Government procurement
Annex
This annex provides a comprehensive but non-exhaustive list of quality infrastructure elements for green hydrogen (GH2) that should be implemented according to an Expert Survey for IRENA’s ongoing project “Quality Infrastructure for Green Hydrogen: technical standards and quality control for the production and trade of renewable hydrogen”.
Acknowledgements/Abbreviations
This publication has been prepared under the overall guidance of Aik Hoe Lim of the World Trade Organization (WTO) and Roland Roesch of the International Renewable Energy Agency (IRENA).
International Trade and Green Hydrogen
Hydrogen produced exclusively from renewable power – known as green hydrogen – is widely recognised as a key pillar in replacing fossil fuels and decarbonizing sectors that cannot easily be electrified such as some industrial processes shipping and aviation. This publication – jointly produced by the International Renewable Energy Agency (IRENA) and the World Trade Organization (WTO) – explores how trade policies can support the development of green hydrogen markets. The publication highlights in particular how lowering tariffs on key products building reliable infrastructure realigning domestic support programmes and developing green government procurement can foster the development of green hydrogen supply chains and the transition to a low-carbon economy. International trade could also play a significant role in matching supply and demand for green hydrogen as the potential for domestic production in some economies might not be enough to satisfy domestic demand. The publication also addresses the challenges and opportunities for developing economies offered by green hydrogen and its derivatives such as green methanol and green ammonia. It underscores the importance of international cooperation and the need to align regulatory frameworks to encourage technology development enhanced transparency and market growth.
Mapping supply chain issues from a trade perspective
Green hydrogen has a number of uses. It can be used directly as an energy carrier and chemical input in multiple end-use applications. It can also be combined with a sustainable carbon source or with nitrogen to produce derivative compounds such as methanol or ammonia which can be used as feedstock for chemical production (e.g. plastics and fertilizers) or as sustainable fuels.
The Revised WTO Agreement on Government Procurement (GPA)
The WTO's plurilateral Agreement on Government Procurement ("the GPA" or "the Agreement") is an important ongoing success story for the Organization. In March 2012 the GPA Parties completed a comprehensive revision of the Agreement encompassing both its text and coverage (market access commitments). The revised GPA the negotiating processes that led to its adoption and coming into force and the continuing gradual broadening of its membership are of therefore interest for the evolution of the international trading system. The GPA's successful renegotiation the continuing growth of its membership and its vitality as an instrument of public policy were not achieved through happenstance. The paper discusses a number of specific design features of the GPA that clearly facilitated the successful conclusion of the renegotiation and that as such may in the future be relevant to other areas of global trade liberalization. In addition to the Agreement's plurilateral nature of particular interest are the approach taken with respect to application of the most-favored-nation (MFN) principle in the Agreement; the GPA's continuing strong emphasis on principles of reciprocity in market access concessions; and its approach to special and differential treatment for developing countries in all of which it differs from approaches that are widely used in other WTO Agreements. Apart from the above the GPA revision is important for the merging of trade and good governance concerns that it exemplifies. As discussed in the paper the themes of governance and the sound management of public resources that are treated in the revised Agreement were not afterthoughts to the renegotiation; rather they permeated the revised text and received focused attention from the Parties in their own right. As well the GPA has direct implications for investment policy and for domestic economic reforms and is an important tool of e-commerce. And the revision has made possible very significant synergies between the GPA and other international instruments and activities in reducing barriers to participation and strengthening governance in public procurement markets. For all these reasons the revised Agreement is likely to have a wider impact than meets the eye and well merits the support and attention that it has received from the participating WTO Member governments.
Government Procurement Agreement
Government procurement accounts for an average of 15 per cent or more of a country’s GDP. The WTO’s Agreement on Government Procurement covers government purchasing of goods services and construction work valued at US$ 1.7 trillion annually. This brochure produced to mark the WTO’s 20th anniversary looks into how the Agreement came about and what it embodies.
The Relationship between Services Trade and Government Procurement Commitments
To date government procurement has been effectively carved out of the main multilateral rules of the WTO system. This paper examines the systemic and other ramifications of this exclusion from both an economic and a legal point of view. In addition to relevant elements of the WTO Agreements particularly the Agreement on Government Procurement (GPA) and the General Agreement on Trade in Services (GATS) it derives insights from a large number of Regional Trade Agreements (RTAs) that embody substantive provisions on both government procurement and services trade. An important finding is that from an economic perspective general market access commitments with respect to services trade and commitments regarding government procurement of services are complementary and mutually reinforcing. In contrast from a legal point of view and at the multilateral level disciplines in the two areas have been "divided up" into two Agreements with different (but complementary) spheres of application: the key provisions regarding the scope of application of the GATS and the GPA make clear that each serves purposes that the other does not. Analysis of corresponding provisions of RTAs broadly supports and extends this finding. In light of the foregoing a question arises as to possible ways of deepening disciplines in this area. Part 5 sets out for reflection several related options: (i) the built-in mandate in the GATS for negotiations on services procurement (Article XIII:2); (ii) "multilateralization" of the GPA; (iii) the eactivation of work in the (currently inactive) WTO Working Group on Transparency in Government Procurement; and (iv) the taking up of relevant issues in the context of bilateral or regional negotiations. Overall we find that each of these possibilities has potential merits though none is without related challenges.
Infrastructure Provision and Africa’s Trade and Development Prospects
Transitioning from the post-2008 financial meltdown to a sustained period of global growth and prosperity involves a major challenge: how to ensure the effective management of international economic interdependence. Trade growth good governance and sustainable development constitute essential ingredients to any solution as is a fairer distribution of the gains of trade. Two issues stand out in this conversation. The first concerns the unfinished business of the global fight against the scourge of poverty which impacts one region more than most: Africa. At the same time a key pre-requisite for economic performance - affordable and efficient public infrastructure and services – remains lacking in this region – notably in Sub-Saharan Africa. To address this the region itself has initiated a major long-term continent-wide infrastructure development programme which is intended to fix this problem sustainably - namely the Programme for Infrastructure Development in Africa (PIDA). Its success foreshadows an economic transformation that will potentially usher in an emergent Africa in the 21st century. Secondly in one area of economic activity – trade in government procurement markets - the revised WTO Agreement on Government Procurement (GPA) is emerging as a multi-dimensional tool of trade governance and development. The thesis of this paper is that GPA participation by African countries - a prospect which to date they have declined to take up - holds strong potential to reinforce the positive effects of PIDA and to contribute to the region's growth and development more generally. Developing this thesis the paper examines the possible application of the GPA to support Africa's infrastructure programme drawing on its three dimensions of instrument of governance market access instrument and 'policy space' instrument in support of the development financial and trade needs of developing countries. Based on the analysis the paper concludes that the potential benefits outweigh the potential costs of participation in the GPA by African countries and accordingly that the GPA merits consideration by the region in this regard. A successful implementation of the infrastructure programme also portends a significant expansion in the size of the African government procurement market. Were African countries to accede to the Agreement in this context it would constitute not only a big rise in membership numbers but also a significant expansion in the value of market access under the Agreement. The broad outlines of a potential win-win scenario for both African countries and GPA Parties thus begin to emerge. The paper nonetheless acknowledges that delivering these benefits would involve significant practical and political challenges. It concludes that if the challenges can be overcome and the mutual benefits delivered the revised GPA would have been demonstrated as an effective tool for balancing flexibility and reciprocity in the government procurement sector consistent with sustainable development principles with the capability to deliver win-win benefits for a broad range of stakeholders in the post-2015 era.
Assessing the Value of Future Accessions to the WTO Agreement on Government Procurement (GPA)
The WTO Agreement on Government Procurement (GPA) is a plurilateral Agreement meaning that it comprises only a subset of the full Membership of the WTO. Currently a number of WTO Members that are not Parties to the Agreement either are actively seeking accession to it have commitments to accede to the GPA in their respective WTO accession protocols or are on their own initiative looking at the potential pros and cons of accession. In this context there is a need for factual information concerning the potential consequences of GPA accession and a framework to assess related benefits and costs. Of interest is both the systemic value of such accessions – i.e. the value they will add to the extent of market access commitments under the Agreement – and their potential benefits and costs for individual acceding Parties. This Working Paper introduces new sources of information relevant to these topics (principally the statistical reports that have been circulated recently by GPA Parties) and shows their relevance to and usefulness in assessing the above-noted matters. The Paper presents estimates of the size of potential market access gains from pending and possible future GPA accessions based on simple extrapolations from the data sources identified. Next the Paper shows how the same data sources can assist in throwing light on the potential benefits and costs of GPA accession for individual WTO Members/countries contemplating accession. The latter use of the data is developed in the context of a more general discussion of the benefits and costs of GPA accession for individual WTO Members also drawing on existing literature qualitative aspects and "insights from the field" (i.e. our own work in advising and conducting seminars for such countries and other WTO Members).
India’s possible accession to the Agreement on Government Procurement: What are the pros and cons?
This chapter examines the pros and cons of accession to the WTO Agreement on Government Procurement (GPA) by India. This discussion is of relevance since despite consistently resisting pressure to negotiate government procurement provisions in its regional and bilateral trade agreements in February 2010 the Government of India became an observer to the GPA. India’s decision to be a GPA observer comes at a time when interest in the GPA appears to be growing and signals that major developing countries such as India are assessing their interests in relation to GPA accession.
The benefits for developing countries of accession to the Agreement on Government Procurement: The case of Chinese Taipei
On 9 December 2008 the World Trade Organization (WTO) Committee on Government Procurement adopted the accession of the Separate Customs Territory of Taiwan Penghu Kinmen and Matsu (Chinese Taipei) to the Agreement on Government Procurement (GPA). After completing the relevant domestic legislative procedures Chinese Taipei delivered its accession document to the WTO in June 2009 and formally became the forty-first signatory to the GPA on 15 July 2009.