Governments are key players in the economy, responsible for spending taxpayers’ money. In order to carry out their tasks and deliver goods and services to citizens, governments establish economic relations with a large number of providers. Public procurement refers to the purchase by governments and state-owned enterprises of goods, services and works.

Given the size of government spending on goods, works and services, public procurement can be an extremely useful policy tool to achieve economic growth and promote socio-economic transformation. While the primary objective of public procurement is to deliver the goods and services necessary to accomplish government objectives in a timely, transparent and efficient manner, in recent years, LAC countries have been using public procurement to pursue secondary policy objectives as well.

E-government procurement (eGP) refers to the use of information technology (e.g. the Internet) by governments in conducting procurement relations with suppliers and contractors. eGP can be an effective channel to enhance transparency, accountability, and efficiency of the government purchasing function. Furthermore, eGP can induce economic development by stimulating markets, modernising the public sector and improving government performance. Finally, the simplification and/or elimination of repetitive tasks in the procurement process by automation can result in considerable time and cost savings.

In the LAC region, public procurement agencies or public procurement regulatory and monitoring entities are central bodies in charge of the regulation and monitoring of a country’s public procurement system. This is different from the model commonly found in OECD countries, where these bodies are often a contracting authority. In the LAC context, it is uncommon for procurement regulatory entities to purchase on behalf of public sector entities, with the exception of framework agreements and reverse auctions. The most common model found in the region is for countries to centralise policy and monitoring and decentralise operations. Experience from the region has shown that having an agency with a dedicated policy and monitoring role can drive change by ensuring that new rules and regulations, developed as part of the modernisation of legal frameworks, are implemented.