AfDB. 11 th Annual World Bank Group European PSLO Retreat January 21-23, 2013 IFI PROCUREMENT RULES AND POLICIES. Brussels

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1 11 th Annual World Bank Group European PSLO Retreat January 21-23, 2013 IFI PROCUREMENT RULES AND POLICIES African Development Bank Group Brussels 22 nd January, 2013 AfDB Vinay Sharma, Director, Procurement and Fiduciary Services 1

2 Summary of Presentation IFIs Procurement Principles IFIs Harmonization Forum Achievements African Development Bank Group AfDB 2

3 Economy and Efficiency Transparency Oversight role Our Procurement Principles Equal Opportunity Development of local industries IFIs Procurement Principles

4 IFI s Rules and Policies : Constitute best international practice Open Competition is the Rule.. Majority of IFI contracts won through International Competitive Bidding IFIs ensure transparency and accountability through appropriate procurement arrangements, tools and mechanisms IFIs strive for Efficient procurement process - ICB Development processes owned by the Borrower

5 IFI Requirements for Good Procurement Practice Competitive Bidding Wide and Timely Notification (Advertising) Evaluation Criteria and Methods Shown Fair Conditions of Contract Broad Specifications Clear Terms of Reference 5

6 IFIs Procurement Arrangements Use of harmonized Standard Bidding Documents Free access to IFIs and UNDB web portal Prior or post review of process Systematic internal and external audits Neutral and independent reviews of receivable complaints Sanctions and Zero Tolerance to fraud and corruption Tools and Mechanisms Harmonized sanctions with IFIs/MDBs - CDA Information disclosure policy Independent Review Mechanism Integrity and Anti-corruption Department Whistle blowing mechanism How Transparency and Accountability are Ensured

7 IFI Procurement Relationships: Borrower, IFI and Vendors Borrower Suppliers Contractors Consultants 7

8 IFIs / MDBs Rules and Policies Harmonization Forum Established in 1998 by Heads of Procurement (HOP) of the participating organizations the purpose of: Providing mechanism for procurement cooperation among MDBs / IFIs; Aiming to lower transaction costs to Borrowers; Discussion on policies, procedures and practices; and Establishing best practices. Participating IFIs /MDBs include: AfDB, AsDB, BSTDB, CDB, CEB, EBRD, EIB, IADB, IsDB and the World Bank. Meeting of HOP held every nine months on rotational basis. Next meeting in March 2013 in Tunis hosted by AfDB. The African Development Bank 8

9 IFIs / MDBs Rules and Policies Harmonization Forum: Other key players often engaged by invitation: FIDIC- as a body representing the engineering consulting industry; CICA- representing Contractors. Providing mechanism for procurement cooperation among MDBs and IFIs; UN agencies, Transparency International etc. HOP Working groups often created to discuss technical issues, including development of Master Procurement Documents, E-GP etc. Working groups normally made up of procurement policy personnel of various participating organizations. Working groups submit their reports to the HOP for discussion and adoption. The African Development Bank 9

10 Achievements: Substantive harmonization of Policy Documents by all MDBs Co-Financing made much simpler as a result Developments of Bidding Documents Significant transaction costs savings for Banks and Borrowers MDB Master documents are often cited as standards in the industry Development of Procurement Diagnostic Tools Joint Diagnostics by MDBs. Similar standards, predictability of results Joint Capacity Building Initiatives Knowledge sharing Business outreach activities The African Development Bank 10

11 Achievements: The harmonization process is deliberative and rigorous It has contributed significantly to the development agenda of the MDBs / IFIs Problems with co-financing: Eligibility (often charter issues) Debarment Issues Agreement signed and under implementation Harmonization work going on presently on a large number of emerging areas: E-GP; Procurement in fragile states; PPP operations; Procurement in private sector operations; Sustainable procurement practices in public procurement, etc. The African Development Bank 11

12 THANK YOU African Development Bank Group AfDB 12