Procurement Reform for Humanitarian and Development Challenges in Kurdistan Region of Iraq (KRI)
Sr. Communications Officer, World Bank
August 9, 2016 was a significant milestone in the development of the Kurdistan Region in Iraq (KRI) as the Kurdistan Regional Government (KRG) marked the entry into effect of a new legal framework for public procurement. More than 100 attendees, including Ministers, Governors, Private Sector Representatives, Donors, and Diplomats were present at the launch event for the new framework, which was covered by media and broadcast live on two television channels.
The leadership of the Minister of Planning, H.E. Dr. Ali Sindi, and the inter-ministerial committee that he convened were vital to the success of the reform effort. The launch of the new legal framework, which features a new Procurement Regulation and standard bidding and contract documents, was the culmination of extensive efforts of the inter-ministerial committee including consultations with a variety of stakeholders over a period of two years.
The procurement reform initiative is part of a multi-faceted reform program supported by the World Bank, including the KRG 2020 Vision of 'Effective, transparent, trusted and honest Government', and the three-year economic reform plan aimed at "Achieving Shared Prosperity and Protecting the Vulnerable" launched in June 2016.
The 40% of KRG public expenditure spent on public procurement constitutes about 20% of the GDP. That alone underscores the need to have a transparent, accountable and modern procurement system that performs economically, efficiently and effectively. The Region faces many challenges including the recessive effects of regional conflicts, as well as the protracted humanitarian crisis spawned by those conflicts and heavily impacts the Region. This makes it even more crucial that the KRG public procurement system is optimally designed and implemented, transparent and accountable.
By adopting the modernized legal framework, KRG joined an advanced rank of countries that utilize the potential of a modern public procurement system not only for improved efficiency and effectiveness in public expenditures, governmental operations and service delivery, but also as a key tool in promoting core development and governance objectives and initiatives.
The new legal framework covers all stages of the procurement cycle from planning to contract implementation. It includes an expanded range of procurement methods, and provisions on sustainable procurement policies and practices, use of e-procurement, and oversight and policy-making functions. It also establishes enhanced transparency and accountability, procedures for awards of PPP projects, and an independent complaint review-mechanism. Additional procurement reform initiatives include capacity building programs for the public and private sectors, guidance material for practitioners, a "Doing Business with KRG"toolkit for the private sector, introduction of public procurement into academic curricula, establishment of a web-portal and development of an e-Procurement strategy and implementation plan.
The progress achieved by the KRG is no less remarkable in view of the FCV context of the Region. At the launch event, Yolanda Tayler, Practice Manager for the MENA Region in the Bank's Solutions and Innovations in Procurement Department, noted that "the implementation of the new legal framework for public procurement is a gateway, transformational step that will enable the Region to be better positioned to meet the development and humanitarian challenges that it faces. It will help to put the Region on the map internationally and regionally as a place that is serious about effectiveness, transparency, integrity and accountability in public procurement". She added that "the adoption of a new legal framework for procurement that reflects international good practice standards puts KRG firmly in the top tier of public procurement systems in the MENA region".
The procurement reform achieved by the KRG is a trendsetter, both for significant reforms in the Region, as well as for the wider MENA Region. It demonstrates what can be accomplished against all odds in an FCV context with a committed leadership, an inclusive, interactive reform process, and an engaged donor institution to help mobilize technical resources. Moreover, the KRG reform reflects a practical understanding of the strategic role of public procurement in addressing complex humanitarian and development challenges.
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