INFRASTUCTURE PROCUREMENT: EBRD APPROACH

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INFRASTUCTURE PROCUREMENT EBRD APPROACH
The Summit Economic Forum 2006 (SEF06)

• Richard Gargrave
• Principal Procurement Specialist
• European Bank for Reconstruction and Development

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What are the EBRDs objectives?

• To promote transition to market economies by
  investing mainly in the private sector
• To mobilise significant foreign direct investment
  through better investment climate
• Good corporate governance at project, corporate
  and country levels
• To encourage environmentally sound and
  sustainable development

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What is the EBRD?

• International financial institution, promotes
  transition to market economies in 27 countries
  from central Europe to central Asia
• Owned by 60 countries and two inter-governmental
  institutions

Cumulative commitments 28.4 billion
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EBRD Project Profiles (Public Sector)

• Generally large value gt USD10 million up to USD
  400 m
• Transport Infrastructure
• Roads, Airports, Ports, Railways
• Municipal
• Wastewater/Water Treatment, Landfill, Transport
• Power Energy
• Power stations, power distribution energy
  efficiency
• Nuclear
• Safety upgrades, Waste processing,
  Decommissioning

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Ensuring Quality in Procurement

• Sound procurement principles
• Open Tendering the norm
• Use of Prequalification/Post qualification
• Open and impartial evaluation methods
• Banks prior review
• Complaint procedure
• Monitoring of performance
• Use of experienced independent Engineers

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EBRD Procurement Principles

• Aligned to WTO (Govt Procurement Agreement)
• Implementation of sound procurement practices
• Fair competitive tenders
• Need to achieve economy and efficiency
• Ensure transparency and accountability
• No allocations, preferences or restrictions
• Client is responsible for procurement
• Fair and balanced contracts

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Prequalification

• Used for Goods, Works and Services
• Adequate notification
• Use of standard application documents
• Clear and targeted minimum qualification
  criteria, financial, technical, experience,
  facilities
• Pass/fail basis
• Possibility for conditional prequalification

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Open Tendering

• Used for Goods and Works
• Adequate international tender notification
• Use of EBRD standard tender documents
• Balanced international contract conditions, such
  as FIDIC
• Clear and neutral specifications/scope of works
• Clear objective evaluation criteria based on
  lowest evaluated cost. Tenderers must be
  substantially compliant and meet qualification
  requirements.
• Other factors such as life-cycle costs
  productivity or performance guarantees may be
  taken into account

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Competitive Selection

• Used for Consultancy Services
• Quality or Quality and Cost based
• Short list of not more than 6 firms, selected as
  a result of expressions of interest
• Use of WB standard tender documents as a basis
• Balanced international contract conditions
• Evaluation criteria based on predetermined points
  system for qualifications, experience and other
  factors.
• Generally, Quality factors at least 80 of total.

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Works Contract Harmonisation

• FIDIC-MDB Harmonised General Conditions of
  Contract for Construction
• FIDIC Red Book adapted for IFI conditions
• Nine year licence agreement
• Not yet mandatory for projects

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The Clients role during implementation

• The client is responsible for all aspects of the
  procurement of contracts. It invites, receives
  and evaluates tenders and awards contracts which
  in all cases are concluded between the client and
  the supplier or contractor

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The Banks role during implementation

• Public Sector Operations
• The Bank reviews and monitors the clients tender
  process and contract administration to ensure
  that procurement is carried out in accordance
  with agreed procedures. The Bank reviews
  complaints
• Private Sector Operations
• The Bank undertakes due diligence and monitors
  contract administration to ensure that fair
  market prices are obtained

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Value of contracts by sector in 2005 ()
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Loan funded public procurement for Goods,
Supply and Install Works contracts
m
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Annual Value of Public Sector Contract Awards
(2001-2005)
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How to Contact us

• General enquiries Tel [phone] / fax
  44 207 338 6690
• Procurement opportunities via website
  www.ebrd.com
• PublicationsTel 44 207 338 7553 / fax 44 207
  338 6102
• Procurement and Technical Services UnitTel 44
  207 338 6534 / fax [phone]