New Opportunities in Government Procurement
AUSFTA guaranteed access for firms of each country to their respective government procurement markets. For US firms, the agreement led to a reform of the Australian procurement market and the removal of state and federal preference policies overcoming previous barriers that gave advantages to local firms. For Australian firms, the FTA overcame loadings previously imposed on Australian firms as Australia was a non-signatory of the international agreement on government purchasing.
Australian suppliers were subsequently able to bid for contracts tendered by US federal government entities with a waiver from the Buy American Act.
AUSFTA guaranteed access for firms of each country to their respective government procurement markets. For US firms, the agreement led to a reform of the Australian procurement market and the removal of state and federal preference policies overcoming previous barriers that gave advantages to local firms. For Australian firms, the FTA overcame loadings previously imposed on Australian firms as Australia was a non-signatory of the international agreement on government purchasing.
Australian suppliers were subsequently able to bid for contracts tendered by US federal government entities with a waiver from the Buy American Act.
- Australia became a designated country under the US Trade Agreements Act, avoiding a 6 per cent penalty on foreign goods and competing on equal terms with suppliers from over 60 other designated countries. The removal of this barrier allowed Australian firms to operate directly instead of through a joint venture or US subsidiary.
These reforms generated significant sales by foreign affiliates of each country ± although no exact statistics are available. AUSFTA enabled Australian businesses to access the US federal government procurement market valued at over US$200 billion annually. Australian Infohrm human relations firm for example, was able to contract its services to the US Department of Justice and the Federal Deposit Insurance Corporation.
Lend Lease took advantage of the opportunity to expand into construction and commercial property management in the government sector. It secured over US$1 billion of new work in the second half of 2011 (AFR, 26 April 2012) with total revenue over US$4 billion. Projects included mixed use buildings in Manhattan, the National September 11 Memorial and the JFK Terminal 4 redevelopment. In the second half of 2011, Lend Lease became the preferred tenderer on five US government healthcare projects worth Rapid growt