WASHINGTON, June 6, 2016—The World Bank today approved $10 million in additional financing to help Bangladesh scale up its electronic government procurement system to meet higher demand for more effective and efficient use of public funds.
This additional financing to the Public Procurement Reform Project II will help set up a new state-of-the-art data center with 200 terra-byte storage capacity and a mirror site to replace an existing lower capacity data center to keep pace with exponential growth in demand from public procurement entities. With robust security features and 180 times more capacity, the new center will offer storage for 8.6 million tenders and support about 325,000 registered bidders.
In 2011, the project rolled out electronic procurement and online performance monitoring systems in four public procuring entities, which cover transport, local government, water, and power and together spend about half the country’s annual development budget. Known as e-Gp, electronic government procurement reduced tender processing time from 51 days in 2012 to 29 days in 2015, and the number of registered bidders grew 35-fold, to 18,000 over the same period. Since August 2015, Bangladesh has processed online more than 32,000 government tenders at a total value of about $3.7 billion.
“The World Bank believes in strengthening country systems. Since 2002, we have been helping Bangladesh bring systemic changes in public procurement, as a well-functioning system can ensure value-for-money, support fair competition in the private sector, and optimize execution of the national budget,” said Qimiao Fan, World Bank Country Director for Bangladesh, Bhutan and Nepal. "We are happy to see how quickly the bidder community, even at the local level, has embraced electronic procurement. We are also helping create a professional procurement cadre in the country.”
The financing will also help the project continue professional certification and training on public procurement. It has helped 89 officials to receive member status and professional diplomas at the UK-based Chartered Institute of Procurement & Supply, while 84 have completed master’s degrees in procurement. The project has facilitated training on public procurement for about 2,700 participants, ensuring that over 85 percent of procuring entities have at least one trained staff.
“Public procurement was a complex, lengthy process only a few years ago. The shift to digitization and a focus on capacity development have allowed a new way of doing business. E-Gp has also reduced transaction costs for both the procuring entity and the bidding community,” said Zafrul Islam, World Bank Team Leader for the project. “The new data center will be able to support nationwide e-GP implementation for all public procuring entities.”
With this additional financing, the World Bank’s support to the project now stands at $68.10 million. The credit from the World Bank’s International Development Association, which provides grants or zero to low interest loans, has a 38-year term, including a six-year grace period, and a service charge of 0.75 percent.