in business,” WTO Director-General Roberto Azevêdo said on Wednesday.

Many had hoped that the ratification of the revised GPA could happen in time for last December’s ministerial conference in Bali, Indonesia, which also saw the global trade body’s first multilateral agreement in nearly 20 years. Weeks before the Bali conference, however, officials confirmed that the ratification process would need to continue through early 2014.

With the new GPA set to enter into force within weeks, one question on trade observers’ minds will be how this may help in bringing in additional participants, especially given the inclusion of new provisions aimed at facilitating accessions to the pact.

“The modernised text of the revised GPA and the expanded commitment to market access should prompt other WTO members to consider the potential advantages of joining,” Azevêdo remarked.

China has been one of the most high-profile WTO members attempting to sign on to the deal in recent years, but its offers to date have been deemed insufficient by current participants. Others negotiating GPA accession include Armenia, Jordan, Moldova, Montenegro, New Zealand, and Ukraine, to name a few.