There is no alternative to good public governance involving efficient and accountable public procurement for Bangladesh’s social and economic development. The country is about to make its public procurement regime more transparent and operational through simplification of procedures, and by encouraging officials to avoid bureaucratic dilatory practices but not at the cost of transparency.
Two major public procurement regulations — Public Procurement Act 2006 (PPA) and Public Procurement Rule 2008 (PPR) — have defined basic objectives and principles such as value for money, fair treatment, non-discrimination, integrity, and social and industrial development. Measures include Country Procurement Assessment Report (CPAR) and the Public Procurement Reform Project (PPRP) meant for streamlining the process of public procurement.
An efficient public procurement system is a necessary condition for ensuring efficient public investment and therefore, economic growth. A more effective and transparent procurement system frees up public money for achieving more and better development outcomes and improving delivery of public services. Introduction of e-procurement system is playing an important role in establishing transparency, curbing political interference and increasing competition.
It is found that adoption of e-GP (government procurement) reduces price to cost ratio by at least 10.25 per cent and in the most robust case, by 11.85 per cent. In Bangladesh, number of invited tenders is increasing with increase in number of agencies that are procuring through e-GP. Currently, total registered government procurement agency in e-GP is 1313.
More than 75 per cent of the Annual Development Programme (ADP) is spent on public procurement and its yearly value was US$16 billion (as of July 2019), according to information available with the Central Procurement Technical Unit (CPTU). Now, over 55 per cent of the total procurement is done through e-GP. Total number of registered bidders was 46,704 (as of July 26, 2018) which increased to 63,027 (as of September 29, 2019). Total number of invited tenders was 0.3 million, the value of which was US$37 billion (till July 31, 2019).
However, participation of women entrepreneurs (WEs) in public procurement is negligible — only one per cent globally, according to International Trade Centre (ITC). In Bangladesh, the situation is believed to be more bleak and there is no gender-segregated public procurement data.
Women’s participation in the country’s labour force is only 36.3 per cent, 91.8 per cent of which is informal. The number of WEs is estimated to be 10 per cent among all entrepreneurs, lower in comparison to neighboring countries. Full potential of Bangladeshi WEs could not be explored due lack of access to finance, marketing, information and training. They struggle most in marketing their products. In such a situation, both their market access and competitiveness can be improved by engaging them in public procurement.
However, gender issue has not been duly considered and addressed in various aspects of public procurement, stakeholders told a dialogue on “Engaging Women Entrepreneurs in Public Procurement” organised by Business Initiative Leading Development (BUILD) and ITC at the CPTU on December 01, 2019. Dwelling on the e-GP issue, they observed that registration process required for participating in e-GP is a problem for women as it requires IT knowledge to some extent. WEs also face problems in going through the process of acquiring trade license, low scale of operation and stringent selection process that restricts them in competing with male tenderers.
Challenges faced by WEs include lack of awareness of documentation required for taking part in procurement process; lack of capacity to develop business profile and documentations required for submitting tenders; large amount of time required in tender submission and processing for approval and lack of supply diversity in WEs’ business operations. It was recommended that WEs should undertake initiatives to develop capacity and understanding on relevant matters and take specific trainings if needed. Women chambers can play a role in improving capacity of their members through training. Women-led chambers might also hire experts from CPTU to conducting their training.
Women face barriers of mindset that prefers male members of society in getting engaged in economic activities that cover public procurement. The WEs do not always have the level of experience — 05 years’ experience plus quality of work in terms of monetary value. But working experience in the private sector is not considered, a provision which acts as impediment for WEs. So despite some success in doing business, some WEs cannot just be engaged business in the public sector.
There is a lack of well-connected network amongst the WEs. They also do not have capacity to develop business profile and documentations required for the purpose. Training is given only after becoming an e-GP registered tenderer. Also, there is a perception that public procurement sector is often dominated by muscle men/powerful entities and there is a social stigma that has created an atmosphere of fear for the WEs while participating in this sector.
However, the situation has changed in last few years. The environment has now been more transparent through introduction of e-GP. There prevails a lack of supply diversity in case of WEs’ operations.
Therefore, a gender-segregated list of tenderers can be developed based on areas of operations and eligibility. A national platform for WEs can also be formed as Government Traders Forum (GTF) for knowledge sharing among members and network building by WEs. They need to have clear understanding of areas where their capacity building is needed the most, for which specific trainings have to be organised focusing on scopes and opportunities for them.
It is important that newly adopted measures relating to tendering process are published on CPTU website and its Facebook page. Fairs can be organised with procuring entities and women tenderers who are not able to get linked to these entities. The Ministry of Women and Children Affairs can keep provision for providing their tenders prioritising women.
Women running small and medium enterprises (SME) may be encouraged to participate in the process and this should be specifically mentioned in the regulation. Payment method to subcontractors may also be clearly delineated in the procurement regulations as in most cases there is possibility of having sub-contracts by the WEs with large contractors.
Women may be encouraged to apply in limited tender, quotation and cash purchase and procuring entity (PE) can encourage bidders with higher percentage of female employment. Policies may be made to appreciate women’s participation in areas such as stationeries, staff uniforms, and decoration materials. Some criteria of open tender method should also be relaxed for women. Provision may be included in the PPR making it mandatory for procuring entities to buy local products from local entrepreneurs.
It is hoped that more engagement of WEs in the public procurement process can ensure transparency and help small and medium enterprises sector to be in the mainstream of economic development.
Ferdaus Ara Begum is Chief Executive Officer at Business Initiative Leading Development (BUILD).
