Investing in the Consolidation of Public Procurement
Public procurement forms 19% of GDP and 50% of the national budget, which gives it key importance in the current circumstances of Afghanistan. The new government of Afghanistan has brought extensive reforms in the procurement process to meet international standard to decrease corruption and create economic opportunities for private investment.
In strengthening investments and small and medium enterprises, the public procurement systems have created the following opportunities for strengthening private and public private investments.
The National Procurement Authority (NPA) up until now has received 3,717 procurement projects out of which 1,485 are related to goods, 1,345 are related to constructions, 103 are related to consultancy services, and 784 are related to non-consultancy services.
|NO||Project Type||Value (AFS)||% in Total Procurement Projects|
The NPA has developed an electronic procurement system, for the registration of private companies to make the procurement process timely and informational on every project to all companies. Based on the information received from NPA, the estimated annual procurement value is close to USD 2 billion.
|NO||Project type||Value (AFN)|
|1||Preference given to domestic manufacturing over foreign manufacturing||15%|
|2||Preference given to domestic companies over foreign companies(resident/non-resident)||10%|
|3||Preference given to foreign company residents over foreign company non-residents||5%|
|4||Preference given to joint ventures||5%|
The Afghan government’s new strategy is to consolidate the procurement of the public goods. Annually the government purchases billions of dollars worth of goods such as food supplies, pre-fabrication construction materials, and for public institutions and the military. The strategy is to outsource procurement to big companies with the obligation to manufacture the goods in Afghanistan.
|NO||Sector||NO. of Projects||% of Total Projects Projects|
|2||Economic Governance & Private Sector Development||94||02%|
|3||Good Governance, Rule of Law, & Human Rights||178||05%|
|4||Agriculture & Natural Resources||439||12%|
|7||Education & Culture||459||12%|