Hello everyone. Welcome back. Coursera Global Public Procurement. Last three sessions, we learned about US Federal Government public procurement and some of the State Government public procurement. Public procurement is always a literally boring subject as you've noticed. It's a lot about the procedure, a lot about the rules and regulation, very dry, especially when you're dealing with US Federal Government, there's a whole bunch of the regulation is Buy American Act to Berry Amendment, all other issue related to global public procurement agreement. It is very dry however, all issue, what we are going to do for next two session for the UN public procurement, is a little bit more flexible. I will say it's a little more exciting item, because if you are from Asian countries, this will be a lot more relevant to your business than US federal government. Because US federal government unless your government, has already a legal framework agreement, whether it is Free Trade Agreement or Trade Agreement Act, your company may not be eligible to participate any of US public procurement business at all. But UN public procurement is very different because we have more than 190 UN member country. As long as your country are the member, and your company is not sanctioned by any non-perform issue, any of the legal issue, your company is eligible to apply and participate any of the UN public procurement as long as you have a technical capability and a financial resources to perform the contract. However, one main criteria for the UN public procurement, if your country is sanctioned by the UN, whatever you can do as a company, because your company is based in that particular country, you are not eligible for participating any of the business issue at the UN public procurement funding mechanism. Before we talk about the UN public procurement, let's briefly talk about ICB versus NCB. Now ICB, you may heard about the expression many time, it is international competitive bidding or UK, we call it tendering or TNDR. In the both ICB and tendering, we use quite often as the flexible manner, but ICB is the most common way or the method or the public procurement. Basically, this mechanism provides executing agency, or we call it a contracting agency, or the authority with a wide range of choices, selecting best bid from competing supplier or the vendor or the contractor. International means this is open for business for all international contractor. Versus NCB, is national competitive bidding, as what itself indicate, this will be the limit on all the contractor within the boundary of nation that contract issue. If we are building hospitals, for example, in Bangladesh. If Bangladesh want to issue the contract as the NCB, that mean only those company in [inaudible] in the Bangladesh are eligible to participate the business. If this mechanism is ICB, then all other company, all the eligible company or they have a capability, technical or financial capability, can participate in business. You understand ICB and NCB is very important. Majority of business opportunity we see in the UN basically is ICB. The regional development bank, like Asian Development Bank or African Development Bank, we call these bank as a multilateral development bank. These banks also, they have a mandatory contract procedure for executing agency, as it helps the country borrowing the money base, that's what we mean by executing agency. Those countries borrowing the money they must have provision of ICB, international competitive bidding, as a form of getting best value for their money. When they borrow money in Bangladesh, build 100 or 1,000 bed hospital, and Bangladesh does not unnecessary has its own money, so they borrowed the money from Asian Development Bank. Asian Development Bank as a banker or a development bank, they are not there to generate profit for commercial purpose, but they are there to assist, to help underdeveloped countries to achieve economic growth. Therefore, they normally give very long-term, 20-year, 30-year long-term, very low interest rate to support a member country in Asia. ICB is basically the tendering format that most of the country following. Another good characteristic of UN public procurement, globally at the moment, the global public procurement is basically all based on e-procurement. There was time like when you're bidding through some of the tendering process in Pakistan, India, or Sri Lanka, and other Middle Eastern country, there were time to participate those tendering or ICB process, you actually have to buy hard copy RFP, request for proposal. That mean you have to spent a couple of hundred dollar to buy the document. You got to have somebody in local to purchase the document in order for you to consider and write the proposal, send it in actually the proposal as hard copy as well. There are some agency, there are some country still insisting to have the paper-based public procurement policy, but I would say a majority of global trend is now turning into e-procurement. So UN public procurement, the good news is all basically based on ICB, international competitive bidding with e-procurement. Because of this structure, UN public procurement, you don't need to be in there. In other word, if there is requirement from UNOPS, are UNDP in Europe for example, or you UNDP in Africa are UNDP Thailand. They wanted to buy something for African country for office furniture or computer. You don't need to be there to present a document. Wherever you are, whether you are in Thailand, in Korea, or in Japan, you can prepare the contract proposal, and then you will send it in by basically uploading your documentations over the email and participating your tendering process through the e-procurement system. So we're going to talk about later on the forms I would contract for participating UN public procurement, but normally you will have technical proposal and also pricing proposal that there is a different mechanism to prepare the contract. We're going to talk a little bit about that issue later on. But today let's revisit the issue of the public procurement element, these three key element. This is something we talk about the session one and the three key determining principle of the public procurement. Number 1, we said where the money come from for public procurement. Source of funding must be public, the first criteria. Second criteria was the rules and regulation because money is basically a public fund. That because now your money, not our money, it is the government money and paid for by the tax. So it the people money. Therefore, to use the public fund there must have certain rules and regulation, various compliance issue in there. So second criteria is public procurement must have rules and regulation to participate, and evaluate, and perform everything from A-Z based on rule-based the procurement process. Third key element is the beneficiary, as we discuss earlier as part of the public procurement, the principal and all this issue and source of funding must be public. Therefore, we have rules and regulation and then it's only benefit to the public not the private industry or any particular private group. So UN as you understand UN basically and live on with the money and contributed by the member country. We have more than 190 member country, including Korea, Japan, any other country, even North Korea as a member as well. Proportion of the contribution based on the wealth of the country, UN issue, the ranking basically of the country wealth based on GDP, the gross domestic product and other element, decide how rich your country is and then proportion of your country ranking and then you will pay contribution payment. There are a number of a country that do not pay contribution, but normally that's what happened. Because UN procurement basically based on all the fund provided by the member country contribution. We have a very strict rules and regulations for UN Public Procurement. For the US Federal Government, as you remember, we have Federal Acquisition Regulation, F-A-R, we call it FAR. For UN, we have a UN procurement guideline. The UN procurement guideline, like FAR, there are many clear provisions, what you should do, what you should not do, and their rigid provision for exclusion. In other words, some companies may not eligible to register a defender at all. The first criteria is a country bay. Your country must not be sanctioned under UN Security Council. If not, then they would look at your own company. Was the company ever sanctioned by any other contracting agency? Not only, UN I'm talking about, but talking about all other public procurement agency, especially, for Multilateral Development Bank, ADB, African Development Bank. US federal government, IFC, the World Bank. If you do have any of the performance issue or when you have any illegal issue with any of these global public procurement contracting authority, or agency, you may not be able to participate in any other contracting agency. So you have to be very careful when you deal with other public entity for public procurement, because it's a rule based and regulation based. You must strictly follow the regulation and comply with the order thing, do what they asked you to follow. For UN Public Procurement, there are normally 10 different steps of procedure or you can call it process, to complete the transaction. But this transaction from one is not much different from any other public procurement agency such as the US Federal Government or even EU, or Multilateral Development Bank. It's pretty much similar. I will not say exactly the same, but it is pretty much similar. Let's have a look at it, what be the process? The process of international competitive bidding, how it actually originated, how it evaluated, how we actually perform, how it phase out, and basically they consist of 10 different steps. First step, is a need. There must be some need, on why you to need build a hospital? Why you need to buy a vaccine from WHO? Why you need to buy some office furniture by UNOPS. When you have some need, then the need trigger for a budget allocation. You've got to have a need for public use, and then in this instance, the need is already for the member country, for UN. An African country for example, Swaziland or any other African Republic of Congo, they need to by office furniture, IT equipment. They want to buy the thing through UN agency and then UN will buy for them. UN funding or basically UN procurement is not to return to any favor. In other words, it is not like a Multilateral Development Bank, actually you're lending the money, UN will basically buy for in-kind donations. You don't need to pay back what they buy through actually UN. Need generate asset, the budget allocation, and budget allocation give actually methodology, how are they going to execute the budget. After you have the budget allocated, then figure out what you want to do, then you can come up with market research. After market research and then there is advertisement of your tender or ICB, international competitive bidding. Most of the UN Public Procurement, these at the moment are all ICB based. After the advertisement of your business opportunity for the procurement, then people will redistribute the RFP, request for proposal, write the proposal and submit. Contract or you perform the contract. If you can pay for what you provided for services and product, and then phase out. These are the 10 important steps for completing international competitive bidding for UN public procurement. This applies, not only for the UN, but all other important agency. Today, we had a look at what it means by UN public procurement and definition of ICB, and also NCB and the process of how to understand ICB. The next session, we're going to talk about a more specific issue about how to prepare, to participate in UN Public Procurement. Thank you.
