Has Protectionism Found A New Home?

Has Protectionism Found A New Home?

August 17, 2021
Procurement

One of the first acts of the Biden administration was to direct public buyers to buy from American firms. China is apparently doing the same and the EU is seeking to add tariffs to those who make it harder for EU countries to trade with them.

Boris Johnson touted Brexit as a chance to “roll back the influence of the state” and to redirect procurement spending to British firms. More recently, the UK’s Labour Party proposed a new policy of “Buy British” for Government contracts.

A long history of trade liberalisation seems to be fraying, but it would appear only for those in public procurement. At a time when many countries are looking inwards, it makes good electoral sense for politicians to announce the creation of a virtuous circle of public spending, where tax payer’s money is directed by the government to taxpayer-owned businesses.

But this apparently meritocratic policy hides some significant problems: members of the World Trade Organization are required to run liberal, transparent trade regimes. The Government Procurement Agreement explicitly prohibits discrimination against overseas suppliers.

Public procurement is significant, restraining access to significant contract opportunities will likely cause a knock-on effect where a countries exporters are also discriminated against in opposing markets. Countries also need to be honest about their own capabilities, not every country has the local suppliers that can deliver the best products or services. Pushing buyers to buy from inferior, local suppliers will only lead to poorer public services.

Many politicians appear to be suggesting that they can localise public spending, but it is notable that they aren’t suggesting rescinding their membership of the Government Procurement Agreement. The impressive-sounding policy may turn out to be nothing more than soundbites and sabre-rattling. Due care needs to be taken as public procurement is not immune to protectionism and misplaced rhetoric could come at a significant cost.

To find out more about our trade analysis work get in touch.

September 21, 2021

More Than Half Of Australia’s Procurement Is Uncompetitive

This week, the Australian Government House of Representative  standing committee  has been presiding over a an inquiry into government procurement practices. It...
September 15, 2021

Our story. Reinventing a business.

Spend Network exists because I almost lost everything. Where we came from: I'd built a consultancy with twenty staff and clients across...
August 31, 2021

UK and Central America Increase Trade Ties

The UK’s export credit agency UK Export Finance (UKEF), has signed a partnership with Banco Centroamericano de Integración Económica (BCIE), Central America’s...
August 26, 2021

New Canadian Government Opportunities For Indigenous Businesses

We recently discussed new procurement changes in Australia with the Western Australian government procurement process, which includes specific policies to increase opportunities...
August 18, 2021

Will Europe Get Stricter On Procurement?

The EU countries have agreed to pass the International Procurement Instrument (IPI), one that was initially proposed by the European Commission back...
August 12, 2021

The Right Data In The Right Place

We collect tens of thousands of documents every day. We visit more than 700 sources to collect this data. That's what our...
August 6, 2021

Slovenia Strides Forward With Procurement Improvements

Slovenia is slated to join Ukraine as the only public administrations that will routinely monitor contract overspend on all public contracts. What's...
August 3, 2021

South Korea Targets SME Growth Through Health Procurement

When selling to governments, SMEs often have challenges with matching the buying power and supply chain strength of larger organisations. For the...
August 3, 2021

New Carbon Reporting To Impact 1,000 Suppliers

New rules to help reduce CO2 in public contracting show that at least 720 suppliers will be required to provide a detailed...
August 3, 2021

Trade, Policy And Procurement Meet Again.

The UK's Trade and Agriculture Commission has published its final report, along with twenty-two recommendations, one of which is to direct the...
August 3, 2021

McGowan Government Enhances Aboriginal Procurement Policy

In 2018, Western Australian Labour Premier Mark McGowan introduced a landmark Aboriginal Procurement policy. The objective of the policy was to improve...
August 3, 2021

Are Trade Agencies Becoming More Like Hedge Funds?

Trade promotion, where a country promotes its companies and products to be bought by another, has a certain image. One imagines suave...
August 3, 2021

Meeting The Research Challenge

Our clients expect us to answer tough questions. Questions like, "what's the total value of public contracting worldwide?" or, "who's the leading...
August 3, 2021

US Consults On Social Procurement

The US Government's Office of Management and Budget (OMB) has requested submissions on the "methods and leading practices" to assess whether agencies'...
August 3, 2021

Harnessing Procurement To Tackle Climate Change

As experts in procurement and open data, we are pleased to see the recent announcement that global confectionery giant Mars is harnessing...

Newsletter

Compelling research, insights and data directly into your inbox.

Recent media stories

Search

Scroll to Top