Korea Federation of SMEs Holds the 4th SME Public Procurement Policy Research Meeting

The Korea Federation of SMEs announced on the 11th that it held the '4th Public Procurement Policy Research Meeting for SMEs.'

원본보기 아이콘

The Public Procurement Research Meeting is an expert group launched by the Korea Federation of SMEs in August 2023, centered on academia, research, and the legal sector, aiming to develop improvement measures related to public procurement policies and to discover new tasks.

At this event, active discussions were held on the systems that need to be improved to revitalize the entry of SMEs into the public procurement market in response to the rapidly changing domestic and international political and economic situations.

The current system prohibits delivery of all products to all institutions when a supplier is sanctioned for unfair practices. However, there was an argument that, to revitalize SME management, delivery restrictions should apply only to specific products and specific institutions subject to sanctions. Additionally, to ensure fair pricing in the public procurement market, it was discussed that companies should be allowed to participate in setting the estimated price, and the minimum bid rate should be raised from the current 80-84% to around 88%.

In particular, there was consensus on the need for a system to reflect sudden increases in raw material prices after procurement contracts are signed. Currently, in construction contracts, if the price of certain materials rises, it can be reflected in the contract amount; however, in goods manufacturing contracts, adjustments to the contract amount are only possible if all costs, including raw material costs, labor costs, and expenses, increase, which rarely happens, making it practically difficult to utilize the system. Therefore, it was suggested that the delivery payment linkage system introduced in the civilian market in 2023 should also be implemented in the public procurement market so that increases in raw material prices alone can be reflected in the contract price.

Kim Ki-moon, Chairman of the Korea Federation of SMEs, said, "The public procurement market accounts for about 10% of the domestic gross production, and SMEs supply 64.6% of this, making it a very important market for SMEs," adding, "Procurement contract systems should not only consider the economic efficiency of purchase contracts but also fully serve as a means to realize national SME support policies. Therefore, when the new government is inaugurated, active system improvements should be made based on the voices from the SME field."

© The Asia Business Daily(www.asiae.co.kr). All rights reserved.