WTO Reaches Deal Expanding Government-Procurement Contracts

After more than a decade of negotiations, the World Trade Organization today clinched an agreement that opens up government-procurement contracts to more foreign competition.

The revised accord, approved in Geneva as the WTO prepares to begin its eighth ministerial meeting, covers 42 members of the trade arbiter. China, which submitted a revised offer in late November, won’t join the agreement this year.

“Government procurement represents one of the most rapidly expanding areas of opportunity for traders of goods and services,” U.S. Trade Representative Ron Kirk said in a statement. The revised accord means U.S. suppliers “will have the opportunity to support more American jobs with broader, deeper access to government procurement work in many of our partner economies.”

The revised agreement expands coverage of procurement to include a number of central and sub-central entities not previously included in the GPA and modernizes the text to reflect current practices in procurement.

Kirk urged China, which began its discussions to join the agreement about four years ago, to make an offer that matches the benefits given by other members of the WTO.

“China has submitted three offers, each an improvement over the last,” he said. “But China still has some distance to go.”

The U.S. wants China to cover state-owned enterprises, add more sub-central entities and services, reduce its thresholds for the size of covered contracts and remove other broad exclusions, Kirk said.

Source: Bloomberg