Procurement of products and services by governmental or public organizations has beenone of major topics gathering much attention in multilateral, pluri-lateral or bilateral trade negotiations
since, depending on size of relevant state economy and budget of a government, a share of the government procurement market in its economy is said to be generally between 10 percent and 15 percent of GDP1.
Some reasons, such as needs for protection of domestic economy and industries or national security, have been raised from states for limiting access to the government procurement markets in the state. At the same time, it is said that such the circumscription of the government procurement markets prevents a government to maximize the utility of its budget as this kind of policy may be a hazard for the government to procure the best possible goods or services at a possible reasonable price. It is also pointed out that discrimination between domestic and foreign supply of goods or services create an arbitrary barrier against competitive markets, which distorts fair and equitable conditions for providers of goods and services in a long run, and prevent building a free trade system and order despite this might help a government to achieve its objective in a short run. Moreover, it is said that this could induce an inefficient economy in a state since this may give a protected industry less incentives to improve their goods and services.
Based on such the circumstances and ideas mentioned above, there have been discussions in several occasions and places on how to manage the government procurement and some international disciplines have been created of the Agreement between the European Union and Japan for an Economic Partnership (JEUEPA) is an output of such discussions, which this paper analyzes.
The section I and section II of this paper outlines some materials and notions relating to the government procurement which is the bases of this agreement. Section III explains the text and commitments of Japan and the EU in the JEUEPA. Section IV makes a short observation regarding the relationship of it with the Brexit. Analysis is delivered in Section V.
This article is written based on the personal recognition and opinion of the author and does not reflect the standings of the organization to which the author belongs.
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Koutaro Matsuzawa is Consul, Consulate General of Japan in Honolulu
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