China Launches Pilot Program to Optimize Government Procurement

China’s finance ministry has announced the launch of a pilot program in selected regions of the country to promote fair competition in government procurement and continuously optimize the procurement business environment.

Pilot work will be carried out to address the issue of abnormally low prices in government procurement in the free-trade pilot zones of Beijing, Tianjin, Shanghai, Fujian, Guangdong, and the free-trade port of Hainan, according to a notice released by the Ministry of Finance on Wednesday.

The notice states that procurement entities in the pilot areas should comprehensively consider the historical transaction information of projects and market research to form scientific, complete and clear procurement demands, and must set reasonable maximum price limits to provide a basis for competitive bidding by suppliers.

It is imperative to strengthen the review of abnormally low prices in government procurement, the notice stated, urging further work to strengthen the guidance and supervision of evaluation experts.

The notice will be implemented from Feb. 1, 2025.