Procurement practices in international development projects: trends, networks and performances

Abstract

Purpose International development projects are a dominant means by which aid is distributed to countries. Over the past 70 years, the distribution of trillions of dollars of development aid has been mediated by the United Nations (UN). However, most of this aid has failed to deliver the expected outcomes for which it was assigned. Nevertheless, a significant proportion of projects can be considered successful. Despite the glaring question as to which factors contribute to the success or failure of projects, no study has comprehensively documented the relationship between procurement mechanisms invoked to deliver aid projects and project outcomes. This study aims to assess this relationship. Design/methodology/approach Leveraging network analysis methodology, this study examines the World Bank data set of over 247,000 developmental contracts worldwide granted over the past 20 years. It identifies the range of procurement practices used and interrogates their ability to deliver satisfactory project outcomes. Findings Eleven prevalent practices are identified covering aid projects across twelve sectors. As might be expected, Africa is the largest recipient of aid, while the Middle East is the least. Overwhelmingly, international competitive bidding (ICB) is the leading procurement procedure, both in terms of contract number and total dollar value. However, ICB does not always deliver the best outcomes, with other, more boutique approaches sometimes doing better. Social implications The breadth of this study, encompassing such a vast data resource, and generating such a rich pool of findings will now empower researchers to take the next important step, which is to progress this study in exploring why it is that certain procurement strategies have worked for some sectors, but not others. Countries, financial institutions, the UN and construction enterprises alike will be very interested in the results. Originality/value The spectrum of outcomes identified will be of interest to academics and practitioners alike wishing to investigate further the drivers behind the results described here.