China to open public contracts to EU

7 June 2006
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08 June 2006 | Paul Snell

China will open its public procurement market to EU firms if it joins the international Government Procurement Agreement (GPA).

It announced its intention to join before the end of 2007 at an EU/China conference on public procurement held in Beijing last month. The move will make it easier for foreign firms to bid for Chinese public contracts, worth an estimated £20 billion a year.

Speaking at the conference, Charlie McCreevy, European commissioner for internal market and financial affairs, said: "Opening up our government procurement markets would be mutually beneficial to our economies."

Companies should be able to tender for Chinese telecoms, utilities, transport and aerospace contracts under the deal.

The GPA was drawn up by the World Trade Organisation to make government procurement more transparent. It guarantees fair international competition.

The agreement only applies to contracts over specified thresholds. These vary from just over £100,000 for central government purchases of goods and services up to just under £3.8 million for construction contracts.

Meanwhile, the EU Council of Ministers has agreed a draft directive that will allow the free movement of services between EU states. It sets out that member states must not discriminate against providers from other EU nations. The draft will now move to the European Parliament.

SMjun2006

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