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The World Trade Organization's agreement on government procurement : expanding disciplines, declining membership?

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  • Hoekman, Bernard
  • Mavroidis, Petros C.

Abstract

The authors analyze the new Government Procurement Agreement (GPA) that was negotiated between a subset of General Agreement on Tariffs an Trade (GATT) members in the Uruguay Round, focusing especially on the expansion of coverage to services and on the strengthening of enforcement mechanisms. Coverage objective were substantially achieved, although commitments containmany exceptions for services. The transparency of signatories'procurement practices was enhanced and enforcement provisions were strengthened, particularly by the introduction of a bid-protest challenge mechanism, which allows private parties (firms) to invoke the Agreement before national courts. (A potential problem: domestic courts could produce divergent interpretations of the GPA). Unlike most of the other Tokyo Round codes - for example, the agreements on technical barriers to trade (standards), import licensing, customs valuation, subsidies, and antidumping - the GPA could not be"multilateralized."Its disciplines apply only to World Trade Organization (WTO) members that have signed it. Public procurement represents a major source of demand for goods and services in most countries. Getting domestic procurement policies"right"can therefore have major effects on welfare. And improving developing countries'access to global procurement markets could help induce governments to adopt multilateral rules, if those could be shown to be in their interests. The authors explore why only a limited number of countries have signed the GPA. They suggest the pursuit of tariffication as one avenue through which the Agreement might be expanded to cover all WTO members. In the process, the GPA could be improved economically by eliminating current provisions that allow for measures with quota-like effects, and by weakening incentives to seek"absolute"sector-by-sector reciprocity.

Suggested Citation

  • Hoekman, Bernard & Mavroidis, Petros C., 1995. "The World Trade Organization's agreement on government procurement : expanding disciplines, declining membership?," Policy Research Working Paper Series 1429, The World Bank.
  • Handle: RePEc:wbk:wbrwps:1429
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    References listed on IDEAS

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    1. Deardorff, Alan V., 1987. "Why do governments prefer nontariff barriers?," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 26(1), pages 191-216, January.
    2. Bernard M. Hoekman & Petros C. Mavroidis, 1994. "Competition, Competition Policy and the GATT," The World Economy, Wiley Blackwell, vol. 17(2), pages 121-150, March.
    3. Vousden,Neil, 1990. "The Economics of Trade Protection," Cambridge Books, Cambridge University Press, number 9780521346696.
    4. McAfee, R. Preston & McMillan, John, 1989. "Government procurement and international trade," Journal of International Economics, Elsevier, vol. 26(3-4), pages 291-308, May.
    5. Patrick Messerlin, 1981. "The political economy of protectionism : The bureaucratic case," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 117(3), pages 469-496, September.
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    Cited by:

    1. Aaditya Mattoo, 1996. "The Government Procurement Agreement: Implications of Economic Theory," The World Economy, Wiley Blackwell, vol. 19(6), pages 695-720, November.

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