How Ready Is Indonesia to Open Government Procurement à la TPP?
Government procurement is an important area of economic regulation in every nation, and free trade and comprehensive economic agreements are becoming central venues for adopting procurement standards. Based on arguments for efficient government spending on goods and services, opening commercial opportunities for local firms abroad, and larger concerns of social protection and policy pursued through procurement decisions, countries like Indonesia now need to consider whether they are ready to go down this path. This chapter analyzes in some detail the requirements of the World Trade Organization (WTO)’s Government Procurement Agreement and similar provisions of the Trans-Pacific Partnership (TPP) to assess which reforms, and political choices, Indonesia would need to make to bring its current system into compliance with these international norms. It argues that the costs, benefits, and challenges must be carefully weighed and counsels for a cautious and phased-in opening.