Regös, N. & Fazekas, M. (2021). Objective corruption risk indicators using Low and Middle Income Country datasets. GTI-R/2021:01, Budapest, Government Transparency Institute, August 2021.
In 2018 global public procurement spend was $11 trillion, accounting for 12% of global GDP (Djankov et al, 2020). This indicates that to prevent deliberate (fraud, corruption) or unintentional (waste, inefficiency) misuse of public resources through overpriced, delayed or low quality public works, goods or services is essential to avoid significant negative impact on social welfare, reduce citizens’ life standards and their access to public services.
Public procurement represents one of the highest corruption risk activities among government functions, as it is one of the most straightforward ways to transfer large sums between the public and the private sectors (e.g. one large highway contract can lead to a high value of corrupt rents). In addition, corruption is relatively easy to hide due to high technical and legal complexity and the generally high degree of official discretion in designing and implementing public tenders.