Foreign participation in public procurement and firm performance: evidence from sub-Saharan Africa

Procurement policy and SME participation in public purchasing

“…7 There is a substantial literature assessing the (potential) role of PP as a mechanism to support innovation (Edler and Georghiou 2007;Aschoff and Sofka 2009;Edler and Yeow 2016) and SME entrepreneurship (Dennis Jr 2011; Harland et al 2019). One reason is that PP can represent a meaningful source of demand for firms, so that a government contract may encourage firms to invest more, expand employment, and increase productivity (Ferraz et al 2015;Hoekman and Sanfilippo 2019). Success in promoting greater participation by SMEs in PP may help attain broader industrial development objectives (Geroski 1990;Acemoglu et al 2018), including through spillovers within geographical clusters of economic activity (Porter 1990).…”

Government Demand and Domestic Firms Growth: Evidence from Uganda

“…Focusing on construction firms in Germany, Gugler et al (2020) for example find that winning firms significantly increase labor demand in the period following winning a procurement contract. Effects are generally heterogeneous across firm characteristics, but seem to be more salient for younger, smaller and domestically owned firms (Hoekman and Sanfilippo, 2020). Hebous and Zimmermann (2021) find that firms winning government contracts expand capital investment in the presence of financing constraints.…”

Editorial

“…Através de instrumentos como as políticas de "compra nacional", as contrapartidas para grupos-alvo (como as PME) e os requisitos de transferência de tecnologia para proponentes estrangeiros, a contratação pública pode criar emprego, promover a modernização das empresas e desenvolver cadeias de abastecimento regionais (UNIDO, 2017). As conclusões de um inquérito realizado em 19 países africanos sugerem que um aumento de 10 pontos percentuais na percentagem da produção total vendida a um governo está associado a uma produtividade 4 % mais elevada (Hoekman e Sanfilippo, 2020). Dada a importância dos contratos públicos para o desenvolvimento industrial, a União Africana apelou recentemente aos Estados-membros para que atribuam pelo menos 30 % dos contratos públicos ao setor privado africano, incluindo PME e empresas de mulheres e jovens (UA, 2021).…”