Centralized government procurement saves China billions

April 19, 2012 9:21 am


View of Yiwu International Trade City II seen in this picture taken on Oct 21, 2008/XINHUA
BEIJING, April 1 9 – Centralized government procurement has helped save $2.19 billion for China’s central government departments since its adoption 10 years ago, the Government Offices Administration of the State Council said on Wednesday.

Altogether, central government departments spent a total of nearly 90.7 billion yuan ($14.4 billion) on purchases over the last 10 years. The savings were comparable to receiving a 13-percent discount.

Government procurement across the whole country was about 1 trillion yuan in 2011, or 10 percent of China’s fiscal expenditure, with about 150 billion yuan in savings on centralized procurement.

These savings were comparable to a discount of 12 percent, according to Wang Ying, director of the government procurement management office under the Ministry of Finance.

As of March this year, government procurement mechanisms have been established for all governments at the county level.

Three centralized procurement centres have been set up for central government organs and more than 2,100 procurement organizations have been set up for local governments

More than 16,000 people are employed by these procurement organs. The procurement law was introduced in 2002, in a bid to enhance procurement efficiency, save money and prevent corruption.

Centralized procurement helps promote energy conservation, supports small and medium-sized enterprises and popularizes non-counterfeit products such as computer software, said Wang Lida, director of the Central Government Procurement Center.

To curb possible procurement-related corruption, the National Bureau of Corruption Prevention will cooperate with relevant departments to intensify monitoring and inspection, said the bureau’s disciplinary inspector Guo Songjiang.

A public participation system and an approval system for major procurement projects have been established to bring the process of government procurement out into the open, said Guo.

Officials found interfering or illegally participating in government purchasing will be investigated without leniency, he said.


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