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Public Procurement in Germany

Strategic Dimensions for Well-being and Growth

image of Public Procurement in Germany

As the largest economy in Europe, Germany has a massive public procurement market, accounting for around 15% of GDP (EUR 500 billion) per year and affecting many areas of the economy and society. This review analyses public procurement's impact on the well-being of Germany's citizens by focusing on six areas: economic impact and beyond, the legal and governance framework, centralisation, e-procurement, strategic procurement and human capital. In addition, it analyses procurement at subnational level, since almost 80% of procurement in Germany is conducted by Länder and local governments.

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The use of strategic procurement in Germany

Different approaches to acquiring goods and services can lead to public funds being used to achieve complementary policy objectives. Strategic procurement takes into account these complementary policy objectives. Strategic procurement can deliver varied policy goals in addition to the immediate objectives of achieving value for money and maximising efficiency in delivering public services. In recent years, the German government has placed importance on strategic procurement, developing several national strategies and work plans to support it. This chapter discusses the approaches Germany has taken to mainstream the use of strategic procurement. Germany’s specialised competence centres have been successful in supporting contracting authorities and suppliers, for example. In addition, several policies have created a framework for strategic procurement in the country. To maximise impact, however, additional measures may be necessary to diffuse a systematic approach to strategic procurement – especially at the sub-central level.

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