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PROCUREMENT BEST PRACTICE
& the Millennium Development Goals
FIDIC/GAMA CONFERENCE
Durban, 16 March, 2009
Enrico VinkFIDIC Managing Director.
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Overview
Who is FIDIC?
The MDGs Status Report
The links to FIDIC and its members
Key issues impacting on MDG progress
Conclusion
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FIDIC Today
FIDIC 1913 3 Member Associations
FIDIC 2009 - 81 Member Associations.
FIDIC Members represent some 45,000 firms and
some 2 million professionals in the consultingengineering business.
FIDIC speaks with ONE voice. It represents ALL theprivate sector consulting engineers (approx 3m)
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FIDIC Objectives
What FIDIC Does?- represent globally the consulting
engineering industry
What FIDIC offers?- best business practice and tools to
promote a sustainable industry:documents, guides, training etc
What are FIDIC Principles?- quality, integrity and sustainability
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Global Infrastructure Market
Annual investment in construction - $5,100 billion
Average impact on GDP 9%
Significant Economic Value implied
Annual consultant fees - $310 billion
Annual Investment by MDBs - $80 billion?
(ODA Spending - $105 billion)
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The Millenium Development Goals
1. Eradicate extreme poverty & hunger
2. Achieve universal primary education
3. Promote gender equality & empower women
4. Reduce child mortality
5. Improve maternal health
6. Combat HIV/Aids, Maleria & other diseases
7. Ensure Environmental Sustainability
8. Develop a global partnership for development
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The MDG Scorecard Mixed Results
1. Poverty & hunger:
1 billion less than $1/day (down 20%)
800 million under nourished Mixed results since 1990, but also some successes
2. Primary education
Enrolments up 8%, but 115 million children no schooling
3. Gender equality
Slow progress in many countries (only 3% improvement)
Politics and Societal changes
4. Child mortality Good progress, but 11 million under 5 die each year
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The MDG Scorecard
5. Maternal health
Some progress, but 200 million unsafe
High risk of death during child birth6. HIV/Aids, Maleria etc
Still major problem - 20 million deaths
Huge impacts on economic growth
Maleria affects 350-500 million people
7. Environmental Sustainability
Deforestation, urbanisation, water, fisheries etc still
significant problem. The carbon trade scandal.8. Global partnerships
Governments, private sector, NGOs, Civil Society
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The Millenium Development Goals - Upsides
Agricultural training for self sufficiency
Better irrigation schemes
Expanded transport infrastructure
Water supplies improved
Power supplies increased
Waster water treatment enhanced
Institutional reforms
Integrity, transparency
More health/education facilities
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The Millenium Development Goals - Upsides
Numerous reports on Infrastructure & MDGs
1. http://www.oecd.org/dataoecd/22/31/36567911.pdf
2. http://www.new-rules.org/docs/epiam/lofgren-bonilla.ppt
3. http://pse.litbang.deptan.go.id/ind/pdffiles/Thestudyofeffieciency.pdf
4. http://www.unece.org/commission/MDGs/Brochure_MDG_E.pdf
5. http://businessfightspoverty.ning.com/group/mdgsatthemidpoint/forum/topics/2014886:Topic:10751
Message clear development needs goodinfrastructure!!
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The Millenium Development Goals - Downsides
Natural Disasters floods, droughts etc
Politics
Corruption (see also politics)
Lack of Infrastructure
Global versus local Poor policies and procedures
Lack of support
Inappropriate support Weak procurement
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Procurement Issues
Price dominated ie competition at all cost encourages corner cutting.
Influenced by political and economic factors.
Huge negative impact of corruption
Lack of focus on core objectives end users ,andsuitability of outcomes (life cycle issues,MDGs)
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Fair Procurement & FIDIC
Quality paramount
Capacity Building priority
Sustainability
Integrity
IFIs important
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Project Scope
Investment priorities
Political & legalconsiderations - MDGs,
Intl Conventions etc
Sustainability Issues:social, environmental,economic, cultural
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Quality Tools
Quality Management System
Guide
ISO9001:2000 interpretation
guide
Training kit
Business practice guides
Quality of Construction
Quality Based Selection
Forum
Quality Management Forum
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Sustainability Tools
Environment Management Systems
Industry resource kit
Urban resource kit
Project Sustainability Management
Guide
Business practice
Guide
Strategy
Sector report
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PSM Methodology
Anchored in core indicator list arising fromUNCSD/Agenda 21/Millennium Development Goals
Process for transparently customizing to projectneeds
Includes
Client-specific objectives/commitments
Stakeholder involvement
Equator principles/IFI Safeguard Principles/financing
issues Local Agenda 21 activities/MDG priorities
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PSM Uniqueness
Covers all kinds of projects
Compatible with GRI, other sustainability systems,client policies
Selection of performance targets for every issueranging from compliance to SD
Continuous improvement focus
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Integrity Tools
Business Integrity Management
System
Guide
Training kit
Business practice
Code of Ethics
Policies
- Conflict of Interest- Anticorruption
Model Representative Agreement
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Integrity Tools
FIDIC Policy 0 tolerance
Products BIMs, GPIMs
Influence IFIs, others
MAs and firms
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Business Integrity Management System (BIMs)
Compatible with most global conventions.
Based on Quality Management System.
Can be Third Party Audited
Encourages Training & Education
Being implemented, but
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Other FIDIC Tools
HIV/AIDs policy 2004: http://www1.fidic.org/about/statement19.asp
FIDIC Contracts and Agreements
Defining Services of Consultants
Risk Management Guides
Capacity Building programmes
81 Voices worldwide
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Conclusions
Procurement:
- Governments and clients need good advice on: Investment options and scope
Politicial, economic and social priorities
Procurement options
Contract options
Integrity
- what are the real issues and their impact?- how to tackle the root causes?
Sustainability
- what is it, and how can it be defined?- where and when to discuss? By whom?
- national law/conventions/procurement/contracts?
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Conclusions
Consulting Engineers: Talk to ALL stakeholders Offer real solutions Humanise what you do and spread the word
Associations- Raise profile- Promote the industry- Seek to influence decision makers
Funders- Utilise more the skills of the consulting sector
- Support and encourage capacity building- Promote best practice procurement
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FIDIC contacts
International Federation of Consulting Engineers
President: John Boyd, Canada
President-Elect Gregs Thomopulos, USA
Treasurer Adam Thornton, NZ
Secretariat World Trade Center 2
Geneva Airport
Box 311
CH-1215 Geneva 15Switzerland
Tel: +41 22 799 49 00
Fax: +41 22 799 49 01
www.fidic.org
Managing Director Enrico Vink
General Manager Peter Boswell
Thank you