In addition to  the GPA, the United States has 14 FTAs with 20 countries, 4 of which  (Canada, Israel, Singapore, and South Korea) are also parties to the  GPA. Available 2010 Data Show Covered Procurement Reported by the United States Was Twice the Combined Amount Reported by the Next Five Largest GPA Parties

Data available from the WTO for 2010 show that the United States  reported more than twice as much GPA-covered government  procurement as the next five largest GPA parties combined, although  total U.S. government procurement is less than the combined total for the  other five parties. 2.) According to USTR officials,  limited tendering is considered to be covered procurement under the  GPA. These statistics provide transparency—one of the GPA’s  main goals, according to the WTO—about parties’ implementation of the  GPA as well as the agreement’s benefits. Parties have not provided data for all entities  covered by the agreement, as required. Inconsistencies in reporting. U.S. Agencies’ Approach to Reporting GPA- Covered Procurement Does Not Ensure Timeliness, Accuracy, and Comparability

U.S. agencies’ approach to statistical reporting of covered government  procurement to the WTO does not ensure the timeliness, accuracy, or  comparability of the reported data. In addition, USTR  lacks a methodology for reporting states’ and other government entities’  GPA-covered procurement, as the GPA requires, and instead reports  estimated total government procurement, which exceeds covered  procurement. Revised U.S. As a result, the United States did not report  procurement data to the WTO for 5 years, despite the 1994 GPA  requirement to report annual statistics. In addition, it is  inconsistent with federal standards for internal control that call for U.S.  agencies to issue relevant, accurate, and reliable information and to  record and communicate the information within a time frame that enables  entities to carry out their responsibilities. Conclusions

Government procurement constitutes a significant potential market for  international trade that the U.S. government has sought to open through  the GPA and FTAs. Moreover,  recent data on procurement covered by U.S. FTAs are not available— NAFTA parties last exchanged such data in 2005, and the government  procurement chapters of the U.S. FTAs we reviewed do not require  statistical reporting of covered government procurement. Recommendations for Executive Action

To improve the quality and transparency of statistical reporting of  international government procurement by GPA and U.S. FTA parties to  fulfill their commitments under these agreements, we recommend that the  U.S. Trade Representative take the following two actions:
Prepare and submit a proposal to the WTO GPA working group on  statistical reporting established by the Committee on Government  Procurement that aims to improve the quality of statistical reporting by  WTO parties to address the weaknesses we identified. Ensure that calculations using U.S. procurement statistics and other  data are reviewed for accuracy before reporting them to the WTO. Appendix I: Objectives, Scope, and Methodology

For this report, we (1) broadly compared covered government  procurement reported by the United States and other parties to the World  Trade Organization’s (WTO) Agreement on Government Procurement  (GPA) and U.S. free trade agreements (FTA); (2) assessed the  usefulness of GPA and U.S. FTA parties’ statistical reporting for more  detailed comparisons of—and transparency regarding—their covered  government procurement; and (3) examined the extent to which U.S.  agencies’ approach to reporting statistical data on covered government  procurement to the WTO ensures timeliness, accuracy, and  comparability. These limitations  include the absence of U.S. statistical notifications to the WTO for years  after fiscal year 2010; the lack of timeliness, completeness, and  consistency in GPA parties’ reporting; the lack of common understanding  and practice among GPA parties regarding reporting of procurement data;  the 2009 change in the U.S. methodology for reporting federal  procurement; and the failure of U.S. notifications to distinguish covered  from noncovered government procurement for the states. 6.)
Why GAO Did This Study

Globally, government procurement, estimated at $4.4 trillion annually, constitutes a significant market for international business. However, according to officials from the Office of the U.S. Trade Representative (USTR), which is responsible for reporting to the WTO, government procurement markets are often closed to foreign competition. GAO was asked to review U.S. participation in international procurement agreements, which seek to ensure fair and open competition on a reciprocal basis. This report (1) broadly compares GPA-covered government procurement reported to the WTO by the United States and other parties; (2) assesses the usefulness of statistical reporting of government procurement data by GPA and U.S. FTA parties for more detailed comparisons; and (3) examines the extent to which the U.S. approach to reporting such data ensures timeliness, accuracy, and comparability. GAO analyzed WTO and U.S. documents and data pertaining to the GPA and U.S. FTAs and interviewed officials in Washington, D.C., and Geneva, Switzerland.

What GAO Found

Under the World Trade Organization (WTO) Agreement on Government Procurement (GPA), the United States has reported opening more procurement covered by the agreement to foreign firms than have other parties to the agreement. For example, U.S. data for 2010—the most recent available—show that the United States reported $837 billion in GPA-covered procurement. This amount is about twice as large as the approximately $381 billion reported by the next five largest GPA parties—the European Union, Japan, South Korea, Norway, and Canada—combined, even though total U.S. procurement is less than that of the other five parties combined. (See figure.)
Deficiencies in the statistical reporting of government procurement by GPA and U.S. free trade agreement (FTA) parties, including the United States, limit detailed comparisons as well as transparency—one of the GPA's stated goals. For example, the GPA parties' reports that GAO reviewed were not always submitted on time and often lacked certain required data. Also, a lack of common understanding of key terms' definitions led to inconsistencies in GPA parties' reporting. Moreover, while parties to the North American Free Trade Agreement (NAFTA) are required to exchange government procurement data annually, NAFTA's parties have not done so since 2005; other U.S. FTAs GAO reviewed do not require reporting of government procurement data. As a result, policymakers and others have limited information with which to monitor the agreements or assess their financial benefits.
The U.S. approach to statistical reporting of GPA-covered government procurement to the WTO does not ensure the data's timeliness, accuracy, and comparability. For instance, while a recent revision of the methodology for calculating covered U.S. federal procurement improves accuracy, it creates a 6-year reporting delay. In contrast, the GPA requires the reporting of annual procurement statistics within 2 years. In addition, U.S. agencies have not developed a methodology for reporting states' covered government procurement, as the GPA requires. Instead, the United States reports total state-level procurement, which GAO estimated may exceed covered procurement by about 10 percent. Further, the expertise needed to report government procurement data to the WTO is fragmented among the four agencies involved, leading to inconsistencies, errors, and deficiencies. Federal standards for internal control call for U.S. agencies to issue relevant, accurate, and reliable information within a time frame that enables entities to carry out their responsibilities.

What GAO Recommends

GAO is making six recommendations to USTR to improve statistical reporting of government procurement under the GPA and U.S. FTAs, including working with GPA parties to enhance their reporting, resuming the required data exchange with NAFTA parties, improving U.S. federal and state procurement data reported to the WTO, and ensuring that U.S. statistical notifications to the WTO are well documented and reviewed for accuracy. USTR did not provide official comments.