By Paul Emanuelli

This article is an excerpt from The Art of Tendering: A Global Due Diligence Guide.

In its Benchmarking Public Procurement 2016 report, the World Bank Group assessed the procurement regulatory practices of 77 countries in the areas of procurement life cycle practices and complaint mechanisms. The report underscored the importance of combatting corruption, stating that “when the tendering process is rigged because of corruption, competition cannot play its role in driving the prices down and quality up.” The report also noted that all 77 countries reviewed had at least one transparency deficiency.

The report found a correlation between high per-capita GDP and higher levels of procurement transparency, with high-GDP countries like the United States, United Kingdom, South Korea, and Italy scoring high on procurement transparency (8/8), where they were joined by lower per-capita GDP countries, including Hungary and Romania. In keeping with this general correlation, the report also found that the lowest per-capita GDP jurisdictions, including Nigeria and Senegal, also scored lowest in procurement transparency.

However, some high per-capita GDP countries, like Canada and Spain, scored far lower in procurement transparency (5/8) than many lower per capita GDP countries, including India, Brazil, Mexico, and Russia (7/8), and equal only to lower income countries, including Nicaragua, Zambia, and Kenya. As these findings illustrate, the correlations between high per capita GDP and high procurement transparency, and low per capita GDP and low procurement transparency, while reflective of general trends, are far from absolute.

In its expanded follow-up Benchmarking Public Procurement 2017 report, the World Bank Group assessed the procurement regulatory systems of 180 countries, focusing as in the past year on procurement life cycle practices and bid protest mechanisms. The report found significant delays in supplier payments, with timely payment in only one-third of all jurisdictions.

Many jurisdictions also allowed for unregulated bid security requirements, imposing potentially high burdens on bidders. The digitization of the procurement process also remained a work-in-progress, with only 56% of bidders in OECD countries (which was the highest percentage group) able to submit bids electronically. Many jurisdictions also had no legal mechanism to launch a process complaint prior to the award of a contract.

There were also a wide range of differing remedies available between first-tier and second-tier adjudicative processes.

The 2017 report included detailed assessments of multiple CARICOM jurisdictions, with the following notable highlights:

  • Antigua and Barbuda scored 38% on the transparency of solicitation documents; 39% on bid submission processes; 43% on bid evaluations and awards; 50% on content and management of contracts; 0% on performance guarantees; and 15% on timely payment to suppliers.
  • The Bahamas scored 50% on the transparency of solicitation documents; 24% on bid submission processes; 43% on bid evaluations and awards; 68% on content and management of contracts; 50% on performance guarantees; and 33% on timely payment to suppliers.
  • Barbados scored 31% on the transparency of solicitation documents; 58% on bid submission processes; 14% on bid evaluations and awards; 40% on content and management of contracts; 58% on performance guarantees; and provided no data on timely payment to suppliers.
  • Belize scored 40% on the transparency of solicitation documents; 40% on bid submission processes; 29% on bid evaluations and awards; 68% on content and management of contracts; 34% on performance guarantees; and 33% on timely payment to suppliers.
  • Dominica scored 35% on the transparency of solicitation documents; provided no data on bid submission processes; scored 71% on bid evaluations and awards; 59% on content and management of contracts; 38% on performance guarantees; and provided no data on timely payment to suppliers.
  • Grenada scored 34% on the transparency of solicitation documents; 75% on bid submission processes; 57% on bid evaluations and awards; 27% on content and management of contracts; 58% on performance guarantees; and 33% on timely payment to suppliers.
  • Jamaica scored 56% on the transparency of solicitation documents; 96% on bid submission processes; 64% on bid evaluations and awards; 77% on content and management of contracts; 62% on performance guarantees; and 7% on timely payment to suppliers.
  • Kitts and Nevis scored 47% on the transparency of solicitation documents; provided no data on bid submission processes; scored 43% on bid evaluations and awards; 45% on content and management of contracts; 40% on performance guarantees; and provided no data on timely payment to suppliers.
  • Lucia scored 47% on the transparency of solicitation documents; 27% on bid submission processes; 57% on bid evaluations and awards; 64% on content and management of contracts; 38% on performance guarantees; and 7% on timely payment to suppliers.
  • Suriname scored 39% on the transparency of solicitation documents; 100% on bid submission processes; 29% on bid evaluations and awards; 68% on content and management of contracts; 50% on performance guarantees; and 48% on timely payment to suppliers.
  • Trinidad and Tobago scored 42% on the transparency of solicitation documents; 31% on bid submission processes; 43% on bid evaluations and awards; 59% on content and management of contracts; 38% on performance guarantees; and 0% on timely payment to suppliers.

In comparison to the CARICOM countries noted above, the following sample of countries across North America, Europe, and the globe, scored as follows:

  • The US scored 98% on the transparency of solicitation documents; 57% on bid submission processes; 57% on bid evaluations and awards; 64% on content and management of contracts; 54% on performance guarantees; and 100% on timely payment to suppliers.
  • Canada scored 98% on the transparency of solicitation documents; 78% on bid submission processes; 57% on bid evaluations and awards; 73% on content and management of contracts; 58% on performance guarantees; and 75% on timely payment to suppliers.
  • Mexico scored 80% on the transparency of solicitation documents; 71% on bid submission processes; 64% on bid evaluations and awards; 64% on content and management of contracts; 70% on performance guarantees; and 67% on timely payment to suppliers.
  • Puerto Rico scored 53% on the transparency of solicitation documents; 69% on bid submission processes; 43% on bid evaluations and awards; 73% on content and management of contracts; 42% on performance guarantees; and 33% on timely payment to suppliers.
  • The UK scored 66% on the transparency of solicitation documents; 50% on bid submission processes; 64% on bid evaluations and awards; 59% on content and management of contracts; 34% on performance guarantees; and 50% on timely payment to suppliers.
  • Ireland scored 73% on the transparency of solicitation documents; 43% on bid submission processes; 64% on bid evaluations and awards; 60% on content and management of contracts; 0% on performance guarantees; and 85% on timely payment to suppliers.
  • France scored 69% on the transparency of solicitation documents; 71% on bid submission processes; 64% on bid evaluations and awards; 73% on content and management of contracts; 58% on performance guarantees; and 50% on timely payment to suppliers.
  • Germany scored 76% on the transparency of solicitation documents; 29% on bid submission processes; 79% on bid evaluations and awards; 82% on content and management of contracts; 78% on performance guarantees; and 67% on timely payment to suppliers.
  • Italy scored 70% on the transparency of solicitation documents; 82% on bid submission processes; 64% on bid evaluations and awards; 82% on content and management of contracts; 78% on performance guarantees; and 100% on timely payment to suppliers.
  • Spain scored 68% on the transparency of solicitation documents; 94% on bid submission processes; 64% on bid evaluations and awards; 73% on content and management of contracts; 86% on performance guarantees; and 100% on timely payment to suppliers.
  • Sweden scored 66% on the transparency of solicitation documents; 75% on bid submission processes; 64% on bid evaluations and awards; 68% on content and management of contracts; 0% on performance guarantees; and 75% on timely payment to suppliers.
  • Switzerland scored 68% on the transparency of solicitation documents; 67% on bid submission processes; 57% on bid evaluations and awards; 50% on content and management of contracts; 20% on performance guarantees; and 75% on timely payment to suppliers.
  • Australia scored 78% on the transparency of solicitation documents; 39% on bid submission processes; 71% on bid evaluations and awards; 77% on content and management of contracts; 0% on performance guarantees; and 100% on timely payment to suppliers.
  • New Zealand scored 88% on the transparency of solicitation documents; 75% on bid submission processes; 64% on bid evaluations and awards; 45% on content and management of contracts; 0% on performance guarantees; and 67% on timely payment to suppliers.
  • Japan scored 70% on the transparency of solicitation documents; 67% on bid submission processes; 50% on bid evaluations and awards; 68% on content and management of contracts; 58% on performance guarantees; and 67% on timely payment to suppliers.
  • The Republic of Korea scored 60% on the transparency of solicitation documents; 59% on bid submission processes; 57% on bid evaluations and awards; 77% on content and management of contracts; 66% on performance guarantees; and 100% on timely payment to suppliers.
  • India scored 63% on the transparency of solicitation documents; 75% on bid submission processes; 50% on bid evaluations and awards; 68% on content and management of contracts; 54% on performance guarantees; and 59% on timely payment to suppliers.
  • Pakistan scored 58% on the transparency of solicitation documents; 44% on bid submission processes; 57% on bid evaluations and awards; 59% on content and management of contracts; 30% on performance guarantees; and 67% on timely payment to suppliers.
  • Russia scored 100% on the transparency of solicitation documents; 78% on bid submission processes; 64% on bid evaluations and awards; 82% on content and management of contracts; 50% on performance guarantees; and 33% on timely payment to suppliers.
  • The Ukraine scored 70% on the transparency of solicitation documents; 59% on bid submission processes; 86% on bid evaluations and awards; 70% on content and management of contracts; 50% on performance guarantees; and 37% on timely payment to suppliers.
  • South Africa scored 62% on the transparency of solicitation documents; 52% on bid submission processes; 71% on bid evaluations and awards; 73% on content and management of contracts; 58% on performance guarantees; and 48% on timely payment to suppliers.
  • Nigeria scored 68% on the transparency of solicitation documents; 60% on bid submission processes; 50% on bid evaluations and awards; 68% on content and management of contracts; 74% on performance guarantees; and 57% on timely payment to suppliers.

As this sample of global scores for the World Bank’s benchmarking study illustrates, some jurisdictions are further ahead than others in meeting global procurement standards, but all jurisdictions remain a work-in-progress. Furthermore, while procurement systems at the jurisdictional level may have earned certain scores in the World Bank benchmarking study, this still leaves significant work to be done at the institutional level to ensure that each institution is meeting applicable standards. Ultimately, lawsuits, audit reviews, and failed projects tend to impact at the institutional level, irrespective of the benchmarking score earned in the World Bank’s review of procurement practices at the jurisdictional level.