Brussels, 17/01/2012 (Agence Europe) -The main creative force behind the agreement on public procurement at the WTO, which was concluded at the ministerial meeting in December 2011, Commissioner Barnier is making China's support for this agreement a priority. The Asian giant's public market order book has reached an annual figure of $1 trillion.
On his visit to Beijing, where he was due to meet with several senior Chinese economic leaders on Tuesday, including the governor of the central bank, Zhou Xiaochuan, and the finance minister, Xie Xuren, Michel Barnier expressed his hope that China would support the new multilateral agreement, signed under the auspices of the WTO last December, to open up the public markets. Public orders account for 16% of demand in China and 19% in Europe, explained the staff of the commissioner for the internal market. According to the European Chamber of Commerce in China, the Asian giant's public order book has risen to an annual figure of $1 trillion but foreign companies remain largely excluded from this market.
On Tuesday, Commissioner Barnier explained that “the next priority is for China to support the new WTO agreement on public procurement. We have a new framework that is much better. China must say whether it will support the agreement as it is”. After ten years of negotiations, 15 countries party to the WTO agreement of the 1994 Government Procurement Agreement (GPA) concluded an agreement in principle on 15 December on the modernised version of the GPA. This is expected to generate a much larger opening up in public procurement for countries involved in this market and will see value currently generated in the GPA rise from €500 billion to €600 billion or even €1 trillion if new countries give it their support.
The compromise reached between Armenia, Canada, South Korea, US, Hong Kong, Iceland, Israel, Japan, Liechtenstein, the Island of Aruba (Netherlands), Norway, Singapore, Switzerland, Taiwan and the EU still needs to be finalised at a legal level by the end of March before it can be officially signed. It extends the scope and field of action for an agreement that since 1996 has opened to international competition calls for tenders on public procurement, including the provision of goods and services, infrastructure, motorway building, construction of airports, railway stations and telecommunication networks. The revised agreement will primarily submit the international purchases of parties to the GPA to more transparent rules. It also offers its parties new possibilities of market access, the result of significant negotiations between the signatory parties. The new text is also expected to facilitate support for the GPA from other WTO members. As well as China, which has been negotiating since 2007 and which has recently presented its second revised offer, Albania, Georgia, Jordan, Krygyzstan, Moldova, Oman, Panama and Ukraine are also negotiating their accession to the GPA.
China's accession to the GPA is still coming up against obstacles, due to Beijing's refusal to grant European companies access to equivalent government markets to those enjoyed by Chinese companies in the EU. In summer 2011, the commissioner for trade, Karel De Gucht, welcomed the progress made in opening up Chinese public procurement, with the abolition of regulations used to protect indigenous innovation. Nonetheless, Barnier considers that the most recent proposals made by Beijing remain “insufficient”. The commissioner is expecting further changes regarding participation of the foreign banking sector in Chinese bonds and the opening up of the car insurance market to foreign insurers. (EH/transl.fl)