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Taiwan’s Accession to Government Procurement Agreement to Create Opportunities for U.S. Businesses

After a seven-year wait, Taiwan acceded to the World Trade Organization’s Agreement on Government Procurement. Membership will further open a large potential market to U.S. exporters wanting to sell to government entities in Taiwan.

by Joshua Pierce and Katrice Kelly

On July 15, 2009, Taiwan acceded to the Agreement on Government Procurement (GPA) of the World Trade Organization (WTO). The GPA is a plurilateral WTO agreement, and Taiwan is the 41st WTO member to join. The agreement requires its signatories to provide national treatment to the goods, services, and suppliers of the other members.

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Confucian temple, Tainan, Taiwan (iStock/© Tsung-Heng Chen)
Confucian temple, Tainan, Taiwan (iStock/© Tsung-Heng Chen)

 

More Than 30 Ministries Covered

As part of the accession agreement, Taiwan has offered extensive coverage of its central and local government entities, as well as a number of universities and other state-owned enterprises. U.S. industry will now have access to procurements for more than 30 ministries and commissions, including the Ministry of National Defense and Ministry of Transportation and Communications. U.S. industry will also have access to Taipei City and Kaohsiung City governments, 48 universities and technical schools, three veterans’ hospitals, and numerous service sectors that include engineering, information technology, and certain telecommunications. Conversely, Taiwan’s firms will be eligible to compete for U.S. government procurements that are covered by the GPA at both the federal and subcentral level. In 2007, Taiwan’s government procurement market was valued at more than $21 billion.

Procurements Published on the Web

Taiwan is now obligated to open much of its government procurement to international bidding by suppliers from other GPA members. Taiwan’s procedural obligations under the GPA will provide U.S. companies with concrete guarantees that covered procurements will have a high level of transparency and predictability. Furthermore, Taiwan will publish procurement opportunities on its Government Procurement Information System Web site. Procurements covered by the GPA will be noted and summarized in English on the site.

The GPA also requires that members treat the products, services, and suppliers from other members in a non-discriminatory manner and provide them with “national treatment.” This means that Taiwan must conduct covered procurements with a blind eye to whether the vendor is a domestic supplier or a foreign supplier from a GPA member economy. Finally, Taiwan will be required to provide a domestic review mechanism to address complaints about the conduct of covered procurements, including complaints lodged by U.S. companies.

With its accession to the GPA, Taiwan fulfilled a commitment that it made when it became a WTO member in 2002. In December 2008, after several years of negotiations, the WTO Committee on Government Procurement approved the terms of Taiwan’s accession to the GPA.

Joshua Pierce is an international trade specialist with the Market Access and Compliance unit of the International Trade Administration. Katrice Kelly is an international trade specialist with the Manufacturing and Services unit of the International Trade Administration.

 

 

Infrastructure Projects Prominent among Upcoming Procurement Opportunities in Taiwan

Taiwan and the United States are already significant trading partners, with two-way trade of more than $61 billion in 2008. From 2005 to 2007, government entities in Taiwan awarded approximately 2,170 procurements that could have been covered by the GPA.

In addition to normal government procurement activities, Taiwan is engaged in two major infrastructure programs to improve transportation, communication, and education. The first program is the Special Act for Expanding Investment in Public Works to Revitalize the Economy, which uses vouchers for immediate stimulus. It also creates a four-year plan (2009–2012) for improving public works worth approximately $15 billion.

The second program is the i-Taiwan 12 Project. This eight-year (2008–2016) infrastructure project is worth more than $4 billion. Among other things, it will expand science parks, revitalize industrial parks, and create more and better-organized free trade zones and trade logistics centers.

For more information on those and other export opportunities, visit the U.S. and Foreign Commercial Service Taiwan Web site. To report a trade barrier in Taiwan or any other country, visit the Department of Commerce’s Trade Compliance Center.