World Bank Announces New Procurement Procedures
The World Bank Board of Executive Directors approved a new Procurement Framework (Framework) for its procurement policies, regulations, and procedures on July 21, 2015. The Bank described this new Framework as “a once-in-a-generation systemic reform and culture change” and “a comprehensive modernization of the Bank’s entire procurement regime.” These changes are the result of the Bank’s first ever comprehensive review of its procurement practices. The Bank undertook this three-year review because it recognized that much has changed since its procurement guidelines were written in the 1960s and its one-size-fits-all approach is not sufficiently flexible to meet its clients’ current needs.
Changes include (1) providing more flexibility during the source selection process; (2) streamlining the Bank’s review of low-risk/ low-value contracts while increasing the Bank’s involvement in technically complex and risky contracts; (3) streamlining the process for borrowers to use Alternative Procurement Arrangements rather than the Bank’s arrangements; and (4) devoting additional attention to and revising aspects of the complaints process.
The newly approved Framework consists of the Procurement Policy, Directive, Procedure, and Procurement Regulations for Borrowers, which are annexes to the Framework. It replaces OP 11.00, BP 11.00, and the Procurement and Consultant Guidelines. Breaking with tradition, the Framework combines the Bank’s “red book” and “green book” into a unified set of guidelines.
The World Bank is working quickly to implement the newly approved changes. Full implementation may take years, but the initial effects should be apparent in the next few months. Borrowing organizations should expect some delays, but overall these significant changes will expedite the processing of loans. The Framework also provides flexibility to Borrowers. It will enhance opportunities for technologically advanced companies with sustainable solutions who will now be competitive for awards where they might not have been under the Bank’s traditional procurement policies. Extensive training of the Bank staff as well as the staff of borrowing entities will be critically important, but once implemented, these flexibilities may present new opportunities for well positioned companies.