Green Public Procurement in Bhutan

The launch of Green Public Procurement (GPP) in Bhutan is a strategic approach to scale up the public demand to procure environmentally and socially preferable goods, services, infrastructure, and to bring sustainability logic into the consumption and production habits in Bhutan.

According to the European Commission, GPP is defined as “a process whereby public authorities seek to procure goods, services and works with a reduced environmental impact throughout their life cycle when compared to good services and works with the same primary function that would otherwise be procured.”

GPP in Bhutan provides a cross-cutting industrial strategy to support the development priorities in Bhutan along the vision of Gross National Happiness.

The project was initiated since the government public procurement of goods, works, and services in 2012-2013 accounted for 60-70% of the National Budget, which is 35 % of Gross Domestic Product. Comparing the fiscal years 2006 to 2007 and 2012 to 2013, both the current and capital expenditure has more than doubled. It was found that it will be a huge opportunity to integrate environmental and social considerations into these very large volumes of public expenditure to incrementally promote sustainable consumption and production in Bhutan.

The project also noted that the GPP leadership by government can, in turn, encourage private consumption of sustainable products and if implementation process is carefully and strategically done, the sustainable goods are not necessarily more expensive than their traditional alternatives.

During the launch the GPP project in Thimphu on August 21, the Program Leader, Public Procurement and Infrastructure Finance, International Institute for Sustainable Development, Oshani Perera said the project can be adjusted to suit the Bhutanese society and make it successful. Defining green economy, she said, “Use green stuff to make green stuff and produce green stuff waste.”

Gracing the event, the Finance Minister, Lyonpo Namgay Dorji, said Bhutan faces challenges in preserving the culture as the country spends millions in procuring the goods and services and in preserving the environment. He said the project would help address such issues.

The GPP Bhutan project team aims to implement the Bhutanese practices which will enable the procurement cycle to be used as a driver of green growth by increasing the

positive environmental, social and economic multipliers of public consumption, providing an incentive for sustainable production among suppliers, particularly cottage or micro industries, small and medium enterprises, and build demand and supply capacities to write and respond to GPP tenders. It will also provide strong signals for the market to provide more sustainable products at affordable prices and also encourage private consumption of sustainable products.

GPP would also be able to address the corruption in the procurement with definite common national guidelines showing transparency and support the SMEs to produce locally meeting self-reliance. It will also help in environmental conservation as it will mitigate waste and reduce the pollution.

However, there are challenges in implementing GPP due to the lack of

explicit GPP legal, policy, and regulatory framework, lack of adequate knowledge and capacity, budgetary constraints in the immediate term and shortage of supply of green/sustainable goods and services.

The team recognized that such challenges can be handled with the right procurement policies, laws, and guidelines, providing education and capacity building on GPP, supporting producers and suppliers of green products and services, advocacy and public awareness as well as absorbing the extra cost of green in the initial implementation stages.

In regards to the implementation plan, the discussions were also carried out to encourage the government to buy goods and services in sustainable manner and having an effective mechanism in monitoring and evaluation on the project progress.

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