Considering the limited size and full saturation of the local market, outstanding procurement companies are being encouraged to create opportunities in overseas markets. And it is the government’s role to guide them to success, according to the chief of South Korea’s procurement office.
“Our mission is not only to procure and manage material resources for the public sector, but also to sort out capable procurement providers from the private sector and help them expand into the global market,” Park Chun-sup, administrator of the Public Procurement Service, told The Korea Herald in an interview.
“This year, the PPS plans to focus on its mediator role, selecting competent domestic companies and qualified foreign procurement buyers and consequently matching relevant counterparts.”
Having taken office as the procurement office’s chief in July last year, Park has often underlined the importance of communication, be it within the organization or with customers and the market.
In line with such vision, the PPS has since 2013 been operating a procurement export support program titled G-Pass -- referring to Government Performance Assured companies.
Over the past years, total exports by these G-Pass companies has risen nearly 4.5 times, from $130 million in 2013 to $580 million as of the end of 2017. The number of participating players also soared from 95 to 487 during the same period, PPS data showed.
“We have also established a procurement information system based on the database of the International Trade Center’s Procurement Map system, which allows Korean companies to freely access the government procurement bidding announcements of 192 countries worldwide,” the administrator said.
“In addition, an export strategy map is available for companies to search for profitable products and valid sales strategies per country and region.”
To promote its export-oriented vision and to further expand the overseas business landscape, the PPS will be holding the Korea Public Procurement Expo 2018 at Ilsan’s Kintex, starting Wednesday.
The annual event, which has been effective since 2000, is the nation’s largest public procurement exposition that focuses on building the domestic and overseas market for small- and medium-sized procurement firms.
This year, 309 domestic companies will be operating promotional booths, while some 104 foreign buyers are set to attend, according to officials.
A number of new participant countries such as Uzbekistan and Nepal were noted on the list, reflecting the office’s efforts for geographical diversification, Park added.
Besides the buyers, a number of international organizations and academies are also to attend the event for education, workshops and academic discussions. The list of international organizations include the Organization for Economic Cooperation and Development, International Trade Center, World Trade Organization and Asia Development Bank.
“The number of countries and companies participating in our expo has been increasing steadily, reflecting the market’s keen interest,” Park said.
“We shall continue efforts so that the annual expo settles as a key regional and international event in the public procurement sector.”
The office will also operate special booths for small-sized firms that are not yet qualified for government support, but have such potential in the future.
“The number of these early-stage ventures has doubled from 20 last year to 40 this year, and all participating and operating fees are to be exempted for them,” the chief explained.
“We believe that a balanced participation of such innovative players may often present an unconventional product idea or solution.”
The PPS was created in 1949, shortly after the establishment of the Korean government, as an affiliated department under the Prime Minister’s Office.
Then-named the Provisional Office of Foreign Supply, the procurement office contributed to the vitalization of the Korean economy in its early days. In the 1960s, when it was consolidated with the Office of Foreign Procurement and renamed the Office of Foreign Supply, the office played a pivotal role in laying the administrative infrastructure during the country‘s rapid economic growth period.
PPS is also recognized for its online procurement system, Koneps, which was launched in 2002 and won the United Nations Public Service Award in 2003 for its transparency and efficiency. Global organizations including the UN and World Bank have benchmarked the system.
By Bae Hyun-jung & Lee Kwon-hyoung