Beijing may allow foreign cos to bid for govt contracts

Dec 21 2013, 11:12 IST
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SummaryChina has agreed to make a revised offer to join a global agreement aimed at creating a level playing field for foreign companies.

China has agreed to make a revised offer to join a global agreement aimed at creating a level playing field for foreign companies competing for government contracts, senior US and Chinese officials said on Friday.

Lack of access has been a sticking point with trade partners since China joined the World Trade Organisation (WTO) 12 years ago.

If China were to join the Agreement on Government Procurement (GPA), it would potentially open $100 billion of government contracts to foreign competition every year, and offer opportunities ranging from building highways to running data networks.

The United States and European Union have found China’s past offers of terms for access unacceptable, with Beijing disappointing existing members of the GPA over the amount of business it was ready to throw open.

Michael Froman, the US trade representative, speaking after two days of talks known as the United States-China Joint Commission on Commerce and Trade, said China has “agreed to submit a revised offer in 2014 that would be commensurate on the whole with those other GPA members”.

“We are looking forward to seeing the offer and seeing whether it’s a system that would consider accession to the GPA,” Froman saod.

Chinese vice-finance minister Zhu Guangyao said that China’s bid for the GPA “should be based on mutual respect and equality”.

The discussions on Thursday and Friday were the first high-level trade talks between the United States and China since Xi Jinping became China’s president in March.

Bringing the world’s second largest economy into the GPA would be a huge boost to the agreement. So far only 42 of the WTO’s 157 members have joined.

Hitherto, China has resisted calls to include procurement by local governments, which account for 93 percent of total procurement spending, saying it was up to those local governments to decide.

Most public procurement in China is carried out at sub-provincial level and through projects implemented by state-controlled enterprises and financed with public money.

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