FACTSHEET: SUSTAINABLE PUBLIC PROCUREMENT
Kiribati
Introduction
This Factsheet outlines the current progress in advancing Sustainable Public Procurement (SusPP) in Kiribati based on a desk review. The review applies an analytical framework of six Pillars (or "building blocks") of SusPP systems.
The Framework is designed to make clear that countries do not need to follow a linear step-by-step path to build effective GPP systems. Rather it is important to examine local contexts and prioritize the Pillars with the most potential in the country. No matter where a country starts, a balanced approach to implementation calls for progress on all Pillars to some degree.
This Factsheet is organized as follows:
The Factsheet is intended to be a living document to promote knowledge sharing and support training activities at ADB. It will be revised and improved as new information is uncovered and advances are made. If you have new information, please contact ychu@adb.org.
Country Overview
Public Procurement accounts for 40% of the GDP in Kiribati, excluding donor funded projects. Each year public procurement spend amounts to around AUD$48 million based on the 2022 annual public procurement report. The Government of Kiribati recognizes that public procurement is a tool for domestic economic and social growth, for instance by providing opportunities for local suppliers. The Procurement Framework was recently updated with support from the ADB, resulting in the Public Procurement Act 2019, Public Procurement Regulations 2020 and Procurement Manual 2021. This Framework specifically promotes procurements based on value for money as a core procurement principle, and requires Procuring Entities to consider criteria beyond purchase price including environmental sustainability (such as energy efficiency and environmental impact). Activities have been launched in 2023 to provide guidance, advisory support and trainings on Sustainable Procurement, with an initial focus on lighting and cooling appliances.
Sustainable Procurement can contribute to the country’s goals for social inclusion and environmental protection. Kiribati consists of 33 islands spread over 3.5 million square kilometres of ocean. The population of over 100,000 lives on 21 different islands, many of which are vast distances from each other. Its economy has enjoyed sustained growth thanks to public spending on infrastructure and revenues from fishing licences. Kiribati’s geographic isolation—both between islands and from the rest of the world—raises the cost of development and public service delivery, leading to infrastructure gaps that severely limit opportunities for private sector development. Economic activity primarily consists of fisheries and copra, with the latter heavily subsidised as social support for isolated populations on remote islands.
ADB can play a key role in the promotion of Sustainable Procurement as a continuation of its support under the Kiribati Public Procurement Reform Program. Other related ADB projects include the Pacific Region Infrastructure Facility, which provides technical advice on sustainable infrastructure management and the Pacific Private Sector Development Initiative that works to reduce constraints to doing business, incentivize entrepreneurship and investment, foster new business models, and remove barriers to women’s full participation in the economy.
Maturity Level:
Early Stage
>> Visual snapshot of Sustainable Procurement Maturity Level
Key Achievements
Ongoing work
Official Procurement Portal: Home | Central Procurement Unit
E-procurement Portal: Welcome To Kiribati Ministry of Finance and Economic Dev E-Tendering (tenderlink.com)
Potential pathways forward
>> Timeline of Implementation of Sustainable Procurement Activities
2016
2017
2019
2020
2021
2022
2023
Kiribati 20 Year Vision 2016–2036 (KV20) promotes sustainable development
Kiribati Integrated Energy Roadmap 2017-2025 calls for energy efficiency vetting team to advise procurement
Public Procurement Act adopted
Public Procurement Regulations adopted
Kiribati Development Plan (KDP) 2020-2023 sets “protecting our environment” as one of six Priority Areas
Procurement Manual published on official procurement web portal
NDC Implementation Roadmap outlines priority actions in transport and energy efficiency sectors
Pacific Green Entrepreneurs Network launched in Kiribati
Energy Act adopted with plans to create Minimum Energy Performance Standards and Labelling
Kiribati Trade Association was established by private energy companies to implement Energy Act 2022
GGGI project to advance Sustainable Procurement launched with several activities planned
State of Play & Forward Looking Analysis
of SusPP in Public Procurement System
Pillar 1: Government Vision & Awareness of SusPP
Governments that establish a clear policy vision on SusPP can accelerate the shift from procurement as an adminstrative to strategic function, making clear how SusPP can deliver on important national social and environmental goals.
No specific policy or action plan exists on sustainable procurement in Kiribati. The Global Green Growth Institute is supporting activities in 2023 to conduct a prioritisation exercise by analysing procurement data to identify high volume products categories with higher carbon intensities. This analysis can set a starting point for implementation of Sustainable Procurement in the country.
Beyond this, the Government has made public commitments and set out several policy priorities that sustainable procurement can contribute to achieving. The Kiribati 20 Year Vision 2016–2036 (KV20) outlines the Government of Kiribati’s vision to promote a wealthy, healthy and peaceful nation through the sustainable development of its natural and human resources. The Kiribati Development Plan (KDP) 2020-2023 is the second development plan to implement the Kiribati Vision 2020 of a sustainable healthier, wealthier and peaceful nation. It focuses on the same six Key Priority Areas (KPAs) used in the former KDP 2016 – 2019: 1. Harnessing our Human Wealth; 2. Growing our Economic Wealth and Leaving No-One Behind; 3. Improving our Health; 4. Protecting our Environment and Strengthening Resilience; 5. Good Governance; and 6. Developing our Infrastructure.
Equal Opportunity
The Kiribati Government through its 20-year vision development plan (KV20) is seeking to develop economic activities on the outer islands, through creation of new industries and improved trade with the view of enhancing inclusive growth, sustainable development, and poverty reduction. It also recognizes the lower participation rate of women in the labour force and aims to improve access to disadvantaged groups to business opportunities.
Energy Efficiency and Renewables
The Kiribati Development Plan (KDP) 2020-2023 sets goals to:
The country’s National Determined Contribution (revised) 2022 commits to mitigate up to 33,100 tonnes of CO2 annually by 2050, 42% of the projected Business-As-Usual emissions for 2030. The NDC prioritises energy conservation and energy efficiency, and the transition towards renewable energy sources. A 2021 NDC Implementation Roadmap for the transportation and energy efficiency sectors specifically calls for the promotion of Sustainable Procurement to achieve improved energy efficiency. Other mitigation actions are highlighted in the NDC Implementation Roadmap that can be integrated into sustainable procurements including:
The new Energy Act adopted in 2022, includes a section on Minimum Energy Performance Standards and Labelling which legislates importers of electrical appliances being implemented by the Energy Planning Unit (EPU) of the Ministry of Infrastructure and Sustainable Energy (MISE). The Energy Act 2022 recognizes the significant role of private enterprises for sustainable development and the transition to achieve the vision of providing available, accessible, reliable, affordable, clean, and sustainable energy options for all.
Pillar 2: Legal & Regulatory Framework
Procurement law reform can be key to clear obstacles to implementation by establishing "value for money", not "lowest price", as a core procurement objective, and authorizing procurement approaches suited to SusPP.
Public procurement in Kiribati is regulated by the Public Procurement Act 2019 (PPA) and the Public Procurement Regulations 2020 (PPR) adopted in December 2020. ADB has provided direct support to the government of Kiribati in the development of its revised procurement legislation and associated capacity development activities, including the development of the 2021 Procurement Manual.
Value for Money
The PPA (Section 4.1) sets out “Value for Money” (VfM) as the first of seven key procurement principles, with an emphasis on “protection of the Social Considerations of the people of Kiribati.” The PPR (Sections 5.1-5.3) defines “Value for Money” as “effective, efficient and economic use of resources and the evaluation of relevant costs and benefits, along with an assessment of risks and life-cycle costs. Value for Money considerations can include: fitness for purpose, experience and performance history of a Tenderer, flexibility (including innovation and adaptability over the lifecycle of Public Procurement), environmental sustainability (such as energy efficiency and environmental impact), maintenance and service. The concept of “sustainability” is not mentioned in the PPA and PPR, however the Procurement Manual, Section 3.1.2 and 3.1.3 highlights the importance of sustainability and green growth for Kiribati.
Minimum standards
The Procurement Manual recommends that minimum environmental and social standards be required in all Invitations to Tender within the Certificate of Compliance form. Recommended environmental requirements are linked to ensuring tenderers refrain from environmentally harmful acts and comply with environmental, health, and safety laws. In addition, Tenderers can be asks to commit to the principle of the UN Supplier Code of Conduct that sets out minimum standards for labour rights, human rights, environment and ethical conduct. The Manual, Article 7.4.11.2, also notes that Procuring Entities can exclude Tenderers that have violated obligations in the fields of environmental, social and labour law set in national law, collective agreements or international law (a listing of relevant international laws is provided).
Life-Cycle Costing
The Procurement Manual, developed in March 2021 with ADB support, offers further guidance for consideration by Public Entities. The Manual, Article 7.4.13.7, advises that financial evaluations should reflect Total Cost of Ownership (TCO) or preferably Life-Cycle Cost (LCC), the latter being a broader concept that considers costs and effects beyond the immediate
control of the Procuring Entity, such as environmental considerations, climate effects, social aspects, etc.. Environmental costs may include the cost of emissions of greenhouse gases and of other pollutants, and other climate change mitigation costs.
Non-price criteria
The PPR , Section 5.3, states that Procuring Entities shall not limit evaluations to the price of acquisitions but shall also consider all other possible costs. Such other costs can include warranties, times and scope, service and maintenance, operational costs, disposal (recycling, deposit, demolition, dismounting, destruction etc), delivery time and terms of payment, technology transfer, counter-trade, local content of manufacture, labour and material etc.
Social considerations
The term “Social considerations” is defined in the Procurement Manual as including but are not limited to, “environmental protection, energy and water efficiency, climate change, gender equality, workers conditions, child labour, accessibility for persons with disabilities, social inclusion of indigenous people and reduction of domestic unemployment.” The Manual provides further detail in Section 7.4.13.8, outlining the use of social considerations as voluntary, to be decided on a case by case basis by Procuring Entities depending on the subject matter of the Contract and their objectives.
Domestic preferences
The PPA and PPR allow Procuring Entities to set domestic market preferences. Procuring Entities may decide to privilege domestic Tenderers or international Tenderers committing in their Tenders to use domestic resources. Procuring Entities shall specify the reasons and methodology for such domestic preference in the Invitation to Tender.
The Procurement Manual recommends additional scoring of between 5-15% for domestic preferences. The assigned point value should be based on an analysis of the domestic market potential and weight of the technical component versus the financial (lower weight, higher points for domestic preference). For High Value Procurement (HVP), domestic preferences require careful analysis and may be most suitable in construction and works projects, where local labour may more easily be used.
Technology and knowledge transfer is also encouraged, as well as transfer of assets to domestic Operators, all which can be assigned additional points in tender evaluations. The integration of domestic preferences in MVP or HVP must be approved by the Chief Procurement Officer.
Award/Evaluation Procedure
The PPR, Section 5.1, states that Procuring Entities can obtain VfM by applying technical scoring criteria above mandatory technical criteria (i.e. best price-quality ratio) or without additional scoring (i.e. lowest price). Award criteria must be precise, non-discriminatory, proportional and competitive. The Procurement Manual recommends that when a Procuring Entity uses a life-
cycle costing approach, the data to be provided by Tenderers and assessment method must be objectively verifiable, non-discriminatory and clearly indicated in the Invitation to Tender. If a common LCC method is developed by a legislative act of the Government of Kiribati, Procuring Entities must apply the specified method.
Contract Management
The Procurement Manual highlights the importance of following up on criteria to ascertain that international Tenderers fulfil the requirement to use domestic resources when they receive benefits in the tender evaluation.
Pillar 3: Institutions & Capacity
Implementing SusPP requires assigning clear roles and responsibilities to agencies across government and actors across society, equipping them with the strategic knowledge and technical skills needed for success.
Key Institutions
Public Procurement in Kiribati is decentralised to the Procuring Entities, consisting of Kiribati Ministries, entities funded by Public Funds or 50% of more Government controlled, State-Owned Enterprises and Statutory Corporations. Each Procuring Entity has the full responsibility and accountability for their budget, execution of Public Procurement and that Value for Money is achieved. However, for control, advice and oversight, all Entities are supported by the Central Procurement Unit (CPU) within the Ministry of Finance and Economic Development (MFED). The CPU was established in June 2018 as the centre of excellence for Public Procurement in Kiribati, responsible for providing operational advice, training and support to Procuring Entities. Every Procuringt Entities shall have a dedicated Procuring Officer that closely collaborates with the CPU. The development of a stakeholder engagement and management plan was planned with ADB Financing in 2021.
ADB supported activities in 2021 under the Kiribati Public Procurement Reform Program to expand the capacities of the CPU. The work included formulating a transition strategy to centralize the procurement of core and
strategy purchases within the CPU, and initiate the purchasing of common items required by Procuring Entities above a stated threshold. In 2023, the Global Green Growth Institute (GGGI) financed the engagement of an international consultant to act as Specialist Advisor on Sustainable Procurement in Kiribati. The scope of work of the consultancy includes to a) conduct a prioritization exercise based on procurement data, b) support the Central Procurement Unit to apply and extend sustainable procurement principles and plans, c) write procurement guidelines for lighting and cooling appliances potentially as an Addendum to the Procurement Manual, d) provide advisory support to procuring entities, e) conduct trainings on SusPP. The Specialist Advisor will work in collaboration with a Sustainable Procurement Promotion and Training Officer (national consultant) in Kiribati.
The Kiribati Integrated Energy Roadmap 2017-2025 calls for the establishment of an energy efficient vetting team to advise the government procurement office on the selection of energy efficient appliances (Table 46). It is unknown if this team has been constituted as of June 2023.
Training
The CPU is responsible for conducting training for Procuring Entities. With ADB Financing, training materials were developed and made publicly available on the Kiribati Public Procurement Portal, all based on the Procurement Manual (which contains some guidance on sustainable procurement).
The NZMFAT through GGGI is financing the development of a training program on Sustainable Procurement in 2023 that focuses on improving energy efficiency of lighting and space cooling appliances, with plans to expand into other product categories. Training participants are expected to be,
but not limited to, public service employees responsible for procurement at the ministry level, Island Council finance officers and clerks, and senior leadership from state-owned enterprises. The topics to be covered are:
The GGGI is supporting work to explore the viability of delivering sustainable procurement qualifications through regional tertiary institutions such as the University of the South Pacific. An online course on the topic, for regional delivery, could also be developed.
Pillar 4: Market Practices
Market dialogue throughout the procurement process helps procuring entities to choose realistic sustainability criteria and ensure suppliers succeed in delivering on sustainability commitments over the contract duration.
Market dialogue
The Procurement Manual encourages market dialogue which can be important in the design of Sustainable Procurements. The Manual notes that Annual Procurement Plans should be based on proper and verified “non-committing Market Assessments” to determine a realistic budget (Article 7.3). When preparing tender documents, the Procurement Manual recommends a pre-study investigation to inform the needs assessment stage to determine what the market can offer by y (i) benchmarking with other buyers with similar prerequisites and (ii) contacts with Economic Operators, and (iii) in some relevant cases also with research institutes, to investigate new innovative solutions. A structured plan for how to approach Economic Operators must be developed.
Several tools are available to Procuring Entities to assess the market potential. A Request for Information (RFI) could be issued, either posted or submitted to a selection of potential Tenderers, to receive comments and suggestions, including innovation solutions. Procuring Entities can also specify functional, performance or outcome requirements - rather than detailed technical specifications - which can open the door for market innovation. A Two-Stage Procurement procedure can be used for complex procurements, with criteria described on a high level and Economic Operators invited to propose innovative solutions.
Business Groups
The Kiribati Chamber of Commerce and Industry maintains a member listing that showcases local businesses that can be engaged in public procurements. The Kiribati Trade Association was established by private energy companies following the adoption of the Kiribati Energy Act 2022. The Association was launched following a two-day training on sustainable energy business start-ups and entrepreneurship for the private sector hosted by the Pacific Community’s (SPC) Pacific Centre for Renewable Energy and Energy Efficiency (PCREEE) and the Kiribati Energy Planning Division, Ministry of Infrastructure of Sustainable Energy (MISE).
The regional Pacific Green Entrepreneurs Network aims to support green and inclusive job growth by supporting entrepreneurs (particularly women and youth) develop their green and sustainable businesses whose business models include solutions aimed at contributing to their country’s climate and sustainable development goals. A Greenpreneurs Jumpstart Your Green Business Workshop was held in October 2018, organised jointly between the GGGI and Pacific Centre of Excellence for Renewable Energy and Energy Efficiency. Over twenty participants engaged with trainers and local business mentors to learn about trends in agriculture, waste, and low-impact tourism; requirements for starting a business in the country; and examples of existing successful green businesses in Kiribati and the Pacific region.
A Guide to Green Entrepreneurship in Kiribati was developed that aims to assist other potential green entrepreneurs in developing new, innovative green business ideas that will help Kiribati meet its environmental and developmental goals and ensure a clean, prosperous future for the country. Nine Kiribati businesses have graduated from the Pacific Green Entrepreneurs Network Program, offering sustainable bricks made from recovered waste, sustainable food products, electronics repair services and solutions for solar energy, water and sanitation.
Capacity Building
The NDC Implementation Roadmap Section 2.2.2. calls for the provision of technical assistance and capacity building to support the upgrading of critical industrial equipment to promote energy efficiency and cost savings. A national survey and mapping of energy-intensive activities in the industry sector will be conducted in fish processing plants, copra processing plants, ice plants and others, followed by detailed energy audits to assess the potential technology options or operation and maintenance approaches available to improve energy efficiency. Finally, technical advisory and financial support will be provided for the implementation of the upgrades and financing options for up to five facilities. The potential for cogeneration and sharing of such resources between industrial facilities and nearby power generation facilities will be explored. For the capacity building component, a certification system for energy auditors will be developed. Training will be provided for a selected number of beneficiaries. A system for reporting and aggregating energy data from industry will also be developed.
Pillar 5: Procurement Operations
Various tools and procurement approaches can be employed to help procurers more easily identify environmentally friendly goods and services and attract a competitive market response.
Sustainability Criteria
The government of Kiribati launched a new central procurement website in March 2020. However, no specific guidance on tools on sustainable procurement have been developed in Kiribati to date. The GGGI is supporting work to draft sustainable procurement guidelines for lighting and cooling appliances. The draft will include consideration of the draft Energy Bill, and the minimum energy performance standards for lighting and cooling appliances. The guidelines will be released potentially as an Addendum to the Procurement Manual, in order to make the information accessible and easy for procuring entities to locate and apply. Based on this experience, sustainable procurement guidelines can then be expanded into other key sectors including motor vehicles/transportation, construction, catering and hospitality, and services.
Central Procurement Approaches
The GGGI is also offering direct advisory support to Procuring Entities to integrate sustainable procurement into procurement actions. It also plans to explore the feasibility of “Cooperative Sustainable Procurement” within the public procurement system, where there are multiple public procuring entities that benefit from procuring at scale and with fewer procurement efforts. There is also the possibility of doing the same for suitable state-owned enterprises or between larger private organisations. That extension work could also include sub-regional or bilateral cooperative public procurement with public procurement entities located in other PICs.
Pillar 6: Monitoring & Impact Measurement
Monitoring systems are essential to gather the information needed to keep SusPP implementation on course and communicate on the benefits achieved for the country.
The Chief Procurement Officer of the CPU prepares an Annual Public Procurement Report, including statistics on “the level of contracts with sustainable criteria”. The Report must be submitted to the Permanent Secretary of the Ministry responsible for Finance during the first quarter of the following year. An Executive Summary is to be published on the Kiribati Public Procurement Web Portal after approval. No copies could be found to date.
Under the GGGI project, the national Sustainable Procurement Promotion and Training Officer was required to submit a completion report in 2021 to include data on the total number of people trained and number of public procurement events known to have used the new Sustainable Procurement Guidelines on lighting and cooling appliances.
Key Stakeholders Driving the Sustainable Procurement Agenda
Resources
Projects Supported by ADB
ADB has been supporting Kiribati in building fiscal stability and upgrading infrastructure related to water supply, transport, renewable energy and health, and enhancing disaster resilience. ADB’s approach for the Pacific promotes energy efficiency and renewable energy.
Through TA-9719 REG: Pacific Economic Management (Phase 3), a Senior Procurement Policy Specialist was recruited to support the Ministry of Finance and Economic Development of the Government of Kiribati on the development and implementation of the Kiribati Public Procurement Reform Program, including setting up the public procurement system and mentoring the responsible unit.
Other Initiatives supported by National/International Agencies
The Global Green Growth Institution (GGGI) signed a funding agreement with New Zealand’s Ministry of Foreign Affairs and Trade (MFAT) for the Low Emission, Climate Resilient Development (LECRD) Project. In 2023, GGGI was seeking to engage a Specialist Advisor on Sustainable Procurement in Kiribati to a) conduct a prioritisation exercise based on procurement data, b) support the Central Procurement Unit to apply and extend sustainable procurement principles and plans, c) write procurement guidelines for lighting and cooling appliances potentially as an Addendum to the Procurement Manual, d) provide advisory support to procuring entities, e) conduct trainings on SusPP.
References
ADB Member Fact Sheet, 2020. Kiribati.
ADB “Pacific Renewable Energy Investment Facility Kiribati: South Tarawa Renewable Energy Project”, Project No. 49450-021, August 2020.
ADB Presentation “Public Procurement Reform in Kiribati” dated 9 March 2021.
Global Green Growth Institute, Guide to Green Entrepreneurship in Kiribati.
Government of Kiribati, Kiribati 20 Year Vision 2016–2036 (KV20)
Government of Kiribati, Act to Regulate Public Procurement of Goods, Services and Works 2019.
Government of Kiribati, NDC Implementation Roadmap for the transport and energy efficiency sectors, 2021.
Government of Kiribati, Kiribati Integrated Energy Roadmap 2017-2025
Government of Kiribati, Public Procurement Regulations 2020.
Government of Kiribati Public Procurement Web Portal.
Government of Kiribati, 2021. Procurement Manual.
Pacific Women Sharing Pacific Development, 2018. Women’s Economic Empowerment Feasibility Study, Kiribati.
UN Job Net, Job posting for KI07 Specialist Advisor Sustainable Procurement Kiribati by the Global Green Growth Institute (GGGI), expired on 16 March 2023.
World Bank, Global Public Procurement Database “Kiribati country profile for 2021”.
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