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International financial institutions and United Nations procurement: 2. Prepare for opportunities with the IFIs and the UN

2. Prepare for opportunities with the IFIs and the UN

Prepare your company to work with IFIs/UN agencies and expand your international presence. The international aid market is growing and offers many opportunities for Canadian businesses.

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Preparing for procurement opportunities

Country strategy documents

Begin by identifying country and development needs.  IFI projects are based on a country’s vision for its long-term development through strategy documents. These can help your company identify potential opportunities and a country’s key priorities. Successful companies will track projects throughout the lifecycle. 

 Access country strategy documents

Project cycle

Key stages in the procurement project cycle

Procurement projects and subcontracts are available at every step of the project cycle. These include (but are not limited to):

Identification

IFI/UN identifies development need(s), outcome(s) to be achieved, and time and cost constraints.

Preparation

IFI/UN researches and analyzes the supply market. Chooses appropriate selection method and approach to market options. Prepares Procurement Plan.

Appraisal

IFI/UN specifies the technical, financial and economic requirements, and develops an evaluation methodology. Prepares to go to market.

Negotiation

IFI/UN selects and/or negotiates the most appropriate proposal or bid. Contract is awarded.

Implementation and Supervision

IFI/UN proactively manages the contract and project implementation.

Evaluation

IFI/UN conducts post-implementation review. Has the project delivered Value-for-money? What are the lessons learned?

Project and procurement information

The IFI/UN agency and the borrowing country share the work on project preparation. However, the country is responsible for project execution and procurement. Procedures are relatively similar for all  IFIs and UN agencies.

Procurement notices represent the business opportunities in IFI and UN-financed projects. These are generally posted on their respective website, as well as on websites that gather project information from multiple sources. These websites offer advanced search features and several can automatically notify you of opportunities that match your company’s interests. Notices are often posted on the IFI website for free, while other services offer this information with an annual subscription fee.

Before bidding, familiarize yourself with the procurement guidelines of the IFI/UN agency. These guidelines define the policies, procedures, and procurement methods that have been agreed to by the borrowing country and the IFI or UN agency.

The relationship between your company and the borrowing country is governed by your contract with the borrower, not by the IFI/UN’s procurement guidelines. 

Understanding types of procurement

Procurement of goods and works

Bids are not only evaluated on price, but also performance, training, maintenance, and operations costs. Contracts are awarded to the lowest-cost compliant bid, based on the evaluation criteria for a project. Some preference may also be given to domestic bidders, or for manufactured goods with a minimum percentage of domestic content.
International Competitive Bidding (ICB) or Open International Competition is the preferred method when procurement projects are higher-value or complex. ICB ensures all eligible firms are notified so there is equal opportunity to bid on a project. Borrowing countries must publish bid invitations or prequalification invitations in one or more local publication and on UN Development Business Online. In some cases, invitations will also appear on the IFI website

Methods other than ICB may be used, like national competitive bidding (NCB), shopping, and direct contracts. The option chosen will depend on the scope, nature, and complexity of the contract.

Access current guidelines for procurement of goods and works

Procurement of consultants and non-consulting services

Consultants can include:

Non-consulting services are distinguished by measurable outputs/deliverables, including drilling, maintenance, mapping, etc. These are procured in the same way as goods and works. 

Selection of consultants

To select consultants for a contract, the borrowing country publishes a procurement notice on:

The notice will ask firms to submit Expressions of Interest (EOIs). Consult Preparing an expression of interest (EOI) for guidance.
The borrowing country then prepares a shortlist of companies or individuals and sends a Request for Proposal (RFP) or solicitation document to them. The RFP includes the instructions to consultants, the Terms of Reference for the project and the proposed contract.
Your company’s relationship with the borrowing country is governed by the RFP and the contract, not by the IFI/UN’s procurement guidelines.

IFIs are increasingly looking to award contracts based on value for money, fit for purpose, and other business-friendly principles in accordance with the New Procurement Framework. The heaviest emphasis in selecting a consultant is on the quality of the services to be provided, which is usually decided by Quality and Cost-Based Selection. The weight given to quality and cost will depend on the complexity and nature of the assignment, although it is usually around 80 percent for quality and 20 percent for cost.

The borrower may also use Quality-Based Selection (QBS) if the scope and complexity of the assignment is highly specialized and/or difficult to define, or the assignment will have a major impact on the future of the project. In QBS, technical proposals are submitted for evaluation first, and financial proposals submitted only after the technical evaluation has taken place.

Access current guidelines for procurement of consulting services

Corporate and institutional procurement

IFIs and UN agencies also need to purchase goods or services for their own operations. These business opportunities (referred to as corporate or institutional procurement) include a wide variety of goods and services:

These are advertised on:

Private sector lending

IFIs have increased their focus on direct financial lending to the private sector in recent years. Some IFIs also lend directly to non-sovereign guarantee actors such as municipal or local governments and other financial institutions. 

IFIs and the UN offer this lending through a variety of financial instruments, including direct financing and private equities, as well as other innovative financing mechanisms.

Access private sector lending information

Trust funds

Development partners can choose to channel their funds through IFIs, which they can entrust with their policy priorities and funds. Trust funds allow for the scaling up of activities, notably in fragile and crisis-affected situations, to provide support when an IFI’s own ability to lend is limited.

Access trust fund information
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