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Public procurement is a fundamental, crucial component of democratic governance, poverty reduction, and sustainable development. Governments around the world spend an estimated US$9.5 trillion in public contracts every year, which in many developing countries represents approximately 15-22 percent of GDP. From building roads and power stations, to purchasing pharmaceuticals and securing trash-collection services, efficient use of public resources contributes to better delivery of services.

Public procurement also serves as a significant policy instrument, which governments can use to propel changes in public service delivery, create fiscal space and jobs, and stimulate private sector growth. A well-performing public procurement system increases citizens confidence in government and private sector competitiveness, especially by leveling the playing field for small- and medium-sized businesses. Increasingly, developing countries and donor agencies recognize the importance of strong procurement systems to build viable partnerships and collaboration between private and public sector actors and resources.

The World Bank’s Procurement Department helps partner countries ensure efficient use of public resources in Bank-financed projects and through reforms of the countries’ procurement ecosystems. It is responsible for the implementation of World Bank Procurement Framework (described below). More importantly, the Governance-Procurement Department, together with its various partners within and outside the World Bank Group, is a leading authority on public procurement tools and techniques.

Strategic Direction

The World Bank’s Governance-Procurement support focuses on two key directions:

        1. Fiduciary/Operational Function

The World Bank’s operational procurement role is to provide fiduciary oversight and support project preparation and implementation to ensure proper design and use of resources to drive development results in client countries and deliver best value-for-money. The Bank procurement staff provide fiduciary support to project procurement and contract management and assist with monitoring the procurement portfolio. 

    2. Country Engagement

World Bank procurement teams provide technical and country-specific knowledge and support to governments seeking to strengthen their public procurement function. This covers public procurement systems, including laws and regulations, governance and political contexts, professional institutions, and technological infrastructure – such as electronic Government Procurement (e-GP).

World Bank Procurement Framework

The World Bank launched a new Procurement Framework in 2016  that provides a modern set of tools and techniques – such as Project Procurement Strategy for Development (PPSD), Hands-on Expanded Implementation Support (HEIS), Alternative Procurement Arrangements (APA), and the new Systematic Tracking of Exchanges in Procurement (STEP) - that ensure faster delivery with value-for-money. The Framework covers initial and/or life cycle costs and quality as well as other factors, such as risk, proportionality, predictability, sustainability, flexibility, innovation, timeliness, and targeted outcomes during the entire procurement cycle.

The World Bank’s Procurement team supports over 1,750 active projects and around 480 projects under preparation with a total lending commitment of around $300 billion.

Last Updated: Apr 14, 2020